AIDEA orders revisions in so-called 'independent' analysis of AIDEA
In a hearing Friday, Randy Ruaro, executive director of AIDEA, claimed that a $250,000 “independent” analysis of AIDEA remains incomplete because of turnover at Northern Economics in Anchorage.
“We have had some delays with that report, the company that was writing the report, the three different persons at different times who were in charge of it had left employment. And so it became a little difficult to get it completed, but we are looking forward to getting that done,” Ruaro told the Senate Resources Committee.
But that is not the real story.
Northern Economics finished a “long form report” and gave it to the Alaska Industrial Development and Export Authority in early 2024, but the Dunleavy administration did not like the results and refused to release the “independent” analysis.
We now know that for certain, based on a new work agreement with Northern Economics that calls for specific revisions directed by AIDEA.
The new version of the study is due by the end of June, according to a document released in response to a public records request.
While the $250,000 has already been spent, AIDEA is now promising to pay for additional “time and expenses” to revise the “independent” study in ways to suit AIDEA.
This is no longer an “independent” analysis, based on the latest amendment.
The amendment confirms that in early 2024 Northern Economics submitted a “long form report.” After paying the contractor the full amount—with no penalty for failing to produce—the state began to claim the work was not finished.
It says Johns will “detail areas to expand upon, areas to highlight and areas to include that were not originally covered” in the Northern Economics research.
Northern Economics will follow the directions from Johns and provide a “refinement estimate” to AIDEA. Perhaps that means the company will provide a cost estimate for the AIDEA revisions.
The company submitted its last invoice on March 3, 2024, bringing its total charges to $249,871 for work that it finished in February 2024.
Northern Economics President Marcus Hartley has declined to respond to multiple requests about the “independent” review, a term that means the final contents should be determined by the company hired to be independent.
The credibility of Northern Economics, which bills itself as “Alaska’s Trusted Economics Expert,” is on the line here. The company says that it “performs meaningful unbiased analyses throughout Alaska and around the world.”
There is reason to question just how unbiased the analysis will be when a version that Dunleavy supports is finally made public.
After waiting nearly a year, perhaps hoping the study would be forgotten, AIDEA at long last decided to tell Northern Economics that the agency objects to some of the contents of the “independent” report and ordered more work.
In 2023, AIDEA officials said they were excited about having Northern Economics take on the robust job. The AIDEA press release was headlined “Northern Economics to Conduct Independent Analysis of AIDEA.”
“Our team of economists is the best in the business and we look forward to providing this third-party unbiased economic analysis of AIDEA as quickly and thoroughly as possible,” Hartley said in the 2023 press release.
The report was supposed to be complete by late 2023. Last June AIDEA extended the contract until the end of 2024, even though all the money had been spent.
Here is the original contract, earlier amendments and the company’s invoices.
Here is the latest amendment and the AIDEA instructions for revisions.
AIDEA had a political goal with this $250,000 contract: It was to counter the studies performed by two experts in Alaska public policy, Gregg Erickson and Milt Barker.
Erickson said that he and Barker were paid a total of $55,000 for a September 2022 report, “AIDEA Cost & Financial Performance— A Long, Hard Look,” and three reports released a year ago.
Stung by the Erickson/Barker findings and assertions, AIDEA announced plans on September 29, 2022 to hire a contractor to prepare a report for AIDEA that would counter the “disinformation” in the Erickson/Barker report.
AIDEA said it hoped to “complete the analysis by the end of 2022” and headlined its first press release, “AIDEA Debunks Report and Announces Independent Economic Analysis.”
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