Rokeberg backing two permanent fund bills

Posted: Tuesday, January 28, 2003

JUNEAU (AP) -- State Rep. Norman Rokeberg would like to increase the state's share of oil revenues normally flowing to the Alaska Permanent Fund.

Rokeberg, an Anchorage Republican, is sponsoring two pieces of legislation to make portions of the permanent fund available for state government spending.

''It's the rainy day fund, and it's raining,'' Rokeberg said.

A proposed constitutional amendment would allow the Legislature to spend a portion of the fund with a three-fourths vote from both houses.

''That's intended to provide some flexibility in the event of an emergency,'' Rokeberg said.

Rokeberg is sponsoring House Joint Resolution 1, a proposed amendment similar to one the fund Board of Trustees had sought.

For several years, the board has backed a proposed amendment limiting the amount withdrawn from the fund to 5 percent of its market value over a five-year average.

Permanent Fund officials expect the fund to grow an average of 8 percent per year and such a measure would effectively protect it from inflation.

But Rokeberg's bill would include a section that allows the Legislature to withdraw up to 6 percent in a year with a three-fourths vote in each house.

Such a measure could make more than $200 million available for the Legislature to spend.

House Minority Leader Ethan Berkowitz, D-Anchorage, said the measure is unlikely to win Democrat support.

''If inflation is a thief in the night, this would allow the Legislature to be the thief in the day,'' Berkowitz said.

Another measure sponsored by Rokeberg, House Bill 11, would lower royalty revenues on new leases going into the permanent fund to the constitutionally mandated 25 percent rate.

It would repeal a law enacted by the Legislature in 1980, at a time when the state was awash in oil revenues, that made new leases pay the fund up to 50 percent of royalty revenues, Rokeberg said.

The bill is aimed at aiding the cash-strapped state in balancing its budget, Rokeberg said. It would raise an estimated $40 million, he said.

Only about 25 percent of the state's oil production pays this higher share of royalty revenues into the permanent fund.

A similar bill introduced by Rokeberg in the 2001 legislative session passed the House 25-10 but died in the Senate.

A Permanent Fund Corp. analysis of the bill two years ago showed such a measure would reduce dividends by about $10, but that was performed when oil prices were lower. A current analysis of the bill was not available, said Robert Bartholomew, permanent fund chief operating officer.

Neither bill has been heard in a committee.

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