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Portrait of Senate President 
		Senator Drue Pearce Portrait of Governor Tony Knowles Portrait of House Speaker 
		Brian Porter
Senator Drue Pearce

State Capitol, Room 107
Juneau, AK 99801-1182
Phone: (907) 465-4993
Fax: (907) 465-3872
Send E-Mail
Gov. Tony Knowles

3rd Floor State Capitol
Juneau, AK 99811-0001
Phone: (907) 465-3500
Fax: (907) 465-3532
Send E-Mail
Rep. Brian Porter

State Capitol, Room 208
Juneau, AK 99801-1182
Phone: (907) 465-4930
Fax: (907) 465-3834
Send E-Mail

Historic Special Session Adjourns With Long Range Plan Proposal
Governor, House and Senate Majorities and Minorities Agree
Public Advisory Vote Scheduled for September 14

For Immediate Release: May 25, 1999
Contact: Bob King at (907) 465-3995
Maggie Wall at (907) 465-4852
Jerry Ritter at (907) 465-3804

Juneau -- The Alaska Legislature adjourned its Special Session Tuesday after both the House and the Senate approved a resolution calling for a public advisory vote on a proposed long-range fiscal plan for the state. The Senate vote on House Bill 1001 was 12-7, the House vote to concur with Senate changes was 31-5. Both bodies also approved a bill proposing ballot language for that election. The Senate vote on Senate Concurrent Resolution 102 was 12-7, the House vote was 31-5.

The bipartisan vote in both chambers indicates that, if voters support the proposal to use a portion of the earnings of the Permanent Fund for essential state services while guaranteeing a dividend to eligible Alaskans, legislation will be introduced to put the long-range fiscal plan into effect.

Click for larger view, thumbnail of Permanent Fund Dividend under this plan"The bipartisan support for this plan that balances the budget and protects the dividend program is a positive step for Alaska and puts us on the way toward a sound financial future," said Gov. Tony Knowles. "It took a lot of hard work to reach this agreement and I appreciate the efforts made by supporters in both houses of the Legislature. Continuing this level of bipartisan cooperation will be important as we seek the support of the Alaska people in approving this responsible plan for Alaska's future."

"We are at a significant juncture in our state's history," said Senate President Drue Pearce. "Together, the Senate, House and administration have developed a realistic, workable, long-range plan that can be used to close the state's ongoing $1 billion fiscal gap. The Senate Finance Committee had 36 meetings at which our fiscal gap was discussed. We worked with financial experts and with our constituents. We think the long-range plan we are asking Alaskans to judge offers the best solution for Alaska's economic security. On September 14, each and every Alaskan can have their say in shaping our state's economic future."

"We are taking this step because doing nothing is not a responsible option; Alaska faces serious fiscal problems that will get worse if we do not act," said Speaker of the House Brian Porter. "This plan will secure our dividends and the dividends of generations to come. It will not become law without a public vote and it requires no personal income tax. I'm confident that as the voting public comes to understand it, they will realize it is, in fact the proper responsible course for Alaska."

The proposed plan would consolidate the State's Constitutional Budget Reserve (CBR) and Earnings Reserve Account into a new account, called the Alaska Income Account. 5.88% of the Permanent Fund's annual earnings would be placed into this account annually, with 50% of those deposits, averaged over five years, going toward dividends.

In 1999 and 2000, the dividend will be guaranteed at a minimum of $1700. The following year, it is anticipated that the dividend will be approximately $1340 and will continue to grow with the value of the Permanent Fund itself. In addition, when the balance of the Alaska Income Account exceeds 40% of the combined total of the Permanent Fund principle and the Alaska Income Account, the excess will be deposited into the principal of the Permanent Fund.

No income tax is required for this plan. The balanced budget plan will be enacted by the Legislature only after - and only if - voters approve it in the September 14 advisory vote.

# # #

Long-Range Balanced Budget Plan Backup Information
To view these files you must have Adobe's Acrobat Reader installed. You can find the plug-in by following the link at the bottom of the left hand navigation bar above. Why Alaska Needs a Balanced Budget Plan
  • Graph 1: General fund revenues versus expenditures - chart shows Alaska’s $1 billion fiscal gap
  • Graph 2: Oil Revenues and production declining
  • Graph 3: Oil Revenues as part of Alaska’s overall revenue picture
  • Graph 4: Permanent Fund net income now surpasses oil revenues
  • Graph 5: CBR threatened: The CBR will run dry in 2003
  • Graph 6: Business as usual: The impact of doing nothing.
  • Graph 7: If we do nothing, chart shows projected savings account balance versus inflation adjusted balance
  • Graph 8: Why cuts alone won’t balance the budget
  • Conclusion

Broadcasters note: Audio comments are available on the Majority Actuality line, 1-800-478-6540
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