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Legislator Gives ACES Presentation in Advance of SessionGara opposes governor's proposed changes to oil and gas tax billRelated ContentHas ACES scored? Or should lawmakers who support it be sent to the penalty box? The debate on Alaska’s oil production tax ramps up, days ahead of the next legislative session. The tax called Alaska’s Clear and Equitable Share, or ACES, will once again dominate the 90-day session that begins January 17. Governor Parnell’s bill would reduce the production or severance tax by about $1.8 billion a year – a move the governor says is necessary to encourage industry investment and reverse a longstanding decline in oil production. Monday, a supporter of ACES, but who has introduced a bill to modify the tax system, HB 231, went into the lion’s den to make his case for the existing tax structure. Gara, in contrast to the governor, proposes tax incentives that would only kick in if companies invest in Alaska exploration or production.* Democratic Representative Les Gara told members of the Anchorage Chamber of Commerce that they were going to hear a perspective on oil taxes that might be new to them. Gara then said, counter to what he calls myths, investment and employment on the North Slope actually have increased since ACES was signed into law in 2007. He says it’s no wonder that Alaska has an unemployment rate far below most of the Lower 48. Republican Senator Cathy Giessel, who supports the governor’s bill, acknowledged that North Slope exploration is up due to what she calls overly generous tax credits under ACES. One area of disagreement concerns what the producers have said they would do if the governor’s bill passed. Gara had a slide projected with testimony from a House Finance Committee last year, in which lobbyists for BP and Exxon Mobil declined to make any promises in response to Gara’s questions. But Giessel says all three major North Slope producers have made more bullish statements since last session, and she noted that the top executives met with Governor Parnell last week, although there were no announcements of written commitments. Gara’s reception at the Chamber was polite and civil, but not enthusiastic. The written questions that were submitted by audience members and presented by the moderator seemed to suggest that the overwhelming majority of the businesspeople were unconvinced by Gara’s presentation. *Correction: Originally this article called Gara an ardent supporter of ACES, but he has indeed filed a bill to make adjustments to the oil and gas tax structure. |
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salaska said on Wednesday, Jan 11 at 8:18 AM
Was anyone surprised that the citizens heard nothing about Parnell's meeting with Big Oil? That is where this legislation was written by the oil companies. Parnell is no longer a true Alaska supporter. He is, and always will be, a lobbist for big oil.
79713614Anonymous said on Tuesday, Jan 10 at 10:45 PM
ACES - Alaska's Clear and Equitable Share. We are taking way more than our fair share! I agree with the notion but it should have been capped because with the price of oil the last couple of years, we are taking way more than our fair share.
79697504Wes said on Tuesday, Jan 10 at 9:18 PM
ACES equals a fair sales price(not a tax) for our non-renewable recourses. When we were contemplating becoming a state, the delegates wisely kept ownership of subsurface minerals to the new state. The reason was and still is wise to this day. There aren't enough people in Alaska to provide a sound tax base with which to pay for state government. Since 1959, this truth has become much more critical as the legislature has created many new programs and the state has entered into consent decrees such as Molly Hootch which legally bind the state to pay huge amounts of money each month to stay in compliance with these agreements. Once our oil is gone it is gone and the expenses will continue. Repealing ACES would be folly: Hopefully Senator Stedman can continue to put the skids to the repeal effort--if he fails you and I will be paying high income taxes and sales taxes to support a state government that still will have insufficient funds to operate and the oil companies will be gone.
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