Dunleavy executive order creating an energy board is likely unconstitutional, legislative lawyer says

JUNEAU — Alaska Gov. Mike Dunleavy’s executive order to establish a dedicated board of directors for a public corporation tasked with reducing energy costs is likely unconstitutional, according to the Legislature’s attorneys.

Executive Order 128 would create a separate board to oversee the Alaska Energy Authority, which manages a billion-dollar fund that reduces rural Alaska residents’ power bills — among other programs. The executive order is one of 12 Dunleavy introduced earlier in the legislative session that lawmakers began hearing this week.

Currently, the Alaska Energy Authority shares a board of directors with the Alaska Industrial Development and Export Authority, or AIDEA, a state-owned investment bank. Curtis Thayer, executive director of the Alaska Energy Authority, on Thursday said the corporation needs its own board with industry experts working on a fundamentally different mission to an investment bank.

“We have one volunteer board, overseeing two multibillion-dollar corporations. And that’s just a lot,” Thayer said to lawmakers Thursday.

The corporation’s capital budget has increased tenfold in the past four years with an influx of federal infrastructure funds, he said. Now, a focus for the corporation is a $400 million planned project to upgrade the Railbelt’s electrical grid.

The Legislature’s attorneys said in a memorandum last week that the state constitution grants the governor the authority to reorganize the executive branch. But an Alaska Energy Authority board does not exist in state law, meaning establishing one could be problematic.

“This is an unconstitutional encroachment on the Legislature’s lawmaking authority and exceeds the governor’s limited power to amend statutes as necessary to reorganize the executive branch,” said Emily Nauman, a legislative lawyer.

[Gov. Mike Dunleavy proposes biggest use of executive power in decades, drawing some skepticism]

Parker Patterson, a deputy attorney general at the state Department of Law, disagreed. He told legislators on Thursday that previous governors had issued similar executive orders to establish new boards.

“That is an entirely appropriate exercise of the governor’s authority,” Patterson said.

Before 1993, the Alaska Energy Authority had its own board of directors. Lawmakers passed a bill that year to consolidate the corporation’s board with the one overseeing AIDEA.

Lawmakers across the political spectrum have generally been supportive of Dunleavy’s plan to establish an Alaska Energy Authority board to manage a growing workload. But they have said legislation was likely the better route.

“I don’t know if there’s many people who disagree with the idea of splitting it,” said Sen. Scott Kawasaki, a Fairbanks Democrat. “I think it’s just how the governor has done it.”

The governor’s 12 current executive orders would become law if not disapproved in a joint session by mid-March. Lawmakers would need 31 “no” votes to block one or all of the governor’s executive orders.

The governor’s office on Thursday did not reply to a request for comment on why the executive order to establish a dedicated AEA board was not proposed as legislation.