One of the Alaska Permanent Fund dividend's oldest and most loyal allies is back in the halls of the state Legislature this week, where he's registering his long-held opposition to using the fund's earnings to pay for government.
Clem Tillion was one of Gov. Jay Hammond's Republican legislative allies when the Alaska Permanent Fund was established in the 1970s — and he was the only dissenting lawmaker when the Legislature repealed the state income tax in 1980.
Four decades later, he remains, as Hammond described him in a memoir, a "brash iconoclast" eager to shape public policy. That's what he was doing in a meeting Tuesday with Gov. Bill Walker, who's proposing to use the Permanent Fund more like an endowment to help pay for state services.
"It isn't just a walk down memory lane with Clem Tillion," Walker said in an interview after the meeting. "He comes in with a message."
Tillion had a message for Walker, but he's actually on paid fisheries business as a lobbyist for the Aleut Corp., the regional Native corporation for the Aleutian Islands and part of the Alaska Peninsula.
Tillion, a former fisherman himself, is in Juneau for a session of the International Pacific Halibut Commission before traveling to Portland, Oregon for meetings of the North Pacific Fishery Management Council. But while he's in town, there's also time for tea at the Capitol lounge that's open only to current and former legislators — and to remind some of them of his view that a robust income tax is the most equitable way to close the state's $4 billion budget shortfall.
"I'm still Hammond's man, and what they're proposing with the Permanent Fund is just unacceptable," Tillion said in an interview, sitting on a bench on Capitol's second floor. "I object to them destroying the program."
Tillion doesn't, however, object to the government taking more money from residents. He just thinks that should happen through taxation, rather than tampering with the Permanent Fund's structure.
Walker's proposal, praised by the Legislature's top budget analyst as indisputably a "large step in the right direction," would transform the Permanent Fund into an endowment-like account. Most of the state's volatile oil revenues would flow in, while a more stable stream of investment earnings would flow out to help pay for government.
Dividends would no longer be paid based on investment returns as they are now. Instead, they'd be based on the state's annual natural resource royalties. Tillion says he doesn't like the idea, because eventually, "those resources are going to be gone." The Permanent Fund, Tillion said, is like a company owned directly by Alaskans which the government shouldn't be able to touch.
His solution: keep issuing dividend checks based on investment returns, but if the government needs the money, tax it back.
"If you want to take half of it, go ahead," he said.
A state income tax would have to be about the same rate as the federal income tax to raise the $3 billion or $4 billion needed to close the state's budget deficit, according to a Walker administration analysis. The Walker administration is proposing an income tax that's 6 percent of federal liability, while Tillion thinks that number should be more like 16 percent.
He wants industry to pitch in more, too. Even though he's been a dogged advocate for Alaska fisheries, Tillion supports bigger levies on fish and for mines. Mineral extraction is taxed so low it's "ridiculous," Tillion said.
Walker said he was "a little surprised" at how aggressive Tillion was when it came to taxes. Nonetheless, he said he appreciated someone of Tillion's stature stopping by his office to offer an opinion.
"You never have to wonder about what Clem's thinking, cause he'll tell you," Walker said. "He's not just telling stories. He's talking about the here and now."
When he's not talking financial policy at the Capitol, Tillion remains a "huge asset" to Aleut Corp. lobbying on fisheries issues, said corporation president Thomas Mack.
At 90 years of age, Tillion has had both knees replaced and uses a cane, and the sweater vest and flannel pants he wore Monday evoked another description from Hammond — that Tillion looks like "something from 'Guys and Dolls' sired by 'The Great Gatsby.'"
His abilities in the Capitol, however, are undiminished, said Sam Cotten, commissioner of the Alaska Fish and Game Department and Tillion's son-in-law. Cotten attributes Tillion's longevity to his continued involvement in public policy.
"A lot of us feel like that's helped him keep a sharp mind," Cotten said.
Tillion's lobbying work involves advocating for fisheries policy that will help revitalize corporation assets at an abandoned Navy base on the island of Adak, 1,200 miles west of Anchorage, said Rudy Tsukada, the president of Aleut Enterprise LLC, an Aleut Corp. subsidiary.
While Tillion's age is naturally cause for some concern, Tsukada said, there's no disputing that his experience and the respect he draws from fisheries participants make him a "meaningful and respected speaker."
"I'm not exactly sure how to say it — why do you guys use a 90-year-old lobbyist? Because he kicks butt," Tsukada said. "He's super-effective."
Tsukada wouldn't reveal how much Tillion is paid, other than to say it's "probably not enough."
"He does this for the love of Adak and the Aleutians," Tsukada said. "Fish has been his life."
Between stories of his World War II service and interruptions by lobbyists, legislators and staffers, Tillion said, wryly, that at his age, death is something he's "looking forward to."
But in the meantime, he persists at the Capitol advocating for what he describes as "the greatest of self-interests: family."
"I've never been silent in my life — this is my land," he said. "How my children live depends on the decisions I make here."
Alaska Dispatch Publishing