Governor's cut to oil dividend payouts leaves many Alaskans unhappy

Yes, you could call it free money.

But that doesn't mean all Alaskans are happy about the $1,022dividend cheques nearly every resident will receive starting Thursdayfrom the state's oil wealth fund.

Folks were looking at getting more than twice that amount.

"It's really putting the hurt on my community," said JoelJames, mayor of the tiny Yup'ik Eskimo village of Gambell, which,like many remote communities around the vast state, is plagued bychronic unemployment and astronomical living expenses. "I'mdefinitely disappointed."

Each year, residents get the cheques from the Alaska PermanentFund, a reward of sorts for living here at least a full calendaryear.

It's fun money for some, with businesses offering highlyadvertised dividend deals. For others, it's a way to make ends meet.

The amount of the annual cheques is based on a five-year average ofthe multibillion-dollar fund, and they took a hit when recessionyears were part of the formula, with $900 cheques issued in 2013before payouts rebounded again.

Shrinking the payout

Last year, the amount for every person was a record $2,072. Andthis year, the cheque was estimated to be even higher at about$2,100. That is, until Gov. Bill Walker stepped in and shrunk theamount because of the state's multibillion-dollar budget deficit, asituation exacerbated by low oil prices.

Walker's action is being challenged in court by state Sen. BillWielechowski and two former lawmakers who allege the governorillegally vetoed fund earnings appropriated for dividends.

"It was not done legally, it was not done appropriately and itdid not belong in the budget," said Wielechowski, an AnchorageDemocrat. "And because it didn't belong in the budget, the governorcouldn't veto it."

Walker said in a statement he did not take his decision lightly,and he acknowledged it may have upset some Alaskans. He said settingthe amount of this year's dividend "more in line with thehistorical average" will ensure there's money for futuredistributions.

"Alaska lost over 80 per cent of its income in just two years,and we are burning through $12 million of savings each day," Walkerwrote. "This is simply not sustainable."

'Does he have the right to do that?'

James, the Gambell mayor, is among those also questioningWalker's veto, saying it leaves a financial vacuum for ruralresidents who depend on the money for life necessities. Another isShirley Adams, a clerk in the tribal government office in theInupiat Eskimo village of Kivalina, on Alaska's northwest coast.

"I'm wondering does he have the right to do that," said Adams,who often uses the money to catch up on bills.

Some people are asking the same thing in the Yup'ik village ofManokotak, said Nellie Alakayak, the community's temporary tribaladministrator. The money often goes to survival expenses, such asclothing and other basics, for many people in her village.

"I think they kind of feel cheated," she said of this year'scheque.

$21.1 billion since 1976

The fund was established in 1976 after the discovery of oil onAlaska's North Slope, with the first dividends distributed toresidents in 1982. Excluding the upcoming payout, more than $21.1billion has been distributed to Alaskans over the decades since.

This year's distribution has prompted mixed feelings for longtimeAnchorage resident Jerry Wolf, 85, who moved to Alaska's biggestcity as a teenager in 1947.

On the one hand, he understands the governor's action andbelieves the lawsuit is a distraction from the real problem thatthe state has been too dependent on its shrinking oil resources. Onthe other hand, many rural residents really need the money.

"I can see in our villages across the state that they have beenvery dependent on this little boost, and in many cases maybe even toput some more food on the table," Wolf said.

The amount is fine with Quamaundya Elliott. Until this year, the21-year-old Anchorage nanny has pooled her money with her mother'schequesbecause she was living at home rent-free. This is the firstchequeshe'll get for herself.

"I wish it were bigger, but you know, it's OK," she said.

"Money's money."