We had finally stopped the Corrupt Bastards Club and had gotten our state’s finances back on track with the ACES oil tax structure. We were building a large Constitutional Budget Reserve with the new oil tax. Then came SB 21 in 2014 with a per-barrel tax credit never seen before in the public or private sector. As a result, as written recently by the UAA Center for Economic Development, our economy got “stuck in a rut.” The start of our seven- year rut matches perfectly with the enactment of SB 21 in 2014.
The oil industry and its legislative backers said Alaska would benefit by increasing oil production and creating more jobs. But oil production and oil jobs decreased, and none of the promoted benefits were ever achieved. As a result, we have blown through our Constitutional Budget Reserve earned under ACES to make up for the per-barrel tax credit under SB 21. Yet we still hand out this unearned incentive. Now the Legislature is considering new sales and income taxes to make up for the shortfall caused by the oil industry per-barrel tax credit welfare program under SB 21.
Our Legislature needs to focus on receiving a return for the sale of our resources. Investment in the oil industry does not necessarily increase the return on income for Alaska — especially if all the new investment is on federal land. Contact your legislators and ask them to support SB 114, which pares back the per-barrel tax credit. It’s time for Alaska legislators to stand up for Alaska and end the oil industry incentive that will forever keep us in a rut.
—Wayne Blank
Anchorage
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