Skip to main Content

Berkowitz: Alaska needs a different approach to developing its valuable resources

  • Author: Ethan Berkowitz
  • Updated: September 27, 2016
  • Published October 30, 2010

It means something to be an Alaskan, something unique to each of us, and something shared by all of us. More than any other place, we have the resources -- both physical and human -- to face the future on our own terms: self-reliant, independent, and with justifiable optimism. Throughout this campaign, I've shared my vision for our future and introduced a series of bold ideas to prosper from Alaska's opportunities and secure our future.

It is time to show initiative and reject complacency. It is time to live up to the best of the Alaska spirit and move forward boldly as the independent, self-reliant people we can and should be. It is time for a new approach.

As a resource state, we need to reduce development risk, increase resource production and jobs, give Alaska a fair share of revenues, enforce budget discipline, and de-politicize our relationship with resource developers. The Palin-Parnell tax, ACES, undermines Alaska's competitiveness by choking off the investment we need. Tinkering with ACES using caps and credits -- as my opponent has recently proposed -- is not enough.

My solution is to revise the revenue structure by adopting an all-royalty system. This system provides fiscal certainty for industry by accommodating the range of economics confronting oil and gas projects, and giving assurance that the rules will not change once investments are made and production begins. This system is used successfully around the world in oil- and gas-rich areas. It better protects Alaska's interests because it requires work commitments by the producers once they accept contract terms (a commitment not required under Parnell's approach).

The all-royalty system is also better because it is removed from politics. As with the Permanent Fund, elected officials would set policy, but experts and professionals would implement those policies based on business principles, not political calculations.

I've also introduced a series of proposals called "The Alaskan Ownership Stake" that reflect Alaska's unique character and values.

Part I, "Own a Piece of the Pipe," allows individual Alaskans, Alaska businesses and Alaska Native corporations to choose to invest in building a gas pipeline, an opportunity that never before was provided to Alaskans.

Part II creates an option that exists in 27 other states -- allowing Alaskans to purchase lifetime hunting, fishing and trapping licenses.

Part III is called "Open for Business." Alaska currently ranks at the bottom of all 50 states for our business climate, a situation we must reverse. It reduces Alaska's current corporate income tax rate from 9.4 percent to 4.9 percent, moving us from the fifth highest tax regime in the nation to the eighth most competitive. It eliminates taxes on small businesses (non-oil, non-gas, non-mining) making less than $90,000 per year.

Part IV restores integrity to the governor's office and reclaims our stake in ethical, transparent government. It sets the attorney general free from the governor's office to represent Alaskans, and establishes an office of legal counsel in the governor's office to eliminate conflicts of interest. It insulates the Alaska Personnel Board from intervention by the governor's office, bringing ethics back to the executive branch.

Part V, "Restoring Accountability," is how Alaskans will hold me accountable for each proposal I have put forward and gives the public tools to grade my performance as governor.

Standing still in a changing world is a recipe for disaster. Alaska has great opportunities but we must be proactive. Failure to move our state forward jeopardizes Alaska's security, economy and the future we can have for our families, communities and businesses. I have offered real solutions to get Alaska moving and break free of the stagnation of our current acting administration.

Alaskans have much to offer the nation and world. We can provide the energy to drive this state and country into the future, but success requires foresight, will and leadership. We begin by relying on ourselves -- it's the way Alaska has always turned bold ideas into reality.

Ethan Berkowitz is the Democratic candidate for governor.