OPINION: AIDEA propagates misinformation

The Alaska Industrial Development and Export Authority (AIDEA) is upset. Their displeasure is the analysis of AIDEA’s performance authored by economists Milt Barker, Ginny Fay and me. The agency claims we cherry-picked data to show a negative return on projects. They say our comparison of AIDEA’s performance alongside that of the Alaska Permanent Fund was unfair. “I don’t understand what their objective is other than to stop development,” said Alan Weitzner, who headed AIDEA when our report was published in October. The agency offered no specific examples of factual errors in our report.

Still, it’s no surprise that AIDEA doesn’t like our report. We found that Alaska would be $10 billion richer – or Alaskans could have received thousands more in dividends – if the state’s appropriations to AIDEA had gone instead to the Permanent Fund. We documented that since AIDEA’s inception, the majority of its 26 projects have either produced no new jobs, floundered or gone bankrupt.

But AIDEA’s biggest beef seems to be that they were blindsided. Weitzner claimed we never asked AIDEA for its perspective on our findings.

That is nonsense. Our team contacted AIDEA eight times asking the Authority to review our findings and requesting other information. After we finished our rate of return comparisons documenting AIDEA’s poor financial performance, I wrote AIDEA’s chief financial officer suggesting we meet to go over our calculations. She responded she was too busy to meet during the week I would be in Anchorage.

I wrote again, in November 2021, offering to make a special trip to Anchorage to meet with her. “If you or your staff would care to meet in the future for a review our AIDEA rate-of-return calculations, I or Milt Barker would be glad to schedule that at a mutually agreeable time.” I received no reply.

Was Weitzner dissembling? Perhaps, but more likely he didn’t know what was happening inside the agency he was supposedly managing. In the two years leading up to September 2022, 54 AIDEA and Alaska Energy Authority employees had resigned, been fired or otherwise left their jobs. That’s a tsunami of turnover for an outfit with only 82 permanent positions. Weitzner, who earned $217,885 in 2021, abruptly resigned a few weeks later.

AIDEA soon issued a news release headlined, “AIDEA Debunks Report and Announces Independent Economic Analysis.” Again, they didn’t include specifics. In a request for proposals, AIDEA said it would pay up to $250,000 for an “independent” analysis that would document “the Authority’s impressive economic and investment history … and highlight the Authority’s central role in facilitating, supporting, and advancing economic growth and diversification.” (Our analysis cost $30,000, supported by Salmon State, an Alaska environmental nonprofit; no taxpayer money was used.) AIDEA’s lucrative contract went to Northern Economics, Inc.

We also have a new study underway. Our plan is to analyze the agency’s effectiveness at creating Alaska jobs and compare that with jobs created by alternative uses of public money. We have written AIDEA to see if they and Northern Economics are interested in reviewing our data. Perhaps they will be more receptive this time around.

Gregg Erickson is an economic consultant with offices in Juneau and Bend, Oregon.

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