Lawmakers in Alaska are preparing for a challenging legislative session as they contend with limited revenue and a strained relationship with outgoing Governor Mike Dunleavy. With his final year in office approaching, legislators are expressing mixed expectations about their ability to pass significant reforms.
On May 20, 2025, during a Senate session at the Alaska State Capitol in Juneau, Senator Forrest Dunbar, a Democrat from Anchorage, emphasized the difficulties ahead. He noted that with oil prices dropping and existing budget constraints, the likelihood of implementing meaningful policy changes is slim. “With oil prices super low, any expectation for significant changes this year needs to be lowered,” Dunbar remarked.
Criticism has been directed at Dunleavy for not fostering political goodwill during his tenure. Rep. Andrew Gray, also from Anchorage, highlighted that lawmakers are primarily focused on preventing detrimental policies rather than expecting substantial legislative accomplishments. He stated, “The idea that we’re going to get any meaningful policies passed and signed by the current governor is extraordinarily slim.”
Despite these challenges, some lawmakers assert that waiting for a new governor to take the helm is not an option. Last year, bipartisan leaders prioritized increasing the education budget, ultimately overriding Dunleavy’s veto to secure funding. This shift demonstrated a growing impatience with the governor’s reluctance to collaborate.
Senate Majority Leader Cathy Giessel articulated that the gridlock often attributed to the legislative process is largely due to the governor’s office. “In terms of gridlock, the word can only be applied to the barricade that we meet when we send something to the governor’s office,” Giessel stated.
Dunleavy’s administration has faced scrutiny regarding his veto record. His spokesperson, Jeff Turner, defended the governor’s approach, claiming that Dunleavy has maintained ongoing communication with lawmakers. “The Governor has also worked with many legislators on passing a number of bills during his tenure and looks forward to working with legislators again this coming session,” Turner wrote.
Looking ahead, it remains unclear what specific goals lawmakers will pursue given the state’s tight financial situation. Both the governor and legislators recognize that more revenue is needed to meet Alaska’s obligations. However, disagreement persists on the sources of that revenue.
Members of the minority Republican caucus are cautiously optimistic about the potential for legislative achievements in Dunleavy’s final year. Rep. Justin Ruffridge, the minority whip from Soldotna, urged his colleagues to engage in discussions about advancing legislative policies, despite the financial constraints. “If we don’t talk about it every single year until we finally get something that we can all agree on, I think that would be a mistake,” he said.
As the session begins, Giessel plans to advocate for measures that could enhance state revenue. Dunleavy’s recent budget proposal suggests spending approximately $1.8 billion from the state’s $3 billion savings account, increasing the urgency for lawmakers to explore new revenue avenues.
One focal point of discussion will be the application of the state’s corporate income tax to businesses like Hilcorp, a Texas-based oil company currently exempt due to its corporate structure. Giessel views this change as a straightforward solution that could yield tens of millions annually for the state, though its advancement remains uncertain.
As legislators prepare to convene, one of their first tasks will be to consider overriding Dunleavy’s veto of a bill aimed at imposing corporate taxes on online businesses. Giessel expressed concern about the challenges they face in gathering the necessary support to achieve this goal. “Mustering the 45 votes needed to override the governor is a high bar,” she noted.
The upcoming session promises to be pivotal for Alaska, as lawmakers navigate their priorities amidst fiscal challenges and a changing political landscape. With both the legislature and the governor needing to align on revenue generation strategies, the effectiveness of this session may set the tone for the state’s governance in the years to come.
