JUNEAU — The Alaska Permanent Fund’s board of trustees used a “deficient” performance evaluation process to justify firing former CEO Angela Rodell, who said her removal was “political retribution” for opposing Gov. Mike Dunleavy’s budget plan to overdraw the fund, but an eight-month independent investigation found no credible evidence that Dunleavy was involved in her ouster.
Rodell, who served as the corporation’s CEO from 2015 until 2021 and led it to years of strong returns, was abruptly fired during a board meeting in December last year. There was no explanation given and the board did not anticipate Alaskans would want to know why that decision was made, the investigation found.
Former chair Craig Richards appeared before a joint House and Senate legislative committee hearing in January and referred to Rodell’s performance evaluations, but he declined to give more information. That lack of clarity frustrated legislators across the aisle.
Later in January, the committee approved a $100,000 contract for Schwabe, Williamson & Wyatt, an Anchorage law firm, to conduct an investigation into Rodell’s ouster. It released its 65-page report Wednesday.
Attorney Howard Trickey said the investigation led to three main findings: The trustees who voted to fire Rodell gave separate and independent reasons for doing so, but they shared a loss of confidence in her as CEO. The board did not follow an objective process set out in its own charter to evaluate Rodell’s performance. And investigators found no credible direct or circumstantial evidence that the governor was involved in her firing.
The board of trustees had threatened to sue over the investigation into its decision to fire Rodell. The trustees wanted a copy of the report in advance of Wednesday’s legislative hearing, but that request was not granted, leading to a leak of a 16-page report into the ouster written by the corporation’s own law firm, which came to similar conclusions.
Since 2018, the Permanent Fund has provided two-thirds of state government revenue using a rules-based system to make an annual 5% draw from the fund. Rodell had said her firing was “political retribution” for opposing a budget plan proposed by Dunleavy, which would have overdrawn the fund by $3 billion beyond that structure, partly to pay for a larger Permanent Fund dividend.
Investigators deposed the six members of the board who served at time of Rodell’s ouster, five of whom were appointed by Dunleavy and voted to fire her. They all testified under oath that the dividend had not influenced their decision to fire Rodell. Instead, there was a consensus among those five trustees that they had lost confidence in Rodell as CEO and that there was “a strained relationship.”
Several trustees said they fired Rodell after a heated board meeting last October when she and then-trustee Lucinda Mahoney, former commissioner of the Department of Revenue, had a tense exchange about a plan to increase bonuses for investment staff. Mahoney felt that was inappropriate with a $1,114 dividend being paid earlier that year.
Attorney Christopher Slottee, who investigated Rodell’s ouster, said he reviewed the meeting and didn’t find any unprofessional conduct in that three-day meeting. Several trustees said Rodell had tried to manipulate the board to advance her own agenda. Investigators said they found no concrete evidence of that.
They also said that they were “troubled” by a press release Rodell issued in June last year on the verge of a state government shutdown, which warned about the negative impacts that could have on the fund’s investments. Those trustees argued that statement inappropriately pushed the Alaska Permanent Fund Corp. into the political process.
Former trustee William Moran, who was appointed by former Gov. Bill Walker, was the lone no vote against Rodell’s ouster, and said he found Rodell’s performance to be “exceptional.” He testified that he didn’t hear complaints from the other trustees about that press release until October. Rodell issued a similar press release in 2017 before another potential shutdown and no issues were raised at that time.
Board members also discussed a tweet Rodell posted during legislative debates in August last year on the dividend, which stated what the Permanent Fund’s balance would be if Dunleavy’s plans to overdraw the fund by $3 billion were enacted. Richards testified he believed that was a “backhanded critique of the governor” and members of the governor’s office privately flagged similar concerns at the time with Mahoney.
The investigation found that Richards spoke to members of the governor’s office in the months leading up to Rodell’s ouster to say that there were “serious performance issues” and that she might be terminated. There were other discussions described with members of the governor’s office, including Dunleavy’s then-chief of staff, but the investigation found no credible evidence that Dunleavy had orchestrated Rodell’s firing.
”Governor Dunleavy always stated he had no knowledge or involvement in the Permanent Fund Corporation’s Board of Trustees decision to release its executive director, and is satisfied with the results of the investigation,” said Jeff Turner, a spokesperson for the governor’s office, by email.
The investigation found the board had not used an objective annual appraisal process when evaluating Rodell’s performance for several years before she was fired, with her most recent review being the most haphazard. She received “little guidance” on her job performance, whether she was meeting expectations or how she might improve.
Investigators stated that using an objective evaluation process for a CEO, which is set out in the board’s charter, could help eliminate the trustees’ biases and allegations of political influence. But trustees’ lack of confidence in Rodell as CEO “is a sufficient legal reason under the legal standards applicable to at-will employment in Alaska,” the attorneys leading the investigation said.
Anchorage Democratic Rep. Andy Josephson, a former prosecutor, is not convinced. He was concerned at the lack of objective standards in her performance review process and noted that Rodell had threatened legal action in the past against her abrupt firing.
“I think that the state is going to pay her settlement,” Josephson said. “I just do.”
Several legislators said during Wednesday’s hearing that the two trustees who were also members of the governor’s cabinet, Mahoney and former Natural Resources Commissioner Corri Feige, faced split loyalties between their fiduciary duties to protect and grow the fund and then following Dunleavy’s dividend plans, which would overdraw it.
Anchorage Republican Sen. Natasha von Imhof, chair of the Legislative Budget and Audit Committee, said the board appointment process should be reviewed after the investigation, which she called “fair and thorough.”
Josephson said being a Dunleavy cabinet member and a fiduciary for the Permanent Fund is like supporting the New York Yankees and the Boston Red Sox. He proposed legislation in January that would change the makeup and the appointment process for the board of trustees. It failed to pass.
Rodell was traveling overseas earlier in the week and did not immediately respond to a request for comment on the investigation’s findings. She declined to comment Monday after the board elected a new chairperson.
The board of trustees is set to hold a special meeting Monday to choose a new CEO for the corporation from among three finalists: Acting Revenue Commissioner Deven Mitchell; Morgan Neff, chief investment officer of the Alaska Industrial Development and Export Authority; and Melanie Hardin, whose online resume shows her working as an executive at Verizon.
As acting commissioner, Mitchell is also a Permanent Fund trustee, but he will recuse himself from voting in the final CEO selection process.
[Read the report:]