Breaking: Kendall, Lindemuth, and AFN sue over Power Cost Equalization Fund transfer

Scott Kendall

The Alaska Federation of Natives, using Recall Dunleavy attorneys Scott Kendall and Jahna Lindemuth, have sued the Dunleavy Administration over the status of the Power Cost Equalization Fund, which provides financial relief to rural communities to help with high cost of power.

Kendall and Lindemuth worked for the administration of Gov. Bill Walker; Kendall was his chief of staff and Lindemuth was Attorney General. They have collaborated to oppose the Dunleavy Administration in court at several turns during the past three years after they were removed from office by voters. Kendall, who was Lisa Murkowski’s campaign manager and who generally attacks Republicans, is especially active in trying to get a recall of Dunleavy on the ballot, an effort that has apparently lost steam.

The lawsuit challenges the governor’s decision to transfer more than $1 billion in the Power Cost Equalization Endowment Fund, a fund located in the Alaska Energy Authority, to the Constitutional Budget Reserve. The lawyers say this sweep violates the Alaska Constitution and upsets the Legislature’s power of appropriation.

“I have authorized my administration to pursue an expedited judgement on the future of the Power Cost Equalization Endowment Fund,” said Gov. Mike Dunleavy. “This issue is too important to delay any further. A decision by the court will help clarify what is in the General Fund and what is not to determine what gets swept into the Constitutional Budget Reserve to repay it. In order for us to fulfill our constitutional duties, both the executive and legislative branches need to know if the PCE is subject to the sweep.”

Dunleavy has proposed protecting the Alaska Permanent Fund, the Permanent Fund Dividend, and Power Cost Equalization in the Alaska Constitution through his Constitutional Amendments, SJR 6 and HJR 7. The next opportunity for the legislature to meet is on Aug. 2, in a special session called by the governor.

This story will be updated. Check back.


  1. Where’s muh money? People don’t subsidize my heat. Nobody don’t pay my electric. I buy my own food, too.
    We do people no favors by creating dependence, except for those who use public money to buy votes from vulnerable groups. We as a society would be far better served to foster pride in independence (and sustainability).

    • Nah, they don’t care about any law – unless it directly benefits them or their political goals.

    • The reason they didn’t sue is because they work for Walker, or shall I say, they did until Walker lost the election. Since he is making noises about a return, and has some allied bloggers also chiming in with BS, namely Jeff Landfield and also the Midnight Sun, which really went overboard, I would say that the Recall Dunleavy campaign has started to propagandize to get Alaskans to vote the Recall in the affirmative. Landfield used an attention getting title to show how much per diem Big Mike took, without saying that the per diem for the regular sessions was automatically sent and that the gov had been on the low ball end of things for the extra sessions when requesting per diem. Meanwhile the Midnight Sun accused Dunleavy of a “back door veto” on the PCE and of course did not mention that Dunleavy wants it protected by the Constitution – one of the three submissions that he made to the legislature, which has to OK by 3/4 positive vote. So I would say that there be snakes in the grass trying to change the odds. I hope Alaskans are wise to this but I am not holding out much hope after so many people fell for the Russia BS from the DNC.

  2. At the direction of the disgraced and highly embarrassed former governor, Bill Walker. The Little Worm and Wormette finally have a client. Racism, of course, is the legal accelerant.
    No worries! These two stooges have the combined legal prowress of a first year, Affirmative Action law student.

    • The only problem is that Bill Walker is trying to stage a comeback, and already has said that he is “considering” running again. And with the bloggers joining in, who can say for sure what will happen. I hope Alaskans see this for what it is, but I am not holding my breath.

  3. The Democrat supreme Court will rubber stamp this lawsuit. Rule Of Law is finished in Alaska

    • By the way, who appointed the judges? Anyone? The so-called ruling on the recall was so broad as to let in the entire Pacific Ocean! Did the signers ever foresee this turn of events, or were they banking on honesty and integrity? So far, in what I have read in Alaska history and politics, it would appear that they forgot all about human nature.

      • For all intents and purposes, the Alaska Bar Association appoints judges. Non-Bar citizen involvement is merely a sham. The Governor gets to pick from the Bar Associations pals and the Legislature confirms them because they don’t want to cross them.

        • Art is right. ABA is loaded with Democrat women who pick LBGTQ friendly judges from the lower bench. Conservative judges get to go to Kotzebue, Teller and Nome until they are 70.

  4. The AFN and tribes fight and sue over resource development and oil exploration but then turn around and want the revenue from those resources to pay their heating bills. Can’t have it both ways and why is it Constitutional to pay Bush residents fuel bills when the rest of the Alaskans have to pay their own heating bills.

    If the State pays Bush heating bills it should pay equally every Alaskans heating bill. Bush residents collect mountains of cash and benefits from the Federal Government irregardless of all the money the State spends on Bush residents that the State doesn’t pay for non-Bush residents.
    Example property and school taxes are paid by non-Bush residents to operate the schools for their children, provide roads, law enforcement, and infrastructure. Bush residents pay nothing in property taxes or school taxes as the State pays for all operations, construction and salaries of the Bush system. It builds their schools and pays the salaries, operations and maintenance costs.

    Non- Bush residents must pay property taxes for salaries, operations and maintenance of schools and bond for construction of their schools. The State does pay a per pupil subsidy for all students both Bush and non-Bush but non-Bush subsidy in no way fully funds the schools. If you want equality and equity in Alaska the Bush residents have a long way to step up.

  5. At 500,000 barrels a day PCE is a subsidy too far! Crude is coming down TAPS slower than a bicyclist. We need to wake up. Everyone needs to go to work, even if they have to move to where the work is.

  6. I still haven’t figured out the genesis of the “sweep”. Is it the “no dedicated funds” clause? Or is it the enactment of the Budget Reserve Fund amendment in the State Constitution?
    Where’s Joe Geldhof when you need him?

    • The State has over the last couple of decades routinized violating the dedicated funds prohibition in the Constitution. At midnight each June 30, all appropriated but unexpended State funds lapse and return to the General Fund. That is very inconvenient for program managers who like to maintain slush funds of money that should have lapsed under their control. In my days with the Leg, the declaration of all-out nuclear war was a Legislative threat to sweep the “sub-funds of the General Fund,” the euphemism for the slush funds. They tried to make it prettier by coming up with a distinction between restricted and unrestricted General Funds, but the whole notion of “restricted” GF violates the Constitution.

      PCE is a per se un-constitutional dedicated fund, but like so many pretty legal fictions involving rural Alaska, it satisfied an important constituency. This is one where the Plaintiffs are banking on the AKSC playing politics; they won’t upset the PCE applecart by considering it as a dedicated fund.

      • Is there any part of the state that isn’t corrupt?

        Huey Long in Louisiana and Lucky Luciano would be appalled by the blatant illegality up here.

  7. At one time in Native History, Native peoples resented any kind of American government official entering their communities. Elders saw western technology and intelligence unproductive and not useful for Alaska terrain.

    George Atla the senior and Peter John — they had their thinking right continuing the dog sled team rather than the unreliable iron sno-go machine that if it gets stuck then you are stuck! Dogs were more reliable than metal.

    While chopping wood is more reliable than oil and gas, Oil and wick lanterns were more reliable than electric wires. The old permafrost was more reliable than the refrigerator. Even the sod dugout house and athabascan cabins proved warmer than plywood house today.

  8. Are Kendall and Lindemuth declared members of a political party? If they’re registered Republicans, isn’t it time to clean the party out like they’re finally seem to do with Murkowski? I ask from the outside. I’m not a member of any political party. But it seems like both major parties are fracturing badly, and both appear to be trying to appease all extremes.

  9. Shiela,
    Phoney Bill Walker will stage a comeback only after he can raise Byron Mallott from the dead, and make him his running mate again, with a full pardon for the former Lt. Governor’s child sex abuse. Only then, could Walker be viable. Otherwise, Bill Walker is nothing more than a stinky old man who chooses unwisely.

    • Very true. Walker also chose Kendall and Lindemuth……. both a couple of third-rate lawyers who couldn’t make the cut in Brena’s law firm. Walker himself is third-rate and only made the cut because he paid Brena for a partnership role. Government lawyers are some of the dumbest people on the payroll.

  10. Unfortunately too few Alaskans seem to know the history of the PCE program and assume that it’s an ongoing flat subsidy to rural residents. The PCE program was rural Alaska’s share of large state infrastructure investments in the four-damn pool (read up on it here: energy- alaska., Bradley Lake hydro-electric project, the northern intertie and other state spending in rail belt energy infrastructure not to mention the cook inlet tax credits- all of which were huge state investments that gave no benefit to energy costs or rate-payers in rural Alaska. Unlike the large state spends on energy infrastructure along the railbelt there is no single projects that can benefit rural rate-payers because they are spread out across an area twice the size of Texas. The legislative response to this challenge was the PCE program and eventually an endowment setup to provide an easily transportable asset (cash) that could reduce monthly electric costs for rural residents across the state. Just as large state investment in natural gas exploration tax credits and hydro-electric and transmission infrastructure reduces monthly costs for railbelt rate payers – the PCE endowment does this for rural Alaska and is a vital piece of state infrastructure. It has been working as designed and self-funding itself for over a decade, it doesn’t require any additional annual appropriation from the legislature, it just needs to be left alone.

  11. Thank you Dave Messier. Well written. As a manager of a small electric coop on rural Alaska and a recipient of the PCE program, I appreciate your commentary very much. The PCE program has worked very well especially after the endowment was formed. Leave it alone and let it do what it is intended to do!!

  12. The Law Office of Lindemuth and Kendall. The Alaska firm that inspires 500 new lawyer jokes per week. If they’re nice, maybe they can get some free pandemic cash…….or file early for unemployment.

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