Freemoney in Alaska — but not asmuch these days

Nearly ANCHORAGE, ALASKA — every Alaskan woke up $1,100 richer today, thanks to this year’s payout fromthe state’s oilwealth investment fund.

Thedistribution fromthe Alaska PermanentFundis essentially free money for residents, who already don’t pay a state income tax or statewide sales tax. But it’s just half of the expected $2,200windfall, which was reduced for the second straight year to help the state pay its bills amid a recession due to continued low oil prices.

Unlike previous distributions, the amount of this year’s payout was quietly announced in a short news release with none of the fanfare from years past. Here are some facts and history of the checks.

Shrunken checks

A record payout of $2,072was distributed to qualifying Alaskans in 2015. Last year, the amount was estimated to be a bit higher until Gov. BillWalker stepped in and shrunk the amount because of the state’s multibillion-dollar budget deficit, exacerbated by lowoil prices. Walker’s actionwas challenged in court. In August, the state Supreme Court ruled Walker acted within his authority.

How to get free money

The checks are distributed annually to Alaskans who apply for them after living in the state for at least one calendar year, or were born in Alaska by the Dec. 31 deadline of the previous year. This year, about 640,000 Alaskans received checks totaling $672 million. The amount is based on a five-year average of the fund’s investment earnings.

How people spend it

Some use the checks as fun money for purchases like bigscreen TVs and traveling. But for many in cash-poor rural Alaska, the money goes toward necessities such as costly heating fuel or down payments for boats or all-terrain vehicles used in subsistence hunting.

How it all began

The permanent fund was createdbyvoters in 1976as an investment account for royalties after oil was discovered on the North Slope. The principal may not be spent, according to the state constitution, and the earningsmay be usedby theLegislature foranypublic purpose. Residents began getting money fromthe fund in 1982. If an Alaskan has qualified for all of the checks distributed fromthe beginning, he or she would have received $41,221.41, said SaraRace, director of the state’s Permanent Fund Dividend Division. The state has paid out about $24 billion. The fund, valued at about $61 billion, gets its earnings froma diversified portfolio, which includes stocks such as Apple, Microsoft, Chinese commercecompany Alibaba, Bank of America and Facebook.