Alaskan residents not pleased with yearly divident checks

ANCHORAGE, Alaska — Yes, you could call it free money.

But that doesn’t mean all Alaskans are happy about the $1,022 dividend checks nearly every resident will receive starting Thursday from the state’s oil wealth fund.

Folks were looking at getting more than twice that amount.

“It’s really putting the hurt on my community,” said Joel James, mayor of the tiny Yup’ik Eskimo village of Gambell, which, like many remote communities around the vast state, is plagued by chronic unemployment and astronomical living expenses. “I’m definitely disappointed.”

Each year, residents get the checks from the Alaska Permanent Fund, a reward of sorts for living here at least a full calendar year.

It’s fun money for some, with businesses offering highly advertised dividend deals. For others, it’s a way to make ends meet. The amount of the annual checks is based on a five-year average of the multibillion-dollar fund, and they took a hit when recession years were part of the formula, with $900 checks issued in 2013 before payouts rebounded again.

Last year, the amount for every person was a record $2,072. And this year, the check was estimated to be even higher at about $2,100. That is, until Gov. Bill Walker stepped in and shrunk the amount because of the state’s multibillion-dollar budget deficit, a situation exacerbated by low oil prices.

Walker’s action is being challenged in court by state Sen. Bill Wielechowski and two former lawmakers who allege the governor illegally vetoed fund earnings appropriated for dividends.

“It was not done legally, it was not done appropriately and it did not belong in the budget,” said Wielechowski, an Anchorage Democrat. “And because it didn’t belong in the budget, the governor couldn’t veto it.”

Walker said in a statement he did not take his decision lightly, and he acknowledged it may have upset some Alaskans. He said setting the amount of this year’s dividend “more in line with the historical average” will ensure there’s money for future distributions.

“Alaska lost over 80 percent of its income in just two years, and we are burning through $12 million of savings each day,” Walker wrote. “This is simply not sustainable.”

James, the Gambell mayor, is among those also questioning Walker’s veto, saying it leaves a financial vacuum for rural residents who depend on the money for life necessities. Another is Shirley Adams, a clerk in the tribal government office in the Inupiat Eskimo village of Kivalina, on Alaska’s northwest coast.

“I’m wondering does he have the right to do that,” said Adams, who often uses the money to catch up on bills.

Some people are asking the same thing in the Yup’ik village of Manokotak, said Nellie Alakayak, the community’s temporary tribal administrator. The money often goes to survival expenses, such as clothing and other basics, for many people in her village.

“I think they kind of feel cheated,” she said of this year’s check.

The fund was established in 1976 after the discovery of oil on Alaska’s North Slope, with the first dividends distributed to residents in 1982. Excluding the upcoming payout, more than $21.1 billion has been distributed to Alaskans over the decades since.

This year’s distribution has prompted mixed feelings for longtime Anchorage resident Jerry Wolf, 85, who moved to Alaska’s biggest city as a teenager in 1947.

On the one hand, he understands the governor’s action and believes the lawsuit is a distraction from the real problem — that the state has been too dependent on its shrinking oil resources. On the other hand, many rural residents really need the money.

“I can see in our villages across the state that they have been very dependent on this little boost, and in many cases maybe even to put some more food on the table,” Wolf said.