An Anchorage Superior Court judge today ruled against Gov. Mike Dunleavy, saying that the Power Cost Equalization Fund is a special fund that cannot be treated as other sub-funds, which are swept at the end of the fiscal year.
The importance of the ruling can’t be overstated. The Alaska Constitution prohibits special funds, unless they are added to the constitution as such. But Garton is taking a strictly literal view of the Power Cost Equalization Fund, separating it off as a special fund that cannot be touched.
“Because the Plaintiffs have demonstrated that they are entitled to a judgment as a matter of law, and because the Defendants have not shown that they are entitled to a judgment as a matter of law, the court GRANTS Plaintiffs’ motion for summary judgment and DENIES Defendants’ Cross-Motion for Summary Judgment. The Department is PERMANENTLY ENJOINED from sweeping the PCE Endowment Fund into the CBR (Constiuttional Budget Reserve) pursuant to article iX, section 17(d) of the Alaska Constitution,” Judge Josie Garton wrote.
She concluded that “the term ‘general fund’ does not include a separate fund of a public corporation. Accordingly, it does not include the PCE Endowment Fund.”
The lawsuit was brought by Recall Dunleavy attorneys Jahna Lindemuth and Scott Kendall on behalf of several village entities and the Alaska Federation of Natives.
Although the state may appeal the ruling, for now rural power companies may draw subsidies from the fund to help lower the cost of electricity in communities outside of the Railbelt.
The Power Cost Equalization Fund is an endowment-type fund set up in the 1980s at a time when communities on the road system were getting hydropower projects to help lower their costs, but rural areas were not able to tap into those projects.
