As PFD reductions loom, little public backlash so far

JUNEAU — The day after the Alaska Senate passed deficit-reduction legislation last week to restructure the Permanent Fund and reduce Alaskans' dividends, a Libertarian Party official, Michael Chambers, took to Facebook, advertising what he called a "massive" rally in downtown Anchorage.

"Bring your signs! Bring your children!" Chambers wrote. "Make a commitment."

More than 1,000 people were invited to protest the Senate's plan, which would slice dividends to $1,000 from last year's $2,078 checks — a sharp reduction that's drawn criticism from House politicians across the political spectrum.

But by Chambers' optimistic estimate, only three dozen people showed up.

Opposition to the plan in Juneau, where the House has been holding hearings on the Senate's legislation, has been similarly muted. The audience for a Tuesday morning meeting of the House Finance Committee consisted almost solely of paid advocates, legislative staffers and lawmakers.

"You'd think that the emotions of taking the Permanent Fund dividend would drive a tremendous amount of citizens to be involved," Chambers said in a phone interview Tuesday. Alaskans, he added, "need to be more involved in this process."

The tepid turnout could be a sign of public acceptance of the arguments made by Gov. Bill Walker, a Republican-turned-independent, and by senators who voted for Senate Bill 128, which passed 14-5 last week.


[Permanent Fund legislation stalls in House as Walker asks for support]

Walker and GOP Senate leaders say restructuring the Permanent Fund into an endowment to help pay for government is the most effective way to close the state's $4 billion budget deficit, while keeping enough money in the fund to keep paying dividends long into the future.

Some skeptical House lawmakers, meanwhile, point to what they describe as a torrent of emails and phone calls from constituents opposed to the legislation — not to mention the three and a half hours of public testimony that the House Finance Committee heard Tuesday evening, for which 150 people signed up to speak.

"I won't even repeat some of the things they say," Rep. Cathy Tilton, R-Wasilla, said of the missives and messages she's received. Some, she said, outline the consequences if she votes for the Permanent Fund legislation: "You're fired. Get a new job."

At the Colony Days festival in Palmer last weekend, Tilton said, "There wasn't one person that I came across that would be happy to have this happen."

Some lawmakers and observers, however, said the limited objections so far seem to correspond to a public that's growing more aware of the state's budget problems and the steps needed to fix them.

Those sentiments have been mirrored in at least one public survey, from the Rasmuson Foundation. The foundation, which has been pushing lawmakers to approve budget cuts and new revenue sources like a restructured Permanent Fund, polled 800 people in January and found that 68 percent said a $1,000 dividend next year was "acceptable," compared to 27 percent who said it was "unacceptable."

Questions with different phrasing found weaker support for dividend reductions, though with close to half of respondents still willing to accept smaller checks.

"While voters may not be in love with the idea of reducing the PFD, they did say it's acceptable — this is an acceptable thing to do," said Kevin Ingham, the Denver-based pollster who did Rasmuson's survey.

Even the protestors at last weekend's rally acknowledged that turnout was less than robust.

"Any time you can get five people out in the summertime to do something besides camp and fish, you're a winner," one activist, former talk radio host Eddie Burke, told KTUU.

Chambers said other events, like the Colony Days, created a "major conflict" for the rally — particularly for "patriots" in the Mat-Su region, the home of many lawmakers opposed to the Permanent Fund legislation.

Drivers were showing solidarity too, Chambers said.

"They'd put their thumbs up and wave," he said. "Cars going by were just honking crazy."

[3rd ratings agency downgrades Alaska credit as lawmakers debate budget proposals]

That enthusiasm has not translated to Juneau, however, where the House's initial hearing on the Permanent Fund bill was before an audience that included just one member who wasn't a lobbyist, legislator, aide or journalist.

At the Bill Ray Center, lawmakers' temporary home while the Capitol is being renovated, there have been no rallies or demonstrations on the Permanent Fund legislation.


Previous plans to restructure the fund — like those promoted by former Republican Gov. Frank Murkowski a decade ago — got "more debate out in the open," said Steve Haycox, a historian and distinguished professor emeritus at University of Alaska Anchorage.

This time around, Haycox theorized that "people have generally accepted that there needs to be a cap on the Permanent Fund."

"I think people have heard for so long that Alaska's a socialist place and they're getting a free run and they don't pay anything for their milk — it's had more impact than the argument that cutting the dividend is just slicing directly into the Alaska economy and is going to hurt all kinds of people," Haycox said in a phone interview.

"It's not that people are ready to go fishing. It's just that they're disconnected from government," Haycox added, noting that Alaskans pay no income or sales taxes to the state.

Lawmakers offered competing explanations for the relative calm.

Public engagement would likely be improved if the Legislature was meeting in Anchorage, said Rep. Mark Neuman, R-Big Lake and co-chairman of the House Finance Committee.

"I suspect most people in Juneau want to see us use the Permanent Fund dividend for government," he said, a reference to the fact that 20 percent of state employees work in the city.

Neuman, a skeptic of the Permanent Fund legislation, said he's been hearing from constituents in emails, phone calls and conversations.


"Easily 70, 75 percent are opposed to using the PFD," he said.

Sixty percent of the people who testified on the legislation Tuesday evening were against the bill, according to a tally by the Alaska Public Radio Network.

But Fairbanks Republican Rep. Steve Thompson, the other House Finance Committee co-chair, said he's starting to hear from more constituents who say they can live with a cut to their dividend checks.

On Tuesday, he pulled out his phone and showed a reporter the emails he received during the morning's Finance Committee hearing on the Permanent Fund bill, with the messages split between supporters and opponents.

"I love my PFD," said one. "However, I am a realist."

Thompson, a supporter of the legislation, said he thinks there's a "ton of people" who like the bill who aren't engaged in the debate over it. He's not worried about his position jeopardizing his re-election bid, he added.

"The no people are the only ones that make noise," Thompson said.

Another Finance Committee member, Dillingham Democratic Rep. Bryce Edgmon, said he thinks public opposition to dividend reductions is building slowly, set off by the Senate's vote last week.

This time of year, "the fish have hit the beach, and people are busy working," said Edgmon, who represents a rural, fish-rich district in Southwest Alaska and hasn't decided whether or not he'll support the legislation.

"We come back in the fall and they will be here with pitchforks," Edgmon said. He added: "I think the outcry's coming."

Nathaniel Herz

Anchorage-based independent journalist Nathaniel Herz has been a reporter in Alaska for nearly a decade, with stints at the Anchorage Daily News and Alaska Public Media. Read his newsletter, Northern Journal, at natherz.substack.com