Legislature(2025 - 2026)ADAMS 519
01/28/2026 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Fy 27 Governor's Budget Overview: Department of Labor and Workforce Development | |
| Presentation: Statewide 2026 Jobs Forecast and Unemployment Financing Metrics by the Department of Labor and Workforce Development | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
January 28, 2026
1:32 p.m.
1:32:27 PM
CALL TO ORDER
Co-Chair Josephson called the House Finance Committee
meeting to order at 1:32 p.m.
MEMBERS PRESENT
Representative Neal Foster, Co-Chair
Representative Andy Josephson, Co-Chair
Representative Calvin Schrage, Co-Chair
Representative Jamie Allard
Representative Jeremy Bynum
Representative Alyse Galvin
Representative Sara Hannan
Representative Elexie Moore
Representative Will Stapp
Representative Frank Tomaszewski
MEMBERS ABSENT
Representative Nellie Unangiq Jimmie
ALSO PRESENT
Cathy Munoz, Commissioner, Department of Labor and
Workforce Development; Dan DeBartolo, Administrative
Service Director, Department of Labor and Workforce
Development; Karinne Wiebold, Economist, Department of
Labor and Workforce Development; Lennon Weller, Economist
and Actuary, Department of Labor and Workforce Development.
SUMMARY
FY 27 GOVERNOR'S BUDGET OVERVIEW: DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT
PRESENTATION: STATEWIDE 2026 JOBS FORECAST and UNEMPLOYMENT
FINANCING METRICS BY THE DEPARTMENT OF LABOR and WORKFORCE
DEVELOPMENT
Co-Chair Josephson reviewed the meeting agenda.
^FY 27 GOVERNOR'S BUDGET OVERVIEW: DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT
1:34:15 PM
CATHY MUNOZ, COMMISSIONER, DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT, introduced herself and colleagues.
She provided a PowerPoint presentation titled "FY2027
Department Budget Overview: House Finance Committee," dated
January 28, 2026 (copy on file). She began on slide 2 and
relayed that the department had seven divisions. There were
14 job centers under the Division of Employment and
Training Services located around the state. She noted that
a satellite job center was recently opened in Kotzebue.
There were nine vocational rehabilitation client offices
under the Division of Vocational Rehabilitation. The
department administered federal and state training funding
with nine regional non-state Technical Vocational Education
Program (TVEP) recipients. She explained that TVEP was
funded through a share of the employment security tax. The
funds passed through the department and the Department of
Labor and Workforce Development (DLWD) had oversight over
the grants. The department managed grants for 37 State
Training and Employment Program (STEP) regional training
provider grantees around the state. She noted that STEP was
also funded with a portion of the Employment Security Tax.
The department administered funds for nine construction
academies around the state. Additionally, the Alaska
Vocational Technical Center (AVTEC) housed under DLWD was
located in Seward.
1:37:25 PM
Commissioner Munoz turned to slide 3 and addressed FY 25
accomplishments. The department expanded the industrial
electricity and plumbing programs at AVTEC and started a
new industrial machine and maintenance program. She
reported strong enrollment above pre-pandemic levels for
all of the department's programs and waiting lists for the
most popular programs, especially in industrial
electricity, plumbing, and welding areas. She detailed that
Dr. Cory Artiz was in his first year as the AVTEC director.
She shared that in the past year AVTEC was named one of the
top vocational technical schools in the country by USA
Today. She highlighted success in the Occupational Safety
and Health (AKOSH) Diversionary program, which was the
first of its kind in the nation. The program allowed the
department to work through AKOSH with businesses that had
received first time safety violations or first time
violations in the previous five years to make safety
improvements to their business and receive a full waiver of
any financial penalties. The department believed it
resulted in safer workplaces in a more collaborative
manner.
Commissioner Munoz continued reviewing accomplishments on
slide 3. The department successfully launched the Office of
Citizenship Assistance (OCA). She thanked Co-Chair
Josephson, Co-Chair Foster, and Representative Galvin for
attending the launch. The first year had been very
successful and the office served over 250 legal immigrants
with employment and job training services. Additionally,
the office connected legal immigrants with digital literacy
training and English conversational language training. The
office could also do credential translation, which helped
when individuals were coming from another jurisdiction and
they needed help translating their credentials. The
department had been working with the federal Refugee
Support Services to assume the duties of the refugee
agency, which had previously been handled by Catholic
Community Services. The services would be provided by OCA
going forward.
Commissioner Munoz continued to review accomplishments on
slide 3. The department was pleased with the number of
changes at Mechanical Inspection in the Certificate of
Fitness (COF) program, which certified electricians and
plumbers. A number of changes had been implemented
including allowing for comparable military credit toward
licensure. The department had increased reciprocity to 30
states, allowing it to accept licensure from states with
similar licensure to Alaska. The department had also
implemented provisional licensing, which allowed it to
accept an electrician or plumbing license from another
jurisdiction provisionally for up to one year. The number
of electrical journeymen issued certificates of fitness
increased substantially to 423 or a 133 percent increase
over the previous year. The department had issued 435
electrical trainee licenses, reflecting a big jump over the
previous year.
1:42:05 PM
Commissioner Munoz continued to review accomplishments on
slide 3. She highlighted the Workers' Compensation Division
and relayed there was great collaboration between the
Medical Services Review Committee and medical providers to
work to bring the cost of medical services down by
publishing an updated medical services list annually for
reimbursement purposes. Premium costs for employers had
decreased by approximately 38 percent since 2018. There
were safer workplaces overall and a reduction in the cost
of medical services by establishing an agreement about
published services and what the division would reimburse
for the services. She shared that the department
implemented SB 206 (a bill sponsored by Senator Elvi Gray-
Jackson), which allowed it to work proactively to get
individuals who had been injured - who may not be able to
return to their previous line of work, but may be able to
do lighter related work - to get back to work more quickly.
She noted that the longer an individual was separated from
work, the more likely they would never return to the
workplace. The reemployment program called Stay at Work had
been successful in getting people back to work sooner.
Commissioner Munoz shared that moving forward, the
department was focused on a training proposal introduced by
the governor in HB 267 and SB 217. She detailed that it
would be a major boost for short term trainings and
industry recognized training opportunities around the
state, supporting the regional training network and
individual training support through job centers. The 2018
gasline workforce plan was being updated to adapt it to the
current project. The department hoped to get the report to
the legislature by mid to late March at the latest.
1:45:06 PM
Representative Galvin thanked the commissioner for being
present and appreciated hearing the good news. She asked
her staff to look at key performance indicators on the
Office of Management and Budget (OMB) website. She
referenced the AVTEC program and understood the goal was
for at least 60 percent of students to complete the program
and the current rate was about 90 percent. Similarly,
around 90 percent of the graduates were employed in their
field of training. She asked how many students were
reflected in the 90 percent.
Commissioner Munoz answered that the longer programs were
between six to nine months with an enrollment of about 120
students. Additionally, there were short term training
opportunities offered through partnerships with employers.
The maritime program had a partnership with Trident
Seafoods where training was provided on campus during the
offseason that allowed students to work and return to AVTEC
over a period of time. She estimated that in total there
were close to 1,000 students. She offered to follow up with
a precise number.
Representative Galvin was happy with the number provided by
Commissioner Munoz.
Representative Tomaszewski observed that the federal
funding received by the department in the amount of ~$98
million was about 51 percent of DLWD's total budget. He
asked if federal funds were increasing or decreasing. He
looked at slide 2 and reviewed the number of job centers,
TVEP recipients, STEP grantees, and construction academies.
He asked if there was an accessible list with more detailed
information located somewhere.
Commissioner Munoz asked if Representative Tomaszewski was
looking for a list of the grant recipients or a list of the
trainers around the state.
Representative Tomaszewski replied that he was interested
in both.
Commissioner Munoz replied that both were available. There
was a public eligible training provider list located on the
DLWD website that included all of the short term training
programs around the state connected to specific schools and
training centers. Additionally, she would follow up with a
list of STEP and TVEP recipients.
Representative Tomaszewski asked about the federal funding.
DAN DEBARTOLO, ADMINISTRATIVE SERVICE DIRECTOR, DEPARTMENT
OF LABOR AND WORKFORCE DEVELOPMENT, responded that the
department's federal funding was up 4 percent overall. He
clarified the department did not necessarily realize the
full amount of federal funding it was authorized for. He
offered to provide a breakdown showing the actuals spent as
opposed to budget authority.
Representative Tomaszewski referenced the mention of
Trident Seafood. He asked if the department received
private donations to help with training. He asked how it
worked for a private company to donate to the training and
helping to facilitate the advancement of more construction
and maritime positions.
1:50:15 PM
Commissioner Munoz replied that Trident paid for the
program and sent a certain number of students annually as
part of a multiyear program. Additionally, the department
received tax deductible donations from businesses for its
training programs, which were used in a variety of ways.
Representative Stapp referenced the AKLNG [gasline project]
and remarked that workforce development was a big
challenge. He was a bit disappointed that he did not see
any movement in the proposal regarding gearing up for
workforce development needed to fulfill jobs associated
with the project that he hoped would begin shortly. He
specifically mentioned STEP to the Fairbanks Pipeline
Training Center (FPTC). He did not see the center listed as
a STEP grant recipient. He remarked that if the state was
serious about the project, it should be the number one
priority to devote resources to the training center because
most of the workforce for the pipeline would come from
there. He asked for the commissioner's thoughts.
Commissioner Munoz answered that FPTC was a wonderful
facility that provided fantastic short-term training in
welding and other. The center was added to the TVEP program
the prior year. There was limited STEP grant funding of
about $6.5 million. The department had a proposal for the
legislature to consider that would significantly increase
the funding. The department hoped the money would go to
support programs like the FPTC and to provide individual
training support through the job centers.
Representative Stapp stated that the center used to be a
hefty recipient of STEP grants. He saw the proposed funding
change for STEP grants, but he was concerned the
legislature had no say over the grant participants. He
stressed that if AKLNG was on the horizon, the state was
facing a very serious workforce challenge that would
require targeting the vast majority of the state's
resources into pipeline training trade jobs. Otherwise, he
believed the state would miss out on capitalizing on a
great opportunity.
Commissioner Munoz believed FPTC received over $1.5 million
through TVEP and its previous STEP grant was $400,000. The
center's training funding increased by over $1.2 million in
one year. She relayed that the department had limited funds
and was trying to ensure programs and individuals
throughout the state were benefitting from the funding. The
department had a major proposal before the legislature that
she would love to talk to legislators about. The proposal
would help and subsidize programs like the pipeline
training center. Additionally, the late U.S. Senator Ted
Stevens included a $20 million appropriation many years
back for FPTC that was contingent on a final investment
decision. She elaborated that it was close to the point
where the U.S. Secretary of Labor could release the funds
once the final green light on the project was given. She
stated that the funds would go directly to FPTC.
1:55:24 PM
Co-Chair Josephson stated it was fantastic news he had not
been aware of. He referenced a gasline caucus meeting he
attended the previous summer where the commissioner and her
team had presented. He remarked that the state wanted to do
all it could for current Alaska residents, but he recalled
hearing there would be around 10,000 workers needed for the
entire pipeline project. He noted that the state did not
have that capacity. He believed it was a fact there would
be many people moving to the state [to do the work].
Commissioner Munoz replied that the department's primary
focus was on getting Alaskans trained and employed with the
economic opportunities on the horizon. The department
recognized it would be necessary to import some labor for
the work. The department was looking at its policies to
ensure there were no barriers in its certification process.
Particularly related to electricians and plumbers because
DLWD had purview over certification of those professions.
The department had done a number of things to encourage
easier certification for qualified workers to work in
Alaska.
Representative Hannan referenced Commissioner Munoz's
mention of industrial electricians and plumbers. She asked
for verification that AVTEC still produced residential
plumber and electrician certifications.
Commissioner Munoz answered that a plumbing pathway for
certification was 4,000 hours for residential and 8,000
hours for commercial. She noted it was a four-year
apprenticeship whether a person was going for 4,000 or
8,000 hours and the training provided by AVTEC was equal to
one year of an apprenticeship.
Representative Hannan remarked that her nephew is an AVTEC
alumni and was busy every day working.
Commissioner Munoz replied that the department was very
proud of the work taking place at AVTEC. She encouraged
members to visit the program. She detailed that the
teachers were experts in their fields, typically coming in
toward the end of their careers and wanting to give back.
1:58:17 PM
Representative Galvin stated her understanding the governor
was requesting to move the STEP program from the numbers
section to the language section [of the budget], which
would allow for additional funding without legislative
action. She believed the request would result in a net
increment of just over $800,000. She noted that the
governor was also requesting $1.4 million to maintain
worker's compensation operations. She asked if the change
was because DLWD was looking for more flexibility in how
the dollars were spent or if the department needed to move
funding more quickly. She asked about the intent behind the
proposal.
Commissioner Munoz responded that the department received
quarterly estimations on what its tax revenue would be
coming in through the employment security tax program. Due
to fluctuations in the economy, the unemployment rate, and
growth in wages, the amount could grow more than
anticipated in a year. She explained that when it happened,
the department wanted the flexibility to be able to get the
surplus money out to training providers in order for more
Alaskans to benefit from the money.
Representative Galvin asked if the department had been
unable to cover its needs in the recent past. She asked if
it was the reason for the proposed change. She asked if the
department wanted the flexibility to use potential surplus
funds immediately when they became available.
Commissioner Munoz answered affirmatively. She explained
that there were many more applications for competitive
grants and requests for individual training support through
DLWD's job centers than funding available.
2:00:48 PM
Representative Bynum expressed appreciation to the
department for its work and wanted to see more of it. He
noted he would save some of his questions about pipeline
development, the K-12 system, and training opportunities
for the subcommittee process. He referenced Commissioner
Munoz's mention of people being able to donate and receive
tax donations. He asked if the department had looked into a
way to leverage the new program the governor had opted the
state into through the scholarship granting organizations
for this particular purpose.
Commissioner Munoz replied that she was most familiar with
the current educational tax credit program and AVTEC had
been the beneficiary of the opportunities. She noted that
the university also received educational tax credit
donations. She would have to follow up on the question.
Representative Bynum thought it was a tremendous
opportunity for the state. He noted that it was new, so he
did not expect the department to already have something
lined up. He noted that the Alaska Industrial Development
and Export Authority (AIDEA) had recently entered into an
agreement in his district. He detailed that AIDEA was
working in the Ketchikan shipyard, a state-owned facility.
He explained that work development and creating jobs had
been a priority for the facility and recently the operator
JAG Marine Group had come in and was making tremendous
opportunities for growth in jobs. He noted that a growth in
jobs meant there was a need employees. He elaborated that
AIDEA recently entered into an agreement with JAG Marine
Group and Generation Southeast Vocational Center located in
Juneau and Prince of Wales to create a pipeline of skilled
work. He asked if the department was working to align with
trades to have partnerships.
2:03:40 PM
Commissioner Munoz highlighted the maritime partnership
between AVTEC and the University of Alaska Southeast, which
was named a maritime center of training excellence by the
U.S. Department of Transportation. There were great
opportunities for Alaskans to get excellent maritime
training through the university and AVTEC in state.
Additionally, she had recently been on Prince of Wales
Island with the AVTEC director, and they were working with
the local director on articulation agreements that would
allow individuals who had completed a program at Prince of
Wales to articulate into AVTEC to enable quicker
educational advancement.
Representative Bynum lauded all of the people involved
including AIDEA. He remarked that AIDEA executive director
Randy Ruaro was doing a phenomenal job ensuring those
things were thriving in his community. He understood there
were opportunities statewide. He was excited about the
working partnerships. He appreciated the work by the
department to make sure the positive opportunities
continued.
Commissioner Munoz replied that as a fellow Southeast
resident, the department was very pleased that the shipyard
was running with a new operator.
2:05:25 PM
Mr. DeBartolo addressed slide 4 showing the department's
organization and mission delivery. The department had six
major divisions. He noted that the commissioner had
mentioned seven divisions earlier because sometimes the
Alaska Workforce Investment Board (AWIB) was thought of as
a division, but it was technically part of the
commissioner's office and Administrative Services Division.
The slide depicted the department's FY 27 budget as a
function of its mission to provide all Alaskans safe and
legal working conditions and to advance opportunities for
employment. He detailed that 10 percent of the DLWD budget
went to leadership and support including the commissioner's
office, the Administrative Services Division, fiscal
functions, human resources, and the Labor Market
Information Unit responsible for research analysis. Next,
15 percent of the budget went to the protection of workers
including workers' safety, licensing, and compensation
functions.
Mr. DeBartolo continued reviewing slide 4. He detailed that
18 percent of the DLWD budget went to income replacement
including unemployment insurance and disability
determinations. The largest portion of the department's
budget - 57 percent - went to workforce development
including vocational rehabilitation services, job centers,
technical vocational education programs in Seward, and
training grants to individuals and organizations throughout
the state.
2:07:44 PM
Mr. DeBartolo turned to slide 5 titled FY 2026 - Current
Year Implementation Status." He highlighted AVTEC and the
expansion of the industrial electricity program and
plumbing program. He relayed that the prior year, the
legislature granted DLWD a supplemental in the amount of
$660,000 and an increment of $182,000. The department had
requested an accelerated timeline to expand its industrial
electricity lab from 15 seats to 30 seats. He noted that
ordering and installing the equipment and expanding the
space would take time. The department appreciated the
funding and he confirmed that all of the purchases had been
made. He briefly pointed to several photos on slide 6. The
upper lefthand corner showed the target building for the
expanded industrial electricity program. The photo on the
right showed current remodeling efforts; it was not yet
ready for the labs due to some delays, but things were
moving forward. The center photo showed the temporary home
for the industrial electricity lab. The program was
currently using the additional heavy diesel space in
Seward. Eventually the program would move into the new
building currently under progress. There was high demand,
particularly for the industrial electricity program. The
department was proud of the direction of the work.
Mr. DeBartolo returned to slide 5 and highlighted item 3
pertaining to AWIB. He relayed that Catholic Community
Services had administered refugee support services funds
for quite some time and the current federal administration
communicated that it wanted the services to be a state
responsibility. The state was still allowed to parter with
CCS, but the funds had to go through a state entity. The
previous year, DLWD requested $3,100,000 in additional
federal authority. The funding had not yet come through,
partially due to machinations at the federal level with
budgeting. When the funding came in, the department would
be required to do an annual report and work with its
partners on helping refugees benefiting from the funds.
Mr. DeBartolo continued reviewing slide 5. The department
was asked to mention some of the items that were not funded
the previous year. He highlighted the Alaska Safety
Advisory Program, formerly called the Alaska Safety
Advisory Council (ASAC). He relayed that Labor Standards
and Safety used to help ASAC put on the Governor's Health
and Safety Conference. He elaborated that volunteer private
sector partners and individuals helped do some of the roles
associated with ASAC. Through the governor's Executive
Order (EO) 135, the duties were put into Labor Standards
and Safety. The department requested $290,000 to support
two positions to run the new functions under the EO and the
Governor's Health and Safety Conference, but the items were
not funded. Consequently, the division was collecting fees
from vendors to run the conference. He noted that the
department could not let the money go unspent. The division
currently lacked the capacity to do the other functions
under the EO.
2:12:12 PM
Co-Chair Josephson asked if the request was repeated in the
FY 27 budget.
Mr. DeBartolo replied that the department did not request
the funding in the FY 27 budget. He continued to review
slide 5. He looked at item 5 pertaining to mechanical
inspection. He detailed that at the end of May 2024, SB 204
was rolled up with a number of other bills after the
conference committee had completed its work on the budget;
therefore, a fiscal note was not attached to pay for a
portion of the mechanical inspection support for the
Certificate of Fitness (COF) program. The department
requested $58,000 in FY 26 for the item, but it was not
approved. The program was moving forward, but as the
department modernized its systems, the gaps in funding and
reduction in collection of fees was making it harder to pay
for maintenance of the systems. He noted it was a concern
going forward.
Commissioner Munoz clarified that the referenced
legislation took the training certificate from two years to
six years. She explained that occasionally, more often than
the department liked, an individual came to the department
with their training hours ready to sit for the journeymen
test, but it could not take the hours that occurred on a
lapsed certificate of fitness. The department determined
that a solution would be to take the certificate from two
years to six years in order to avoid the situation.
However, making the change resulted in lost revenue because
the certificates were not occurring every two years.
Representative Hannan asked how it had impacted keeping
mechanical inspectors certified to work without the
$58,000. She asked if the number of certificates being
given had slowed down, if people were still pending, or if
the department had been able to cover it with money from
somewhere else.
Commissioner Munoz replied that they were extremely busy.
She relayed that COF were way up and the department issued
over 400 journeymen certificates and over 400 trainee
certificates in the previous year. She stated it was a busy
shop that was running on a shoestring.
2:15:06 PM
Representative Hannan stated that most of the state's
professional licensure programs eventually paid for
themselves by design. She highlighted the Board of Nursing
as an example. She asked if the $59,000 gap was permanent.
Alternatively, she asked if the fees would eventually
increase so a six-year certificate would pay for the
balance.
Commissioner Munoz replied that the goal would be to
increase by a nominal amount at the journeymen level. She
thought it could be used to cover the particular gap.
Mr. DeBartolo reviewed item 6 on slide 5 pertaining to
workers' compensation. The Stay at Work (SAW) program
passed in May of 2024 and the fiscal note that would have
funded the position to get people back to work coming off
of injuries was not funded. The department requested the
funding in the FY 26 budget, but it was not approved. He
relayed that Workers' Compensation was operating at a 30
percent vacancy rate. The division was covering the work as
well as it could, but it was a difficult situation.
2:16:40 PM
Mr. DeBartolo advanced to slide 7 titled "FY 2027 Fund
Source Allocation by RDU." He highlighted that the
department's total reliance on unrestricted general funds
(UGF) was fairly low compared to other departments
(reflected by the blue portion of the six pie charts on the
slide). He stated that the department was fourth overall.
He noted that he would cover a one-time request for FY 27
on an upcoming slide that raised the percentage for
Workers' Compensation. He provided a breakdown of the
department's budget by fund source: federal funding
accounted for 50.5 percent, designated general funds (DGF)
accounted for 27.5 percent, UGF accounted for 13 percent,
and "other" accounted for 9 percent.
Mr. DeBartolo turned to slide 8 titled "FY2025-2027
Operating Budget Comparison." The major change between FY
25 authorized and FY 27 governor was largely the one-time
UGF request. Most of the increases were due to contractual
salary increases, health benefit changes, and the change to
the TVEP program (which increased DGF). He moved to slide 9
and reviewed the department's operating budget request. He
noted that the statewide items associated with the
information technology (IT) classification and the
transferring of positions out of the Department of
Administration (DOA) were not represented on the slide
because the slide only reflected DLWD items. The first and
second items on the slide were related to the STEP
appropriation to the language section of the budget. He
explained that having the appropriation in the language
section would allow the department to provide funding to
training providers needing funds late in the fiscal year.
Mr. DeBartolo explained that STEP was a competitive grant
program and the department did not get to direct the
funding anywhere it wanted. He stated that applicants were
not all awarded funds. He elaborated that language would
allow DLWD to go to the Office of Management and Budget
(OMB) or Lennon Weller, the department's actuary would
inform the department that it had approximately $900,000 or
$1.1 million additional STEP funds. The department could
ask OMB for the adjustment in language and OMB could grant
the authority in order for DLWD to get the funds on the
street as soon as possible. He noted that the method had
worked well for TVEP. He clarified that the AWIB
competitive grants went to organizations and the Workforce
Services grants went to individuals.
Mr. DeBartolo addressed item 2 on slide 9 for Workers'
Compensation. He relayed that the component was the
department's largest request for the FY 27 budget. The
department requested $1.4 million to shore up the Workers'
Safety and Compensation Administration Account (WSCAA).
Typically, Workers' Compensation was 99 percent funded by
WSCAA from funds generated by employer workers'
compensation insurance premiums. The department received
2.7 percent of the premiums redirected into the budget to
run Workers' Compensation. He explained that Alaska had
become safer as a state and premiums had dropped, which
resulted in a drop in the percentage. He elaborated that at
the same time, the department had contractually obligated
salary increases. There had been a salary study for hearing
officers that drove up personal services cost
substantially, but revenue had been dropping. The
department was requesting the $1.4 million UGF increment to
cover operations in order to avoid a 30 percent vacancy
rate in the coming year.
2:21:18 PM
Representative Galvin referenced the item description for
the Workers' Compensation component to maintain operations.
She found it hard to connect maintaining operations with a
one-time increment. She understood that insurance premiums
had dropped because of improved safety. She did not
understand how the funds could be one-time-only unless the
maintenance pertained to one-time projects. She asked for
additional detail.
Mr. DeBartolo replied there were several options. He
explained that the one-time increment would give DLWD time
to workshop its options. Alternatively, the department
could request an ongoing UGF increment, but that was
challenging in the current [financial] environment. The
department had chosen not to request an ongoing increment
in hopes it could find the best path forward.
Representative Galvin was interested in more details on how
the WSCAA was spent previously and how the $1.4 million
would be spent in the coming year. She referenced Mr.
DeBartolo's mention of a 30 percent vacancy rate, and she
imagined the department had previously been able to cover
the cost.
Mr. DeBartolo replied that in 2021 WSCAA had a balance of
~$2.2 million that was typically returned to the account
via the reverse sweep process. Once the funds were swept,
the account no longer had a buffer. He explained that the
department looked at the likely FY 27 costs and asked for a
portion of the amount to cover operations through the year
instead of asking for the entire $2.2 million.
Commissioner Munoz was interested in more detail on how the
$1.4 million would be spent. She wanted to support the
department's work and thought the information would help
committee members when making budget decisions.
Co-Chair Josephson believed the $1.4 million was used to
maintain the [Workers' Compensation] division.
Commissioner Munoz responded affirmatively.
Co-Chair Josephson stated his understanding that the
funding was used to keep the lights on, employees paid, and
the commission functioning.
Mr. DeBartolo confirmed that the funding would cover basic
operations including payroll. The department would love to
get positions filled and to pay individuals for hearings
and related support.
Commissioner Munoz offered to follow up with a budget
breakdown for the Workers' Compensation Division and how
the funds would be used specifically. She reiterated Mr.
DeBartolo's statement that the WCSAA was swept several
years back, and the funding was not returned, which created
a hole in the division's budget. The department had been
able to float the gap for a year, but it could not do it
for the coming year. The money was needed to pay for the
division services.
Co-Chair Josephson explained that for decades after the
Constitutional Budget Reserve (CBR) was created there was a
reverse sweep vote [by the legislature] and at 12:01 a.m.
on July 1 the money went back [from the CBR into the
original accounts]. He detailed that about four or five
years ago the process broke down. He added that he had a
bill designed to increase the compensation premium to
increase DGF.
2:26:44 PM
Representative Stapp asked about moving the STEP grant
appropriation to the language section of the budget. He
asked if it was due to the multiyear nature of the grant
money.
Commissioner Munoz replied that was because of the
fluctuation in revenue received by the department based on
tax revenue. She explained that the department may project
a certain amount but when the quarter was accounted for it
may receive additional revenue due to changes in the
economy, unemployment, wages, etcetera.
Representative Stapp asked how STEP grant awardees were
selected.
Commissioner Munoz replied that AWIB reviewed applications
in a competitive grant process. The maximum amount awarded
was $400,000 in the current framework. She believed there
were 27 grantees in the current year.
Co-Chair Josephson asked for verification that it was not
fixed in statute like TVEP.
Commissioner Munoz agreed.
Representative Hannan asked how many positions a 30 percent
vacancy represented within Workers' Compensation.
Mr. DeBartolo replied that it was currently 13 positions.
Representative Hannan asked for verification that 13
positions were vacant.
Mr. DeBartolo replied affirmatively.
Representative Hannan recalled that in 2021 several funds
that had never been considered sweepable in the past were
suddenly swept and by 2022 there were some new OMB and
legislative agreements that the funds were not sweepable.
She asked if the WSCAA fund was now on the list of funds
that were not considered sweepable because the funds were
collected from payers. She asked for verification that
WSCAA was not UGF and was made up of workers' compensation.
Mr. DeBartolo replied it was considered a DGF fund. The
department received the funds and was allowed to spend them
up to its allocation. However, the determination about
whether a fund was sweepable occurred between the
Department of Law and OMB. He explained that the fund had
been determined to be sweepable.
2:29:48 PM
Co-Chair Josephson shared that he had been involved in
legislation pertaining to the reverse sweep that did not
pass and his office had studied the issue. He stated his
understanding there were individuals paying a premium tax
into WSCAA. He noted that the funds originated from a
business. He asked if the dollars were going into the CBR
annually.
Mr. DeBartolo confirmed that if there was a sweepable
balance in WSCAA at the end of a fiscal year, the funds
would be swept. The largest amount occurred five years
back. More recently, there had not been sweepable amounts
and the department had to cover Workers' Compensation
operations with whatever it could scrape together in the
past year.
Co-Chair Josephson had always thought it was a lawsuit
waiting to happen because he wondered why private
businesses were paying for the CBR. He asked about the
nexus and stated, "I don't get it."
Representative Hannan recalled that prior to 2021, the
WSCAA fund was so healthy the legislature discussed
increasing benefits to people receiving workers'
compensation because Alaska was far behind and the rates
had not increased in a number of years. She remarked that
if the fund was swept, there was no room for increasing
benefits to people. She asked for verification that the
$2.1 million DGF swept in 2021 that came from Alaskan
businesses to be held for Alaskan employees injured on the
job had gone into the CBR as if it was UGF due to "the
politics of this weird business."
Commissioner Munoz responded affirmatively.
Co-Chair Josephson clarified that the funds were not
payments to injured workers but were used to operate the
division.
Mr. DeBartolo confirmed that it was operational funding for
work done in Workers' Compensation.
Co-Chair Josephson stated, "Same, same." He remarked that
it still did not justify the sweep.
Commissioner Munoz agreed that the money that flowed into
WSCAA was from a fee into on Workers' Compensation
policies. The fee went into WSCAA, which funded the
division to pay benefits and maintain a worker's
compensation system.
2:32:57 PM
Mr. DeBartolo concluded the presentation on slide 10 titled
"FY2027 Estimated TVEP Distribution." He explained that
when TVEP was reauthorized, it was in statute that the
recipients listed on the slide received the percentages
listed on the slide. There was no discretion for the
department other than looking at the amounts available. The
department held $250,000 in reserve in case there were
fluctuations in the available funds at the time of
distribution. The remainder of the funds went towards
program administration and recipients. He clarified that
STEP funds were competitively granted through AWIB or
individuals in DETS [Division of Employment and Training
Services].
Commissioner Munoz returned to an earlier question by
Representative Stapp and relayed that the Fairbanks
Pipeline Training Center received $1.7 million in new
revenue through the program.
Co-Chair Josephson thanked the presenters.
2:34:38 PM
AT EASE
2:37:36 PM
RECONVENED
^PRESENTATION: STATEWIDE 2026 JOBS FORECAST and
UNEMPLOYMENT FINANCING METRICS BY THE DEPARTMENT OF LABOR
and WORKFORCE DEVELOPMENT
2:37:52 PM
KARINNE WIEBOLD, ECONOMIST, DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT, introduced herself.
LENNON WELLER, ECONOMIST AND ACUTARY, DEPARTMENT OF LABOR
AND WORKFORCE DEVELOPMENT, highlighted that DLWD produced
an annual actuarial publication that went into depth on
metrics dealing with the financing of the unemployment
insurance (UI) system, which was available on the
department's website. He introduced a PowerPoint
presentation titled "Unemployment Insurance Overview and
Jobs Forecast," dated January 28, 2026 (copy on file). He
began on slide 2 showing a chart of the Unemployment
Insurance Trust Fund balance in blue, benefit costs in red,
and net UI tax contributions (from employers and employees)
in green from FY 02 to FY 25. He detailed that benefit
costs and contributions tended to run counter to one
another. He elaborated that benefit costs rose under
periods of heightened unemployment. The system was designed
to recoup the costs with increased tax rates and net
contributions should respond in kind. He highlighted that
in the past several years post-COVID-19 the closing balance
of the fund was becoming a growing concern. The fund
bottomed out at just under $300 million in early to mid-
2021. Since that time, the fund gained almost $500 million;
the current balance was $819.5 million.
Co-Chair Josephson asked if Mr. Weller's concern was that
the funding was unused.
Mr. Weller responded that primarily there was a disconnect
between the benefits being paid out and the current
financing structure and its ability to respond to the
varying level of benefit costs.
Mr. Weller turned to slide 3 titled "Average Benefit Cost
Rate and UI Trust Fund Reserve Ratio." The slide showed the
balance of the fund and benefit cost as a percentage of
wages covered, which he believed was a better way to view
the information compared to slide 2. From a financial
perspective, as wages changed in the economy, it was
desirable to keep a certain percentage of that in reserves.
He stated that while the fund balance and benefit costs
fluctuate, the linkage [between the two] had broken
somewhat. He highlighted that the most severe economic
recession since statehood occurred in the 1980s and benefit
costs had reached nearly 4 percent in the late 1980s. He
noted that the benefit costs during COVID-19 barely
exceeded 2 percent. He pointed out the precipitous decline
in benefit cost rate (benefits paid as a percentage of
wages in the economy) in the 2000s, with the exception of
the COVID-19 period. The increase in benefit schedules was
another reason for blips upward in benefit costs. The long
term trend was a decline in benefit costs. There was a
growing UI trust fund balance since the early 2010s
irrespective of the benefit costs falling. He elaborated
that the pandemic brought the reserve down, but the reserve
ratio never dropped below about 2.5 percent, which was
still quite significant.
2:44:35 PM
Representative Hannan asked if the benefit costs were set
in statute or tied to the earnings of the job a person had
lost.
Mr. Weller answered that it was technically both. He
elaborated that a schedule set in statute looked at wages
and a corresponding benefit amount related to the specific
wage level. The schedule started at a $56.00 benefit at
$2,500 in base period wages (roughly an annualized period
of wages). He detailed that every $250 in wages increased
the benefit amount by $2.00 up to a weekly maximum of $370,
not accounting for any dependent allowances. The $370
maximum was reached at a base period wage of $41,750.
Representative Hannan remarked that the state had increased
its minimum wage, so in theory the benefit should increase;
however, if a maximum was set in statute it did not matter
if a person's earnings rose. She asked if there was a
presumption that people losing their jobs were not
attempting to claim their benefits in Alaska and instead
they were leaving the state because for $370/week they
could not afford to stay in Alaska. She asked if the
presumption was too speculative.
Mr. Weller replied that it would be understandable to
recognize that the longer a benefit schedule had a fixed
amount while wage rates were simultaneously increasing the
more severe the repercussions would be. He would not
speculate what specifically may result from the
interaction. The data showed a continued decline in claims
loads, which in part indicated that the benefit schedule
was not sufficient and had been eroded in real terms. He
highlighted that the last time it was adjusted was 2009.
Representative Hannan summarized that the maximum benefit
was set at $370 in 2009 and it remained at that level in
2026.
2:48:20 PM
Representative Tomaszewski suggested that the UI percentage
could be shown as another line on the graph [on slide 3] to
show for example that if the state was fully employed there
were more people contributing into the system. He
referenced the UI rate deducted from state employees'
paychecks. He wondered if the rate had increased. He
observed that between 2011 and 2019 the fund balance was
steadily increasing, followed by a significant decrease
during the pandemic and a dramatic increase after that. He
asked if the dramatic increase was a result of more people
working and fewer people collecting benefits or if the UI
rate had been adjusted.
Mr. Weller replied it was a combination of several things.
He noted that the increase had been seen in previous
periods, but it was at a different magnitude post-COVID.
The goal was to have a pre-recessionary target for the fund
between 3 and 3.3 percent of wages. When it was within the
range, there were no solvency adjustments applied to tax
rates. When the number was above 3.3 percent, the
department started implementing credits to bring the entire
tax schedule down. When the number was below 3 percent, the
department started adding on surcharges. With respect to
the base rate, the department looked at the most three
recent years of state fiscal costs for the system against a
staggered three of the most recent four years of wages
covered.
Mr. Weller clarified that it resulted in an average benefit
cost rate over a three-year period, which became the base
of which rates charged to employers and employees. He
elaborated that 73 percent of the benefit cost rate was
applied to employers and the remaining 27 percent was
applied to employees. The resulting rate was based on what
73 percent of the cost rate was and wherever the fund
balance fell. He noted there was one large caveat. There
were statutory minimum tax rates: 1 percent for employers
and 0.5 percent for employees. Once the fund balance had
recovered post-COVID with a 3 to 3.3 percent reserve ratio
and benefits continued to fall (especially as a percentage
of wages covered), the 1 percent minimum floor was hit. He
explained that the system had lost its ability to adjust to
costs and where the balance was and to allow tax rates to
be reflective of the specific cost.
2:52:42 PM
Representative Tomaszewski thought it looked like the
employer tax rate was increased in 2021/2022 and dropped
back down. He observed that the employee tax rate had
remained steady. He remarked that there had been
accelerated growth in 2021/2022. He considered the
department's ability to make adjustments by 3.5 percent. He
asked if there was a chart or graph showing the
information.
Mr. Weller clarified that the solvency adjustment was in
statute. The department was required to go by an explicit
calculation and to determine the solvency adjustment if
necessary. The department did not have the discretion to
make it a specific value. He explained that it was based on
where the value of the fund was relative to the desired
outcome. The difference, by statute, was applied to the
final rate. He could follow up with more specifics if
needed. He noted that the presentation would address the
average tax rates and a rundown of the latest 2026 tax
calculations.
Representative Tomaszewski imagined Mr. Weller had future
projections for the fund balance if no levers were changed.
He asked if the department would come forward with specific
rate adjustment recommendations for the legislature to
consider.
Mr. Weller believed there were a couple of proposals to try
to rebalance the UI financing system. He did not personally
have a specific proposal.
Representative Tomaszewski asked about future growth
projections.
Mr. Weller responded that he produced internal projections
continuously on the direction of the fund and expected
benefit costs and tax rates.
Co-Chair Josephson referenced Mr. Weller's testimony that
for the past 17 years the highest weekly benefit payment in
Alaska was $370. He asked for verification that the benefit
exceeded $1,000/week in Washington state.
Mr. Weller believed it was around $1,300 a week in
Washington. He noted that every state had its own way of
adjusting its benefit schedules or calculating the benefit
amount.
Co-Chair Josephson asked if Washington state was one of the
highest.
Mr. Weller replied that he believed it was one of the
highest. He noted there were a handful of states that
indexed their maximum benefit amount. He highlighted Hawaii
as another state with a fairly significant maximum benefit.
Alaska's benefit amount ranked somewhere towards the
bottom.
Co-Chair Josephson asked if part of the reason Alaska's
benefit was so low was due to its hybrid system that
involved retraining and pivoting to different career paths.
Alternatively, he wondered if other states did the same.
Mr. Weller responded that while the unemployment system was
a joint federal/state system, it had led to a 50 state
experiment where nearly every state chose its own method of
how to finance the program and the type of benefits to
provide. He noted that most states had seasonal
disqualifiers but may provide a higher weekly benefit
amount. He stated there were all sorts of things to
tradeoff, but they were all legislative policy calls.
2:58:29 PM
Mr. Weller turned to slide 4 titled "Average Employer Tax
Rate and Uniform Employee Tax Rate." He stated that there
were 21 tax classes, 20 of which were experience rated.
Rates varied from 1 to 20 with 1 being the low experience
and 20 being the highest rate class. The average rate
classes were 10 and 11 reflected as the blue portion of the
bars on the graph. The average rate had been brought down
to 1 in the past several years; in 2026, all 20 classes
were at the 1 percent minimum. He noted that the uniform
tax on employees was not subject to experience rating, they
all just received the same rate. The rate very infrequently
came off of the minimum .5 percent, partially a result of
the share. He elaborated that 27 percent of the cost rate
ended up being under .5 percent. He pointed out that for at
least the past three years, employers and employees were
paying the statutory minimum.
Mr. Weller moved to slide 5 titled "Average Weekly
Benefit/Average Weekly Wage." He explained there was a
long-term downward trend in the average weekly
benefit/average weekly wage ratio, with the exception of
labor market shocks and/or in combination with a benefit
increase. The ratio reflected the replacement rate, which
was currently just over 22 percent. He detailed that the
state was currently replacing on average 22 cents on the
dollar in lost wages. He highlighted that increases in the
ratio on the graph reflected a combination of a labor
market contraction, but the largest increase was in 2009
when the new benefit amount was changed. Since that time,
there was a consistent downward trend in the ratio. He
considered what it meant for the program in terms of
individuals filing.
3:01:21 PM
Mr. Weller moved to slide 6 titled "Recipiency Rate." He
noted that the graphs on slides 5 and 6 used data from the
[federal] Employment and Training Administration (ETA)
because it was comparable across all 50 states. He
explained that the recipiency rate reflected the regular
benefit claimants collecting as a percentage of the total
estimated unemployed in a given period. The data showed a
long-term downward trend in the number of employed
individuals filing for and collecting benefits. The rate
was at a historic low of about 22 percent.
Representative Galvin referenced the $370 maximum benefit
amount [in Alaska]. She highlighted maximum benefits
provided in other states including Washington at $844,
Oregon at $673, Hawaii at $639, and Wisconsin at $370. She
remarked that many were twice the amount received in
Alaska. She noted that Mr. Weller had mentioned the rate
had not been changed since 2009. She asked if it was
strictly a policy call for the legislature. She wondered if
there was some other mathematical formula that Mr. Weller
may advise the committee to consider.
Mr. Weller replied there were suggested replacement rate
metrics that were nationally recognized. He stated that 50
percent was a rate that was spoken about frequently. He
reiterated his earlier statement that every state had its
own method of calculating the replacement rate. There was
an infinite number of ways to go about determining the rate
on an average basis, at the top of the schedule, and at the
bottom of the schedule. He stated that 50 percent tended to
be the general recommended replacement rate to enable a
person to meet basic needs in order to get from one job to
another, but to avoid creating a disincentive for a person
to return to work. He noted there were more robust methods
to determine what the ideal number may be, but it was a
policy call.
Representative Galvin asked how long a person on
unemployment received the weekly benefit.
Mr. Weller replied that the information was not included in
the presentation. He relayed that the minimum duration was
16 [weeks] and the maximum duration was 26 [weeks]. He
explained it was dependent on the person's pattern of
employment. The more consistent long-term duration of
employment led to a longer qualifying duration. The more
sporadic the employment, the shorter the qualifying
duration.
Representative Galvin referenced the solvency of the fund
and ensuring the state was dispersing an adequate amount.
She stated her understanding that the things to consider
were the maximum benefit and the length of time. She asked
if there was any other consideration the legislature may
need to look at. She asked what the fund balance should be
in order to get through a recession or pandemic.
Mr. Weller answered it was necessary to balance the state's
ability to absorb the costs with the desired benefit
payment. The state could finance any program it wanted, but
it had to be willing to accept the accompanying tax rates.
There were many different levers and ways to rebalance the
system. He reiterated it would be up to the legislature to
decide.
Co-Chair Josephson asked for confirmation that the
timeframe provided by Mr. Weller was 16 to 26 weeks.
Mr. Weller answered affirmatively. The minimum number of
weeks a person could qualify for was 16 and the maximum
number was 26 on a regular benefit claim.
3:07:39 PM
Co-Chair Josephson asked about a situation where an
employee was only employed for two months.
Mr. Weller answered that a person would not qualify for
unemployment if they were only employed for a couple of
weeks in a year. He elaborated that an individual was
required to have at least $2,500 in wages in a year and at
least $250 outside of their highest quarter of earnings. He
explained that a person had to have wages in two quarters
and a minimum amount of wages to earn in order to qualify.
At those levels, a person would likely qualify for the 16-
week minimum. He noted that a person could opt to apply for
benefits for any number of weeks within that time period.
The shorter a person's duration of work and the lower the
wage would result in a shorter duration of benefits. The
more consistent a person's wage was over time, the longer
their eligible duration of benefits.
Representative Bynum asked if the department tracked
whether a person who collected unemployment benefits became
reemployed or left the state once their benefits ceased.
Mr. Weller replied affirmatively. He relayed that the
department tracked when an individual returned to work via
payroll records to determine the reemployment rate. The
department did not necessarily know why a person may stop
filing [for benefits]. He shared that the department also
tried to look at reemployment services aiming to place
individuals in more lucrative and stable employment. The
department did not necessarily know when a person ceased
filing for benefits. He explained that the subsequent
quarterly wage records were needed in order to know. He
added that it was for Alaska only. There were a fairly
significant number of interstate claims by individuals who
earned wages in the state and subsequently left and filed
from outside the state. There was much less information on
those individuals once they left the state. He noted that
if they returned, the department could compare the
individuals over time. The department periodically
conducted more longitudinal analysis on repeat filers.
3:11:56 PM
Representative Bynum thought it would be interesting to see
the data from the perspective given the seasonal nature of
many industries in Alaska where someone was employed for
stretches of time and unemployed for periods of time due to
the nature of the business. He stated it would be nice to
know whether a person was staying in Alaska or leaving the
state and coming back, following the cyclical nature of the
business.
Mr. Weller moved to slide 7 and addressed UI tax rate
calculations for 2026. He highlighted that benefit costs
were just under $41 million in FY 25. He stated that the
most important elements looked at the average benefit cost
rate shown on line 8, which was just under half a percent.
He noted that the average benefit cost rate was split 73/27
employer/employee. The UI trust fund balance as of the end
of September was used at tax calculation time by statute
(shown on line 9). The reserve ratio was approximately 4.7
percent, which was significantly above the high water mark
of 3.3 percent. He explained that it resulted in the need
to apply the statutory maximum of 4/10. He pointed to the
last two lines on the slide [lines 13 and 14] and stated
that if the statutory minimum rates were ignored, the
calculation using a solvency adjustment resulted in a
negative tax rate for employers in 2026. He noted that
under the scenario, employees would pay .12 percent. He
explained that the financing system had lost its
flexibility at these levels of benefit payout.
3:15:11 PM
Ms. Wiebold reviewed slide 8 showing the statewide outlook
for jobs in 2026 by industry. The first column on the slide
showed the average annual employment in 2024, the second
column showed the same information for 2025, the third
column reflected the change between the two years, the
fourth column showed the percent change, and the fifth
column showed the division's forecast for 2026. The jobs
forecast projected the oil and gas industry would be up by
1,000 jobs, construction would be up 700 jobs, and
healthcare continued robust growth and was expected to be
up 1,100 jobs. She noted that federal government jobs were
expected to be down 400 jobs. She noted that she had
written the forecast several weeks back and since that time
additional information had come for 2025 showing that job
losses were much steeper [than the 400 shown on the slide].
Co-Chair Schrage asked if the information was for 2026 and
did not look forward.
Ms. Wiebold replied that it was for 2026 and looked forward
because it had been compiled in 2025.
Representative Hannan asked Ms. Wiebold to repeat her last
point related to a decline.
Ms. Wiebold replied that after losing what the division
believed to be 300 federal jobs in 2025, it projected the
loss of an additional 400 jobs in 2026. When the division
had compiled the forecast, it had been working with limited
preliminary data. Based on additional information received
by the division, she projected that federal job losses in
2026 would be much steeper.
3:17:27 PM
Ms. Wiebold noted that 3,900 jobs were added in 2025 and
3,000 were added in 2026, reflecting a slowing in job
growth. She moved to a chart on slide 9 showing that
Alaska's job growth rate topped and then matched the U.S.
The slide showed a decade of U.S. average annual job growth
compared to Alaska. Alaska was represented by the dark
purple line and the U.S. was shown as a dotted blue line.
The slide showed that Alaska had underperformed the nation
until fairly recently. She detailed that recently when
Alaska's job growth slightly outperformed the nation it was
more reflective of the national rate slowing than of
anything Alaska was doing in particular. In 2025, the
preliminary numbers showed Alaska and the U.S. growing at
about 1.2 percent. The division was forecasting slower
growth of .8 percent for Alaska in the coming year; the
U.S. was also looking at slowing.
Co-Chair Josephson asked if Ms. Wiebold worked with Dan
Robinson.
Ms. Wiebold responded affirmatively.
Representative Galvin looked at slide 8 and referenced the
oil and gas jobs rate. She asked how the specific job
growth would contribute to the state's economy. She
understood it would not necessarily contribute to UGF
revenue because the state did not have an income tax. She
wondered what the state may be losing with respect to the
substantial decline in federal jobs.
Ms. Wiebold answered that in some ways the answer was
straightforward. The average wage was roughly $175,000 for
oil and gas jobs and the department was forecasting the
jobs to increase by 1,000. She noted that the oil and gas
industry was heavily reliant on non-resident workers. She
estimated that about one-third of the increased jobs would
go to non-resident workers. She highlighted an article that
she and her colleagues had written during the past summer
looking at federal employment across Alaska. She relayed
that federal employment wages varied significantly. She
detailed that some of the highest paid workers were located
at the U.S. borders outside of Skagway and Haines and some
of the lowest paid positions were in rural post offices.
There were about 15,500 federal employees in Alaska and the
loss of 1,000 to 1,500 of the positions over the next two
years reflected considerable losses. The state's
relationship with the federal government extended past
civilian employment. There was a strong military presence
in Alaska with between 20,000 and 21,000 active duty
troops. There were about 59,000 veterans living in Alaska,
which reflected the highest percentage of veterans in the
country. She added that the U.S. Department of Defense
(DOD) also supported the largest group of civilian
employees in Alaska at around 6,000 individuals.
Additionally, there were numerous grant contracts through
DOD and the university.
3:21:34 PM
Representative Galvin asked if the department had data
showing how many of the oil and gas jobs were filled with
Alaskans versus out of state workers.
Ms. Wiebold highlighted that the residency of Alaska
workers report was coming out the following week, which was
in depth and would answer the question. She stated that the
ballpark was about 30 to 35 percent.
Co-Chair Josephson asked if Ms. Wiebold had stated
something about Skagway border customs workers.
Ms. Wiebold replied that the border agents posted in
Skagway and Haines were the highest paid federal workers in
Alaska.
Co-Chair Josephson was surprised to hear the information.
Ms. Wiebold added that the highest concentration of federal
workers was located in the Hoonah-Angoon Census Area. She
asked members if they could guess why.
3:23:01 PM
Representative Hannan replied, "U.S. Forest Service."
Ms. Wiebold confirmed that it was due to Glacier Bay
National Park. She elaborated that there were very few
private employers located in the particular census area.
She brought some copies of the department's federal jobs,
forecast, and November fishing edition.
Representative Hannan asked if it was still true that the
Hoonah census area had the highest percentage of PhDs in
the state.
Ms. Wiebold responded that she did not know.
Representative Hannan elaborated that it was because
Glacier Bay National Park had a high number of PhDs who
came to work and decided to stay.
Representative Galvin asked about gender and wages. She
asked if there was recent data around how much women made
compared to men for the same job.
Ms. Wiebold answered that she was responsible for writing
the specific reports, which were fairly labor intensive.
She typically wrote the reports several years apart in
order to have an opportunity to hopefully see a period of
change. The last report was several years old. She shared
that she wanted to do a retrospective soon to see how the
pandemic impacted men and women differently. The most
recent analysis, apart from a small one on women in the
construction industry, looked at how men and women went
through the state recession differently. She relayed that
the biggest improvement in the gender gap wage disparity
occurred at the end of the recession; however, the
recession disproportionately impacted high income men. She
elaborated that oil and gas and construction jobs were
taken out of the equation and men earned less money. She
explained that women were not earning a whole lot more, but
comparatively it looked good. She stated those were the
types of things that were important to take into
consideration when looking at what was taking place, what
the drivers were, and whether or not the numbers were
reflective of what economists hoped they were, which was
some change in the overall conditions.
3:26:15 PM
Representative Galvin asked when to expect the next more
comprehensive study.
Ms. Wiebold replied that there was not a set date yet, but
she would provide links to the most recent studies.
Co-Chair Josephson thanked the presenters. He reviewed the
schedule for the following day.
ADJOURNMENT
3:27:18 PM
The meeting was adjourned at 3:27 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| DOLWD_FY2027 Overview House Finance Committee_2026_0128 FINAL.pdf |
HFIN 1/28/2026 1:30:00 PM |
|
| HFIN Overview DOL-Graphs -LFD 012826.pdf |
HFIN 1/28/2026 1:30:00 PM |
HFIN Budget Overview DOL Graphs LFD 012826 |
| HFIN Budget Overview DOL-FY 26 Mid YR StatusReport 012826.pdf |
HFIN 1/28/2026 1:30:00 PM |
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| DOLWD Jobs Forcast & UI Overview Presentation H Finance.pdf |
HFIN 1/28/2026 1:30:00 PM |
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| DOLWD Response to HFC Questions from 2026_0128.pdf |
HFIN 1/28/2026 1:30:00 PM |
HB 263 |