Alaska Oil Tax Cut Referendum Fought With Millions by Oil Companies

AlaskaAlaska’s Senate Bill 21, introduced by the Parnell administration narrowly passed last year, supposedly giving dramatic tax cuts to oil companies when prices are high but generating more money for the state when oil prices fall below expected margins. Now that bill has been challenged by a referendum which would repeal the tax cuts. Oil companies are not standing aside to watch which way state voters cast their ballots either, they are generating millions of dollars in an attempt to stop the referendum being passed.

Campaign filings, recently made available, in the state show that $1.3 million dollars has been donated by both ExxonMobil and BP to the “Vote No on One” campaign currently running in Alaska. That campaign is using radio and television ads to turn public favor against the bill which will be voted on in the August primary election.

To give you an idea of who the oil companies are fighting against, the “Vote Yes – Repeal the Giveaway” campaign had only raised $104,000 as of Dec. 31. Current records are not yet available for the amount of money they have raised since then, but there seems to be very little evidence to suggest that they would have come up with the more than $3.5 million that the group backed by the oil industries has raised as of Feb. 5.

Chancy Croft, the former state Senate president said that although the oil companies have committed so much money to the fight their contribution is actually, “peanuts compared to the amount of tax that’s at stake here.” According to sources in Alaska the state could lose more than $1 billion dollars a year under this newly approved tax. Advocates for the tax cuts say that the bill helps to turn around a long fall in production in the North Slope area.

Last year this bill, Senate Bill 21, only narrowly passed and was hotly debated by state lawmakers. More than 52,000 signatures were raised after the bill was passed. 45,664 of those were confirmed, clearly enough to surpass the needed 30,169 signatures approved by the state Division of Elections.

BP released a statement which said that Senate Bill 21 was an “important step forward.” They added that BP is very seriously investing in this area by adding 200 jobs and two drilling rigs over the next two years which is an investment of about $1 billion dollars in the area by the oil company.

No matter which side you think really has the best interests of the state at heart it is undeniable that this is a clear case of big money versus little money. Besides ExxonMobil and BP, Repsol has given $265,000, Chevron has given $150,000 and another company, “Keep Alaska Competitive – Vote No on 1” had raised $180,000 by Jan. 8.

Contrast those figures with the groups supporting the repeal of the bill and you the disparity between figures. Vote Yes organizations have received their biggest checks from Anselm Staack, a professor of accounting, who gave $3,500, Chancy Crofft, who gave $2,000 and the Alaska State Employee Association who contributed $3,000 before Dec. 31.

Vote Yes organizers say that they are ready for an “awesome fight” as big oil companies continue to donate millions of dollars as they prepare to fight the repeal of a state bill that provides them tax breaks years of high oil prices.

By Nick Manai

Sources:
Anchorage Daily News
The Daily Advertiser
The Republic

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