Governor Mike Dunleavy has issued a sweeping administrative order aimed at curbing state spending in response to falling oil prices and tightening fiscal conditions.
Administrative Order No. 358, issued Friday, places an immediate freeze on out-of-state travel, new hires, and the creation of new regulations across all executive branch agencies. The order applies to all departments, boards, commissions, and public corporations regardless of funding source, and will remain in effect until rescinded.
“This is the right thing to do,” Dunleavy said in a statement. “Alaskans expect us to manage their resources wisely. With oil prices dropping and our savings accounts unable to carry us through even one year of full state operations, we have no choice but to act now.”
The governor cited a steep drop in oil prices—from an average of $85 per barrel in FY2024 to a projected $68 per barrel in FY2026—as the driving force behind the decision. The decline, caused by increased global production and aging oil fields, is expected to cost the state hundreds of millions in revenue. Once responsible for nearly 90 percent of Alaska’s unrestricted general fund, oil revenue now accounts for just 40 percent.
Under the order:
- All out-of-state travel is suspended. Exceptions require a waiver for essential public safety or mission-critical needs.
- A hiring freeze is in effect for full-time, part-time, seasonal, and non-permanent positions, with exceptions for law enforcement, 24-hour care facilities, and critical frontline workers.
- All new regulation development is halted unless already out for public notice, with limited waivers available for public safety concerns.
The order is intended to refocus the state’s operations on core government services and reduce strain on state reserves. Combined balances of Alaska’s major savings accounts — the Constitutional Budget Reserve, Power Cost Equalization Endowment Fund, and Higher Education Investment Fund — total roughly $4.2 billion, not enough to cover a single year of full state operations.
Dunleavy emphasized the need for fiscal discipline moving forward: “We will not stop fighting for better educational outcomes, safer communities, and stronger support for Alaska’s families — but we must do so with discipline and focus.”
View the full Executive Order here.
