Ellis: This is 'weekend of decision' on oil taxes

Published on NewsOK Modified: March 15, 2013 at 8:55 pm •  Published: March 15, 2013
Advertisement
;

Last year, a consultant not being used this time told lawmakers government take of 70-75 percent for existing operations was "reasonable," though maybe slightly high. Sen. Bill Wielechowski, D-Anchorage, said lawmakers also heard reducing the severance tax would have little to no impact on production.

"This bill has to be stopped," Wielechowski said. "I understand the vote's close, and to any senators out there wavering on this, this is going to be a vote that you will be remembered by," he said.

Committee co-chair Kevin Meyer, R-Anchorage, said he would be "very comfortable" voting for the bill, noting the consultants have been consistent and saying he believes it will lead to more production.

Sen. Lyman Hoffman, the only minority Democrat on the committee, said he mistakenly marked "do pass" on the committee report but got that fixed. He opposes the bill, which he said would move too much cash to the oil companies with no assurances from them.

Senate Majority Leader John Coghill said Thursday that he thought there were at least 11 votes to support the bill, sufficient for passage. Some senators Friday were gathering or reviewing information, like Mike Dunleavy. The Republican freshman from Wasilla said the current proposal is the best approach he's seen thus far, but he wants to study it further over the weekend.

Sen. Bert Stedman, R-Sitka, said the structure of the proposal is on the right track. But he said it would give up too much cash from the legacy fields. He doesn't support the bill as it stands.

The debate comes with legislative leaders already looking at ways to limit state spending amid declining oil production. Alaska relies heavily on oil revenues to run. Higher prices in recent years have helped mask the impact of the production decline.

Rep. Alan Austerman, a co-chair of the House Finance Committee, said he expected savings would have to be used to help buffer the impact of lost revenue under an oil tax plan. He said the big question is how far savings would stretch if it takes seven to 10 years to increase production and the tax base.

The state has about $16 billion in savings between the constitutional and statutory budget reserve funds, but it also has some big obligations, like a multibillion-dollar unfunded pension liability.

The proposed operating budget passed by the House Thursday totaled $9.8 billion.

___

Follow Becky Bohrer at http://twitter.com/beckybohrerap .

| |

Advertisement


Trending Now



AROUND THE WEB

  1. 1
    Dave Chappelle Reveals Shockingly Buff New Look
  2. 2
    Peaches Geldof Funeral to Be Held on Easter Monday
  3. 3
    Mayor Who Fired Lesbian Police Chief Caught On Tape In Homophobic Tirade
  4. 4
    NBA commissioner wants to raise age limit to 20
  5. 5
    Dream guitars I wouldn't mind calling my own (34 Photos)
+ show more