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More than $54 million would be moved from the Alaska Permanent Fund to the state's general fund, which pays for state government services, under a bill passed Thursday in the House Finance Committee.
The measure by Rep. Norm Rokeberg, an Anchorage Republican, would take 25 percent of the money generated through mineral lease royalties and other proceeds and use it to cushion Alaska's budget shortfall. The plan would generate $54.1 million for the 2004 budget and about $43.3 million annually over the next seven years.
The Department of Revenue projects that House Bill 11, if passed into law, would reduce permanent fund dividend checks by under $1 in 2005 and about $20 by 2012.
"There's some criticism that this is a raid on the permanent fund, but I submit it is not," Rokeberg said.
He said the state constitution requires that only 25 percent of the mineral royalties be deposited into the permanent fund. He noted that in 1980 the state was awash in oil money, prompting the Legislature to increase the amount put into the permanent fund to 50 percent.
Rokeberg said moving the percentage back to the constitutionally mandated 25 percent would help reduce the state's draw on the Constitutional Budget Reserve, a savings account used to balance the state budget.
The reserve, which holds about $1.93 billion, is projected to run dry by 2005 or 2006, depending on the price of oil.
"We're running toward the cliff, and if we don't take steps to ameliorate our fiscal situation, we're going to be in trouble," Rokeberg said.
John Manly, Murkowski's press spokesman, said the governor generally supports the measure proposed by Rokeberg.
"He indicated he is generally supportive of it, (but) it might need a little bit of tweaking," Manly told The Associated Press.
Rokeberg's proposal was introduced in the last legislative session and became part of a long-range fiscal plan proposed by members of the House. But the measure died before it made it to the Senate floor.
On Thursday, the bill was approved on a 7-3 vote, but not before Rep. Eric Croft, an Anchorage Democrat, tried to amend it.
Croft's amendment would have required a vote of the people before any changes are made to the dividend formula. It would not have made any changes to HB 11, but Croft said he offered it in an effort to ensure that no more money would be taken from the permanent fund without a public vote. The committee rejected the amendment.
Croft, who voted against the bill, said he offered the amendment as the price for transferring permanent fund money to pay for state government.
"The amendment said at least promise that you won't take any more without asking permission," Croft said, noting that he would introduce the amendment again, once the measure goes to the full House for a vote.
Rokeberg called the amendment a "publicity stunt" and an unconstitutional delegation of authority.
House Finance co-chairman John Harris, a Valdez Republican, objected to the amendment, noting that budget decisions should be made by lawmakers, not the public.
"We were elected to come down here and make decisions, so let's make them," he said. "If the public doesn't like the decisions we make, then they'll throw us out."
Timothy Inklebarger can be reached at firstname.lastname@example.org.