The State Constitution establishes that pension benefits are a contractual obligation and the AKSC has held that earned benefits cannot be diminished.   That said, it is pretty well established that contracts can be reformed by courts or other entities where one party demonstrably cannot perform.   The State's problem would be that it could never really demonstrate that it cannot perform so long as the Permanent Fund exists.   I'm not foolish enough to think that the ever-altruistic citizenry would amend the Constitution to access the corpus to pay my retirement benefits, but the Dividend only has a statutory existence, so as long as the Permanent Fund is making any money, PERS/TRS retirees have first dibbs  on the earnings, all of the earnings, on it should it be necessary to pay retirement benefits, and I take comfort in the fact that the judge(s) deciding the case are in a State retirement system too.