Support the Senate version of House Bill 111
The conference committee for HB 111 is expected to begin work on the bill next week. KEEP Alaska Competitive supports the Senate version of HB 111 because it accomplishes the stated goal of the Governor, House and Senate: it eliminates cashable oil and gas credits while at the same time maintains incentives for new oil by allowing net operating losses to be deducted against future production. The savings to the State is estimated to be $1.2 billion over the next 10 years.
Please write or call your legislator today and urge them to support the Senate version of HB 111.
The Senate version of HB 111:
- Eliminates cash credits statewide starting in 2018. Most importantly, the Senate version eliminates cash credits in a manner that retains incentives for new production
- Maintains existing production tax policies when oil prices rise to the $60 to $100/barrel range
- Repeals the net operating loss as a cashable credit while retaining deductibility and encouraging oil production
- Preserves Middle Earth credits as non-refundable and allows the company earning the credits to apply them against corporate income tax as well as against production tax
- Hardens a minimum production tax of 4 percent
Alaska’s had a great ride, but it’s not sustainable.
Dear KEEP Supporter,
As you know, the KEEP Alaska Competitive Coalition, 5,000 members strong, is a broad based group of native corporations, businesses, unions and individual Alaskans who share one common objective: We care deeply about our state and its economic future.
The oil industry has paid for almost 90% of Alaska’s government. Oil has funded our schools, roads, airports and public safety. Oil strongly supports our charities and has created about 1/3 of Alaska’s jobs. Oil has funded Alaska’s $55 billion dollar permanent fund and has allowed Alaskans the luxury of not having to pay state income or sales taxes.
But, times have changed. It’s been a great ride, but it’s not sustainable.
Oil production has fallen to ¼ of its peak, our pipeline is ¾ empty and oil prices are low. While our General Fund budget has been reduced over the past three years, it still must be reduced further.
Alaska is in a recession due to low oil prices and an unsustainable fiscal situation that discourages investment. Threats to raise taxes on our resources industries also discourage investment.
We will have to compete for investment or we will fail. We will have to continue to reduce the cost of state government. We will have to utilize earnings from our $55 billion dollar permanent fund on a sustainable basis, to help pay for state services. We will need to reduce the amount of our PFD checks. And we may have to start paying our own way, with some form of new taxes if necessary.
We must do all this without taxing away all of the incentives of our resource industries that invest heavily in our state and create jobs.
And, we must change now or accept a worsened economy. With every delay we forgo many of the options that are on the table now and also face elimination of the dividend program out of necessity.
Now is the time for action. We cannot continue to kick the can down the road.
This is where the KEEP Alaska Competitive Coalition can make a difference. We must urge our employees, colleagues, friends, family and others to contact their legislator and ask them to create and support a solution to Alaska’s fiscal crisis. Action must be taken this legislative session and should include cuts, restructuring the permanent fund, and may include new taxes such as an income tax, a sales tax, motor fuel tax and/or other miscellaneous consumption taxes.
And we must remind our representatives in Juneau to not kill our resource industries with unstable tax policies and over taxation in the process.
KEEP has developed a toolkit, similar to what we did during the Vote No on 1 campaign, which will help us deliver our message. The toolkit includes a short video which succinctly explains our fiscal crisis, and our options to fix it, as well as a PowerPoint presentation and printable fact sheet. We have updated our website and now have a social media component where you can review our latest posts and join the conversation.
Once again, thank you for your support of the KEEP Alaska Competitive Coalition. We look forward to working with you to ensure Alaska will be open for business for years to come.
Keep Alaska Competitive
Keep Alaska Competitive
KEEP Alaska Competitive is a 501(c)(6) organization composed of individual Alaskans, Alaska Native organizations, businesses and labor groups who care deeply about our long-term economic future. We do not take contributions from oil producers.
Alaska can have a vibrant future
if we act now
Alaska is in a recession due to low oil prices and declining production.
• State has a $3+ billion deficit
• Reserve accounts are almost drained
We have the ability to fix our fiscal problems.
• Continue cutting cost of government
• Restructure the Permanent Fund
• Add new revenues, if necessary
• Don’t destroy our resource industries with increased taxes and unstable tax policies
Encourage your legislators to find a solution this session