Permanent Fund dividend leaves House Finance Committee fully funded, but unlikely to stay that way

By SUZANNE DOWNING

April 2, 2026 – Late Wednesday night, the Alaska House Finance Committee approved its draft operating budget along with a Permanent Fund dividend proposal that could send every eligible Alaskan roughly $3,800 — but only if lawmakers later agree to draw heavily from the state’s savings.

The committee voted 6–5 to advance a spending plan that would tap about half of the state’s Constitutional Budget Reserve to pay the legally set dividend. The amount reflects the statutory Permanent Fund dividend formula, which has not been followed since 2016, when Gov. Bill Walker cut the PFD in half.

The proposal would spend about $2.4 billion on dividend payments, including roughly $1.4 billion from the Constitutional Budget Reserve. Nome Democrat Rep. Neal Foster joined the committee’s five minority Republicans to pass the plan, breaking with the rest of the Democrat-led majority.

House Finance co-chairs Rep. Calvin Schrage, an Anchorage member who aligns with Democrats, and Rep. Andy Josephson, a Democrat also from Anchorage, opposed the larger dividend and instead supported a payment of about $1,000 per eligible Alaskan, essentially last year’s amount. They argued that a smaller dividend would better align with available revenues and leave more room for education funding and other priorities.

Foster, however, argued that many Alaskans, particularly in rural communities, are struggling with rising costs, including heating fuel, and that the dividend provides direct relief.

“I just don’t know how many Alaskan families are going to get by. Alaskans need help, and what better way to provide that help than to give Alaskans their share of Alaska’s resource wealth via the Permanent Fund dividend,” Foster said.

The plan, offered by Ketchikan Republican Rep. Jeremy Bynum, effectively sets a guaranteed dividend of about $1,500 within the operating budget, with the remainder of the roughly $3,800 statutory amount dependent on a successful draw from the Constitutional Budget Reserve. Accessing that account requires a three-quarters vote of both the House and Senate — a high bar that has historically been difficult to reach. It’s all but certain the full amount will not be granted.

Schrage criticized the approach as creating unrealistic expectations because the majority of the Legislature (Democrats and their allies) won’t vote for it.

Voting in favor of the plan were Foster, Bynum, Rep. Jamie Allard of Eagle River, Rep. Frank Tomaszewski of Fairbanks, and Rep. Elexie Moore of Wasilla. Opposed were Schrage, Josephson, Rep. Alyse Galvin of Anchorage, Rep. Sara Hannan of Juneau, and Rep. Nellie Jimmie of Toksook Bay.

Jimmie, who represents many rural Alaska Native communities, said lawmakers must consider the long-term sustainability of the dividend.

“I’m here today, and I’m thinking seven generations ahead. I’ve said it once, and I’ll say it again. If we gave out a full Permanent Fund (dividend) for the past eight years, there would be no PFD right now. My grandkids won’t get it,” she said. “Unless we’re all willing to bring in new revenue to the State of Alaska, we need to stop fooling around with this full PFD.”

The operating budget approved by the committee also includes a $158 million increase in annual state spending for K-12 education. Lawmakers are continuing work on a separate capital budget.

The spending plan now advances to the Rules Committee, a speed bump on the way to the House floor. The House will not be in session on Friday.