Monday, June 17, 2013

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Democratic Senate Minority in Legislature Fighting Governor's Oil Tax Bill
Dem Sen. Wielechowski calls Parnell's bill "crazy"
By Bill McAllister


ANCHORAGE - In Juneau, Republicans now control both houses of the Legislature, as well as the governorship.

But that doesn't mean the Democratic minority will go down without a fight on oil taxes.

Senator Bill Wielechowski continues to insist that Governor Parnell’s plan to cut production taxes not only will raid the state treasury, but won't achieve the results the governor wants -- increased industry investment and more oil in the pipeline.

At a press availability Wednesday, Wielechowski characterized the governor's new bill as “crazy.”

He said by eliminating the progressive feature of the profits-based tax -- which captures a dramatically higher percentage for the state at high oil prices -- the governor will allow billions of dollars to get shifted to oil development in Libya and Algeria.

"When we passed ACES, we went from a gross tax structure which protected the state on the down side, and instead we said we're going to take the money on the high side. Now what he's doing is he's giving away the low side and now he wants to give away the high side. Terrible public policy. There's not an expert that has testified before us that says we need to do this."

By way of comparison of revenue-raising systems, Wielechowski said that the Norwegian permanent fund, with less oil revenue accumulated over less time, stands at $600 billion, 15 times the size of the Alaska Permanent Fund.

Wielechowski does want to see some changes to ACES. He said there should be a cap on progressivity.

If prices ever spike above $150 a barrel, he says the state's take would be excessive.

He also says he favors a cap on the amount of tax credits for capital expenditures.

Wielechowski has challenged Governor Parnell to a debate, to be broadcast statewide.

Responding to that, Parnell spokeswoman Sharon Leighow emailed CBS 11 News: “The governor looks forward to the public vetting process of his proposal. He appreciates the input of all Alaskans on this important topic.”