Group fights move to repeal oil-tax cut

ldemer@adn.comMay 13, 2013 

To sign or not to sign.

An oil industry group wants Alaskans to think hard about whether to put their names on petitions seeking to put a measure on the 2014 ballot that would repeal the oil tax cuts passed this year by the state Legislature.

The group "We Are Alaska" is coming out against the referendum with radio ads, a Facebook page and Twitter feed. It is being funded by the Alaska Support Industry Alliance. The Alliance is a trade organization with some 500 member groups that support the oil industry and employ people such as engineers, drillers and electricians, but also bankers, caterers and educators. The career and technical education department of the Anchorage School District is listed as an Alliance member, for instance.

There are now organized efforts on both sides of the emerging ballot battle.

"It's to provide the other side of the story," Alliance general manager Rebecca Logan said -- that many jobs and much government spending in Alaska stems from oil revenue.

Explorers and producers are specifically barred from joining the Alliance, whose members employ 30,000 people directly and another 20,000 indirectly, Logan said, referring to an economic profile done recently by the McDowell Group.

"Behind every barrel of oil there are jobs," the narrator says on the We Are Alaska radio ads, which are airing in Anchorage.

About 95 percent of the state's general fund revenue comes from oil proceeds. It pays for everything from troopers and teachers to road repairs and snow plowing. Besides the industry support workers, many of Alaska's 15,000 state employees have salaries or wages paid in part with oil money, she said.

"Their jobs depend on a thriving oil industry," Logan said. While the cut in oil taxes will mean a hit to the state treasury, industry boosters say it should be short term because if more oil is produced, there will be more oil to tax.

Senate Bill 21 was pushed by Gov. Sean Parnell to encourage oil companies to invest in Alaska and stem a long-term slide in production. The governor plans to sign the bill into law at an Anchorage Chamber of Commerce luncheon on May 21, the chamber announced Monday.

Referendum backers began collecting signatures this month to repeal the legislation. They argue it's a giveaway, especially to the major oil producers, ConocoPhillips, ExxonMobil and BP, and cuts taxes without requirements for more investment or oil production. They need to collect signatures of more than 30,000 registered voters by July 13 on petitions that support putting the measure on the August 2014 ballot.

The tax-cut critics have organized as "Vote Yes -- Repeal the Giveaway." Pat Lavin, an attorney and one of the referendum leaders, said he anticipated opposition, just not this early while they were still in the signature-gathering stage.

The Vote Yes group received petition booklets from the state on April 30 and has collected roughly 8,000 signatures already, Lavin said. To put the referendum on the ballot, they must collect signatures in at least 30 of the 40 House districts. They've got volunteers in far flung places already, he said.

"We wound up getting booklets out to Adak," Lavin said.

Logan said her group is not trying to discourage people from signing the booklets. She expects the referendum backers will collect enough signatures. They want people to realize that a cut in oil taxes should spur job growth and won't just mean more money for the oil companies, she said.

The We are Alaska group formed last year and worked to defeat Democratic senators in the bipartisan coalition that in 2011 and 2012 stymied the efforts of Parnell and many Republicans in the Legislature to revamp a Palin-era tax structure.

Known as Alaska's Clear and Equitable Share, or ACES, it progressively increased the state share as oil prices increased. The new measure, which doesn't have a catchy name, contains the barest link between higher taxes and higher oil prices. The state expects to collect $800 million to $1 billion less than it did under ACES by 2017, without new oil production.

If the referendum makes it to the ballot and passes, the state will revert to the ACES tax structure.

Reach Lisa Demer at ldemer@adn.com or 257-4390.

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