Members plan for permanent fund meeting

Group to meet in February to decide whether fund earnings should be used to pay for state government

Posted: Thursday, January 15, 2004

The seven members appointed to Gov. Frank Murkowski's "Conference of Alaskans" to decide whether to use the Alaska Permanent Fund income for state government said they neither support nor reject use of the fund.

"I'm not going to raise my hand or put my hand behind my back," said former state Republican lawmaker Arliss Sturgulewski, an appointee from Anchorage.

"We certainly were not asked by the administration, 'Just exactly what is your position.' I don't think that's a fair question, and I don't answer questions that I don't think are fair," she said.

But Murkowski said Wednesday that deeper state budget cuts or dramatic tax increases could be in the offing without the help of permanent fund money to close the state's budget shortfalls.

While insisting oil and gas development would be Alaska's savior someday, Murkowski said the state has more immediate cash problems.

Four of the seven appointees on the Conference of Alaskans have worked for the Alaska Permanent Fund Corp. or served on its board of trustees.

Helvi Sandvik, president of NANA Development Corp. in Anchorage, said that she is concerned about the future of the state and that all options should be explored.

"I view the use of the permanent fund as a tool that we ought to explore - emphasis on the word explore," she said. "Does that mean that I carte blanche support use of the permanent fund? No, but I do believe that it's appropriate that we begin the dialogue."

The group will meet at the University of Alaska Fairbanks on Feb. 10-12 to determine whether to adopt an endowment method for managing the fund; if some of the earnings should be used for government; how use of that income should be determined; and whether the state should leave a minimum balance in the state's savings account, the Constitutional Budget Reserve.

Michael Burns, a recently retired president of KeyBank and chairman of the conference, said there is no unanimous opinion among the seven on any of the questions posed so far.

"The one thing we all agree on is time is not our friend in this," he said.

With a dwindling state savings account that is expected to run dry in 2007, lawmakers and the administration must find a solution fast.

Murkowski said he expects the conference to focus on the permanent fund and not stray into discussions on whether the state should adopt other broad-based taxes such as a sales or income tax.

"I believe Alaskans spoke on this issue in the last election, and if the conference starts down that trail, it will only bog them down and delay a crucial decision," Murkowski said.

But first the seven appointees must pick another 44 members to attend the conference and help form a recommendation for Murkowski.

Burns said the seven appointees hope to have the members picked by next week. He said they aim to choose a broad cross-section of Alaskans so a variety of viewpoints are expressed.

The appointees will pick the members in closed-door sessions this week without public participation, Burns said.

Brian Rogers of Fairbanks, who will act as facilitator for the conference, said individuals can nominate themselves to the panel by e-mailing the governor's office. Nominations can be sent by e-mail to governor@gov.state.ak.us, according to Murkowski spokesman John Manly.

Manly said the conference is expected to cost up to $274,000.

In March, the Legislature will hold a special session to consider the recommendations of the conference.

Manly said the administration is unclear on whether the regular session will stop during the special session.

That could cost the state as much as $25,000 a day, according to Pam Varni, executive director of the Legislative Affairs Agency.

• Timothy Inklebarger can be reached at timothyi@juneauempire.com.



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