I have been repeatedly asked how, as a fiscally and socially conservative Republican, I could advocate for the bipartisan coalition in the state Senate. The simple answer is that Alaska is different. Watching Fox News or MSNBC gives no insight on how to best govern Alaska's resources. The red-blue split in philosophy at a national level cannot be thoughtlessly applied to Alaska's unique circumstances. The complex answer is that we are an owner state.
In 1920, Congress voted to retain the subsurface mineral rights to all federal lands, even when transferred to private parties. This provided a different development model for late-populated Western states like Alaska. The Statehood Act cemented this policy by dictating that Alaska could not divest the mineral deed of the 103 million acres it received after statehood. Therefore, Alaska will never be Texas, where individuals own the resource in the ground and transact mineral leases as private enterprises. The state is required to own and develop oil and gas, and the Alaska Constitution appropriately charges it to manage that wealth in trust for the maximum benefit of its people.
This reality is reflected in the state's budget and the work of the Legislature. In 2011, the state collected $9 billion in revenues, $8 billion of which was from oil. Almost 90 percent of state funds thus come from North Slope oil fields developed predominantly by three companies. So the primary duty of the state's executive and legislative branches is the responsible oversight of this global energy resource owned by Alaskans. That includes managing it for the best interests of its beneficiaries/shareholders, the people of Alaska.
Consequently, every legislative session in the last decade has been dominated by oil and gas issues, either taxation or gas pipeline development. The Legislature is at its best when it handles these issues in a nonpartisan fashion. Every major advance -- getting TAPS permitted, regulating pipelines, enacting a realistic severance tax, an ad valorem tax, a tough antitrust law and separate accounting for oil and gas taxation -- was a bipartisan act, not marked by Democratic or Republican party labels but by a philosophically united coalition standing tall for Alaska.
Three governors, Democrat Bill Egan and Republicans Walter Hickel and Jay Hammond, understood this concept. While they were political rivals, with sometimes competing visions, each unabashedly acted as our chief executive and pursued Alaska's ownership interests first. Many Democratic and Republican legislators since the 1970s have similarly understood their role as stewards of Alaskans' resources. The members of the last session's bipartisan Senate coalition were of that mold. They said no to a transfer of $2 billion of Alaska's dollars each year to the oil companies when nothing was offered in return. They also said no to a small-diameter gas line that would bypass Fairbanks and do little to reduce high energy costs to Alaska homes and businesses.
Individually we each own about one seven hundred thousandth of the oil resources managed by the State of Alaska. That interest earned $22,000 for each of us last year. Although most of those revenues are spent on state services or saved, rather than being paid to us as a dividend, they nonetheless impact every facet of our daily life. I thus encourage Alaskans to analyze legislative candidates in a manner similar to how they would vote for board members of the largest stock holding in their portfolio. The best applicants will understand their obligation to maximize our long-term shareholder wealth, including a willingness to study oil and gas issues in detail and, as appropriate, act independently. Like being a board member of Disney, Apple or any other company, this has little to do with political affiliation and everything to do with performing as a fiduciary.
That is why I believe Alaskans should vote for candidates who will backseat personal ambitions and party politics to their responsibility to develop our energy resources for our maximum benefit. We are an owner state and it is time we start acting like owners.
Bill Walker owns an Anchorage law firm that practices oil/gas and municipal law. He ran for governor in the 2010 Republican primary.
by BILL WALKER