ANCHORAGE, Alaska (AP) — It's not much — $878 — but Sina Takafua isn't balking at her first annual payout from Alaska's oil savings account.
"I'm just happy. It's free money," she said of the amount after taxes that she'll receive just for living in the state, in her case the northernmost town of Barrow.
State officials on Tuesday announced the amount of Alaska Permanent Fund dividends to be distributed Oct. 4 to all men, women and children who have lived in the state for at least one year. This time around, that's nearly 647,000 people.
This year's amount is the lowest since 2005 and the ninth-lowest in the program that began three decades ago. Last year's dividend was $1,174.
Officials attribute the decrease to the five-year formula used to calculate the yearly dividend. Alaska Revenue Commissioner Bryan Butcher said the formula will stay depressed through next year. After that, officials can stop figuring in performance from 2009, when the fund lost billions in the stock market dive.
"As long as that year is part of the five-year calculation, it's going to be a little low," Butcher said.
Like others surveyed in rural parts of the state, Takafua had planned to use her dividend to pay bills. But Tuesday she said she was sending it all to her mother in Hawaii. "She'll appreciate it," Takafua said.
Some customers at the local fur shop where Takafua works are going for warmth — and style. They're already pre-ordering parkas made of caribou, wolverine and other furs.
"They're waiting for their PFD to pay for them," said Takafua, who moved to Alaska from Maui, Hawaii, with her two sons in 2010. Her husband joined the family later, so he's not yet eligible for a dividend like they are.
New residents must live in Alaska for one calendar year to benefit from the permanent fund, which was established in 1976 after North Slope oil was discovered.
The state began doling out money from the fund in 1982. Residents who have received every check since then have gotten a total of $34,243.41.
Alaska Permanent Fund Corp. officials last month suggested that residents would be seeing a smaller check this time around.
The amount of investment earnings allocated to dividends is based on a five-year rolling average of permanent fund performance. While 2009 stayed in, 2007 was dropped from this year's average, corporation officials said. They said 2007 was a recent high-water mark in which the fund earned $3.4 billion in statutory net income, the realized gains used in calculating the dividend.
Alaska has no state income tax, but residents must pay federal taxes on the bounty.
In the western town of Nome, many residents will be using what's left over to pay for outrageously expensive groceries and gasoline, which sells for almost $6 a gallon.
Gone are the days when people spent their dividend checks on snowmobiles from Morgan's Sales and Service shop, said fourth-generation owner Pat Johanson.
The money that goes to Johanson's four children will end up in savings. But Johanson's plan for his own check depends on how winter fares compared with last year, when temperatures were more brutal than usual.
Johanson, his wife and kids could have a vacation in the near future.
"If January gets to 30 and 40 below again," he said, "I want to go to Hawaii."
So does Sean Irvin of Anchorage. He went there on last year's dividend and wants to go to Maui with the help of this year's money.
Still, there he was at an Anchorage Best Buy, eyeing another PFD treat — no, not the new iPhone 5 coming out Friday, but a humble phone for a landline.
"I want big buttons and caller ID," Irvin said.