As lawmakers consider using proceeds from the Alaska Permanent Fund to patch Alaska’s $2.5 billion budget deficit, they are pushing back against a stress test concluding that their strategy has a 50/50 chance of failure.

“This seems unrealistically or unnecessarily pessimistic,” said Sen. Peter Micciche, R-Soldotna, after the results of the test were presented.

In a pair of hearings Monday and Tuesday in the Capitol, Alaska Permanent Fund Corp. CEO Angela Rodell stood by the results of the stress test and told lawmakers that the odds of failure could be reduced if the fund changes its investment strategy — a strategy that has driven the fund to record-high levels. As of Jan. 1, the fund was worth $64 billion.

“This analysis is simply designed to give you information about what could happen if we have a really wretched set of market circumstances,” sending the fund’s value downward, Rodell explained.

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