OPINION: To find the cause of Alaska’s issues, look for the bottleneck

That $8 per barrel oil tax credit we hear about? Although the word “credit” sounds positive, most Alaskans are unaware of the negative impact it has on our state and individual Alaskans.

The state of Alaska owes money for the credit so think of it as an expenditure by Alaska. At current pricing for Alaska North Slope crude, or ANS, Alaska owes oil companies about $1.2 billion per year. Unless action is taken, this expenditure will bleed Alaska and Alaskans dry. We must stop the bleeding.

The cost of this expenditure alone approaches $140,000 per hour — every hour, 24/7/365. This is about $3,335,000 per day. This drains Alaska; it’s strangling Alaska.

Our governor recently vetoed $87.5 million for K-12 education from the legislative appropriation. This was one-half of $175 million to improve the lives of Alaska’s children.

But let’s put that into context. The entire $87.5 million veto is less than four weeks’ worth of what Alaska owes for the $8 per barrel expenditure. Alaska owes about $100 million per month because of the credit. It’s killing education; Dunleavy may not approve of funding for schools, but he approves of this.

In 2013, when Dunleavy was in the state Senate, he voted for the $8 per barrel credit. Just after changing his title to governor, he slashed 40% of the University of Alaska budget, about $150 million in one year. Well, where did Dunleavy want that $150 million to go? Based on his votes, his preference was for it to go to the oil companies.

The $150 million slash by Dunleavy accrues in only 45 days — $150 million divided by the $3,335,000 per day cost of the credit equals 45 days. In addition to state services and our pocketbooks, the $8 per barrel credit is killing the university. It seems Dunleavy is fine with this.


This year, our governor cut community assistance by $30 million — that’s 9 days of what Alaska must pay to oil companies. He slashed $10 million for major school maintenance and $10 million for our essential ferries.

These examples give voters a sense of who Dunleavy favors and who he does not. He always favors the oil companies at the expense of our K-12 children, our university or our communities.

Capital budgets are now nearly non-existent because there is little money to fund them. Alaska does contribute about 10% for federal highway monies to get a 90% federal contribution. But across this state, deferred maintenance accumulates. How do we pay for necessary maintenance? We fall further and further behind.

Back in 2019, Dunleavy slashed $20 million from funding for seniors. He cut $7.5 million from homeless assistance. He cut Early Learning by $8.8 million. He hurt the blind, elderly and disabled by cutting $7.5 million. Medicaid lost $77 million. These cuts show who Dunleavy does not listen to. The oil companies have his ear.

His attacks on education, university and communities are habitual.

With one side of his mouth, Dunleavy smiles and says you should get grandiose Permanent Fund dividends. On the other side of his mouth, he voted for the $8 per barrel expenditure costing Alaska $140,000 per hour, which gave to the oil companies nearly the equivalent of $2,000 per resident for each year.

Again, do you sense who Dunleavy favors and who he does not? The money saved through cuts to our PFDs, public education, university and communities did not go to you and they did not go to your government. They went to oil companies. Focus your anger and emotions on Dunleavy’s transfers from you and your government to the oil companies.

Alaskans read and hear about dysfunction within the Alaska Permanent Fund Corp. We read and hear about high staff vacancies in our state agencies. Our governor seems to attract both those immediately around him and those whom he appoints based not on competence but on their loyalty to him, not Alaska’s constitution. We read and hear of unqualified appointments to the University of Alaska Board of Regents and other boards. Extremely questionable investments were made recently by the Alaska Industrial Development and Export Authority. Executive branch silence and secretive conduct are now common. We even read and hear of dysfunction in Alaska’s ability to make timely payroll. These shortcomings appear to part of a larger, wider, taller and deeper problem. Examples like these raise a serious concern of state departments/agencies on the precipice of implosion.

Look for the bottleneck. It’s always at the top.

Joe Paskvan is a lifelong Alaskan and retired attorney. He served in the Alaska State Senate from 2008 to 2012, including a year as co-chair of the Senate Resources committee. He lives in Fairbanks.

The views expressed here are the writer’s and are not necessarily endorsed by the Anchorage Daily News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)adn.com. Send submissions shorter than 200 words to letters@adn.com or click here to submit via any web browser. Read our full guidelines for letters and commentaries here.

Joe Paskvan

Joe Paskvan is a lifelong Alaskan and retired attorney. He served in the Alaska State Senate from 2008 to 2012, including a year as co-chair of the Senate Resources committee. He lives in Fairbanks.