I, Mike Dunleavy, Governor of the State of Alaska, under the authority of Article III, Sections 1, 23, and 24 of the Constitution of the State of Alaska hereby order a statewide annual Government Efficiency Review of all executive branch agencies to identify, evaluate, and implement opportunities for greater efficiency and cost-effectiveness in the delivery of government services.
BACKGROUND AND PURPOSE
State revenues are contingent on the price of oil, which fluctuates continually due to rapidly evolving geopolitical conditions. Public expenditures have nevertheless consistently risen year after year, even as oil revenues are falling due to global events such as OPEC’s December 2024 decision to increase output. The State of Alaska’s savings accounts now hold only enough reserves to fund seven months of government operations.
The constitutional spending cap has proven ineffective at limiting the State’s ever increasing annual budgets and there is presently no other mechanism to constrain spending. At the same time, proposals for new revenue measures, such as taxes, threaten to diminish the climate for private sector investment in Alaska and thereby endanger job creation.
It is imperative that the State put in place mechanisms to annually review and streamline the state budget to constrain expenditures and maintain the soundness of the public purse on a permanent basis. There is currently, however, no process in place to review zero base budget appropriations and expenditures.
The State of Alaska instead uses base budgeting to record incremental transactions to the State budget. Once a transaction is approved by the Legislature, it is then recorded as an annually recurring budget item for which an agency receives funding; that transaction is no longer recorded or accounted for individually, it is part of the yearly tranche of funds the agency receives and is not discussed or reconsidered annually.
A review of annual expenditures for accountability is a basic management practice that should be performed routinely by every organization and is done annually in the private sector. The State of Alaska has a fiduciary responsibility to its citizens to be good stewards of their resources, including making sure funds spent annually are promoting the efficient delivery of government services to Alaskans.
This Order mandates a review of executive branch agencies’ practices, processes, and outcomes to identify efficiencies and savings to the State of Alaska and its people, achieve better outcomes, and prioritize limited resources to promote the efficient delivery of essential services to Alaskans.
GOALS
This Order is issued to achieve the following goals:
- Deliver efficient, effective, and fiscally responsible government services to Alaska’s citizens.
- Identify and implement cost-saving measures and streamline government operations.
- Ensure the best use of every public dollar spent by minimizing administrative overhead, prioritizing responsible resource development, eliminating waste, and eradicating preferential spending on diversity, equity, and inclusion.
- Ensure funds are going to the most critical and urgent needs.
- Promote accountability, transparency, and public confidence, through regular disclosure of how all public money is actually spent and for what purposes.
- Establish procedures for the annual review of every expenditure in the base budget.
- Create and implement guidelines for transparency, accountability, and compliance in all state-funded grant programs.
APPLICABILITY
This Order applies to all executive branch agencies, including departments, boards, commissions, and public corporations (hereafter referred to as “agencies”).
RESPONSIBILITY FOR IMPLEMENTATION
The Office of Management and Budget (OMB) shall be responsible for the implementation of this Administrative Order.
ORDER
GOVERNMENT EFFICIENCY REVIEW
OMB shall annually lead an executive branch-wide Government Efficiency Review of base budget expenditures and practices to:
- Identify potential savings.
- Improve efficiency of operations.
- Modernize processes to fully integrate IT solutions.
- Recommend services to be contracted out.
- Simplify operations.
- Focus the state’s limited workforce where most needed.
OMB shall annually publish a list of funds granted, by agency, to what entities, and for what purposes.
AGENCY PARTICIPATION
During each annual efficiency review, every agency shall:
- Identify target areas and practices to review.
- Utilize technology and artificial intelligence (AI) to review large datasets in order to determine how State of Alaska funds are actually being spent.
- Review and publish how funds granted to non-state entities are being spent.
- Recommend a targeted level of reductions through savings on wasteful and unnecessary spending.
- Recommend state processes to be updated or modernized.
- Recommend where technological or AI resources can realize efficiencies and better outcomes.
- Recommend services that can be contracted out.
INITIAL FOCUS
Initial areas of focus of the Government Efficiency Review will include:
- Grants to non-State of Alaska entities.
- Accounts Payable.
DURATION
This Administrative Order takes effect immediately and remains in effect until revoked.
DATED this 4th day of August 2025.
