Landlords for Legislature's Anchorage office building file $37 million damages claim

JUNEAU — The landlords for the Alaska lawmakers' downtown Anchorage office building have filed a legal claim for $37 million, saying they're owed the money because the Legislature failed to follow its own procurement rules when it awarded the landlords their lease.

The 19-page claim, filed Friday and announced by the landlords Monday, comes after Superior Court Judge Patrick McKay ruled in March that the Legislature's 10-year, no-bid lease was illegal and invalid. The claim can be a precursor to a lawsuit by the landlords against the state.

Lawmakers are now planning to leave the Fourth Avenue building developed by landlords Mark Pfeffer and Bob Acree. Instead, they're planning to purchase a Wells Fargo-owned building in Spenard.

"We are willing to work with the Legislature to achieve savings but without the Legislature's cooperation, we have no choice but to seek legal recourse," a spokeswoman for the landlords, Amy Slinker, wrote in a prepared statement.

The claim begins an administrative process likely to lead to a lawsuit, said Kodiak Republican Sen. Gary Stevens, who chairs the Legislative Council — the joint House-Senate committee that's charged with finding lawmakers a permanent home.

"It means that there's going to be a lawsuit and we expected that," Stevens said in a brief interview Monday. He said he plans no immediate response to the claim before conferring with the Legislature's attorneys.

But if Pfeffer and Acree file a lawsuit, their assertions that they faithfully carried out every request from the Legislature are likely to collide with the constitutional restriction that all state contracts are subject to legislative appropriation.

Nathaniel Herz

Anchorage-based independent journalist Nathaniel Herz has been a reporter in Alaska for nearly a decade, with stints at the Anchorage Daily News and Alaska Public Media. Read his newsletter, Northern Journal, at natherz.substack.com