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Lt. Gov. Sean Parnell is pushing the Legislature to block the imminent return of the 8-cent-a-gallon state gas tax. It's his first substantial policy move as he prepares to take over from Gov. Sarah Palin and he's already running into resistance.
Parnell, who becomes governor in just more than a week, is asking the Legislature to take up the issue at a special session already scheduled for Aug. 10. But some legislators argue it's harder to sell Congress on the need to send road money to Alaska if this is the only state without its own gasoline tax. Others complain of piling things onto a special session that was only supposed to last a day. Last August, when fuel prices were soaring and the state enjoyed a huge budget surplus, the Legislature followed Palin's urging and suspended the state's motor fuel taxes for one year. That temporaily got rid of the tax on gasoline, as well as the 5-cent tax on marine fuel and taxes on aviation fuel. If the Legislature doesn't act soon they will again be imposed on Sept. 1. Much has changed since the Legislature suspended the taxes, giving up $40 million in revenue to the state. A drop in oil prices has since erased the budget surplus. Anchorage gas prices also went down from $4.37 a gallon last August to about $2.90 a gallon now. That is still among the highest in the nation, Parnell said, and more than local motorists paid in the past. They need the money, he said, not the state. "Legislators should take this opportunity to help Alaskans at the pump, and with economic uncertianty gripping our country and our state, this is not the time to place an additional tax burden on our people," said Parnell, who is lieutenant governor until Palin's resignation on July 26. Anchorage Democratic state Sen. Bettye Davis has a bill to keep the taxes away for two years. She made similar arguments as Parnell but her bill stalled this spring in the Senate Finance Committee with opposition from key lawmakers like Sen. Bert Stedman, co-chair of the committee. Stedman said it hurts Alaska if it is the only state that doesn't have its own gas tax but tells Congress that it needs federal money to help with roads. "That makes it harder for our delegation in Washington, D.C., to argue for our fair share of highway funds," said Stedman, a Republican from Sitka. That's the position of Alaska Rep. Don Young, a U.S. House Transportation Committee member who narrowly defeated Parnell in a bruising congressional Republican primary race last year. "It would hurt the delegation's effectiveness in securing federal highway money," said Young's spokeswoman, Meredith Kenny. Alaska's two U.S. senators did not seem as sure. "If Alaska waived it, we would be the only state without one, but I don't know how that would affect our ability to get federal highway money, because the federal highway fund is funded only by the federal gas tax," said Michael Brumas, spokesman for Alaska Republican Sen. Lisa Murkowski. Julie Hasquet, spokeswoman for Alaska Democratic Sen. Mark Begich, didn't address the fuel tax issue but said life can be tougher on the delegation when the state turns down money. "We can tell you Sen. Begich encountered some resistance when Gov. Palin turned down stimulus funds and then asked for federal transportation earmarks," Hasquet said. State Senate President Gary Stevens said there are other problems as well with Parnell's idea. The Aug. 10 special session is supposed to last for just one day, he said, and taking up the fuel tax issue would probably add at least four more days to it. The special session is to confirm the new lieutenant governor; Craig Campbell, and vote on overriding Palin's veto of federal stimulus funds for energy projects. Stevens said he would poll legislators before a final decision is made on Parnell's request. Rep. Mike Doogan, an Anchorage Democrat, said when things get piled onto a special session it eventually becomes just a regular session held at a different time. He also wasn't happy to learn about Parnell's request from a press release, saying he'd hoped for better communication then he experienced under Palin. There are supporters of keeping the gas tax away. Anchorage Democratic Rep. Pete Petersen said Alaska's gas prices are higher than justified. He supports Parnell's idea and is also trying to add the bill outlawing "price gouging" at the pump to the special session agenda. The merits of that bill have been hotly debated.