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News from the Alaska State Legislature, the Office of Alaska Republicans
For Immediate Release: April 28, 2026

Senate Votes for Bankrupting Pension Restart

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JUNEAU – Today the Alaska State Senate passed House Bill 78 in a vote of 12 - 8. HB 78 reinstates defined benefit pensions for state employees and is anticipated to cost Alaskans billions of dollars.

The Senate Republican Caucus has the deepest respect for our public employees. However, we cannot support a policy with unknowable future costs, obscure fiscal notes, and a legacy of failure.

In 2006, the state switched from a defined benefits system to a defined contribution system (similar to a 401(k)) due to the rapidly increasing pension costs.

Twenty years later, the prior defined benefits system is still burdening state budgets, with $7.5 billion in unfunded liabilities. Longer life expectancies, higher medical costs, and other economic factors force Alaskans to pay $200 million a year to offset legacy pension debt. 

Still, the Democrat-led Majority today voted to re-instate a tried-and-failed public pension system.

There is little evidence that public pensions will reduce employee turnover and improve the state workforce.

There are no reliable numbers detailing how much a new pension-based system would ultimately cost. The bill’s fiscal note utilizes numbers from 2025. These numbers were calculated prior to the current global and local economic shifts and do not reflect significant changes made to HB 78 in committee. 

There is no guarantee the funding threshold will be capable of staying above the 90% floor. When it falls, Alaskans will constitutionally have no choice but to foot the bill. Employees who opted for pensions will see their contributions rise, and the rest of the populace will contribute through taxes or further reductions to the PFD. 

The Senate Republican Caucus will continue to pursue options to improve the lives of Alaska’s public employees that are honest, transparent, and do not burden future generations of Alaskans.

HB 78 now heads to the Governor’s desk. The Senate Republican Caucus strongly urges him to veto the bill.

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