Senate President Gary Stevens, R-Kodiak (left) and Speaker of the House Bryce Edgmon, I-Dillingham, watch the voting board in the Alaska Legislature as lawmakers vote on a veto override Tuesday, May 19, 2026, for the pension bill, House Bill 78. (Claire Stremple photo/Alaska Beacon)
Alaska’s public employees and public school teachers will not have access to pensions this year.
In a 33-27 vote Tuesday, the Alaska Legislature failed to override Gov. Mike Dunleavy’s veto of a bill that would have created a new pension system for teachers, municipal employees and state employees in Alaska. Forty votes were needed for an override.
The failure was expected. Lawmakers had passed the pension bill, House Bill 78, by a combined vote total of 33-27 last month, and there was no sign that any legislator had changed his or her position since that vote.
Alaska has been without a pension for new public employees since 2006, when lawmakers closed the existing pension plan to new applicants and mandated a 401(k)-style retirement system.
Though Dunleavy himself receives a public pension, he is opposed to opening a new system for current employees. In a veto message to lawmakers on Monday night, he expressed concerns about potential long-term costs and risks to the state.
“Pension obligations extend for decades, and the full cost of this bill may not be apparent until years after its enactment,” his veto message stated in part.
Despite the governor’s concerns, he was willing to allow the bill to become law as part of a grand compromise: If legislators approved a gas pipeline tax relief bill he supports, he would not veto the bill.
That arrangement fell apart on Monday afternoon after the House failed to advance the governor’s preferred proposal. The governor issued his veto about 10:39 p.m. that night.
Under the Alaska Legislature’s current interpretation of the state constitution, lawmakers are required to meet in joint session within five days to consider a veto override.
Under previous interpretations, legislators frequently skipped holding joint sessions if they either didn’t want to discuss an override or knew they lacked the votes to do so.
On Tuesday afternoon, though legislators knew an override was not in the cards, advocates and opponents spoke for a combined two hours before the final vote.
Rep. Chuck Kopp, R-Anchorage and the pension bill’s most vocal proponent, said the bill is intended to reduce the amount of staff turnover in the state. While the bill was expected to cost $73 million per year to implement, Kopp expected it would save over $240 million in training costs for new employees and overtime needed to cover positions left vacant by staff who had resigned.
“House Bill 78 is not a retirement bill. … It is a workforce bill, and it’s a resource development bill. We cannot build a gasline through this state unless we can retain our engineers. We cannot permit a mine when the permitting office turns over in 18 months. We can’t drill on the North Slope when the Haul Road isn’t being maintained,” he said.
Sen. Bert Stedman, R-Sitka, gave a 25-minute speech rejecting Kopp’s argument, saying in part that the lack of a pension system is not causing the vacancy problem. If the state’s Supplemental Benefit System — not used by some municipalities — is included with the state’s 401(k)-like public employee retirement system, Alaska has generous retirement benefits, he said.
Stedman suggested that higher salaries may be part of the answer to the state’s vacancy issues. Alaska used to be No. 1 in the country for teacher salaries. It’s now ranked below Washington state, he said.
Rep. Jeremy Bynum, R-Ketchikan, said that in his experience as an employer, higher salaries helped but weren’t a complete solution.
“That still didn’t solve the problem of retention, because people still cannot live in our communities affordably, so we’ve got a lot of challenges ahead of us,” he said.
Stedman also warned that the bill is based upon actuarial estimates that may or may not be accurate. The state’s prior pension plan was left only partially funded because of an actuarial error that led to a years-long lawsuit and left a multibillion-dollar shortfall.
Sens. Bill Wielechowski, D-Anchorage, and Jesse Kiehl, D-Juneau, each suggested that the proof of the need for the bill is in the state’s lived experience. Alaska has experienced 13 consecutive years of negative migration, and state and municipal governments continue to struggle to fill positions.
“This will make a tremendous difference if we override this veto and put back the option of a modest defined benefit pension for Alaska’s public servants,” Kiehl said.
The legislature’s regular session ends Wednesday night.
Any new pension bill would have to restart from scratch in January, when the 35th Alaska Legislature convenes for its first year.
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