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The Alaska Permanent Fund Corp. has scrapped plans for a $1.4 million media campaign to muster voter support to change the way dividends are calculated.
Fund managers will instead wait for the Legislature to finally decide whether to put the ballot question before voters in November, said executive director Bob Storer.
Permanent fund officials wanted the Legislature to sign off on its plan to use money from the same pot that dividends are paid to finance media spots supporting the change in the way the fund is calculated.
But their request angered a group opposed to the ballot initiative and also raised questions from skeptical lawmakers.
"This whole thing just doesn't pass the political smell test," said Eddie Burke, of the opposition group Alaskans, Just Say No.
The Permanent Fund Board of Trustees has endorsed a so-called "Percent of Market Value" method of calculating the money available for dividends.
Under the proposal, the amount available to be paid out of the $24 billion fund would be based on 5 percent of its total value over a five-year period.
Advocates say it protects the fund against inflation - fund officials expect an 8 percent rate of return over time - and ensures a dividend each year.
The change would make about $1.3 billion available from the Permanent Fund, which is more than enough to provide dividends to eligible Alaskans and have money left over.
Gov. Frank Murkowski supports using a portion of the money to help close the state's budget shortfalls.
But that remains an open question within the Legislature, which has never before used any of the fund earnings for anything but dividends.
The POMV proposal - which is viewed by fund managers and some lawmakers as a politically less sensitive "management tool" - also faces an uncertain future in the Legislature.
If either proposal is to go on the Nov. 2 ballot, it would require bi-partisan support to meet the two-thirds required vote.
Permanent fund officials have remained neutral on whether to use any of the fund earnings for government. The corporation has traditionally left the decision on how to spend the money to the Legislature. But some lawmakers say it is not appropriate for the Alaska Permanent Fund Corp. to spend its own money on a media campaign to advocate the POMV change.
"I think it is a question of fairness here," said Rep. Kevin Meyer, R-Anchorage.
Just Say No has to raise private donations if it wants to wage a campaign against the POMV proposal, Meyer said.