During the budget standoff, frustration built up over the demands of the House Minority in exchange for their votes needed to tap the Constitutional Budget Reserve (CBR). A nuclear option was developed involving transferring over $7 billion in permanent fund earnings.
The proposal was to transfer earnings of the permanent fund to the principal of the fund, utilizing a loophole in the Constitution by making less state funds available for appropriation, bypassing the ¾ vote requirement to access the CBR. This would allow a simple majority vote to access the CBR.
I was very concerned about this proposal for the following reasons:
• It’s not fully vetted and the financial impact has not been adequately analyzed;
• It’s all Alaskans’ fund and the people need to be involved in any decision;
• It will severely lower Alaska’s liquidity, may affect our bond rating; and
• If there is a correction in the stock market there may not be enough funds available to pay Dividends from the Permanent Fund.
As you know, I stood firm with a strong group of House Majority legislators opposed to using the earnings of the permanent fund as a gimmick to access the CBR; this is why I worked so hard to help my colleagues craft the budget deal that passed the legislature.
As your representative, I will continue to insist that you are involved in deciding the future of the permanent fund!
Representative Jim Colver represents District 9 which includes: North Palmer (Buffalo Mine, Farm Loop, Fishhook, Soapstone), Glacier View, Glennallen, Sutton, Delta, Valdez & Whittier