Permanent Fund bosses vote to defy Alaska Legislature, keep Anchorage office

The Juneau offices of the Alaska Permanent Fund Corp. are seen Monday, June 6, 2022, in Juneau, Alaska. (Photo by James Brooks/Alaska Beacon)

The Alaska Permanent Fund Corp. will keep its Anchorage office, ignoring state lawmakers’ instructions to shut it down.

The corporation’s Board of Trustees voted 4-2 on Thursday to continue operating the office, though board members acknowledged that the decision is likely to intensify legislative dissatisfaction with the corporation.

The corporation, which manages Alaska’s $80 billion trust fund, opened an Anchorage office last year, in space already leased by other state agencies. 

State legislators criticized the action, in part because the corporation’s board of trustees took action without requesting legislative permission. 

“That should have gone through the standard budget process,” said Rep. DeLena Johnson, R-Palmer and co-chair of the House Finance Committee. Johnson was in charge of the subcommittee for the Permanent Fund Corp.’s budget.

In this year’s state budget, lawmakers inserted a clause stating, “It is the intent of the legislature that the Alaska Permanent Fund Corporation will not establish or maintain new office locations without corresponding budget increments for that purpose.”

So-called “intent” language is not legally binding, but it signaled legislative dissatisfaction with the corporation’s action.

“The matter wasn’t about that particular issue — I’m not particularly concerned about the Permanent Fund Corp.’s operations — as much as making sure the Legislature maintains the power of appropriation,” Johnson said. 

Lawmakers also restructured the corporation’s budget to specifically limit funding for the Anchorage office. They created a line item specifically for that office and gave it $100, less than a pittance in a document that’s typically measured by the millions.

“Ignoring the clear legislative appropriation power is a terrible precedent and probably a mistake,” said Sen. Jesse Kiehl, D-Juneau and an opponent of the Anchorage office. “It’s an inefficient way to spend Alaskans’ money. That’s why the Legislature didn’t give any money to do it.”

That budgetary language isn’t final — Gov. Mike Dunleavy still must sign the budget and could use his line-item veto authority — but trustees didn’t wait for the governor’s input.

After debating behind closed doors, the six-member board exited an executive session for the 4-2 vote to approve the corporation’s budget and direct the executive director to keep the office open.

Trustee Adam Crum, also commissioner of the Alaska Department of Revenue, said he believes it is “very clearly” in the executive branch’s authority to move money around within budget line items to keep the Anchorage office going.

That’s worth doing, he said, because the corporation has been able to fill vacant positions with people who were willing to work in Anchorage but not in the corporation’s Juneau headquarters.

“Recruitment and retention right now in Alaska is such an important issue, and providing tools to the corporation — any tools that they can have to give them that upper hand to compete … is really important,” said Trustee Ryan Anderson, commissioner of the Department of Transportation and Public Facilities.

Trustee Jason Brune, formerly commissioner of the Alaska Department of Environmental Conservation and now sitting in a public seat on the board, was the board member who suggested keeping the office open.

“It sends a message to the staff that are there that we don’t want them being a yo-yo from one location to another,” Brune said. “I think that we need to send a message that we support what we did and are going to continue to stand by them as well.”

Trustee Gabrielle Rubenstein provided the fourth vote in favor of the action, while trustees Ethan Schutt and Craig Richards voted against it.

“I think it’s a mistake,” Richards said. “We have strong feelings among the trustees. I don’t personally agree that the Legislature should have shut the Anchorage office down. It’s been good for the organization, clearly, deservedly. But on the other hand, I think that we should be rising above this and not getting into a fight.”

Correction: The day of the vote has been corrected from the initial version of this article.

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