Here's a way to make up our state's budget deficit that would achieve the following:
No income tax.
No state sales tax.
Leave the permanent fund at today's level.
Interested? Sound like a good goal? Plus, it wouldn't require a constitutional amendment.
We are today "growing" the permanent fund in two ways: 1) by inflation proofing it; and 2) contributing 25 percent of our royalty oil and gas income.
Over the last five years, we have contributed an average of $480 million in inflation proofing per year.
Over the same five years, the 25 percent royalty has averaged about $300 million in income per year.
Quite simply, we would use the 25 percent royalty as our inflation hedge into the future. Remember, when the gas line is built and some day ANWR is produced, this 25 percent will grow in significance.
This idea would hold the fund at today's value of $28 billion and help inflation proof it into the future for our children and grandkids.
Then, we could use the $480 million a year that we are now "double growing" the fund with to pay the most important item in our state's budget: our children's education.
We could use this almost $500 million a year to fund the majority of our statewide education cost of $700 million and take that amount out of the state budget. This would help make up the projected annual budget deficit of $710 million.
If you like things as they are today, no income tax, no statewide sales tax and keep today's dividend, then "Keep It Simple Sally." Keep the permanent fund at today's level and use this $480 million a year to help fund our most important commitment for the future: education.
The Legislature wouldn't have to let us vote for this idea, but if they would, I'd vote for it. Would you?
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