As oil prices and inflation rise, Dunleavy pushes for higher PFDs and bonds

Gov. Dunleavy stands behind a lectern next to a sign that says "relief for Alaskans"
Gov. Mike Dunleavy urges the Legislature to pass his PFD and construction bond package bills during a news conference on Thursday in the Capitol. (Andrew Kitchenman/KTOO and Alaska Public Media)

Gov. Mike Dunleavy says higher state revenue and inflation mean that the Legislature should pass his proposals to pay higher permanent fund dividends and to borrow money to pay for capital projects.

“We can certainly afford a PFD that the people of Alaska expect,” he said on Thursday. “And given the inflationary rates, inflationary picture that we’re going through right now, I think, you know, we’re going to really ask the Legislature to give that due consideration as soon as possible.”

The state has increased its forecast for oil and investment revenue. If the forecast holds up, the state would have a roughly $1.6 billion surplus over the next year and a half. 

Dunleavy wants the state to issue $325 million in bonds to pay for construction projects for ports, airports, fire stations and other projects.

Dunleavy has proposed a PFD of roughly $2,500 based on using half of the state’s annual draw from the permanent fund. He also proposed an additional $1,200 dividend payment, which is the difference between the 2021 PFD that was paid out and an amount Dunleavy proposed. He said the PFD could help Alaskans deal with inflation. 

He also said it would be good to borrow now because interest rates are low and could go up. 

Some legislative leaders have questioned whether higher dividends are sustainable. And they have raised concerns that the state shouldn’t borrow for projects that it could pay for as part of the annual budget. 

[Sign up for Alaska Public Media’s daily newsletter to get our top stories delivered to your inbox.]

Previous articleGov. Dunleavy defends state paying for settlement arising from his actions
Next articleHere’s how to decide if you’re safe to go out when you’re recovering from omicron
Andrew Kitchenman is the state government and politics reporter for Alaska Public Media and KTOO in Juneau. Reach him at akitchenman@alaskapublic.org.