AD Main Menu

GOP candidates for U.S. Senate oppose repeal of oil-tax cut -- some mildly, some fiercely

Alex DeMarban
The three GOP candidates for the Republican nomination for U.S. Senate are, from left to right, Joe Miller, Dan Sullivan and Mead Treadwell. Loren Holmes illustration

Before a pro-industry audience in the first publicized forum of the U.S. Senate race, Dan Sullivan and Joe Miller swatted at one another over the controversial oil tax cut, while Lt. Gov. Mead Treadwell said he once solicited the help of national Republican group to knock off the bipartisan coalition in the state Senate that had blocked the measure.

A question about the tax cut -- which could be repealed if a voter initiative on the August ballot passes -- was one of three submitted ahead of time to Republican primary candidates by the Alaska Support Industry Alliance, which organized the breakfast forum before about 200 people on Thursday. Although the oil tax cut is not a federal issue, it’s the most important matter facing the state and affects everyone, said Rebecca Logan, general manager of the Alliance.

Miller has a campaign ad that touts his work as a part-time attorney for the Fairbanks North Star Borough, when he “took on powerful corporate interests in the important TAPS pipeline case.” Major oil companies lost that fight after squaring off against the borough and other local communities over the pipeline’s value  -- and therefore potential tax revenue.

Miller, usually outspoken and direct, gave a nuanced reply to the oil tax question. He pointed out that he’s signed a pledge not to raise taxes. He said his supporters fall on both sides of the issue. Some want to repeal the cut. Others say businesses need a stable tax climate.

He said the issue is technically complex, and the state is trying to find the magic number that provides maximum public benefit while also enhancing production.

He said other things, too, but finally suggested it might be too early to repeal the law: “Certainly, I think the jury is out on this. But to sit back and say we ought to reverse it in a very short time period, without having that information back, I don’t think it’s a very good idea.”

Meanwhile, former Natural Resources commissioner and attorney general Dan Sullivan, who has been criticized for staying quiet on key issues and who helped Gov. Sean Parnell push the cut through, wasn’t quiet on this one.

“Here’s my answer,” Sullivan said, raising a “Vote No on 1” bumper sticker and getting a rare burst of applause. “I’m not 100 percent sure what Joe’s answer was, but here’s my answer.”  

He said that after the failure of House Bill 110, an earlier version of Parnell’s cut, the governor in 2012 asked Sullivan to lead the team that pushed through he redesigned tax cut, which came to be known as Senate Bill 21. He also encouraged companies across the country to invest in Alaska and said the cut is working, producing new investment on the North Slope that’s sparking the economy and jobs.  

“Thousands of hours, testifying, speeches, designing this, working with the Legislature, calling certain legislators in the dark of night for key votes, because this passed by a thin hair,” Sullivan said.

Sullivan, who joined the race in October, said one of his advisors told him to keep quiet on the oil tax cut. Early polling suggested there wasn’t a lot of support for the cut.

“I had one advisor who said, ‘Hey, you might want to lay low. It’s not polling well. You don’t want to be associated with this,’” Sullivan said. “Don’t be associated with this? I own this. What I’m going to do as a candidate is be a full-throated proponent and educate people on why this is so important. I’m not going to play defense.

“Look at Mark Begich. Where is he on this? I don’t know. One of the most important issues in the state of Alaska, he won’t get off the fence.”

“I’m one of the number-one advocates of this issue. Do or die. If that hurts my campaign because it doesn’t (poll) well -- it’s called principles,” Sullivan said.

For his part, Treadwell, argued that because he’s lieutenant governor, and therefore supervises elections officials, he would not state how he’ll vote. But he said he’d give the audience a good idea of how he feels.

He said he had once urged former Gov. Sarah Palin, when she was running in 2006, if she would sign a tax pledge.

“She said, ‘No, I wouldn’t. The taxes on oil companies were set in a culture of corruption; we have to raise them,’” recalled Treadwell. “I said, ‘Governor, I’m not sure I agree with you.’”

Treadwell said he supported a tax cut before Parnell and Sullivan did: “I ran for that. I ran for filling the Alaska pipeline as your lieutenant governor.”

He said he remembered a September 2010 speech after he and Parnell were nominated where the governor shifted position and the effort to cut taxes began.

“As a member of a caucus of lieutenant governors and secretary of states that raise money for the Republican Party around the country, I made sure that they spent money here to help us get rid of the Senate coalition that was holding up this bill so we could get Senate Bill 21 through,” Treadwell said.

In his closing statement, Miller seemed to shoot back at Sullivan, who has brought several state lawsuits against the federal government. Miller said the state has an amazing opportunity to be part of a movement -- with lawmakers like Ted Cruz and Rand Paul and Mike Lee -- seeking to win state control over what are now federal lands.  

“If we elect someone that’s going to go along to get along, just be part of the system and been filing lawsuits here and there, working hard but not really making any progress, the fact is you aren’t going to get that change,” Miller said. 

Correction: This story originally reported that the forum was held Wednesday.