No governor should have the power to interfere with the Permanent Fund

By Bill Walker
Fairbanks Daily News-Miner, June 18, 2022

For generations, the primary responsibility of Alaska policymakers has been acting as managers of the vast oil and gas reserves across our state, working to ensure that our resources are developed on our terms.

Oil will remain a significant part of the fabric of our state for the foreseeable future, but a primary role for our leaders to play in the years ahead is that of money manager.

We are fortunate to benefit from the wise actions of the great Alaskans who founded the Permanent Fund in preparation for a future decline of state revenue generated from nonrenewable resources. Without their foresight, we would have no way to consistently pay for teachers, troopers, transportation, and every other essential service the state provides.

There is broad recognition that we are transitioning from relying on our oil wealth to pay the bills to relying on the sustainable management of the Permanent Fund. The fund will be a unique and renewable resource as long as we insist that we only draw on the endowment in a structured manner and continue to make prudent investments without political interference.

This is not a given, especially because the existing selection process for trustees of the Alaska Permanent Fund Corporation is clearly broken. Political pressures are seeping into hiring and firing decisions — and the overall management of the fund.

The Alaska Permanent Fund has been without an executive director for the past six months since the firing of the previous CEO, a widely respected professional who grew the fund by $32 billion. The fund has lost over $3 billion dollars since her firing, and it does not appear that the trustees have even begun the process of finding a replacement. During these uncertain financial times, we must have the confidence that the Alaska Permanent Fund is being professionally managed without political influence.

During my first term as governor, I worked within the existing process when I appointed trustees. But I agree with Rep. Andy Josephson and Sen. Natasha von Imhof that the appointment process needs to be reformed. During my next term, I will introduce a proposal to model the selection of trustees after the Alaska Judicial Council, which is the institution that protects our judiciary from the political process and makes sure that every judge is independent and eminently qualified.

This reform will make it so that I, as governor, have less ability to influence hiring and management decisions made by the Permanent Fund. That’s precisely the point: We need to get politics out of the way and let our professional money managers do their job.