New Alaska salary commission unanimously recommends 67% pay raise for lawmakers

The state salary commission on Wednesday recommended a 67% pay raise for legislators — alongside a significant pay boost for the governor and his cabinet — shortly after all five members were replaced by the governor.

Under the plan approved unanimously by the new commissioners, legislators’ salaries would increase from $50,400 to $84,000 per year, matching half of the new salaries proposed for the heads of state agencies. That would be the first pay raise for legislators since 2010.

The Alaska State Officers Compensation Commission is charged with making salary recommendations for the governor, senior executive branch officials and legislators. Earlier this month, the Legislature voted unanimously to reject the commission’s previous plan to significantly increase the salaries of the governor, lieutenant governor and department heads, without increasing the compensation of lawmakers. Legislators at the time questioned the viability of relying on the commission to calculate salaries moving forward.

Two of the five former members of the commission resigned days after the Legislature rejected the commission’s recommendations. The other three were abruptly removed from their positions by Gov. Mike Dunleavy earlier this week.

Five new commissioners were appointed, and a meeting was swiftly scheduled for Wednesday afternoon. During that meeting, the new commissioners waived a rule that requires them to notice meetings 20 days before they are held, allowing them to amend the previous commissioners’ recommendations immediately.

The new compensation package for legislators would not impact their per diem expense payments, which allow them to collect $307 tax free per legislative day. Per diem payments would add roughly $37,000 per year for legislators who claim then during an entire 121-day legislative session.

The pay increase has long been called for by lawmakers who say they struggle to maintain homes in both Juneau and their home districts, and who say the limited wages make the Legislature less diverse.

The recommended pay raises for lawmakers pave the way for the Legislature to also approve hefty pay increases for the governor and members of his cabinet.

Former Republican Rep. Kurt Olson, who had been the commission’s chair, submitted his resignation Monday. One commissioner, Lee Cruise, who was appointed by the governor, resigned by email last week after taking a job with the Dunleavy administration. The remaining three commissioners were removed from their positions by Tuesday afternoon.

The new commissioners announced during Wednesday’s 15-minute meeting included newly-elected chair Donald Handeland, an engineer and active member of the Republican Party; Miles Baker, who until earlier this year worked in Dunleavy’s office; Duff Mitchell, managing director at Juneau Hydropower Inc.; Larry LeDoux, a former state education commissioner; and Jomo Stewart, president of the Fairbanks Economic Development Corp.

Handeland, Baker and Mitchell were picked by Dunleavy. LeDoux’s name was put forward by Senate President Gary Stevens, R-Kodiak. Stewart’s name was put forward by House Speaker Cathy Tilton, R-Wasilla.

While the decision to recommend lawmaker pay boosts passed unanimously, both LeDoux and Stewart said they were taken by surprise when Mitchell made the motion to increase legislator salaries to $84,000.

“I’m not 100% comfortable with the process that’s been expedited,” Stewart said during the commission meeting, after Baker and Handeland defended Mitchell’s motion.

Handeland said in an interview that he had been told to expect the motion for an $84,000 legislator salary during a meeting earlier Wednesday with Kate Sheehan, director of the personnel and labor relations division in the Department of Administration, and a member of the Department of Law. But Handeland said he had not communicated with other commission members about the motion before the commission met.

Stevens and Tilton said there was no deal struck between the governor and legislators to ensure pay raises for both, but that Dunleavy acknowledged the need for pay raises across the board.

“He said, ‘I’m gonna do something about that.’ And he did. But I had nothing to do with what happened,” Stevens said.

Members removed ‘in the spirit of cooperation’

House Minority Leader Calvin Schrage, an Anchorage independent, said he had concerns about the process used by the commission, and questioned how independent it is. But he was generally supportive of the salary increases.

“If you want commissioners that are talented and you want legislators that look like the people of Alaska, you need to increase salaries for both, and this current proposal does that,” he said.

The Senate has drafted a bill with the same $84,000-salary proposal for lawmakers, Stevens said, but the legislation had not been introduced. Stevens said before Wednesday’s vote that if the commission had done nothing for legislators’ pay, that bill could go before the Legislature.

In response to questions, Dunleavy spokesperson Jeff Turner said by email “it was clear that legislative leadership was not satisfied with the work being done by the Alaska State Officers Compensation Commission. In response to that, and in the spirit of cooperation, Governor Dunleavy removed the three commission members to allow new members to be appointed.”

“The decision to amend the previous salary report was made by members of the commission. You will have to ask them about their decision,” Turner added.

Mitchell, who made the motion to amend the commission’s recommendation, said the idea of pegging legislator salaries to half the compensation of department heads had come from the Legislature. But he insisted he had not spoken to any lawmakers before making his proposal.

“I think I picked it up, there was some discussion, or read something where, I don’t know who it was, I don’t know where I picked it up, but they were talking about some kind of benchmark to the commissioners,” said Mitchell in an interview. He later added that he may have spoken about the idea when he was interviewed by a member of the governor’s office for the commission position. “I don’t know how that came up or whatever. So I may have shared it.”

Jordan Shilling is director of boards and commissions for Dunleavy, and several commission members said they communicated with Shilling before joining the commission. Shilling did not respond to a request for comment on his communications with commission members.

The commission members who were not picked by Dunleavy said they were blindsided by the process, but still supported the pay increases.

“I normally wouldn’t make a decision like this on a rushed basis,” Stewart said in an interview after the commission meeting, adding that he was “taken aback at how rapidly that was going to happen.”

LeDoux said after the meeting that he supports the salary recommendation, but “it’s always good to give lots of notice to the public.”

“I don’t know the circumstance of why it was expedited, but I suspect there are deadlines involved with the Legislature,” LeDoux said.

Asked why he chose to hold a vote Wednesday rather than waiting to make recommendations at a later date, Handeland, the commission chair, took a long pause.

“I don’t know if there was urgency in that,” he said.

Unless lawmakers reject the new recommendations, including their pay raises — an unlikely scenario — the increases will take effect July 1 for the governor and commissioners, and in January 2024 for lawmakers.

‘Rotten with politics’

Alaska’s independent commission was established in 2008 in part so lawmakers would not need to vote to increase their own salaries. Under state law, the commission’s recommendations are released as a final report to the Legislature. The report becomes effective 60 days after it is introduced, unless lawmakers pass a bill to explicitly reject it.

The commission’s replacement came after lawmakers rejected its recommendations two years in a row. In 2022, they rejected a plan that would have marginally increased legislator base pay but substantially cut per-diem allowances, translating to a proposed pay cut for most lawmakers.

Stevens said after last month’s Senate vote to reject the commission’s pay raises for the executive branch that the commission had failed in its duty to meaningfully debate salaries for legislators. After the House disapproval vote, Tilton said she wished the commission’s recommendations were more “balanced.” Sen. Bert Stedman, R-Sitka, said that the commission was “rotten with politics.”

“I think we just need to give up on that commission,” Stevens said last month. “They have never done their job or looked at things seriously.”

In an email sent Monday to staff at the Department of Administration, former commission chair Olson said he had “mixed feelings” about stepping down. Olson cited the votes this year and in 2022 by the Legislature to reject the commission’s recommendations in his email. He said “several members” of Senate leadership had worked to block the proposed pay bump for the executive branch.

Olson did not respond to a request for comment on his departure from the commission, nor did Cruise, the other member of the commission who left voluntarily.

Cruise was hired as a policy analyst in the commissioner’s office at the Department of Revenue. As a state employee, he is now ineligible to serve on the commission that recommends salary adjustments for the governor and the heads of state agencies.

Cruise, who had been appointed to the commission by Dunleavy, was the field director for Dunleavy’s re-election campaign in 2022.

Three other commissioners were told by the governor’s office Tuesday afternoon that their services were no longer required.

“I’m glad to not be part of the news story anymore, even though I think legislators deserve a raise,” said one of the removed commissioners, Larry Persily, a journalist and former deputy commissioner of the Alaska Department of Revenue. He had described recent meetings about legislators’ pay as “unproductive” and “contentious” and not coming close to an agreement.

Another commissioner, Carrigan Grigsby, vice president of Avis Alaska, declined to comment about being abruptly removed from his position.

“I was happy to be of service and wish the new commissioners best of luck going forward,” he said by text message.

A fifth commissioner, Aryne Randall was also removed from her position Tuesday. Randall was appointed by Dunleavy in 2022 and is the chief operations officer of C.E.F. Properties, a Wasilla-based commercial real estate development company. She did not respond to a request for comment.

Persily’s term was set to end 2025. Grigsby’s and Randall’s were set to end in 2024. All three were told by email that they serve at the pleasure of the governor and received an emailed letter signed by Dunleavy, thanking them for volunteering on the commission.

‘A huge disservice’

Proponents of a pay increase for lawmakers have said that increasing lawmakers’ compensation would boost the diversity of the Legislature by make it more financially viable for young parents to run for office.

According to data gathered by the National Conference of State Legislatures, at least 30 states offer lawmakers lower base pay than Alaska’s, including several states that offer no base pay at all and guarantee only per-diem payments when lawmakers are in session.

Stevens said that it can be particularly difficult, financially, for lawmakers with young families to serve in Juneau and maintain another home in their districts.

Heidi Drygas, executive director of the Alaska State Employees Association, a union representing about 8,000 state employees, said Wednesday she supports a pay increase both for the governor and for lawmakers.

“We are doing our state a huge disservice by not properly compensating these public servants shaping policy for our entire state. We want and deserve the best of the best. Not just folks who are independently wealthy, retired, or left to struggle in order to serve,” Drygas wrote in a social media post.

Samuels reported from Anchorage. Maguire reported from Juneau.