Senator Berta Gardner

April 1, 2015

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Serving Midtown, Spenard, and UMed

State Capitol Bldg. Rm 9
Juneau, AK 99801
Phone: 907-465-4930
Call Me: 1-800-331-4930

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Emergency Tax Legislation

Dear Friends and Neighbors,

Senator Gardner and Senator Olson during a weekly Senate Minority Caucus Press Availability.
Last week, I held a Bipartisan “Lunch & Learn” at the Capitol with Senator Olson and Representative Seaton on the benefits on Medicaid expansion.

  As we work our way through the budget process, we do so knowing these relevant facts:

Because of the fall of oil prices, Alaska is right now about 3.5 billion dollars in deficit.

While there is much we can do to scour each program and service, looking for duplication, inefficiency and waste, we know it is not possible to cut our way back to fiscal health.  If we laid off every single state employee we would still be $2.5 billion in deficit.  Even then we could not lay down our moral and constitutional obligation to properly manage our resources, to maintain public safety, to provide a free public education to every child in the state, to care for those unable to care for themselves, and to maintain viable state infrastructure. 

So, what do we do?  More and more people are asking about the revenue side of the equation.  I believe that work will start later this year.  In the meantime, however, Alaskans have been shocked to learn that next year, we will pay oil company credits amounting to $600 million more than we earn on production taxes.  I don’t believe that even supporters of retaining SB21, our tax structure, think it is right for us to give away our oil.  This week Senator Wielechowsi and Representative Gara introduced “emergency legislation” to address this problem by tweaking SB21.

Their bill will change what we call “the floor” or the minimum gross tax to 12.5 % (it’s currently at 4 %) and cut the per barrel tax credit in half.  This provision applies to only three fields (Prudhoe, Kuparuk and Colville River) and only for 2 years.  It also applies the discounted tax rate for new fields only for the first 4 years of production.  We believe this proposal equitably encourages investment while treating Alaska fairly. I believe tax stability.

           I’m Berta and I’m still listening,

           If you have any questions, please feel free to contact my office

signed: Berta

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