Gov. Mike Dunleavy is casting doubt on the future of a bill that would move many public-sector workers back to a pension system.
The proposal passed the bipartisan-majority Senate in late January. If signed into law, many employees of state and local governments, including teachers, would have the option to switch from the existing defined-contribution retirement plan to a pension plan. Proponents pitch it as a way to improve hiring and retention.
In a news conference Wednesday, Dunleavy said he was skeptical that a pension plan would make a significant difference in recruiting young people.
“Full disclaimer, I’m a tier one retiree. I was a teacher,” Dunleavy told reporters, referring to his own pension. “But younger folks appear to be less interested in that.”
Supporters of the bill have said a pension system would help keep mid- and late-career police officers, teachers and other government workers in their jobs. But Dunleavy said he preferred another idea – a three-year pilot program to provide teachers with yearly bonuses of between $5,000 and $15,000.
Earlier this year, the House’s Republican-led majority rolled the Dunleavy proposal into a larger education reform package that is being negotiated between House and Senate leaders.
“I would say that this issue that we’re talking about, in terms of recruitment and retention, will have a much larger impact,” Dunleavy said.
Dunleavy also touted investments in the Department of Public Safety that he said were meant to help recruit and retain state troopers.
Dunleavy stopped short of issuing a veto threat on the pension plan, saying he had not seen the bill that passed the Senate on Jan. 31.
“But I’ll tell you this. We’ve got to also stop being a Make-A-Wish Foundation, meaning there’s a lot of great ideas, but if you don’t have the money to be able to do it, you’ve got to allocate your limited resources to the places you think are going to have the best outcome,” he said. “And that’ll be a decision I have to make.”
Senate leadership has said the bill would not substantially increase the cost of retirement benefits, but opponents are skeptical.
It’s unclear whether the pension bill will make it to Dunleavy’s desk. It’s been referred to three House committees, which have yet to schedule a hearing on the bill.
Eric Stone covers state government, tracking the Alaska Legislature, state policy and its impact on all Alaskans. Reach him at estone@alaskapublic.org and follow him on X at @eriwinsto. Read more about Eric here.
