11- September-2025 Alaska Permanent Fund Updates
Anchorage, September 11, 2025 – Alaska’s Permanent Fund is again in the spotlight as the state prepares to send out dividend checks and officials debate its future. The first of two 2025 Permanent Fund Dividends (PFDs) will be paid on Oct. 2, 2025, as scheduled by the Alaska Department of Revenue. This year’s PFD was set at $1,000 per person by the legislature – far below last year’s $1,702. The payments come from the earnings of the Alaska Permanent Fund, a sovereign wealth fund created in 1976 to save the state’s oil revenue for future generations. The Fund recently reached a record value, surpassing $83.5 billion in June 2025.
2025 Dividend Payments Scheduled
For 2025, every eligible Alaskan will receive a $1,000 dividend. The Department of Revenue has announced a staggered payout schedule to distribute the money efficiently. Key dates include:
- Sept. 11, 2025 – Payment for outstanding 2024 applications. Any 2024 applications still marked “Eligible-Not Paid” by Sept. 3 will be paid out on Sept. 11.
- Oct. 2, 2025 – First 2025 dividend payment. Applicants who are eligible by Sept. 18 (and who filed online with direct deposit) will receive their $1,000 on Oct. 2.
- Oct. 23, 2025 – Second 2025 payment. Any remaining eligible applications (filed by Oct. 13, including paper-check filers) will be paid on Oct. 23.
Officials stress that direct deposit is the fastest way to get the money. In fact, the Oct. 2 payment wave covers all direct-deposit applications, while the Oct. 23 wave includes the rest (paper check recipients). (Alaskans can check their application status online through myPFD.)
State Budget and Fund Revenues
The modest $1,000 dividend reflects a tight state budget situation. In June 2025, Governor Mike Dunleavy signed the new fiscal 2026 operating budget – after vetoes, it totals about $14.7 billion. Revised forecasts showed lower oil prices (about $68/barrel in spring 2025) and a revenue shortfall of roughly $222 million. The governor’s vetoes cut about $122 million from the budget to match the reduced outlook.
Faced with a looming deficit, lawmakers trimmed many expenses. In the spring of 2025, both houses of the legislature negotiated cuts to balance the budget. The House initially pared the dividend from Gov. Dunleavy’s proposed $3,900 to about $1,400 per person. A Senate Finance Committee draft then cut it further to $1,000. Ultimately, the approved FY2026 budget included a $1,000 PFD (when adjusted for inflation, this is the smallest payout since the PFD began in 1982).
The budget squeeze comes as the Permanent Fund plays an increasingly large role in state revenue. In the upcoming fiscal year, analysts project only about $1.6 billion from all oil taxes and royalties, but $3.8 billion from the fund’s scheduled draw. In other words, roughly 60% of Alaska’s general fund revenue will come from Permanent Fund earnings. (By comparison, oil revenue will supply only about 25–30%.) This dynamic reflects Alaska’s shift from oil to its savings: the Permanent Fund now underwrites more of the state budget than petroleum taxes.
In past years, legislators routinely transferred part of the fund’s earnings into the principal account to keep up with inflation. However, in 2025, lawmakers suspended a planned $1 billion “inflation-proofing” deposit and declined another $1.5 billion scheduled for FY2026. They argued that a $4.0 billion deposit made in 2021 to the fund’s principal would suffice. Permanent Fund trustees objected, saying that a special deposit cannot be counted retroactively as inflation-proofing. The Fund’s Board of Trustees has urged the Legislature to stick to consistent rules and continue the inflation-proofing practice to preserve the Fund’s value.
Fund Value and Performance
The Alaska Permanent Fund Corporation manages the state’s oil-wealth endowment from its Juneau headquarters. Its board invests the fund’s assets globally to support dividends and state services.
The Alaska Permanent Fund Corporation (APFC) in Juneau is charged with investing the Permanent Fund’s $80+ billion corpus for long-term growth. As of the close of Q3 (March 31, 2025), the fund’s total value was about $80.8 billion, reflecting steady market gains. Over the current fiscal year, it has earned roughly 4.6% in investment returns. The board’s stated investment goal is to achieve an average real (inflation-adjusted) return of 5% per year. (Long-term, exceeding inflation by 5% would preserve the fund’s purchasing power for future generations.) In practice, recent returns have generally trailed that target. For example, the APFC notes that its five-year average performance is about 10.5% (nominal), which roughly meets long-term goals, but annual returns can vary widely.
APFC officials emphasize a cautious, long-term approach. Chief Investment Officer Marcus Frampton says the team focuses on a “resilient portfolio that performs over time” and uses a “disciplined, forward-looking strategy” to meet Alaska’s needs. The fund’s earnings (realized interest, dividends, and gains) are deposited into the Earnings Reserve Account, from which dividends and up to a fixed draw for government spending are paid each year. So far, the Permanent Fund’s investment earnings have indeed enabled the state to pay out large dividends: since the PFD program began, the fund has generated over $87.8 billion in net income used for dividends and state services.
Proposals for Change: Endowment Model vs. Draw Limits
Amid the budget crunch, Alaska’s leaders are debating whether to change how the Permanent Fund is structured. One major proposal is Senate Joint Resolution 14, which would ask voters to amend the state constitution. SJR14 would combine the fund’s two accounts (the protected “principal” and the spendable earnings reserve) into a single endowment, and also set a fixed spending rule. In practice, that means the entire fund would be treated as one pool, and the Legislature could only withdraw up to 5% of its value each year. Supporters call this the “single-fund endowment model.” They argue it follows global best practices, since all earnings would automatically be reinvested in the fund, removing the need for ad-hoc inflation-proofing transfers. The APFC Board of Trustees has recommended considering such a change as a way to secure sustainable dividends. Proponents note that constitutionalizing a capped 5% draw would prevent sudden cuts to the fund and provide a predictable revenue stream.
Opponents caution that restructuring could carry risks. Some analysts point out that the current 5% withdrawal rate may already outpace the fund’s net returns once inflation and management fees are included. In other words, if the fund is only earning about 4–5% in real terms on average, regularly taking 5% annually will gradually erode its balance. Under the existing two-account system, the Earnings Reserve acts as a buffer: once it is exhausted, spending automatically stops. But if the accounts are merged, that “floor” vanishes – theoretically allowing withdrawals up to 5% each year, even if it means dipping into the previously protected principal. Critics worry that converting the fund into a full endowment without adjusting the draw rate could leave the fund’s corpus vulnerable and reduce long-term stability. They urge caution and suggest that Alaska should instead adjust spending if needed, rather than altering the fund’s structure.
What’s Next
As Alaskans receive their 2025 PFD checks this fall, the future of the Permanent Fund remains a central issue. The incoming checks are smaller than in past years – reflecting a rare downshift in what once seemed a nearly automatic benefit. Meanwhile, public leaders continue to debate how to balance the budget, care for the fund’s health, and honor the fund’s mission. Both Governor Dunleavy and the Legislature say they want to preserve the fund for future generations, but faced with declining oil revenues and rising demands, they must make tough choices. If voters approve any constitutional changes, Alaska’s Permanent Fund could look very different in the coming decades. For now, though, it stands at a historic high in dollar terms – a reminder of the state’s vast oil wealth and the enduring experiment of sharing it with every Alaskan.
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