The Democrat majority in the Alaska House passed House Bill 78 on Monday, repackaging a defined benefit pension system that was shut down in 2006 after it left the State of Alaska with billions in unfunded liabilities — liabilities still in the billion in 2025.
Despite repeated warnings from independent fiscal analysts and economists, the bill pushes forward a financially risky restructuring of Alaska’s public employee retirement system.
HB 78 allows current employees in the defined contribution system to opt into the older defined benefit tier, effectively recommitting the state to decades of guaranteed payments without certainty that future funds will be available to cover them.
The Reason Foundation, an independent public policy think tank, projects the bill could create as much as $11.4 billion in additional liabilities. That projection is based on investment return assumptions of 7.25%, a figure that exceeds the average returns Alaska’s pension funds have actually achieved since 2001, which sit at just 5.8%. If those elevated return expectations aren’t met, the gap would likely fall on state taxpayers because the Alaska Constitution considers this a nonnegotiable obligation.
Supporters of HB 78 struggled to offer clear evidence that the measure will deliver the recruitment and retention improvements it promises. Alaska already maintains a lower turnover rate for public employees compared to other states with defined benefit systems, including Texas and Utah. A 2021 survey commissioned by the state found that public employees ranked retirement benefits well below other factors like pay, workload, and student behavior.
HB 78, pushed by Rep. Chuck Kopp, a Republican who caucuses with Democrats, ignores both historical context and fiscal responsibility. The 2006 pension reform was enacted precisely to stop the unchecked growth of long-term liabilities that threatened the state’s financial foundation. By reintroducing a similar system now, opponents say, the legislature is risking a repeat of that crisis.
Despite efforts from House Republicans to raise these issues and propose safeguards, the Democrat Majority advanced the bill. The legislation now heads to the Senate, where its financial implications are expected to face further scrutiny, but where the Democrats — and their union handlers — are solidly in charge.
God help us. No one can do math up there. ( as evidenced by our school reports) And they’re sure more money will help. But where will the money come from? Will they support a gas line or more oil or heaven forbid some roads to resources like mines and timber? I’m betting not. Any of our children that want to stay in Alaska are hosed.
They do “political math” which is founded upon the following precepts eloquently outlined by the eminent economist Thomas Sowell: “The first lesson of economics is scarcity: There is never enough of anything to satisfy all those who want it. The first lesson of politics is to disregard the first lesson of economics.”
Mine went south long ago. Saw no long term future here.
It is all about power and control, then add the collective common sense of our legislature is extremely low, along with their financial understanding. A bad combination. Indeed, God help us.
Yes they can. They see green.
I’ve place a private bet that Rep. Bynum a so called Republican, will vote with the Democrats. In my opinion we have a Ortiz 02 in this, becoming apparent, RINO. The tragic part of this statement is my having supported his candidacy. Never again. Cheers, Johnson-Ketchikan
You lost that bet, Bynum voted against the bill. He’s smart enough to know this bill won’t do what Democrats think. Kopp is too out of touch to understand the first thing about young workers, and the State can’t afford his soft landing for every state and muni emoyee.
As I recall, the issues with the pension plan were the result of Mercer skullduggery and Alaska’s refusal to fund its retirement obligations at the insistence of its majority party for years 😉
And, if the “unions” had the power you regularly claim people would not have lost the right to a pension, and Dunleavy would never have been elected
Sssshh!! You’re making too much sense here
Thank you, Captain Hindisght
So, question for Mr. Kopp:
.
Why is it that you don’t want Everyman and Everywoman Alaskan to have a full statutory PFD, but you have no problem using an outdated pension gimmick to get more money into the hands of government workers, all at a huge cost to the state’s treasuries? Aren’t you the man who claims the state is near broke and that’s why you don’t want a full PFD payout? If you are so against a full PFD, ewhy are you so willing to risk huge benefits only to government workers?
When election time nears the next cycle, we will remember and go after you with a vengeance. Enjoy your abbreviated stay in the Legislature ……again.
The answer to your question is clear but Kopp will never admit his intentions.
Voting to use the PFD to fill the pockets of union government workers will certainly guarantee his re-election and he will remain in power which in turn will fill his pockets like most politicians who cater to the union mafia.
If he supports every Alaskan receiving their share of the PFD he certainly wont garner the votes he thinks he “deserves”.
Andy,
Kopp “deserves” to be kicked out on his arse. He got it good a few years ago. He’ll get it again. Maybe he’s too ignorant and arrogant to understand that. We are coming after him…….union mafia or not.
Agree with Andy’s assessment of evil Kopp’s intentions. But dividing the electorate up by paying the haves with the have not’s money only works on the short end. History proves that the have nots, when taken to the limits, will resort to old methods like the guillotine. These punk*ss legislators who are so quick to let the union bosses control their destiny will be the first in line.
Bedfellowing the crap right up over our heads. Not serving honorably, as elected, should and will have easily justifiable consequences. How hard could it be to do the right thing?
The Soviet Alaska Union
Just like what WDC is doing to the US… JNU is plunging the state into a black hole of debt it can never escape from… Then one day the mineral rights are being signed away in a fire sale… And poof it’s all gone… ***
Suzanne, can we please get the names of the Republicans that voted for this?
Kopp.
Yundt?
Who else?
Here’s the simple solution: make public the names and addresses of only those voters who voted for these democrats and those RINOs who favor this stupid HB 78 Bill.
Those publicly named voters then get an Annual Personal Stupid Tax of $50,000 per year.
Nonpayment requires fixed jail time.
The funds collected will not solve the guaranteed financial short fall BUT it will correct the voter rolls in one or two elections for certain.
This is nothing more or less than paying off the two most important voting blocks.
Unions and unionized state workers.
If this insanity does become reality, the law of unintended consequences (and the intended ones) will kick in hard and fast.
People will leave.
Income taxes are inevitable.
PFD is toast, eventually along with the corpus of the whole fund.
Stagnation.
And eventual insolvency.
Alaska is literally selling its soul here.
If a government worker leaves before, say 10 years or less, their benefit is very small if they have one at all. Right now, we fund a 5 years and out system so we’re constantly recruiting and training. This churn requires large HR departments to process it all with employees that are mostly new.
Boo Hoo.
Wonder how the private sector does it?
Parasite much?
We need constitutionally protected benefits for rest of Alaskans.
Currently government pensions and benefits eat all the oil money ever since that lawyer Walker figured out how to steal PDF and got himself judge to seal the theft in.
And to make sure rest of us is nothing but slaves Juneau is attempting to intentionally create debt so massive it can’t ever be paid of.
For me as a peace officer, I can retire at 51 with 25 years of service, instead of 59 1/2 under Tier IV. Which is good because if I retired at 60, statistically for my line of work I’d have 3-5 years of retirement before dying.
Usually, legislative protections wind up putting the State in the negative. While keeping the retirees well paid.
Apparently, I can opt out of the pension, which I will most certainly do since members of the pension that was canned in 2006 had to pay 25-30% into it. Who can afford to contribute that much? Not me.
I’ll be retiring without this stupidity.
Good! Tier IV is a joke and the proposed Tier V is not as good as Tier III, but is much better.
I can’t wait until the baby boomers that get a pension but don’t want the younger generations to get one go to the nursing home and sit and wait to get their butts wiped because there are too many of them and not enough of the younger generations to take care of them. Oh it’s coming you selfish jerks. FAFO….
Amazing that with the governor alerting Alaskans to the downward expectations of State income due to lower oil prices that those beholden to the unions would still do this. Look at California’s debt at 48 billion plus and ask why the democrats and their Rino buddies want to go in the same direction. A classic case of killing the golden goose because of greed.
Can anyone show me a city or state where a pension system did not result in near bankruptcy, massive increases in debt and taxes, and overall a lower standard of living?
.
Come on leftists, step up here. Show us all where it has worked. Take your time, i will wait.
It’s all President Trump’s fault…. duh.