Thursday, June 19, 2008

Alaska Governor Sarah Palin Scrubs Proposed $729 Million Energy Debit Card Program, Will Reveal Final Proposal On June 20th

Alaska Governor Sarah Palin announced on June 18th, 2008 that she will not implement her energy debit card program proposed as part of a package designed to provide assistance to Alaskans in paying sharply higher energy costs. Full story published in the Anchorage Daily News, the Fairbanks Daily News-Miner, and aired on KTUU Channel 2.

The proposed cards were part of a proposed $1.2 billion energy assiatance program conceived by Palin. $729 million would have been allocated for these cards. Every Alaskan eligible for a 2008 Permanent Fund dividend would have received one. The benefit on the card would have been $100 month and it could be used only for energy purchases. The cards would have "merchant codes" so they could be used only for energy purchases at gas stations, fuel distributorships, utilities and the like. The program would have lasted only one year.

Many state legislators expressed opposition to the debit card plan. In my previous post, I expressed concern about the cost of associated bureaucracy and the possibility of fraud. Many Alaskans in the Interior and the Bush believe the program would have been unfair to them, because each Alaskan would have received an equal allotment despite the fact that energy costs are significantly higher in the Interior and the Bush than in South Central Alaska. And to drive this latter point home, on Thursday June 12th, 800 Fairbanks residents assembled at the Carlson Center in the presence of 30 state legislators to protest high energy prices.

After review, Palin's staff then determined that the cost of administering such a plan would be higher than originally anticipated. But the rest of the package, $475 million in grants to electric utilities which are projected to result in a 60 percent reduction for all ratepayers, is still on the table.

"Some didn't like the relief idea at all. But many of the lawmakers understand, particularly those whose constituents are being hit by the cost of energy in a big way and that's true predominately outside of the Anchorage Bowl areas," said special assistant to the governor Joe Balash.

The Palin Administration is now looking at providing relief that could include a straight check to Alaskans similar to a PFD check. This was one of my suggestions in my previous post. The final details will be unveiled on Friday June 20th when the governor releases her proposed legislation.

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