HB78 makes major changes to the Public Employees' Retirement System and Teachers' Retirement System by reopening a defined-benefit pension option for certain public employees and teachers. It would allow some new hires to choose between the defined-benefit and defined-contribution plans, and allow current teachers and public workers in the defined-contribution plan to use their account balances to purchase past service in the defined-benefit system.
The Alaska State House of Representatives passed HB78 on May 12, 2025 by a vote of 21 to 19. We have assigned pluses to the nays because this bill could realistically add $7 billion in additional costs to future state budgets, according to the Reason Foundation, and reintroduce Alaska to significant pension risk. These government positions should not exist in the first place, as they lie outside the proper role of government. Government pensions are a gross waste of money when plenty of private-sector investment options are available. This legislation expands the size and cost of government by reviving a pension system rooted in collectivist principles.
