IN THE SUPERIOR COURT FOR THE STATE OF ALASKA THIRD JUDICIAL DISTRICT AT KENAI

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1 IN THE SUPERIOR COURT FOR THE STATE OF ALASKA THIRD JUDICIAL DISTRICT AT KENAI K. A. and A. A., ) ) Plaintiffs, ) ) v. ) ) STATE OF ALASKA, DEPARTMENT ) OF REVENUE, PERMANENT FUND ) DIVIDEND DIVISION, ) ) Defendant. ) ) Case No.: 3KN-10-44CI MEMORANDUM DECISION AND ORDER K. and A. A. appeal the decision of the State of Alaska Department of Revenue ( Department ) denying K. A. a permanent fund dividend ( PFD ) for the 2008 and 2009 application years, and denying A. A. a PFD for the 2009 application year. For the reasons below, the Court REVERSES the Department s finding that K. and A. are ineligible to receive a PFD because they have not established the intent to remain indefinitely in Alaska. BACKGROUND K. A., a minor child, first applied to the Department for a PFD in K. is a United States citizen born in California; her parents, who have both legal and physical custody of K., are of Canadian and British citizenship. B. A., K. s father, entered on a TN visa for professional workers and J. A., her mother, accompanied him on a related TD visa. 1 Knowing he was ineligible for a PFD, Mr. A. executed a limited power of attorney 1 These visas, part of the North American Free Trade Agreement, grant their holders (professionals and dependents) a non-immigrant temporary status allowing them to work in the United States for three years.

2 to attorney Kenneth Florence so Mr. Florence could act as K. s eligible sponsor for the PFD application. Mr. Florence timely applied on behalf of K. for the PFD. K. was denied a PFD because she lacked a proper sponsor and she did not meet the residence requirement to be eligible for the PFD. K. sought a ruling reviewing her denial. K. s younger sister A., a United States citizen born in Alaska, joined K. s appeal after both children were denied PFDs for the 2009 application year. The applications were identical in form to K. s 2008 application; attorney Mark Osterman was given the same limited power of attorney by Mr. A. that Mr. A. gave Mr. Florence to apply for K. in The administrative court consolidated both cases based on K. s appeal to the Superior Court. In a final ruling, the administrative court ruled that a licensed attorney with a limited power of attorney was a proper sponsor under these circumstances. The court nevertheless denied PFDs to the children, finding them unable to meet the eligibility requirements because their parents lacked sufficient intent to reside indefinitely in Alaska for purposes of receiving a PFD. This appeal followed. STANDARD OF REVIEW There are no disputed questions of fact in this case. Questions of statutory and regulatory interpretation are reviewed under the independent judgment standard. This standard is applied where the questions of law presented do not involve agency expertise or where the agency s specialized knowledge and experience would not be particularly probative as to the meaning of the statute. 2 Application of this standard permits the reviewing court to substitute its own judgment for that of the agency, even if the agency s 8 U.S.C. 1101(a)(15)(E), 1184(e)(2); 8 C.F.R The visas may be renewed indefinitely. 8 C.F.R (h)(1)(iv). 2 Tesoro Alaska Petroleum Co. v. Kenai Pipe Line Co., 746 P.2d 896, 903 (Alaska 1987). MEMORANDUM DECISION AND ORDER 2

3 decision had a reasonable basis in law. 3 The court reviews the interpretation of statutes de novo and adopts the rules of law that best reflect precedent, reason and policy. 4 K. and A. also argue the Department s decision implicates the equal protection clauses of the United States and Alaska constitutions, and the Supremacy Clause of the United States Constitution. The reviewing court applies its independent judgment to questions of constitutional law, reviewing constitutional issues de novo. 5 DISCUSSION The Department conceded at oral argument that the attorney sponsoring the K. and A. was an eligible sponsor for the children. Therefore, the only remaining issue is the children s eligibility. K. and A. contend that they are eligible to form the intent to remain indefinitely in Alaska and also argue that to find them ineligible violates the equal protection clauses of the United States and Alaska constitutions and the supremacy clause of the United States Constitution. Each of these arguments will be addressed in turn. I. The Statutory Residency and Indefinite Intent Requirement To be eligible for a PFD, Alaska law requires that an applicant be a resident of the state of Alaska 6. Alaska residency requires that the applicant be physically present in Alaska with the intent to remain indefinitely in Alaska and to make a home in Alaska. 7 The Department denied PFDs to K. and A., finding that the children did not meet all eligibility requirements as they were not able to form an intent to remain indefinitely in Alaska. In the 2008 denial of K. s PFD, the department relied heavily on the Andrade decision as dispositive of the issue of whether K. and A. could form an intent to remain 3 Id. 4 State, Dep t of Revenue v. Andrade, 23 P.3d 58, 65 (Alaska 2001). 5 Id. at 65 (citing Waiste v. State, 10 P.3d 1141, 1144 (Alaska 2000)) AAC AS (a). MEMORANDUM DECISION AND ORDER 3

4 indefinitely. 8 K. and A. argue that to base an evaluation of the children s intent entirely on their parents immigration status effectively imputes a legal disability onto the children, rendering them unable to receive the PFD although they are United States citizens who have never left Alaska. To receive a PFD, the applicant has the burden of proving both physical presence and the intent to remain indefinitely in Alaska; both requirements must be met before a PFD can be awarded. 9 K. and A. have proven physical presence; all that is at issue is the requirement of an intent to remain indefinitely in Alaska. Generally a minor s intent to create, keep or abandon a residence follows the intention of the child s parents or legal guardians. 10 The minority of the child leads to the conclusion that... where intention or purpose is relevant... the intention or purpose which has to be taken into account is that of the person or persons entitled to fix the place of the child s residence. 11 Since 8 The Administrative Law Judge stated that although the Andrade case was distinguishable, the decision was instructive in that the court did not separate the children s legal status as U.S. citizens from their parent s status as aliens. Hon. Rebecca L. Pauli, Office of Administrative Hearings, Decision, In re A Permanent Fund Dividend, OAH No PFD (Nov. 10, 2009). 9 Andrade, 23 P.3d at See, e.g., Mozes v. Mozes, 239 F.3d 1067, 1076 (9th Cir. 2001). 11 Id. Citing Lepe-Guitron v. I.N.S., 16 F.3d 1021, 1025 (9 th Cir. 1994), K. and A. concede that the child s domicile follows that of the parents at common law, but assert that courts and legislatures have distinguished between residence and domicile. See U.S. v. Venturella, 391 F.3d 120, 125 & n.6 (2d Cir. 2004). Although resides usually denotes residence,... it may also denote domicile... For the most part, residence and domicile are two perfectly distinct things. Residence is [t]he act or fact of living in a given place for some time, while domicile is a person's true, fixed, principal, and permanent home, to which that person intends to return and remain even though currently residing elsewhere... residence generally does not require an intent to remain or return, domicile does. Id. (citations omitted); see also Martinez v. Bynum, 461 U.S. 321, 330 & n.11 (1983) ( Although the meaning may vary according to context, residence generally requires both physical presence and an intention to remain... Contrary to the suggestion in the dissent... we have said nothing about domicile. The Texas statute, like many similar ones, speaks only in terms of residence. ); George v. Jones, 317 S.W.2d 662, 666 n.3 (Mo. App. S.D. 2010) (noting residence is an ambiguous term where undefined by statute, and may or may not be the legal equivalent of domicile depending on the context). Case law suggests, however, that the intent of an unemancipated minor generally follows that of the parents as to both concepts where residency is defined with an intent element; for example, courts MEMORANDUM DECISION AND ORDER 4

5 the applicants are both minors, Mr. and Ms. A. intent to remain in Alaska is relevant to the determination of the minors intent as they are the persons with legal and physical custody of the children. Because of their immigration status, Mr. and Ms. A. cannot establish their intent to remain and are ineligible to apply for PFDs. 12 Mr. A. testified at the administrative hearing that in the event Mr. and Ms. A. visas were not renewed, they would leave Alaska and the children would accompany them. The facts of this case present an issue of first impression in Alaska: whether a minor whose parents are statutorily barred from intending to remain indefinitely in Alaska can nevertheless intend to remain indefinitely for purposes of PFD eligibility. Case law provides guidance on the eligibility of lawfully admitted aliens for a permanent fund dividend. Examination of immigration status is rationally related to the determination of the intent to remain a resident because immigration laws necessarily affect one s ability to effectuate such intent. 13 In Andrade 14, the court examined the determining a child s habitual residency under the Hague Convention note that residency generally follows the intent of the parents as to young children. See, e.g., Papakosmas v. Papakosmas, 483 F.3d 617, 622 (9th Cir. 2007); accord Mozes, 293 F.3d at To the extent that the residency requirement defined may be more or less rigorous than a domicile requirement, the state is entitled to adopt different standards of either domicile or residency for different purposes. Andrade, 23 P.3d at 71 72; see also Wit v. Berman, 306 F.3d 1256, 1260 (2d Cir. 2002) (holding that although one may be legally domiciled in different places for different legal purposes, a person is deemed to have only a single domicile for the particular legal purpose for which the concept is then being used, and citing examples of statutory domicile requirements); Venturella, 391 F.3d at 125 n.6 ( Thus, despite the generally distinct meanings of residence and domicile, those terms may have an identical or a variable meaning depending upon the nature of the subject-matter of the statute as well as the context in which the words are used. ) (citing Perkins v. Guaranty Trust Co. of New York, 8 N.E.2d 849 (1937) (alterations in original)). Finally, the court notes that the residency requirement statutorily established for the PFD program itself differs from other residency requirements. Andrade, 23 P.3d at (quoting Church v. State, Dep't of Revenue, 973 P.2d 1125, 1129 (Alaska 1999)). Eligibility for a PFD requires the applicant to prove more than physical presence or plain residency in Alaska. The applicant, by statutory definition, must also prove his accompanying intent to remain indefinitely. Id. at 69. In this way, the PFD requirement resembles a habitual residence or domicile requirement, but is not exactly like either; Alaska statutes and the administrative code have clearly defined the residency requirement and the evidence required to prove it. See AS ; 15 AAC Andrade, 23 P.3d at 74 ( There is no basis for concluding that all legal aliens should be eligible to receive a PFD. Aliens have to be present in Alaska legally and be able to form the requisite intent to remain, like all other applicants. ). 13 State, Dep t of Revenue v. Cosio, 858 P.2d 621, 628 (Alaska 1993). MEMORANDUM DECISION AND ORDER 5

6 intent to remain issue as it related to immigration status, finding that not all aliens are able to form that intent because of the restrictions of their immigrant status; depending on an alien s immigrant status, federal immigration law can place restrictions on an alien s ability to intend to remain. The court found that some categories of lawfully admitted aliens could not form the required intent to remain in Alaska without jeopardizing their federal legal alien status. 15 Mr. and Ms. A. fall into the category of lawfully admitted aliens who are ineligible for the PFD. 16 Aliens may not seek PFDs if their admission to the United States is expressly conditioned on an intent not to abandon a foreign residence or (by implication) on an intent not to seek domicile in the United States. 17 Andrade notes such conditions are not required for all nonimmigrant statuses. 18 Mr. A. status is TN and Ms. A. is TD, which are expressly classified by federal regulations as temporary nonimmigrant statuses. 19 Temporary nonimmigrant status can only be granted without the intent to establish permanent residence, and the alien must satisfy the inspecting immigration officer that the proposed stay is temporary... [having] a reasonable, finite end that does not equate to permanent residence. 20 A PFD cannot be granted to those 14 Andrade, 23 P.3d at Id. at See 15 AAC (d). The Administrative Code states: If an alien... has been assigned... a nonimmigrant status allowing only a limited stay in the United States, the department will not consider the alien to be a resident under AS (a)(3) and this section, unless the department finds that the alien has taken a significant step to convert or adjust to a permanent or indefinite status. Id. 17 Andrade, 23 P.3d at 73; see also 15 AAC (d). 18 Id. 19 See DEP T OF STATE, Types of Visas for Temporary Visitors, available at temp/types/types_1286.html; 8 C.F.R (b) (last accessed February 14, 2011) C.F.R (b). MEMORANDUM DECISION AND ORDER 6

7 persons who keep their residence and benefits in another country as such persons would not be able to legally establish an Alaska residency. 21 This case differs factually from past decisions examining the intent to remain issue because Mr. and Ms. A. did not sponsor K. and A.; in Andrade, alien parents of citizen children were also the children s sponsors. 22 This factual difference is important here because the Andrade court never reached the issue of the citizen children s eligibility, but only the issue of the eligibility of their parents; the court found the lawful permanent resident parents were eligible sponsors and once the parents were found eligible, the children were found eligible. 23 Given the fact that the children are United States citizens, and have an eligible sponsor, the court finds that the immigration status of Mr. and Ms. A. is merely one factor to be weighed in the determination of whether K. and A. have formed the intent to remain indefinitely. When determining residency for PFD purposes, the Department must consider the guidelines established by 15 AAC : (a) An individual's intent to establish residency, remain indefinitely in Alaska, or to return to Alaska and remain indefinitely is demonstrated through the establishment and maintenance of customary ties indicative of Alaska residency and the absence of those ties elsewhere. Acts that are required by law or contract or are routinely performed by temporary residents of Alaska are not by themselves evidence of residency. In evaluating whether an individual claiming Alaska residency has demonstrated an intent to remain indefinitely in Alaska, the department will consider whether or not an individual has: (1) taken steps to establish Alaska residency and sever residency in a previous state or country; 21 AS (b)(2). 22 See Andrade, 23 P.3d at 63 ( The children s applications were denied because their sponsor, Andrade, was found ineligible for the dividend. ). 23 See id. at (restricting eligibility discussion to categories of alien eligibility). MEMORANDUM DECISION AND ORDER 7

8 (2) ties to another state or country that indicate continued residency in the other state or country; and (3) taken other action during the qualifying year, through the date of application, that is inconsistent with an intent to remain in Alaska indefinitely. This court finds that multiple factors weigh in favor of the children s argument that they have proven intent to remain indefinitely in Alaska. The Department failed to take into consideration the many physical and professional ties the A. family has to the area. 24 Most importantly, the Department failed to give weight to Mr. and Ms. A. stated intent to apply for visa renewals indefinitely. Instead, the Department found a legal inference drawn from the parents immigration status to be determinative of the intent issue. 25 In this case, the children have both been residents of Alaska (A. s entire life and nearly all of K. s life) for a few years and have never left the state. Mr. A. has worked in Alaska for years and testified that he intends to attempt to continue to work in Alaska indefinitely. Mr. and Ms. A. own two properties in Alaska and have resided in Alaska without absence. These facts suggest that K., A. and her parents do presently intend an indefinite residence in Alaska, even if the parents as a legal matter cannot form the intent to remain permanently. If the parents are at some indefinite time in the future required to leave Alaska by operation of federal law, the fact that the children are likely to follow them is not conclusive evidence of the present intent of the children. The parents have asserted their intent to apply for renewal of their visa for as long as they are permitted to 24 Brodigan v. State, Dep t of Revenue, 900 P.2d 728, 733 n.12 (Alaska 1995) (holding [e]ligibility for PFDs includes meeting a definition of residency tied to physical contact to the state ). 25 The ALJ stated that Mr. A. asserts that because he can renew his TN status indefinitely, K. can remain indefinitely. Mr. A. is mistaken. His status is dependent on several factors beyond his control. Decision at 4. This court construes Mr. A. assertion as a statement of intent to apply for renewal of his visa at each opportunity to do so, conceding that the time may come when his renewal application is denied. Insofar as the children are concerned, it is clearly Mr. A. actual intent that they remain with Mr. and Ms. A. in Alaska indefinitely. MEMORANDUM DECISION AND ORDER 8

9 do so. If required to impute any aspect of the parents intent to the children, it is more logical and more fair to impute this plan to remain in Alaska for as long as possible than it is to impute a theoretical absence of intent based upon a federal legal requirement. If this case presented all the same facts, except that the minor child was 17 and had enrolled at the University of Alaska Anchorage with the intent to enter college in Alaska when she turned 18, and had stated an intent to graduate from college in Alaska and work in Alaska, she would indisputably be entitled to a PFD regardless of the intent or any legal disabilities of her parents. A precocious child might formulate such an intent much earlier in life. To deny very young children the PFD that would be granted to an older child who has precisely the same legal status strikes the court as illogical, and creates a distinction that would be impossible to regulate. The State does not deny PFDs to people who may have formulated an intent to retire outside the state at some undefined point in the future 26 and does not, as appellants point out, seek reimbursement of previously granted PFDs from those that do so. 27 K. and A. meet all requirements in the plain language of AS , which defines the intent to remain indefinitely in Alaska. This section states that a person demonstrates the intent required: (1) by maintaining a principal place of abode in the state for at least 30 days or for a longer period if a longer period is required by law or regulation; and (2) by providing other proof of intent as may be required by law or regulation, which may include proof that the person is not claiming 26 See Perito v. Perito, 756 P.2d 895, 899 (Alaska 1988) (... the intent to remain permanently should be interpreted to mean the intent to remain indefinitely. Otherwise, it is likely that a large percentage of Alaskans would not be considered residents, since many intend to retire elsewhere. ). 27 Indeed, in the case of the hypothetical college-bound child, the award of a PFD furthers the essential purpose of the PFD program: to encourage people to remain in Alaska and to reduce population turnover. See Cosio, 858 P.2d at 627 (emphasis omitted) (quoting Ch. 21, 1(b), SLA 1980). MEMORANDUM DECISION AND ORDER 9

10 residency outside the state or obtaining benefits under a claim of residency outside the state. 28 K. and A. have maintained a residence here for the past thirty days, and continue to maintain that residence here. Mr. A. has testified that K. has only an American passport and claims only American benefits (although through her parents, she is also British and Canadian). If K. and A. are not residents of Alaska, they seem not to be residents anywhere at all. The present actual intent of the A. family as a whole is to remain in Alaska indefinitely. The state cannot deny this benefit to the children based on the possibility of future events forcing the children to leave the state, while ignoring all other factors pointing to an intent to reside indefinitely. 29 Only Mr. and Ms. A. are barred from seeking PFDs because they have chosen to maintain a residency in foreign countries; the children s only attachment to another country is by virtue of their lineage. For these reasons, the Court finds that K. and A. have formed the intent to remain indefinitely. II. Equal Protection Claim The United States Constitution and the Alaska constitution both guarantee equal protection of the laws for all persons. 30 Alaska s constitution, in article I section 1, mandates equal treatment of those similarly situated ; it protects Alaskans' right to nondiscriminatory treatment more robustly than does the federal equal protection clause AS (b). 29 Perito v. Perito, 756 P.2d 895, 899 (Alaska 1988) (affirming superior court s interpretation that... the intent to remain permanently should be interpreted to mean the intent to remain indefinitely. Otherwise, it is likely that a large percentage of Alaskans would not be considered residents, since many intend to retire elsewhere. ). 30 U.S. CONST. amend. XIV ( No state shall... deny to any person within its jurisdiction the equal protection of the laws ); ALASKA CONST.. art. I, 1 ( all persons are equal and entitled to equal rights, opportunities and protection under the law ). MEMORANDUM DECISION AND ORDER 10

11 We have long recognized that [this clause] affords greater protection to individual rights than the United States Constitution's Fourteenth Amendment. 31 To succeed on an equal protection claim, the plaintiff must demonstrate that he has been treated differently than a similarly situated person. 32 Because PFDs are an economic interest, the Court held in Church that PFD eligibility regulations are subject to minimum scrutiny review to determine if they violate the equal protection clause of the Alaska constitution. 33 Under a minimum scrutiny analysis, the court does not determine if a regulation is perfectly fair to every individual to whom it is applied, but only if the regulation bears a fair and substantial relationship to a legitimate government objective. 34 The legitimate government objective of PFD residency requirements is to ensure that only permanent residents receive a PFD. 35 K. and A. argue that their treatment differs from that of similarly situated children and that they are being unfairly denied Alaska residence on the basis of their parents immigration status. As noted, the children were found to have an eligible substitute sponsor and the Department does not contest this finding. To receive a PFD, all applicants must prove physical presence and intent to remain indefinitely in Alaska; this subjective intent requirement is separate from an objective requirement of physical presence alone. 36 Because the purpose of permanent fund dividends is to encourage persons to maintain their residence in Alaska and to reduce population turnover, the intent to remain test uses the subjective intent requirement to ensure that dividends are only given to those Alaska residents who plan on maintaining their residence in the 31 Alaska Civ. Liberties Union v. State, 122 P.3d 781, 787 (Alaska 2005). 32 Lawson v. Helmer, 77 P.3d 724, 728 (Alaska 2003). 33 Church v. State, Dep t of Revenue, 973 P.2d 1125, 1130 (Alaska 1999). 34 Eldridge v. State, Dep t of Revenue, 900 P.2d 101, (Alaska 1999). 35 Id. at AS (8); 15 AAC MEMORANDUM DECISION AND ORDER 11

12 state. 37 The Court notes that parties do not challenge the residency requirement on grounds that it facially discriminates against children of temporary legal nonimmigrants. The A. children only allege that the Department erred in applying the residency requirement to them by treating their parents immigration status as wholly dispositive of the issue of the children s intent to remain indefinitely. The Court finds that qualifying citizen children of legal aliens should be eligible for PFD as long as they prove their intent to remain indefinitely using the statutorily required analysis as mentioned in part I supra. Therefore, a denial of PFD to K. and A. based solely on their parents immigration status cannot withstand even a minimum basis review. The Equal Protection clause demands that all persons similarly circumstanced should be treated alike. 38 The United States Supreme Court noted in the landmark case Yick Wo v. United States that [t]hough the law itself be fair on its face, and impartial in appearance... if it is applied and administered by public authority... so as practically to make unjust and illegal discriminations between persons in similar circumstances, the application of the statute violates the Equal Protection clause. 39 In overlooking the evidence which would establish an intent to remain, particularly overlooking the fact that K. and A. have provided evidence of their personal and physical ties to Alaska, the Department has denied benefits to children who meet the statutory residency requirements to receive a PFD. The Department appears to have denied these benefits solely on the immigration status of their parents, without proffering a legitimate rationale 37 Cosio, 858 P.2d at 628 (citing AS (a)(1)); Church v. State, Dep t of Revenue, 973 P.2d 1125, 1129 (Alaska 1999) (citing Brodigan v. State, Dep t of Revenue, 900 P.2d 728, 733 n.12 (Alaska 1995)). 38 Plyler v. Doe, 457 U.S. 202, 216 (1982) (citing F. S. Royster Guano Co. v. Virginia, 253 U.S. 412, 415 (1920)) (internal quotations omitted) U.S. 356, (1886). MEMORANDUM DECISION AND ORDER 12

13 for why it did not apply the guidelines set forth in 15 AAC in determining whether the children had intent to remain indefinitely in Alaska. There is no lawful reason to deny these benefits to K. and A. where the evidence weighs in favor of an intent to remain indefinitely and where the conduct of the parents suggest that it is their intent that the children remain indefinitely. The immigration status of a parent can certainly be considered in determining a minor s intent, but the exclusion of children based solely on their parents legal inability to establish that intent to remain is impermissible. 40 Requiring K. and A. to establish their indefinite intent to remain in Alaska in and of itself does not place an impermissible equal protection burden on them. All child applicants must establish their eligibility separate from their sponsors. 41 In this case, the children meet all statutory requirements and have demonstrated an intent to remain indefinitely. The court finds that the eligibility requirement is unconstitutional as applied by the Department to K. and A. because the Department relied solely on the parents immigration status to determine intent to remain indefinitely, without examining the personal and physical ties of K. and A. to Alaska as required by 15 AAC III. The PFD Residency Requirement and the Supremacy Clause When a state statute is challenged under the Supremacy Clause of the Constitution 42, the analysis begins with an assumption that the police powers of the state are not to be superseded by 40 Cosio, 858 P.2d at 628. In Cosio, the Supreme Court noted statutory expansions of the PFD program after doubts expressed in Williams v. Zobel, 619 P.2d 488, 458 (Alaska 1980), rev d, 457 U.S. 55 (1982), about the constitutionality of excluding children from the program. Id. The Court also noted legislative amendments to the statute which allowed certain classes of aliens to be eligible as long as lawfully admitted; these amendments were made out of concern that restrictions of all aliens would be found unconstitutional under the equal protection clause. Id. 41 AS (a) (stating residency requirements for PFD eligibility). 42 U.S. CONST. art VI ( This Constitution, and the laws of the United States which shall be made in pursuance thereof... shall be the supreme law of the land; and the judges in every state shall be bound thereby... ). MEMORANDUM DECISION AND ORDER 13

14 federal law unless that is the clear and manifest purpose of Congress. 43 Immigration regulation is an exclusively federal power, but not every state enactment impacting aliens is a regulation of immigration that would violate the Supremacy Clause. 44 The Supreme Court in DeCanas v. Bica 45 noted that there was no indication in either the wording or legislative history of the INA suggesting that Congress intended to preclude even harmonious state regulation touching on aliens in general. 46 In Andrade, the Supreme Court examined Alaska s PFD residency requirement in light of federal immigration law using the tests set forth by DeCanas and Toll v. Moreno 47. The Court found the residency requirement not pre-empted by federal law as it is not a regulation of immigration, but of eligibility for a state economic benefit. 48 The Court held that PFD eligibility and residency requirements did not stand as an obstacle to the accomplishment and execution of Congressional objectives in enacting the Immigration and Nationality Act, and the residency requirement can be construed in a manner that includes nonrestricted legal aliens in PFD eligibility. 49 A full analysis as undertaken in Andrade is not appropriate here. K. and A. do not challenge the residency or eligibility requirements generally, but only challenge the 43 Andrade, 23 P.3d at 75 (citing Ray v. Atlantic Richfield Co., 435 U.S. 151, 157 (1978)). 44 Andrade, 23 P.3d at U.S. 351 (1976). 46 Andrade, 23 P.3d at 75 (quoting DeCanas, 424 U.S. at 354) U.S. 1 (1982). 48 This issue was fully analyzed by the Supreme Court in Andrade, 23 P.3d at 76. The court found that: First, the statute is not a regulation of immigration. The state legislation in question is clearly limited to the administration of Alaska's unique economic benefit program... Second, there has been no ouster of state power to regulate PFD eligibility by Congress. The PFD is a purely local phenomenon... the nature of the subject matter is eligibility for a PFD. Congress has never unmistakably ordained that Alaska could not regulate its PFD program... [W]e conclude that the PFD eligibility statute does not stand as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress in regulating immigration because the statute can be construed in a manner that includes nonrestricted legal aliens in PFD eligibility. Id. 49 Id. MEMORANDUM DECISION AND ORDER 14

15 Department s use of their immigration status as determinative of their children s intent. Mr. A. has conceded that he and Ms. A. are not eligible for a PFD. The court finds Mr. and Ms. A. immigration status is only tangentially related to this case as part of the determination of whether their daughters have the intent to reside indefinitely. K. and A., and their sponsors, are United States citizens and meet the residency requirement held constitutional in Andrade. There is therefore no conflict with respect to federal immigration law under these facts. OPINION Although Mr. and Ms. A. are statutorily barred from intending to remain in Alaska indefinitely for purposes of PFD eligibility, the evidence demonstrates that in their stated intent to apply for visa renewals indefinitely, Mr. and Ms. A. do expect and intend that their children will reside in Alaska for the indefinite future. Mr. and Ms. A. immigration status is, by federal law, of a temporary intention, nature and duration and leaves them unable to create the intent to remain indefinitely and be eligible for PFD under current Alaska law for themselves alone. Mr. and Ms. A. clear intent for K. and A. is to remain in Alaska as a family indefinitely, to keep attempting to renew their visas, and to retain the family s employment and property in Alaska. To the extent that Mr. and Ms. A. intent is relevant to the determination of the children s intent, the evidence of their intent to apply for renewal of their visa applications, their employment and their domiciles must be factored along with the theoretical possibility that they will be required to leave Alaska under federal law. To the extent the Department relied solely on Mr. and Ms. A. immigration status to determine the children s intent to remain indefinitely, and failed to consider other factors relevant to the children s intent, the Department s MEMORANDUM DECISION AND ORDER 15

16 determination is incorrect. After reviewing all factors independently of the Department s decision, the court finds that K. and A. have met their burden of proving their intent to remain indefinitely in Alaska. The court finds that limiting consideration of a child s intent to remain in Alaska solely on the immigration status of their parents violates the equal protection clauses of the United States and Alaska constitutions. The court does not reach the issue implicating the Supremacy Clause of the United States Constitution. CONCLUSION The A. children have proven intent to remain indefinitely in Alaska for purposes of permanent fund dividend eligibility. The Department s determination that K. and A. did not show eligibility was based solely on their parents immigration status and overlooked other factors which should have been used to weigh the children s intent to remain. Because the court finds that the Department s factual conclusions were incorrect, and because the Department s application of regulations violated the equal protection rights of the children, the court reverses the Department s final decision denying PFDs to the A. children. DATED in Kenai, Alaska, this 22nd day of February, I certify that a copy of the foregoing was mailed/faxed/placed in box in the Clerk s Office to the following at their addresses of record: A.//AAG Kane Signed PETER G. ASHMAN Superior Court Judge pro tem Date:2/23/11 Clerk: [This document has been modified from a Superior Court decision to conform to technical standards for publication.] MEMORANDUM DECISION AND ORDER 16