Historic split of Alaska’s health department will become final within days unless Senate moves fast

Gov. Mike Dunleavy’s sweeping proposal to divide Alaska’s massive health department into two agencies via an executive order appears poised to go into effect this summer unless the Legislature makes a last-minute decision to meet in joint session by Saturday.

State Senate leaders say there are no plans for a joint session, despite pressure from House leaders to “disapprove” the split -- the only way the Legislature can take action.

Dunleavy in January issued Executive Order 21, a 100-plus-page document that divides the unwieldy Alaska Department of Health and Social Services into a Department of Health and a Department of Family and Community Services. The administration contends the Alaska Constitution allows the governor to make such a sweeping reorganization rather than proposing a bill that’s subject to legislative review and amendments.

Supporters say the “beast” of an agency, by far the state’s largest, needs division to streamline processes and align funding. Each department would have its own commissioner. The administration estimates it will actually cost nearly $2 million annually to enact the change, but future cost savings could offset the initial price tag.

Critics say the split needs more vetting than the executive order process offers. A mid-February analysis by the Legislature’s legal advisers found the order contained numerous errors, added ambiguity to statute, and may represent an overreach of executive power. Attorneys recommended legislation instead.

Executive orders cannot be amended by the Legislature. They’re either allowed to go into effect or disapproved, a historically rare action in Alaska. Of 120 executive orders proposed since statehood, only seven have been disapproved, according to a 2021 Legal Services memo.

Other agencies have been reorganized or created by executive order, including the Department of Corrections. But an order of this scale, which would enact and repeal more than 100 state statute sections, is unprecedented.

Dunleavy withdrew a similar proposal last session after it ran afoul of “technical issues” within a prior executive order. The order also drew concerns from some community and tribal organizations.

Two weeks ago, legislative leaders said it seemed unlikely they would meet in joint session on the governor’s new order.

But in a last-ditch effort to prompt movement, House leaders in a letter Friday urged their counterparts in the Senate to “take the actions necessary to disapprove” the executive order.

The proposal adds millions in spending for 13 new high-level positions without filling front-line vacancies and lacked meaningful outreach to stakeholders, the letter states. “(W)e implore all of our colleagues in the Senate to scrutinize the precedent and wisdom of approving an EO of this scope, substance, and level of known issues.”

The split automatically goes into effect July 1 unless the Legislature meets in joint session to disapprove it by midnight Saturday. Before that can happen, however, a House resolution to reject the action needs to be heard in the Senate Health & Social Services Committee.

Asked Tuesday if there was going to be a hearing, committee chair Sen. David Wilson, R-Wasilla, immediately answered, “No.”

The letter from House leaders doesn’t serve as an official request, Wilson said. And now it’s too late to schedule a hearing under a requirement that hearings on new legislation get five days of public notice, though a waiver process exists.

Wilson said he’s talked to people worried about diminished services at department divisions like the Office of Children’s Services or the Alaska Psychiatric Institute.

“They’re just fearful and I think that it’s understandable fear,” he said. “But I think that you have enough legislators that are looking at this that will hopefully pay close attention to see how the direct impact to the service providers or the patients or clients is going to transform over the next year. And we were told that the end user should not see a difference.”

Senate President Peter Micchiche on Friday said that there’s “not much interest in the Senate involving a joint hearing” given his conversations with members.

“I want to see the department split,” Micchiche said. “It seems that most senators feel the same way.”

A disappointed Rep. Tiffany Zulkosky, the Bethel Democrat who co-chairs the House Health & Social Services Committee, said Wednesday that the governor’s order adds millions in new spending without any evidence that reorganization will address the department’s chronic problems.

Allowing the governor to make such sweeping changes without legislative participation also sets a precedent for future governors and lawmakers in the absence of broad legal authority regarding the permissible scope of an executive order, Zulkosky said.

“Any place where the executive usurps the legislative process upsets the checks and balances and poses significant legal risks to future Legislatures,” she said. “Unfortunately, the magnitude of that right now cannot be known.”