Federal money committed to Alaska hit a seven-year high of $19.7 billion

The federal government committed $19.7 billion to Alaska in the year that ended Sept. 30, the most in at least seven years, through contracts, grants, loans and other payments.

That's up 6% from $18.6 billion the year before, according to USAspending.gov, the government's spending database.

The federal government is the largest source of money coming into Alaska's economy, followed by oil and gas, Bob Loeffler, a University of Alaska Anchorage professor, told a Commonwealth North forum in June. Federal money drove about half of the state's economic growth from 2015 to 2023, the economists there said.

The Department of Defense is the largest federal spender in Alaska, and it buys construction, utility services and goods from local communities, said Brett Watson, an economist with the university's Institute of Social and Economic Research. Federal contract spending in Alaska grew 150% from 2015 to 2023, to about $4.5 billion, probably the fastest growth of any kind of federal spending, he said.

Federal jobs have moved the other way. Alaska's federal civilian workforce fell about 16% between 2024 and 2026, slightly faster than the national drop, the economists said. Most of those workers left through buyouts.

The new federal year's first month was up from a year earlier. October brought $2.26 billion, compared with $1.99 billion last October.

USAspending's figures for the latest three months show a drop of about 22% from the three months before. That drop is almost entirely November, which agencies have barely begun reporting. So far it shows $37 million. September and October each brought about $2.26 billion, more than June or August. The numbers will change as agencies catch up.

The figures count commitments to pay, such as a signed contract or an awarded grant, not money already spent. They're counted by where the money is used, not where the company or agency getting it is based. That leaves out contracts Alaska Native corporation subsidiaries win for work in other states.

Watson used a different measure of federal spending at the forum. By his count, it grew from just under $11 billion in fiscal 2015 to just under $20 billion in fiscal 2023, as Alaska climbed out of a recession driven by falling oil prices. Without COVID money still flowing in 2023, he said, it was just over $18 billion.