One of the final bills President Joe Biden will have signed during his time in office is one that Alaska U.S. Sen. Lisa Murkowski has been pursuing since she joined Congress more than two decades ago.
On Sunday, Biden signed the Social Security Fairness Act, repealing federal laws that dock Social Security payments to workers who pay into Social Security and receive public sector retirement benefits. The change will boost Social Security benefits for about 15,000 people in Alaska.
“I have been working on the Social Security Fairness Act for as long as I’ve been representing Alaska in the United States Senate,” Senator Murkowski said in a prepared statement on Monday. “Hardworking public servants should not be denied the benefits that they paid for because of their career choices, and I’m relieved that this longstanding injustice has been remedied.”
The laws docking the payments were passed in the 1970s and 80s in response to concerns about the overall health of the Social Security program. The provisions meant that if you receive state retirement or disability benefits and worked fewer than 30 years in a job covered by Social Security, your Social Security benefits could be cut by as much as 50%.
It hits Alaskans harder than any other state because Alaska has opted all state and local public sector employees out of Social Security entirely. The thinking when Alaska opted its public sector employees out of Social Security was that the state’s pension plans were more generous, but that hasn’t been true for nearly two decades.
In 2006, the state, facing its own retirement concerns, ditched public pensions for new employees altogether and replaced them with a 401(k)-style retirement plan that is more volatile and doesn’t guarantee a minimum payout in retirement. The switch has long been a significant sticking point for teachers, police and other public sector workers.
In recent years, the sorry state of the public retirement system in Alaska has been blamed for a revolving door of employees and chronic under staffing — with vacancies that clock in above 30% for some state agencies — as employees leave for jobs in the Lower 48 that not only have pensions but don’t carry the penalty with Social Security because they have not opted out of the program.
While the change is welcome news to the 15,000 Alaskans estimated to be affected by the fix, there’s still a lot of interest in changing the state’s retirement system to return some form of pension to public employees. The Alaska Senate passed such a measure in 2024 before it died in the Republican-controlled House. The House has since flipped to a mostly Democrat Bipartisan Coalition, giving new energy to the issue.
Rep. Zack Fields, the Anchorage Democrat who is set to chair the House Labor and Commerce Committee, said late last year that he anticipated legislators will give another run at passing a pension bill. He pointed to the more than 70 vacancies in the Anchorage Police Department and classrooms taught by long-term subs as signs that something needs to be done.
“Do you support the police or not? And if you support the police, you have to fix our worst-in-the-nation retirement system,” he said. “If you want teachers in the classrooms, we can’t have the worst-in-the-nation retirement system for teachers … It’s really not optional if you want Alaska to be economically competitive.”
Matt Acuña Buxton is a long-time political reporter who has written for the Fairbanks Daily News-Miner and The Midnight Sun political blog. He also authors the daily politics newsletter, The Alaska Memo, and can frequently be found live-tweeting public meetings on Twitter.
