Juneau, Alaska (KINY) - The State Department of Revenue's Spring Revenue Forecast paints a dire picture.
A billion-dollar deficit is projected in Fiscal Year 21. Even absent a Permanent Fund Dividend, the deficit would still amount to an estimated $400 Million.
Juneau Senator Jesse Kiehl was asked on Action Line if its time to end the dividend program. "I don't think its time for the PFD to die, but there's going to be a lot of folks who argue that. There are going to be a lot of folks who say we shouldn't have an income tax that asks non-resident workers to pay something for the services and the infrastructure they use here in Alaska because we could just delete the PFD and I don't think that's a fair approach. There's going to be a lot of folks who say we shouldn't take a look at the long term structure of our oil taxes so that when prices get back to a reasonable level we're getting a fair share again instead of leaving cash on the table because we could just delete the PFD and I don't think that's a fair approach."
Kiehl adds that he doesn't see room for the PFD to go significantly lower and still be fair to Alaskans.
Kiehl said he believes state savings accounts will be all but gone by the end of next fiscal year, June 30 of 2021. He figures there might be $400 Million left in the Constitutional Budget Reserve which he says is not really enough for managing cash flow through the year. So Kiehl figures the state will need to raise revenues sooner rather than later.