JUNEAU — For the second time in as many days, the Alaska House of Representatives voted Thursday against paying a $3,000 Permanent Fund dividend this year.
House lawmakers now appear ready to approve a $1,605 dividend and send the idea to the Senate for consideration. A vote on the smaller dividend is expected Friday.
The House voted 20-10 against the $3,000 dividend, which was offered as an amendment Thursday to House Bill 2003 by Rep. David Eastman, R-Wasilla. Ten members of the 40-person House were excused absent.
The vote is part of a continuing divide between the 23 members of the coalition House majority that controls the House and the 16 members of the Republican House minority. The minority doesn’t have enough support to advance legislation on its own but does control enough votes to determine the outcome of any vote to override a veto by Gov. Mike Dunleavy.
The governor and members of the minority have supported a $3,000 dividend paid using the traditional formula in state law. Members of the majority continue to advocate a lesser amount because a traditional dividend — at present levels of state spending — would require overdrawing the Alaska Permanent Fund.
“It’s like taking an early withdrawal from your retirement account,” said Rep. Geran Tarr, R-Anchorage, as she tried to explain the consequences of a $3,000 dividend.
In her vision, that larger dividend would require violating legislation passed last year that limits withdrawals from the fund to less than what the fund can earn in a given year. If an overdraw happens, the fund will earn less in the long term than it otherwise might, and there will be less money available in the future.
But lawmakers in favor of the larger dividend said the traditional formula remains in law, regardless of what individual lawmakers think about it, and it should be followed.
“This is what the majority of Alaskans believe in," Eastman asserted.
“I, for one, believe the statute was correct,” he said, referring to the traditional formula. “It was wisely calculated and should be followed.”
With the House majority and minority at an impasse, several lawmakers have floated the idea of a compromise that would involve a $1,600 payment up front and an additional $1,400 payment if lawmakers change the dividend payout formula for subsequent years.
Rep. Chuck Kopp, R-Anchorage, was among the lawmakers who said he believes that formula should be changed. Kopp, following remarks Wednesday from Speaker of the House Bryce Edgmon, I-Dillingham, said lawmakers have been stymied because of resistance from the governor. Dunleavy controls the agenda of any special session he calls, and he has not been willing to add a formula change to that agenda.
“We need the administration to cooperate with us,” he said. “Until they are willing to do that, we cannot have an honest conversation about what a new formula would look like.”
If the House approves HB 2003 on Friday, it could be considered in the Senate as early as Saturday. Senators also could take up House Bill 2001, approved by the House on Wednesday. That bill reverses about 80% of the $444 million vetoed by Dunleavy from the state operating budget.
In other business, the coalition majority confirmed that it has scheduled Senate Bill 2002 for a vote Monday. If passed by the House and signed by the governor, that measure that fixes the state’s capital budget and “reverse sweep.”