JUNEAU, Alaska (AP) — An Alaska Department of Law investigation found there were no violations of state law or regulations in a contract awarded to the grandson of a major donor to an effort to elect the governor in 2018.

The law department outlined its conclusions in a Jan. 29 memo about the sole-source contract awarded to Clark Penney, grandson of developer Bob Penney, the Anchorage Daily News reported Wednesday.

Bob Penney gave more than $350,000 to a political group supporting the election of Republican Gov. Mike Dunleavy.

The Alaska Industrial Development and Export Authority awarded Clark Penney’s company, Penney Capital, a contract in March 2019 worth $8,000 monthly to work with an economic development team formed by Dunleavy’s administration.

The contract was not publicly advertised or opened to competitive bidding.

The memo from Attorney General-designee Treg Taylor to Dunleavy Chief of Staff Ben Stevens said state attorneys investigated the authority’s procurement and contractor selection process and compliance.


The memo does not provide details of the investigation’s scope and length.

Authority Executive Director Alan Weitzner said the contract was enacted before he began his role.

The director at the time, Tom Boutin, said he was not aware of the memo and did not have anything to add.

“Whatever (the Department of) Law says, I’m sure they must’ve looked at it pretty thoroughly because quite a long time has gone by since Clark Penney ended the contract,” Boutin said.

The state extended the contract once, but Penney canceled the agreement in March 2020, saying he had become a distraction.

While state attorneys found no violations of existing rules, they recommended the authority consider changing its procurement rules to require more disclosure.


The memo was written 11 months after Dunleavy said his administration would perform a “deep dive” into the contract following questions about its legality from Democratic state Reps. Jonathan Kreiss-Tomkins and Zack Fields.

Fields declined immediate comment on the memo.

Kreiss-Tomkins said he is dissatisfied with the memo’s detail and wants to know how the authority concluded only Penney had the qualifications needed to justify a sole-source contract.

“It just elicits new questions in my mind,” Kreiss-Tomkins said.

Assistant Attorney General Maria Bahr, a law department spokeswoman, declined a request to make a contract investigator available, noting that investigations “are often conducted and vetted by a team of attorneys.”

The memo is the final report in the case, Bahr said.