The corporation that manages the $54 billion Alaska Permanent Fund is rejecting a proposal from the Walker administration to invest in the oil and gas tax credits issued by the state.

The corporation does not view the idea as "an attractive investment opportunity," said Paulyn Swanson, communications manager for the Alaska Permanent Fund Corp., in an email on Tuesday.

Swanson said the "proposed structure and related returns do not justify taking on the associated risks."

Craig Richards, Walker's former attorney general and under contract to the governor as a private attorney, pitched the idea to the corporation's board of trustees at its Sept. 2 work session.

Richards presented the concept as a potential money-making opportunity for the fund without hurting a state that's already on the hook for paying hundreds of millions of dollars for the tax credits.

One way the tax credits currently work is an oil producer that pays production taxes in Alaska, such as ExxonMobil, BP or ConocoPhillips, can buy a tax credit at a discount from an independent oil company that pays no taxes, because it has no income, but did work exploring for oil to earn the tax credit, officials said. The big oil producers can then benefit by collecting the full value of that tax credit from the state. In other words, they buy the tax credit low and sell it high.

Under the concept, the Permanent Fund could have potentially bought the tax credits at a discount, and sold them to another buyer for a higher value.

Swanson refused to specify the idea's possible returns and risks.

"The risks are not related to the credit of the state of Alaska," Swanson said. "We continue to have confidence in the state's credit."