Cities reap some dividend rewards

Posted: Thursday, October 20, 2005

While many Alaskans already have received — and spent — their Alaska Permanent Fund dividends this year, some have had theirs intercepted by the cities of Kenai and Soldotna and haven't seen a dime yet.

Kenai has been garnishing people's PFDs for five years and Soldotna got on board for the first time this year, taking advantage of a state statute that allows municipalities to ding dividends as a means of collecting unpaid traffic fines and other fees.

People without such garnishments had $845.76 deposited to their bank accounts Oct. 12, or will receive a check in that amount Wednesday.

However, if people opted for direct deposits and had garnishments levied against them for unpaid traffic tickets or things such as unpaid child support, no deposit was made and they will receive a reduced check next week.

Soldotna City Manager Tom Boedeker told the city council last week that Soldotna levied "about $35,000 in fines."

He said the amount was actually closer to $40,000, but $5,000 would be paid to the state courts to cover court costs assessed when offenders forfeited their bail.

Boedeker explained that if a person gets a speeding ticket, a bail amount is set, and if the person does not show up in court, the court enters a default judgment for the amount of bail, which the person then forfeits.

"We can go in and collect on the unpaid fines," Boedeker said, by garnishing permanent fund dividends.

Since Kenai began garnishing people's PFDs for unpaid traffic tickets and other fees, that city has collected $83,211.30, according to acting City Manager Chuck Kopp.

This year, Kenai collected $17,658, or 59 percent of the amount levied, Kopp said.

Cities do not automatically collect the amount levied, because, in Boedeker's words, "We are not at the top of the food chain."

He explained that garnishments levied against PFDs for such things as child support are paid first. Other levies might also take precedence over municipal traffic fines.

"We're near the bottom of the chain," Kopp said.

In its first levy year, Kenai collected $24,514 or 45 percent in 2001. In 2002, Kenai collected $12,344, or 67 percent.

Due to a state error, Kenai did not collect any levy amounts in 2003, but collected $28,694, or 78 percent for the combined 2003-04 period, Kopp said.

Because cities are entitled to "reach back" up to five years in attempts to collect unpaid fines, Soldotna's levy amount this year is comparatively high, according to Boedeker.

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