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Alaska business-backed group spends more than $10,000 on last-minute anti-income tax television ads

  • Author: Nathaniel Herz
  • Updated: June 14, 2017
  • Published June 14, 2017

JUNEAU — A conservative, business-backed political group with ties to the oil industry is spending more than $10,000 to run television ads opposing an income tax in the final days of the special session of the Alaska Legislature.

The ads, from Prosperity Alaska, hit KTUU's airwaves Tuesday and KTVA's on Wednesday, according to filings with the Federal Communications Commission. The 30-second commercial features Scott Hawkins, the chair of the group's board, petting a dog in a kitchen, where he argues that "big-spending House liberals are crying wolf."

"But there is no wolf. Alaska has plenty of money to fund essential state services and pay a healthy dividend," Hawkins says in the commercial.

Hawkins is considering a Republican bid for governor next year, but aside from opposing an income tax and petting the dog, the commercial makes no mention of his aspirations.

But the ad goes on to attack six members of the House majority who supported an income tax to help close Alaska's $2.5 billion deficit: Republican Reps. Paul Seaton of Homer and Gabrielle LeDoux of Anchorage, Democratic Reps. Les Gara of Anchorage and Scott Kawasaki of Fairbanks and independent Reps. Dan Ortiz of Ketchikan and Jason Grenn of Anchorage.

Prosperity Alaska is a 501(c)(4) corporation under IRS rules — a so-called "social welfare" nonprofit that doesn't disclose its donors. But the group is housed at same Midtown Anchorage building as Hawkins' oil and mining logistics company, Advance Supply Chain Integrators.

Prosperity Alaska's board of directors includes Hawkins, Alaska State Chamber of Commerce President Curtis Thayer, Lynn Johnson — co-founder of oil field equipment manufacturer Dowland-Bach — and staff from the Resource Development Council and the Support Industry Alliance, both of which support the oil and mining industries.

Prosperity Alaska also sent mailers last month attacking Alaska Gov. Bill Walker and six House majority members — referred to as Walker's "tax-and-spend gang."

The Legislature's special session is scheduled to end Friday, with lawmakers trying to decide on a spending plan for the state's next fiscal year, which starts July 1, to avert a government shutdown.

House majority members want to raise $700 million for the state budget with an income tax, which would ask higher income Alaskans to pay higher rates. That's in contrast to using investment earnings from the Permanent Fund, which would take an equal amount of cash from each Alaskan's dividend — hitting poor residents harder.

Both the House and the Republican-led Senate majority support using some fund earnings to pay for government, but neither is proposing to use enough to completely fill the $2.5 billion deficit.

The House wants use the income tax to cover the difference, while the Senate opposes the tax and would prefer to fill a remaining gap of hundreds of millions of dollars with state savings and by cutting the budget, with big cuts to school district and university education spending. The House's income tax proposal appears to be dead, having been voted down by the Senate; Walker has also proposed a modified version that both chambers have received coolly.

Asked why his group opposes the income tax and not dividend reductions, Hawkins responded: "We're not commenting on the Permanent Fund in this ad."

"We're commenting on the income tax and that it's unnecessary," he said. "I don't accept the fact that there's a moral equivalence between levying a tax on people that's not needed versus not mailing quite as much money to people from the dividend fund as some people might like."

Grenn, the Anchorage independent and one of the subjects of the new television ad, was unmoved.

"Yawn," he said, when asked about the commercial Wednesday. "We've seen this attack ad before. It's more of the same that isn't a fair description of what's going on."