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Industry rallies employers and workers to 'vote no on 1'

Alex DeMarban
Gov. Sean Parnell signed Senate Bill 21, the More Alaska Production Act, into law during a special meeting of the Anchorage Chamber of Commerce at the Dena'ina Center on Tuesday, May 21, 2012. Groups that support the oil tax reform legislation are urging Alaskans to vote down a citizen initiative to repeal it on Tuesday's ballot. Bill Roth

A Friday email blast from a group opposed to Ballot Measure 1 offers a window into efforts to rally support before next week’s vote on Alaska’s oil tax, with the group suggesting that employers arrange rides to polls and “impress on” workers how their vote could affect their jobs and families.

The email seeking help from Senate Bill 21 supporters was sent by Jim Jansen, co-chair of Keep Alaska Competitive -- Vote No on 1. On Friday, it reached some 600 businesses with tens of thousands of employees. Recipients include Alaska Airlines, GCI and six Native corporations, including ASRC and Doyon Ltd., Jansen said.

In an unrelated effort, Alyeska Pipeline Service Co. president Tom Barrett also sent a letter to about 800 employees and at least 500 contractors on Friday expressing his belief that a "no" vote is in Alaskans' interest in part because, he said, SB 21 will help put more oil in the trans-Alaska pipeline. Alyeska, owned primarily by BP, ConocoPhillips and ExxonMobil, is not part of Keep Alaska Competitive but has given money to a different campaign group, Vote No on 1. 

Alaska voters on Tuesday will consider a citizen referendum asking if they want to repeal SB 21 and replace it with the previous oil-production tax, Alaska’s Clear and Equitable Share, which pumped billions of extra dollars into the state’s savings accounts between 2007 and 2013.  

Critics of SB 21 have said it will largely benefit those with jobs tied to the oil industry or its contractors while hurting the rest of the state by reducing tax revenues partly because SB 21 lacks the rising tax rates of its predecessor.

Vic Fischer, co-chair of the Vote Yes -- Repeal the Giveaway group, said the letters are “simply out to spread fear among the people employed in the oil industry and related activities.”

Fischer said ACES is better because it increased the number of oil explorers in Alaska and encouraged new activity by providing large tax credits for investments in Alaska. The vast majority of the tax credits under SB 21 go for barrels produced from legacy fields, freeing up income for the largest producers that can be spent anywhere. 

“No one is out to mess up oil production,” Fischer said. “We want more independents and more production.”  

Jansen said Fischer was wrong about spreading fear.

“We’re trying to spread the facts,” he said of his letter. “If we don’t have a competitive tax structure to encourage investment, production will continue to decline. How far can it decline before you don’t have anything?

“If he calls that fear-mongering, that’s not the intention,” Jansen said. “We’re trying to make people understand the importance of the issue and the risks if we don’t deal with it.”

Jansen added most of the companies that received his email do not receive revenue from the oil industry. But like all Alaskans they depend on it because the state’s economy is inextricably tied to the oil industry, with petroleum production providing most of the revenues for the state budget, he said.   

The email from Jansen said it was paid for by Keep Alaska Competitive, which does not accept money from oil producers, according to its website. Jansen said the campaign group consists of grass-roots business leaders and individuals. Some of its top contributors -- and some of the recipients of Friday's letter -- have connections to the oil industry, however.

Alaska Frontier Constructors, for example, has played a key role building Exxon’s Point Thomson field. Udelhoven Oilfield System Services, a longtime contractor on the North Slope and Cook Inlet, is listed as another top donor.   

Lynden, a shipping company with air, land and marine operations, is also a top contributor to Keep Alaska Competitive. It receives only a “small minority” of its business from the oil industry, about the same amount it receives from the fishing industry, said Jansen, chairman at Lynden.

“This is an Alaskan issue,” Jansen said. “Our whole group has been doing this for four years because we believe the future of our state is based on competitive tax rates. We’ve never done this once for the oil industry.”

The letter asks supporters of Keep Alaska Competitive for their help and provides talking points employers can tell workers -- including that oil production fell sharply under ACES and that industry can invest elsewhere if it likes.

“This election is EXTREMELY close. Recent polling shows we are within the margin of error. Every vote counts. It is critically important that working Alaskans, specifically your employees, ‘vote,’” the email from Jansen says.

“You can do your part by impressing on your employees how this vote will impact them, their families and their jobs.”

Asked how an employer should do that, Jansen used his company as an example. He said he has never told his employees how to vote, he said, but he has told them how their decisions affect the company’s future.

“If you’re a truck driver for Lynden and Alaska loses the pipeline because there is not enough (oil) flow, and there is no more freight to haul to Prudhoe Bay and state government loses 90 percent of its revenue and there is no freight to haul, that is not a good thing for a truck driver of Lynden,” he said. “We’re trying to pass along the facts as we see them.”

The email also suggests that employers arrange rides to polls and give workers time off to vote. Friendly competitions for the work group sporting the most “I voted” stickers will also help, it says.

The email from Tom Barrett to Alyeska employees and contractors said, "In simple terms, since the law (SB21) was enacted by the Alaska legislature and signed by the Governor the decline rate of TAPs throughput has improved (from a more than 6 percent decline in 2012 to under a 3 percent decline for calendar year 2013). You can check the numbers on the Alyeska Pipeline website.”

Supporters of ACES have said North Slope oil production has been declining for a quarter century, and SB 21 will not stop the decline that has come because the state's large oil fields are aging. They've also said the pipeline is decades away from being shut down. 

Fischer said he hoped people would make up their own mind.   

“I want to remind the recipients that in the secrecy of the voting booth, they can vote ‘yes’ and that will assure them in the long run they will be better off,” Fischer said.