Alaskans bank on annual dividend

[September 23, 2009]  ANCHORAGE, Alaska (AP) -- Isaac Nukapigak plans to spend his annual reward for living in Alaska just catching up with the basics of survival in his remote whaling village, where gasoline can top $9 a gallon and a gallon of fresh milk can set you back almost $15.

"It will help pay for fuel for winter, heating fuel. That will come in very helpful, the help from the state to help defray the high cost of energy," Nukapigak, a 52-year-old whaling captain from the North Slope village of Nuiqsut, said of the dividend payments from the state's oil royalty investment program distributed to every eligible man, woman and child each fall.

Folks here are eager to learn the amount of this year's Alaska Permanent Fund dividend, to be announced Wednesday afternoon by Gov. Sean Parnell. There are 657,400 recipients this year.

Whatever it is, the payout from the state's oil royalty investment program will pale in comparison with last year's record share of $2,069, which was combined with a special energy relief payment of $1,200, bringing the total haul to $3,269. The one-time boost was proposed by then-Gov. Sarah Palin and approved by state lawmakers to help offset soaring fuel prices.

Dividends will be smaller because investment earnings allocated to dividends are based on a five-year average of fund performance, which was poor last year because of the downturn in the economy. Not that anyone is turning down what amounts to free money in a state that also has no income tax.

The dividends are especially crucial in rural, outrageously expensive parts of the state, including Nuiqsut, an Inupiat Eskimo village 625 miles north of Anchorage. Job opportunities are limited and though some residents commute to the oil fields in the region, many can't afford to leave families who rely on subsistence hunting for much of their food, according to Nukapigak, a lifelong resident.

The village of 500 depends on the whaling crews such as his that provide tons of meat from the sea. This year, two bowhead whales were caught. That means less dollars spent at the local store. The village Native corporation also helps by subsidizing about half the cost of fuel used for subsistence activities, but Nukapigak still sunk more than $5,000 feeding his crew and fueling his skiff during the three-week whaling season. That's another reason to welcome the dividends coming to his nine-member household.

"Everything is so expensive," Nukapigak said. "Everything adds up. That's why subsistence is very important to us, to survive the harsh Arctic environment."

Necessities also take precedence over luxuries when it comes to dividend expenditures in Kotlik on Alaska's western coast, said Kenneth Hunt, 31, assistant manager of a community grocery store. He is a lifelong resident of the Yupik Eskimo community of about 600.

Hunt's dividend is "going to my heating fuel bill, my electricity bill. It's going to some groceries," he said. "Most people, when they get their dividends, usually pay up the bills first."

Some people, however, can't help but splurge around dividend time, at least in Anchorage, where car dealers and retailers lure buyers with big "PFD" deals.

Such offers aren't necessary at Michael's Jewelers, a family-owned shop established 40 years ago in Alaska's largest city. Come dividend time, business jumps at least 30 percent, according to Mindi Robuck, who runs the store. She's already seeing signs of another upswing this year, despite the recession.

"A couple of people have mentioned they'll see me around PFD time," said Robuck, who has her own dividend plans. "I think it will go into my kitchen, probably on granite counters."

The fund was established in 1976 after North Slope oil was discovered. Including the upcoming dividends, the fund has since yielded $16.5 billion to Alaskans since the first payout of $1,000 in 1982, according to the state Revenue Department. That's not including the energy relief money, which alone totaled $730 million.

Before last year's plum allotment, dividend payments ranged from $331 in 1984 to $1,963 in 2000. People must live in the state for one calendar year to qualify for the money.

The payout of this year's dividends is scheduled for Oct. 8 for 520,000 applicants who requested direct deposit. Checks will be mailed starting Oct. 22.

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On the Net:

Alaska Permanent Fund Corp.: http://www.pfd.state.ak.us/

[Associated Press; By RACHEL D'ORO]

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