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Gov. Sarah Palin announced Tuesday she will move the state Division of Habitat back into the Department of Fish and Game.

Former Gov. Frank Murkowski triggered great controversy when he moved the division from Fish and Game to the Department of Natural Resources in 2003 to promote development. Palin criticized the move in her campaign, but she spent a year studying the effects of the change before deciding to move it back.

"We could not find one area where they failed Habitat," Palin said of the Department of Natural Resources.

Rather, she moved it to avoid the public perception that the division wasn't able to effectively protect resources in its new home, and to improve communication between Habitat and Fish and Game, she said.

Legislators pushing House Bill 41, which would move Habitat back to its original home, had been hoping for an executive order, which is a simpler process.

"Saved me some work," said the bill's author, Rep. Les Gara, D-Anchorage. "We don't have to keep marching people to hearings anymore."

The Habitat Division grants permits for projects that could affect the state's fish and game resources.

During its time in the Department of Natural Resources, it has had a memorandum of agreement to use science from Fish and Game biologists, although that department did not have any direct say in whether permits were issued.

Palin said there would be "minimal budget impact" and no net change in employees. Habitat has 38 employees. When Murkowski moved the division, he also eliminated 22 jobs.

"We really had a division that belonged in two places," said Tom Irwin, natural resources commissioner.

He said the move would strike the right balance between protecting resources and promoting development. He also said the state was still committed to "getting to yes" on permits for industries, such as oil and gas, mining, timber and fish processing.

The move will take effect January 2009.

Irwin said the Habitat Division's relocation would not affect the permit process for the Tulsequah Chief Mine and other projects.

"We don't want a disruption," Irwin said. "We still need permits tomorrow and the next day and the next."

The Tulsequah Chief Mine developer, Redfern Resources Ltd., has applied for permits to use a controversial hoverbarge on the Taku River.

But Irwin also said, "I really foresee that (Fish and Game Commissioner) Denby (Lloyd) and his department will become much more involved."

Last week, the state Board of Fisheries voted to ask Palin to return the division to Fish and Game.

Kate Troll of the Alaska Conservation Alliance said that the move gave more parity in permitting to the two commissioners of each department.

"It was important to restore the required checks and balances of the government," she said.

Palin's executive order is scheduled for release Tuesday.