An eight month investigation into the firing of former Permanent Fund CEO Angela Rodell was presented to the Legislative Budget & Audit Committee yesterday afternoon in Anchorage. The committee, chaired by Senator Natasha von Imhof (R – Anchorage), hired the law firm Schwabe, Williamson & Wyatt in January to investigate the firing of Rodell by the Permanent Fund Board of Trustees. The investigation cost the state $150,000.

The report (click here to view the entire report) concluded that Governor Mike Dunleavy (R – Alaska) did not direct Rodell’s firing. After Rodell’s termination, many of Dunleavy’s political opponents claimed he had orchestrated her firing because of her position against overdrawing the Earnings Reserve of the Permanent Fund, something Dunleavy has advocated for to pay larger dividends. The report states:

There is no direct evidence or credible circumstantial evidence that Governor Dunleavy directed the Executive Director’s termination. Trustees Richards, Feige and Mahoney denied when asked directly if anyone from the Governor’s office had directed them to terminate Ms. Rodell. Non-commissioner Trustees Schutt, Rieger, and Moran reported no contact whatsoever with the Governor or his administration related to the Executive Director’s performance or termination. And they did not perceive the other Trustees to be acting at the direction or on the behest of the Governor’s office.

The investigation also found that after the board terminated Rodell in December 2021 she “angrily told the Trustees that there would be political consequences for their actions.” Rodell’s salary as CEO was almost $400,000 a year.

The investigation did find that the board did not precisely follow the Charter when it came to evaluating Rodell’s performance. But the CEO serves at the pleasure of the board, which can terminate the CEO for any reason. Interviews with trustees and her performance evaluations show that Rodell’s relationship with the board and staff began to deteriorate in 2018. According to the report:

In 2018, the Executive Director’s evaluations started taking on a less positive tone, and average performance scores assigned by the reviewing Trustees dropped substantially. 

It goes on to say:

Trustee Mahoney’s primary concern was a tension between the Executive Director and APFC’s investment staff, as reflected in comments and low ratings that investment staff provided in response to the 2021 survey. Trustee Mahoney worried about investment staff attrition.

Von Imhof, who seemed unhappy with the findings of the investigation her committee paid for, did not release the report or supporting documentation until after the meeting was concluded. At one point she berated the lawyers she hired to conduct the investigation. During the meeting attorney Christopher Slottee said staff said the investigation found some staff said “the CEO is at odds with the board” and that Rodell testified “it felt like it fell all apart” and that “it went off the rails” in 2021. In response, von Imhof frustratingly said, “I am hearing again and again that the board has claimed assertions of conflict but they were unable to provide concrete evidence other than a tweet, and a press release. Is this a problem? That people can make a verbal assertions and then can’t back it up, or you can do that all day long?” Slottee went on to explain that a personality conflict is a valid reason for a board to terminate a CEO even if the board did not precisely follow their charter.

The drama surrounding the entire situation stems from how the board handled Rodell’s termination. The report says that the board “did not anticipate that the public would seek some explanation for why Ms. Rodell was terminated.”

After terminating Ms. Rodell, the Trustees issued a press release that simply stated the Fund would be moving in a new direction: “After the review and completion of the annual Executive Director evaluation, the Board of Trustees of the Alaska Permanent Fund Corporation have decided to undertake a search for a new executive director to lead the Permanent Fund in its continued growth and evolving role in support of Alaska.” The Trustees gave little to no consideration to how to explain the termination decision to the public or legislature. The Trustees did not anticipate that the public would seek some explanation for why Ms. Rodell was terminated.

This was a major miscalculation by the board. Because they did not give a reason or explanation for Rodell’s termination, speculation immediately began as to why the board had fired her. Rodell herself told the Legislative Budget and Audit Committee (LB&A) her termination was “political retribution.” With no explanation to the public from the board about her termination, Rodell was able to spread the belief that her firing had been politically motivated and others came up with their own reasons. This ultimately led to the legislative investigation and report released today stating that Governor Dunleavy had not been involved in the firing.