House subcommittee adopts Department of Law FY26 closeout, declines added "statehood defense" increment

The Alaska House Department of Law Finance Subcommittee voted Friday to adopt the closeout recommendations for the Department of Law's fiscal 2026 operating budget, approving a net $2,973,900 increase in unrestricted general funds and nine new permanent full-time positions while declining an additional temporary increment for “statehood defense” litigation.

Chair Josephson opened the meeting at 12:04 p.m. and said the subcommittee would “conclude our work on the Department of Law FY 26 operating budget” and vote on the closeout package. Alexander Schroeder, staff to Chair Josephson, told the panel the proposal adopts all but one of the governor’s items; the chair declined to adopt item 5, a temporary increment described as continued statehood-defense efforts across multiple agencies.

The nut of the dispute centered on the statehood-defense increment. Schroeder said the Department of Law already has a temporary increment of $500,000 in its base for FY26–FY27, has spent an estimated $2 million to $3 million per year on statehood-defense litigation since 2021, and still had roughly $3,700,000 in unspent statehood-defense funds from prior years. For those reasons, Schroeder said the chair was not convinced the department needed an additional $500,000 for each of the next two fiscal years.

Representative Costello objected to the removal of the statehood-defense funding, saying the caseload has roughly doubled over several years and pointing to a set of navigability-rights claims often referenced as RS 2477 matters. “These cases are incredibly important to our state,” Costello said, and asked the subcommittee to reconsider the chair’s decision.

Finance-division staff clarified the structure of the increments. Alexi Painter, finance-division staff, told the subcommittee there is “an existing temporary increment running FY25 through FY27” in the base budget and that the item the chair declined would have been an additional temporary increment running FY26–FY27 on top of that existing increment.

The subcommittee also heard from Stacy Craley, director of legal services for the civil division of the Alaska Department of Law, who described the types of cases driving litigation costs. Craley cited RS 2477 navigability claims, disputes tied to resource-development projects such as the Willow project and Ambler Road, fisheries and wildlife litigation, and other resource-access matters. “Some of these cases may get resolved with the the, new Trump administration, but some of these cases need to be litigated in order to get a final decision,” Craley said, noting that private parties and nonprofits could continue to bring suits that would require the state to litigate.

Schroeder summarized other elements of the adopted closeout: the proposal increases UGF by $2,973,900 (about 3.6% over the department’s adjusted base), adds nine permanent full-time positions (eight in the criminal division and one in the civil division), and approves an interagency transfer of the Department of Administration’s labor-relations analyst positions into the Department of Law’s budget.

After discussion, Representative Costello withdrew the objection and the subcommittee adopted the budget action (BA) report as written. Chair Josephson thanked staff and department representatives and adjourned the subcommittee at 12:19 p.m.

The subcommittee’s decision will be forwarded to the full House Finance Committee as part of the regular budget process.