Alaska Gov. Mike Dunleavy shakes hands with Rep. Andrew Gray, D-Anchorage, following the annual State of the State address on Tuesday, Jan. 28, 2025, in the Alaska Capitol. (Photo by James Brooks/Alaska Beacon)
Alaska Gov. Mike Dunleavy delivered an aspirational address to the Alaska Legislature late Tuesday, celebrating the state’s growth. But his comments also foreshadowed a conflict with state lawmakers over public education.
It was the governor’s seventh annual State of the State address to the Legislature, and lawmakers gave the governor mixed reviews, saying that he offered an optimistic view of the state but failed to address some of Alaska’s challenges, including a looming fisheries crisis.
On Tuesday night, the governor said he intends to introduce “a comprehensive education bill” and alluded to his desire for greater access to charter schools.
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The majorities in the state House and Senate are taking a different approach on education by splitting policy questions from a funding bill that rewrites the state’s per-student funding formula for public schools.
“There’s no doubt we’re going to have our differences over the next few months, but I believe we’re going to find more areas where we agree than we don’t,” the governor said.
Hours before the speech, the governor’s office sent messages to select Alaskans, urging them to testify against the House majority’s preferred education funding bill during a Wednesday hearing.
“It’s a contradiction, right?” said Speaker of the House Bryce Edgmon, I-Dillingham, after the speech.
“I hope going forward, we can work with Commissioner (Deena) Bishop of the Department of Education, as well as the governor, in terms of finding some middle ground. Otherwise, we’re in for a long and protracted session,” he said.
Edgmon and Senate President Gary Stevens, R-Kodiak, sat behind Dunleavy during his speech. Both men represent coastal districts and said they were disappointed that the governor didn’t address the state’s fisheries crisis, which is affecting a major part of the state’s economy. The governor’s own task force on the issue is scheduled to present its recommendations to the Legislature soon.
“He did mention agriculture, which is important, but nowhere near the size of the fishing industry,” Stevens said.
Despite that disappointment, Stevens said he considered Tuesday’s remarks to be a “good speech.”
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Dunleavy noted declines in state crime rates and said his administration intends to intensify drug interdiction efforts.
The governor highlighted positive economic news for the state, including the fact that Alaska gained more than 6,000 new jobs last year, finally erasing losses that occurred during the COVID-19 pandemic emergency. Alaska was the last state in the country to erase its pandemic-era job losses.
“Decline is a choice, and I reject that choice,” the governor said, referring to investments by oil companies on the North Slope.
He mentioned new oil and gas development on the North Slope, positive investment returns and the potential for the Trump administration to authorize even more resource development.
“I couldn’t be more excited about the next four years under the most pro-Alaska president we’ve ever had in President Donald J. Trump,” Dunleavy said.
Sen. Bill Wielechowski, D-Anchorage, observed afterward that new oil developments will take years to generate new revenue for the state treasury, and in the meantime, they will actually reduce state revenue as companies write off their operating expenses against their oil production taxes.
“There really is a tale of two economies going on in this state. From the governor, you heard there’s all this new oil production and all this new work that’s being done. What we’re seeing, though, is the state is not benefiting from that production,” he said.
The governor said the state is advancing work on a long-planned trans-Alaska natural gas pipeline, but he appeared to acknowledge that Southcentral Alaska will inevitably need to import natural gas to alleviate a pending shortage.
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“We’ll address the short-term shortage of natural gas for Southcentral, and we recognize that some of those solutions may be painful and certainly won’t be popular, but they will be temporary,” he said.
Senate Minority Leader Mike Shower, R-Wasilla, said he took the governor’s comments as an acknowledgement that gas imports will be necessary.
“Nobody really wants to do that when we know we have so much natural gas in Alaska. But the reality is, we don’t have the ability to get that gas to the market yet, so until we can, we’re going to have to import it, and that will be painful for us as a state,” he said.
Shower said that overall, he considered the governor’s remarks to be hopeful — that increased resource development will improve the state’s circumstances.
House Minority Leader Mia Costello, R-Anchorage, said she thought the speech was optimistic.
“The governor even admitted, he’s an optimist, which is maybe why he didn’t bring up some of the issues with fisheries, but I think that it was largely an optimistic speech,” she said.
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