JUNEAU, Alaska (KTUU) – Gov. Mike Dunleavy has joined calls from a bipartisan group of legislators for the state of Alaska to divest from Russia.
Dunleavy issued a press release on Thursday, calling for a wide range of actions against Russia and to welcome Ukrainian refugees after they’ve been vetted. He urged state agencies and the Alaska Permanent Fund Corp. to unload its Russia-based assets if and when that’s appropriate.
“As a response to President Vladimir Putin’s war on Ukraine, we all need to do our part to support countries and people who believe in freedom,” Dunleavy said through a prepared statement. “This attack is unprecedented and needs to be addressed.”
A spokesperson for the Permanent Fund said on Monday it had 0.2% of the $81 billion fund invested in Russia, which would be over $162 million. The Alaska Department of Revenue released a memorandum on Thursday, saying that state retirement plans had around $115 million in investments in Russia as of Jan. 31.
The Moscow Stock Exchange has been closed and trading has been limited since Russia’s invasion of Ukraine. The value of some Russian securities have plummeted to a tenth of their normal value.
“Due to extremely low valuations and limited, if any, ability to transact, the prudent course is to continue to monitor the Russian exchanges and divest, when and if appropriate,” the Department of Revenue’s memo says.
Sen. Bill Wielechowski, D-Anchorage, said the governor’s response is “toothless” and Dunleavy could do more to compel the Alaska Retirement Management Board to divest. Wielechowski’s office has been compiling a list of Russian companies the Permanent Fund invests in with ties to prominent Russian oligarchs and those that may run afoul of U.S. sanctions.
“It shouldn’t be a matter of if, it should be a matter of when,” he said about divestment. “I understand it may take a little bit of time, Russia has closed its stockmarket, but I think it’s something that needs to happen.”
Jeff Turner, a spokesperson for the governor’s office, said an administrative order to compel divestment is “not necessary” and that the Legislature could introduce bills to do that. He added that Dunleavy respects the independence of the Permanent Fund’s board of trustees to make investment decisions.
Rep. Jonathan Kreiss-Tomkins, D-Sitka, is set to introduce a bill soon on behalf of the House State Affairs Committee to compel the Permanent Fund to divest its Russia-related assets.
“The idea is that it’s introduced and moved with all expedited consideration,” he said.
The House Labor and Commerce Committee is also planning on introducing legislation designed to block some Russian imports and look at trusts in Alaska that may allow Russian oligarch’s to “shelter” their wealth.
Norway’s $1.3 trillion sovereign wealth fund has pledged to divest from Russia. States across the U.S. are debating whether to have their pension portfolios dump their Russian assets.
Historically, the Permanent Fund has resisted calls to divest for “political” reasons. Paulyn Swanson, a spokesperson for the Alaska Permanent Fund Corp., said the fund’s managers recognize the “escalating tragedy” in Ukraine.
“Together with our managers and custodial bank, APFC is closely monitoring the events that are still developing and is continually assessing the appropriate response,” she said by email.
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