Friday, September 06, 2013

Alaska Media Outlets Predict 2013 Alaska Permanent Fund Dividend With Estimates From $842.88 To $931.51; Actual PFD $900

Update September 18th: Actual PFD of $900 announced. Distribution will be slightly different this year; while direct deposit recipients will receive their PFDs beginning on October 3rd, the second round of payments will not begin until October 24th.

On September 18th, 2013, the official amount of the Alaska Permanent Fund Dividend will be announced in Anchorage, as it is ever year. Direct deposits and checks will be sent out the first week in October. The general consensus is that it will be somewhere in the $800+ range. And as usual, Alaska media outlets are gazing into their crystal balls and putting forth their best guesses.

KTVA Channnel 11 was first off the starting blocks. On September 5th, they published an estimate of $842.88. Their recent track record is improving. In 2012, they predicted a payout of $863.99 vs. an actual of $878.00. In 2011, they predicted $1180.58 vs an actual of $1,174.00. And in 2010, they forecast a dividend of $1,402.32 vs. an actual amount of $1,281.00.

Not to be outdone, KTUU Channel 2 produced their estimate on September 6th, and unlike in the past, their figure is noticeably higher than KTVA: $931.51. In 2012, KTUU did not calculate their own prediction, but farmed it out to the Clark Middle School math class, who came up with a figure of $898.76. In 2011, KTUU predicted a dividend of $1,203.45 vs. an actual of $1,174.00. And in 2010, they forecast a dividend around $1,305, even specifying a range between between $1,295 and $1,329. The actual was $1,281.00. Reproduced in tabular form below:

    2013 2012 2011 2010 KTVA $842.88 $863.99 $1180.58 $1402.32 KTUU $931.51 $898.76 $1203.45 $1305.00 Actual $900.00 $878.00 $1174.00 $1281.00

KTUU used the following methodology. First, they took the average of the fund's income over the past 5 years, multiplied it by 21 percent, and divided by 2 to get a figure of $604 million. From that figure, they subtracted the $1.49 million dollar average of prior year obligations, expenses, and PFD operations that had to be paid out. Working with $602,505,069.66, they divided the number of eligible applicants. Based on last years total of 646,805 eligible Alaskans, they arrived at their final number. While we Alaskans are certainly grateful for the windfall, it is embarrassing that this year's dividend will be lower than the very first dividend of $1,000 awarded in 1982, the first year of the PFD, despite the fact that the Fund ended fiscal year 2013 in June with a balance of $44.9 billion, its largest ever. The Fairbanks Daily News-Miner has a short explanation for the dichotomy.

One of the factors retarding dividend growth this year is that the five-year average upon which it's based still includes 2009, when the fund posted a $2.5 billion loss in statutory net income. Specifically, the 20 percent of the Fund which is composed of U.S. stocks had a negative return of 18 percent on investments that year. Next year, when 2009 drops out of the mix, the dividend will rise back into the $1,300 range. Visit the Alaska Permanent Fund Corporation website for more facts and figures about the Fund.

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