State Sen. Bill "Babyface" Wielechowski hopes to knock the snot out of Andrew "The Dapper Destroyer" Halcro on Monday in an epic debate over a plan to lower oil taxes -- a move that could cost Alaska more than $1 billion annually. The debate is being billed by as "The Broil Over Oil" -- at least by us at Alaska Dispatch.
Cowering well away from the brouhaha will be Gov. Sean "Captain Zero" Parnell, the mousy proponent of the tax cut for three years running who refused Wielechowski's chest-beating Twitter challenge for a mano-a-mano to shine light on the idea's complex pros and cons. Instead, Alaskans get Halcro, no welterweight chump. President of the Anchorage Chamber of Commerce, one-time gubernatorial candidate (he unsuccessfully took on Sarah "The Barracuda" Palin in 2006), and a former state lawmaker, Halcro will put forth industry's argument: Without a hefty tax cut to the state's seven-year-old progressive tax system, oil companies can't afford to produce more Alaska crude.
Stakes higher than ever
Alaskans are plummeting down an oil-greased slope toward a dubious future. Oil production has dropped for more than two decades, and both sides agree the state is headed toward a fiscal cliff. The question: How to avoid economic disaster? The Parnell administration estimates his "oil-tax reform" will cost the state an average $900 million annually for the next six years. But the yearly loss could be well over that if crude prices rise above current projections and $120 a barrel.
Wielechowski, who represents East Anchorage, and his fellow underdog Democrats say that would throw the state's budget into a massive hole. Everyone agrees the current system, known as "ACES," needs tweaking. But Democrats say its incentives have put Alaska on track toward increased production. Meanwhile, Parnell's measure is seen as a giveaway to global companies -- BP, Exxon Mobil Corp. and ConocoPhillips -- that have thus far resisted making any guarantees that the billions in tax cuts would be reinvested in Alaska's aging oil fields.
Halcro, who emailed a challenge to Wielechowski after Parnell wimped out in facing "Babyface," argues that if lawmakers stayed the course they've plotted over three years of attempts to cut taxes -- and continue to do nothing -- then oil production will continue plunging, taking with it the state budget it fuels. A drastic reversal is needed to spur new production -- the current incentives don't work -- and that involves lowering taxes paid by oil companies.
The "Broil Over Oil" commences Monday at high noon at the Anchorage Chamber's weekly luncheon at the Dena'ina Civic and Convention Center. Debate moderator will be Steve Johnson, director of debate at the University of Alaska Anchorage. Tickets are $23 in advance for Anchorage Chamber members and $31 for non-members. The Chamber encourages RSVP.
Meantime, here are some background stories about the tax debate: