I’m $1,100 richer today. So are a lot of other Alaskans: The Alaska Permanent Fund will distribute about $672 million to residents young and old.
Even toddlers will get that $1,100 direct deposit or check. That blows minds in the Lower 48, but it seems totally normal here.
It was supposed to have been more; one recent estimate was about $2,300. But this is the second year in a row that Gov. Bill Walker capped the Permanent Fund dividend, resulting in some serious outcry from eligible recipients.
There’s a reason for that. According to a study from the University of Alaska’s Institute for Social and Economic Research, the PFD has traditionally lifted 15,000 to 25,000 Alaska residents out of poverty. The study also noted that reducing the check by $1,000 would likely send 12,000 to 15,000 more Alaskans down below the poverty line.
The annual payout is particularly important in rural Alaska: Without it, more than 20 percent of Bush residents would fall below the federal poverty threshold. I believe it, given the high cost of living out there. (Hint: If you think you pay too much for milk in your city, imagine forking over $10 a gallon.)
Alaska is an “owner state,” i.e., its resources belong to all residents. The fund originated in 1976 as an amendment to the state constitution; legislators wanted to make sure all the newfound oil income wouldn’t disappear. At least one-fourth of all mineral income is put into a “permanent” fund, to produce money for future generations.
The Alaska Permanent Fund is not UBI
The fund includes a broad range of investments, and checks are cut based on a five-year rolling average of worldwide markets. Last year’s PFD cap resulted in a check of $1,022 – a startling 49 percent less than the 2015 payout.
On the other hand, the 2014 payout ($1,884) was an attention-getting 209 percent higher than the 2013 payout of $900. That wasn’t a low point, though. The 2012 PFD was just $878.
In the grand scheme of things, still not too shabby: Not only is it free money, it’s more than the checks issued between 1983 and 1989. It’s not a universal basic income, but it’s definitely a nice windfall.
Would I have liked a bigger payout this year? Well, sure. Who wouldn’t? Right now, though, I’m going to look on the bright side. Show me another state where they give you money for staying put.
