Defunding Senior Benefit Program hurts Alaska’s elders

Since the release of Gov. Mike Dunleavy’s budget, discussions of the various cuts and impacts have dominated opinion columns and the hallways of workplaces across Alaska. The cuts will fundamentally reshape the kind of state Alaska will become, starting later this year. These discussions are necessary to help form the priorities that the majority of Alaska’s people — and, by extension, their legislators — can support.

Gov. Dunleavy’s proposed elimination of the Senior Benefits Program, critical to Alaska’s low-income seniors, is missing from these columns and discussions. In addition to defunding a program that allows more than 11,000 older Alaskans to afford necessities like heat and medication, the governor submitted both a House and a Senate bill to repeal the Senior Benefits Program altogether. Such action suggests that the governor either doesn’t understand the Senior Benefits Program, or he doesn’t care. To make matters worse, although other major cuts in the budget have loud and well-organized constituencies to argue for them, poor older Alaskans have few to speak for them.

The Senior Benefits Program was created in 2007 as something of a reiteration of the old Longevity Bonus Program that was completely phased out under former Gov. Frank Murkowski. The old program paid a monthly cash benefit to Alaskans 65 and older, regardless of their need for it. The Senior Benefits Program came into being with the recognition that though not all older Alaskans needed this money, there are some who do. These are often single or widowed older women who may have lost their economic security caring for a dependent spouse or child. Or it might have been a low wage worker who never had a chance to save and whose Social Security income is very small. It also includes many who lived and worked by subsistence, not building a retirement savings or substantial Social Security.

In any case, these are older Alaskans who are economically poor. How poor? Those who qualify for the largest senior benefit amount ($250 per month) can have no more than $949 per month in income. The middle benefit amount is $175 per month for persons who have incomes below the federal poverty Level ($1265 per month), and for the current lowest benefit ($76 per month), the income limit is 175 percent of federal poverty level, at no more than $2214 per month. It is difficult to imagine living on such an income in Alaska, especially when the average senior beneficiary is 75 years old, likely has chronic health problems and must regard every expense as a choice between a necessity and another necessity.

When older Alaskans who qualify lose this income supplement from the Senior Benefits Program, it will be gone and irreplaceable. They are not going to go out and get a job or ask for a raise. They are not going to ask for help from mom and dad. They will simply have permanently lost a significant amount of their monthly income, and therefore their financial security. Unquestionably the loss of this income will increase the risk of losing their independence and hasten their move to a much costlier track of dependent care.

The Senior Benefits Program is not a brick-and-mortar program for the state. In fact, it functions in much the same way as the Permanent Fund dividend, though on a smaller scale. The monthly allowance from the state goes directly to the senior beneficiary who then spends it on necessary expenditures in this state. They certainly are not going to fancy restaurants, buying a smart TV or taking a trip to Hawaii. It is a modest financial stimulus to Alaska’s economy and can rightly be regarded as a state investment rather than an expense.

The argument we hear from the administration and some legislators is that the loss of the Senior Benefits Program income is offset by getting a larger Permanent Fund dividend. This makes little sense. Why should an older Alaskan, long past working age, be asked, when other Alaskans are not, to give up their needed monthly income in order to get a yearly dividend (which, last year, they got in addition to their income)? To offset with a PFD, the senior beneficiary would have to divide the PFD amount by 12 and dole it out carefully each month to make ends meet. Does anyone do this, or have to? It is not fair.

There is no sense of security in a PFD that comes once a year that will make up for the loss of the monthly allowance of the Senior Benefits Program. The predictability of a set amount (even a small amount) of monthly income provides more sense of security than counting on a PFD that could vary, diminish, or even vanish in the future. Being old and poor in Alaska is not a circumstance for more insecurity. Rather, as Alaskans of all ages (knowing we’ll all be older Alaskans one day) we must advocate for the preservation of this very important lifeline.

The Senior Benefits Program was reauthorized in the last legislative session through bills sponsored by then-Sen. Pete Kelly (R-Fairbanks) and then Rep. Scott Kawasaki (D-Fairbanks) with unanimous support in the Senate and only one no vote (Rep. David Eastman, R-Wasilla) in the House. Let us hope this legislature recognizes the same value of the Senior Benefits Program for our Alaskan elders.

Senate Bill 58 and House Bill 60 (to repeal the Senior Benefits Program altogether) must be defeated, and the budget must include adequate funding to treat senior beneficiaries the same as other Alaskans with regard to their PFDs. AARP Alaska is proud to speak on behalf of the 11,000 older Alaskans whose lives are made more secure and independent by the Senior Benefits Program. Failure to preserve the Senior Benefits Program for low income older Alaskans will mean we are all the poorer for it.

Ken Helander is the Advocacy Director for AARP Alaska.

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