PFD? BFD!

You may be wondering what the heck all of those initials are. For a long time, I've known what BFD stood for, but it wasn't until after I moved to Alaska that I heard PFD. Not one to be left in the dark, soon after moving here, I found out that PFD stands for Permanent Fund Dividend. I still had no clue what the Permanent Fund Dividend really was, but when you reside in Alaska, you quickly learn. BFD is the way I feel about the PFD this year, considering the fact that we don't qualify for the gigantic dividend ($2,068 from the PFD, with an extra-added one-time energy rebate of $1,200 = $3,2068 per person in your family residing in AK) this year. I know when we qualify next year my view will change, but for today, PFD, BFD!!!

Now that good ol' Sarah is on the Republican ticket and considering the fact that the PFD dividends will be distributed on Friday, some of you may already know plenty about the PFD. For those of you who don't, and are as fascinated by it as I am, I will try to fill you in. To this day, the concept of the PFD is still quite muddy to me, so I don't know how much clarification you will get from me, but you'll get the basic idea.

The PFD was set up several years ago as a way to share some of the proceeds the state obtains annually from Alaska's oil. Basically (in my over-simplified terms), a certain percent of the state's oil money is put into a stock type fund and based on how much money the fund makes (dividends are caluculated based on a 5 year average return on the fund) dividends are calculated and distributed annually. Dividend checks are usually distributed each October. This year, in an effort to help offset the high price of gas and oil for the winter heating, the dividend is being distributed in September.

So, how do you qualify for this PFD, you might ask? There are several qualifying factors, but the major one is this...you must live in the state of AK for one full year prior to January 1. So, for instance, we moved here in December '07. In December '08 we will have been here for a full year and we will qualify in January '09. Get this though, if you move here early in the year this is how it shapes up...say we moved in January '08. January '08-January '09 would be a full year and then we would not have qualified until January of '10! So, we have some friends who have lived here for 6-12 months longer than us, but will qualify for the PFD at the same time we do.

As far as I'm concerned, the PFD is icing on the cake. It is essentially, in my opinion, free money that we will get for doing absolutely nothing, but living in the state of Alaska. It is funny though for those of us who do not qualify to talk and listen to many of the people around us who will be getting a big fat check deposited into their bank accounts Friday. So many of them act as though they are deserving of the money and that those people who do not yet qualify are in some way inferior.

We have quickly learned that if you do not qualify for the Permanant Fund, you are pretty much a nobody in the state of Alaska. There are several instances when "membership" and "priviledges" in the state, are predicated on whether or not you qualify for the PFD. Don't get me wrong, the state is more than happy for us to contribute to the economy and to take our property tax money. The utility companies are willing to charge us the same amount they charge everyone else for heat and electricty. The oil companies are happy to charge us the same high price they charge everyone else for gas. The great legislators of this state, however, do not think that we should be entitled to the same $1,200/person state energy rebate the those who qualify for the PFD are entitled to. They made their point very clear when they signed the bill for the energy rebate only after taking out the clause that would give the money to anyone who has lived in the state for at least six months. They opted instead, to attach the $1,200 to the PFD disbursements this year. If you don't qualify for the PFD, like the rest of the nation, you don't qualify for Alaska's energy rebate.

My personal take on the PFD is BRING IT ON!!!! I know in our household we can always use a few thousand dollars extra to do with however we choose (save, travel, pay bills, college fund, etc.). I for one, do not think it's money that is owed to us (the energy rebate is a whole different story), and next year when we do qualify, I will feel a little remorse for my friends and neighbors who won't be receiving the same free money we will be. I will, however, like the rest of the state, happily watch my bank account grow overnight! We have no idea how much our windfall will be next year, but it doesn't even matter because the fact is, it will be free money!