House committee hears ADA director on HB124; ADA warns some provisions could force costly asset sales

Alaska House State Affairs Committee — Juneau — Feb. 3, 2026

Randy Ruaro, executive director of the Alaska Industrial Development and Export Authority, told the House State Affairs Committee on Tuesday that provisions in HB124 would significantly change ADA’s governance and could force the authority into “fire-sale” divestitures that would impair its ability to make new investments.

Ruaro, presenting a continuation of ADA’s earlier testimony, identified a series of provisions the authority opposes, including changes to board composition and removal rules, new litigation approval requirements, stricter public-reporting mandates, and a provision (section 8) that he said would require ADA to sell roughly $1.2 billion in assets by the bill’s effective date. He warned that compelled sales on a short timetable would likely produce low recovery values and could jeopardize projects and jobs tied to ADA-owned facilities.

"That type of sale for sale would result in likely hundreds of millions of dollars in losses," Ruaro said, describing how an enforced asset cap could leave ADA unable to make further investments or accept grants that count as assets under GASB accounting.

Why it matters

HB124 would alter ADA’s statutory authority and reporting and—according to ADA leadership—could undermine its statutory mission to promote economic development. Committee members repeatedly pressed Ruaro for more granular financial information, saying they need to understand the authority’s current asset mix, how much is committed to active projects and loans, and what remains available for future investment before they change ADA’s capitalization rules.

Key details from Tuesday’s testimony

- Asset accounting: Representative Holland asked for a full accounting of ADA’s assets and the status of loans and other instruments. Ruaro agreed to provide the committee with the letter transmitted to the House and Senate clerks and said he would supply a further breakdown that distinguishes committed projects, loan programs and other categories.

- Pipeline reporting vs. executed investments: Members requested two reports: (1) an updated list of executed investments through the end of the year showing obligations and contract status, and (2) a separate, deidentified pipeline summary that preserves confidentiality for private borrowers. Ruaro agreed to provide both formats.

- Section 8 (forced divestiture): Ruaro said section 8 would require ADA to sell a large portion of its assets — "loans, fixed assets, Ketchikan shipyard" among them — by the bill’s effective date, which could force sales at depressed values. He recommended deleting or substantially revising the section.

- Specific asset impacts: Representative McCabe pressed on the Interior Gas Utility (IGU) loan — a roughly $139 million, long-term loan structured to reduce heating costs in Fairbanks. Ruaro said IGU is a low‑performing asset by design and could be a candidate for sale, but he warned buyers would likely demand changes to terms or pay very little. He said forced sales could lead ADA to litigate constitutional or contract‑clause issues.

- Project examples and economic claims: Ruaro reviewed projects ADA has financed or helped develop, including Ambler access proposals, the Ketchikan shipyard (operator transition and increased jobs), LNG trucking in Cook Inlet, and potential energy projects in the Aleutian Chain. He cited preliminary geologic estimates for leases in the ANWR/Anwar area that he said show 4,000,000,000 barrels of recoverable oil and 7,000,000,000,000 cubic feet of gas, and referenced an estimated $2 billion a year in taxes and royalties quoted from a federal NEPA/SEIS document; those numbers were stated by Ruaro and attributed to external reports.

Committee requests and next steps

Committee members asked ADA to return detailed financial breakdowns: executed investments through the fiscal year, an anonymized pipeline summary, a breakdown of deferred inflows and nonoperating vs. operating revenues, and the resolution establishing a newly formed ADA tech subsidiary. Chair Kerrick said the committee will set HB124 aside for the rest of the day and return on Thursday, Feb. 5, when the chair’s office plans to present a committee substitute that members can amend.

What Ruaro said (selected quotes)

"That type of sale for sale would result in likely hundreds of millions of dollars in losses." — Randy Ruaro, ADA executive director, on section 8’s forced-sale requirement.

"We have a lot of projects in that pending form right now." — Randy Ruaro, on ADA’s pipeline of renewable, geothermal and other projects.

Closing and procedural note

Ruaro agreed to provide the requested accounting and supplemental materials to the committee. The committee set HB124 aside for additional work and will continue consideration on Thursday. No formal committee vote on HB124 occurred at Tuesday’s session.

Provenance: Committee hearing transcript; discussion on HB124 begins at SEG 382 and continues through SEG 1951.