South Anchorage legislative race could determine control of Alaska House

Sep. 21—An open legislative seat in South Anchorage could determine control of the Alaska House in November, setting the stage for a high-stakes race between two first-time candidates.

Republican Rep. Laddie Shaw, a 75-year-old former Navy SEAL who has represented House District 9 since 2019, is retiring. The race to select his replacement pits a Republican aligned with GOP Gov. Mike Dunleavy against a nonpartisan candidate seeking to join a bipartisan coalition that can counter some of Dunleavy's policies.

Republican Lucy Bauer owns several assisted living facilities and is running with endorsements from Shaw and Dunleavy. Independent Ky Holland is a businessman and entrepreneur who says he decided to enter the race when Dunleavy in March vetoed a bill that would have permanently increased education funding for the first time in years. (Shaw was one of 16 House Republicans who then voted to sustain Dunleavy's veto).

The result of the race could determine the leadership of a closely divided House — and by extension, the fate of hotly contested policies, including the future of public education funding and public employee pensions.

Currently, the Alaska House is governed by a mostly Republican majority, with 19 GOP members joined by two Democrats and two independents who represent rural districts. The 16-member minority caucus, made up mostly of Democrats along with independents and one moderate Republican, hopes to grow its ranks in an effort to form a bipartisan coalition to mirror the one that exists in the state Senate.

With only a handful of truly competitive districts out of a total of 40 House seats, House District 9 — which stretches from Glen Alps on the Anchorage Hillside south to Girdwood and Whittier — is seen as a prime potential pick-up for the bipartisan coalition, and a critical fight for Republicans who fear losing the control they narrowly won back from a bipartisan coalition in 2022.

'A kind and genuine person'

Bauer, originally from China, immigrated to the U.S. in 1997, living first in California before moving to Anchorage in 2013. The assisted living facilities she owns cater to Alaskans with special and mental health needs.

"I didn't initially plan to enter the assisted living field when I came to the U.S., but a job opportunity led me to discover my passion for working with individuals facing mental health challenges," Bauer said in an email responding to questions from the Daily News. Bauer declined multiple requests for in person or phone interviews. Bauer's campaign also did not allow Daily News reporters to listen to Bauer's remarks at a recent campaign fundraising event.

Bauer, a widowed mother of five, says she has lived in House District 9 for seven years. In 2022, she began spending extensively to support the campaigns of political candidates. She was one of the biggest donors to Dunleavy's 2022 campaign, giving nearly $60,0000, and to former Anchorage Mayor Dave Bronson's unsuccessful 2024 campaign, giving more than $16,000. She has also donated at least $16,000 to the Alaska Republican Party since 2022, and represented Alaska as a delegate to the Republican National Convention earlier this year.

Also among the candidates whose campaigns she has funded are two Democrats — Anchorage Reps. Andy Josephson and Genevieve Mina — who said they likely earned her support because they advocated for increasing the state reimbursement rates for assisted living facilities, which benefited Bauer's businesses.

Bauer said the additional funding has improved the services offered by homes across the state, including in mental health care.

Josephson said he met Bauer in 2022 when she advocated for increasing state spending on the type of group homes she operates. That year, Bauer testified before the House Finance Committee, telling lawmakers that she operated five assisted living facilities but that she was struggling to hire staff and keep the doors of her facilities open after several years of flat state funding.

"Logically, it made sense for her to go to the Democrats on the subcommittee. They were going to offer assistance," said Josephson.

After Josephson and Mina advocated for increasing the state spending, Bauer donated $1,500 to each of their campaigns ahead of this year's election.

Asked about her political spending, Bauer wrote that she supports candidates "committed to protecting individual freedoms, promoting responsible resource development, and fostering strong communities across Alaska."

Bauer's political spending, which amounts to more than $180,000 in a two-year span, has earned her some support within the GOP. At a recent fundraiser, guests included Shaw, Bronson, Alaska Attorney General Treg Taylor, Anchorage Republican Rep. Julie Coulombe and others.

Coulombe said Bauer's experience made her a good fit for the Legislature.

"Her firsthand experience in dealing with people with mental illness and seniors is experience I feel the Legislature desperately needs. There's a lot of work that needs to be done around mental and behavioral health. I also find her to be a kind and genuine person," Coulombe said.

Bauer has given Coulombe's 2024 campaign $6,000, making her one of Coulombe's biggest financial backers.

Bauer has mostly self-financed her campaign. As of last month she had raised just over $40,000 — $25,000 of which was from Bauer herself.

Bauer said that if elected, she would support increases to public spending on social programs, including supporting substance abuse treatment, which she said would help reduce homelessness and crime. But she appeared wary of policies favored by Democrats and moderate Republicans, including a permanent increase to the education funding formula and a return to a defined benefits system for public employees.

Bauer did not respond to a comprehensive candidate questionnaire distributed by the Alaska Beacon earlier this year. But she did respond to a questionnaire from the Alaska Family Council, an anti-abortion group that has advocated against access to reproductive health care and against protections for LGBTQ+ Alaskans.

In that questionnaire, Bauer said she would support amendments to the state constitution removing protections for abortion access; would support legislation limiting access to gender-affirming health care for minors; would support bans on transgender people's use of bathroom that conform with their gender identity; would support banning transgender kids from playing school sports on teams that align with their gender identity; and would support new limits on sex education instruction in public schools.

Holland did not respond to the Alaska Family Council's survey.

'Solid with the party values'

Shaw, who endorsed Bauer, said he met her for the first time earlier this year. He said his impression was that Bauer would focus on education and social safety net programs if elected to the Legislature.

Shaw attended a meeting earlier this year with Bauer, along with two other GOP candidates in the race who ultimately dropped out: Lee Ellis and Brandy Pennington. The meeting also included Alaska Republican Party Chair Carmela Warfield and her husband, Jason Warfield.

"They asked each other questions, and Carmela, Jason and myself sort of refereed," said Shaw, adding that Carmela and Jason Warfield had been meeting with other GOP candidates across the state.

"They don't want somebody who's going to say, 'I'm a Republican,' and then all of a sudden go the other way," said Shaw. "Jason and Carmela want to be assured that the candidate that's running is going to be solid with the party values."

After Bauer emerged as the top Republican candidate in the primary with 21% of votes, Pennington dropped out and endorsed Bauer. Ellis dropped out and endorsed Holland.

Carmela Warfield did not respond to a request for comment for this story. She has not granted an interview to the Daily News since being elected chair of the party in April.

House District 9 has a history of rebuffing partisan candidates in favor of more moderate politicians. In 2022, Republican U.S. Sen. Lisa Murkowski got more than 51% of votes in the district, easily beating a more conservative Trump-backed challenger who had been endorsed by the Alaska Republican Party. In the same election, Democratic U.S. Rep. Mary Peltola won a majority of votes in the district, receiving more votes than her two GOP challengers combined. Dunleavy performed worse in the district than he did statewide, receiving less than 48% of votes in House District 9 even as he got a majority of votes statewide.

According to figures from the Division of Elections, 27% of voters in the district are registered Republicans, and 13.6% are registered Democrats. Nonpartisan or undeclared voters make up more than 55% of voters in the district.

The evidence appears to point to a district composed of voters more interested in policies than party affiliation. That is what Holland's campaign is banking on.

'Plays both sides'

After graduating from Service High School in Anchorage, Holland moved to Oregon to study mechanical engineering. He returned to Anchorage in 1999 and has worked a variety of jobs since then, including in the oil and gas industry and at the University of Alaska.

At a recent fundraising event in a private home in the district, Holland described priorities that include increasing funding for public schools and reintroducing guaranteed pensions for Alaska's public employees.

Education and public pensions are two areas where the candidates most obviously diverge. Bauer said that though she understands public employees' concern about their inability to save enough for retirement, defined benefits present "considerable financial risks for the state and the affordability long-term is questionable." Alaska is the only state that does not offer teachers any form of guaranteed income in retirement.

Bauer has also said that increases to spending on public education should be "tied to outcomes and real measurable results." She has also indicated she would support policies that would allow public funding to be redirected to private schools, siding with Dunleavy on an issue that is at the heart of ongoing litigation.

Holland's policies mirror those promoted by members of the bipartisan coalition in the Senate, and by members of the current House minority.

Shaw said he thought Holland "plays both sides very well" when speaking to voters, by finding areas of agreement with residents of the district no matter their political affiliation.

Holland said that when he meets voters, he often finds himself defending his lack of party affiliation.

"A lot of folks see an independent and they wonder, 'What are you really?'" Holland said. When he describes his professional background, which includes working as an engineer and investing in fledgling businesses, "people very quickly realize that I've got a background that brings a new lens to many of these issues in terms of actually creating businesses and creating future jobs," he said.

"The bipartisan coalition itself is not an issue that has been closing any doors," said Holland. "I will say that the fact that I'm running an as independent has people concerned about — 'What does that mean? Are you really an independent? Are you really one thing or another?'"

"I've learned to pretty quickly balance the industrial work that I've done in business and the fact that I've also been working in the community, and the independent view comes from both perspectives," he added.

At the recent fundraising event, Holland drew a crowd of union leaders, business owners and members of the current House bipartisan minority. Speaking to his supporters, Holland lifted a campaign sign bearing Ellis' name and thanked Ellis for endorsing his campaign, emphasizing the support coming from a Republican alongside some of the Democrats and independents in the room. Ellis was listed as a co-host of the event but he was not in attendance. He was out moose hunting, Holland said.

Anchorage Republican Sen. Cathy Giessel, whose Senate district includes House District 9, had originally endorsed Ellis in the race but has not weighed in since Ellis decided to drop out. Giessel said Thursday that Ellis' endorsement of Holland "does have influence" on her decision making.

"But I just am still weighing out whether to endorse Ky," she said.

Holland's campaign has received contributions from union political action committees, including the Anchorage Police Department Employees Association PAC and NEA-Alaska, which represents most educators in the state. He also received $2,500 from the Alaska House Democratic Campaign Committee, which seeks to grow the bipartisan coalition. Holland has so far given his own campaign $1,500. He had raised a total of $42,800 as of last month, slightly outpacing Bauer.

Rep. Calvin Schrage, an Anchorage independent who currently serves as minority leader in the House, attended Holland's recent fundraiser. Addressing a crowd of Holland's supporters, Schrage cajoled attendees into signing checks for Holland's campaign, not before speaking about the seat's significance for the prospect of increasing education funding or adopting other policies that Republicans have resisted.

"I'm telling you, this seat is going to be the seat that determines who has the majority next year. All the eyes are on this race," said Schrage.