Joint Resolution Opposing Repeal of Senate Bill 21
Whereas, American energy consumers have a direct interest in obtaining competitively priced domestic energy; and
Whereas, Alaskans have a direct interest in robust economic activity to maintain livelihoods; and
Whereas, over 30% of working Alaskans are directly dependent upon oil and gas exploration and development for employment; and
Sign the petition to oppose the repeal of the More Alaska Production Act (SB 21) by clicking here.
Whereas, over 50% of working Alaskans are directly or indirectly dependent upon oil and gas exploration and development for employment; and
Whereas, Alaska oil production has declined from a peak of over 2 million barrels a day to a little over 500 thousand barrels, and is in free fall at the rate of 5 – 7% per year; and
Whereas, Alaska’s contribution to America’s energy supply and energy security will continue to decline without increased investment in energy production; and
Whereas, determining Alaska’s tax policy is a serious, time consuming and complicated undertaking best done by democratically elected representatives acting in the best interest of the State and its citizens; and
Whereas, the 28th Alaska Legislature spent thousands of hours in committee hearings and floor sessions reviewing, researching, analyzing, modifying, voting on, and passing SB 21 to remove disincentives to investment in Alaska; and
Whereas, legislative hearings demonstrated that SB 21’s removal of investment disincentives will result in more oil production, more revenue for the State of Alaska and more revenue for Alaska’s Permanent Fund; and
Whereas, repeal of SB 21 would result in massive tax increases, reduce Alaska’s global competitiveness, reduce Alaskan employment and income opportunities, reduce US energy production, increase dependence on foreign oil, reduce state revenue, and reduce permanent fund dividends, all of which will adversely affect Alaskans;
Now, Therefore, Be It Resolved, and Let It Be Known, that the organizations and individuals signing below oppose repeal of SB 21 and encourage Alaska citizens to reject placing repeal of SB 21 on the ballot as a referendum.
Alaska’s Oil Production Comeback Gets Started
House, Senate pass SB 21
To read the statement from Gov. Sean Parnell click here.
View the House majority statement by click here.
How they voted:
Republicans voting yes: Bishop (Fairbanks), Coghill (Fairbanks), Dunleavy (Wasilla), Dyson (Eagle River), Fairclough (Eagle River), Giessel (Anchorage), Huggins (Wasilla), Kelly (Fairbanks), McGuire (Anchorage), Meyer (Anchorage), Micciche (Soldotna).
Democrat voting yes: Olson (Golovin).
Republicans voting no: Stedman (Sitka), Stevens (Kodiak).
Democrats voting no: Egan (Juneau), Ellis (Anchorage), French (Anchorage), Gardner (Anchorage), Hoffman (Bethel), Wielechowski (Anchorage).
Republicans voting for passage: Chenault (Nikiski), Costello (Anchorage), Feige (Chickaloon), Gattis (Wasilla), Hawker (Anchorage), Higgins (Fairbanks), Holmes (Anchorage), Hughes (Palmer), Isaacson (Fairbanks), Johnson (Anchorage), Keller (Wasilla), LeDoux (Anchorage), Lynn (Anchorage), Millett (Anchorage), Neuman (Big Lake), Olson (Soldotna), Pruitt (Anchorage), Reinbold (Eagle River), Saddler (Eagle River), Stoltze (Chugiak), Thompson (Fairbanks), Peggy Wilson (Wrangell), Tammie Wilson (North Pole).
Democrat voting for passage: Nageak (Barrow).
Republicans voting against passage: Austerman (Kodiak), Munoz (Juneau), Seaton (Homer).
Democrats voting against passage: Drummond (Anchorage), Edgmon (Dillingham), Foster (Nome), Gara (Anchorage), Gruenberg (Anchorage), Herron (Bethel), Josephson (Anchorage), Kawasaki (Fairbanks), Kerttula (Juneau), Kreiss-Tomkins (Sitka), Tarr (Anchorage), Tuck (Anchorage).
Excused Absence: Guttenberg (D-Fairbanks).
Note: in the reconsideration vote, Austerman, Munoz and Seaton voted for passage.
Alaska’s economic engine is running out of oil.
Help make Alaska #1 again.
Alaska needs more oil production …
… to pay our bills,
… sustain a healthy economy
… keep Alaskans safe, healthy and educated
… and make sure our children have a bright future.
Oil pays for 90 percent of state government…
… which allows us to enjoy a wide range of state services
… without paying state income or sales tax
… or dipping into the Permanent Fund.
Oil grows the Permanent Fund…
… It added $887 million last fiscal year
… and has contributed $12.8 billion since its inception.
One out of every three Alaska jobs is tied to oil & gas …
… and while Alaska’s overall employment level has been steady and North Slope oil & gas employment has been strong, a disproportionate number of North Slope jobs are for oil field maintenance, repair & operations and add no new oil to the pipeline
… in fact, only one in five BP employees on the North Slope is involved in finding more oil or building projects
… and with many contractors involved in drilling & construction now focusing their business activities and hiring on growth areas like North Dakota, there’s growing concern about the loss of these skills in Alaska and implications for future growth here.
But oil production is rapidly declining …
… The trans-Alaska pipeline is three-fourths empty and now carries 25% as much oil as it did at its peak.
… Since 2007 – when the legislature imposed ACES retroactively – North Slope production has declined 21%
… and decline an average of 6.5% last year.
Between revenue losses from declining oil production and state spending increases, Alaska may face a budget deficit this year…
… The oil price required for the state budget to break even increased 22% in a single year
… from $85/barrel in FY 2012 to $104/barrel in FY 2013, according to the state’s Office of Management & Budget.
… Some experts predict oil will drop this year
… How will Alaska make up the difference as oil revenues continue to decline? New individual taxes and fees? The Permanent Fund? Cuts to state services?
In fact, according to the Legislative Finance Division, Alaska will lose $900 million next year due to falling oil production…
… That’s more than the entire state spends on schools, roads, harbors and airports each year
… almost double the entire Municipality of Anchorage operating budget
… more than six times this year’s Fairbanks North Star Borough’s budget
… and 2.5 times more than the entire budget for the University of Alaska.
Alaska is missing out on the nation’s oil boom because our tax structure is too high
... In 2010, Wood Mackenzie, a leading world energy industry research firm, ranked Alaska 129 among 141 oil & gas regions worldwide in terms of fiscal competitiveness & near the bottom of U.S. states, along with California
… which is one of the main reasons why production has increased 18% in the Gulf of Mexico, 20% in Texas and a whopping 192% in North Dakota over the last 5 years while continuing its free fall in Alaska.
… Since ACES, ConocoPhillips’ capital spending in the Lower 48 has tripled; in Alaska, it’s been flat.
… BP’s 2012 capital spending in Alaska is roughly half what it was projected to be before ACES
… and two-thirds of its spending isn’t adding new oil to the pipeline
The solution is simple: Lower taxes = more production…
… There are 4.2 billion barrels of recoverable oil left in the legacy fields (Prudhoe Bay, Kuparuk) but little incentive to produce them because ACES eliminates the upside potential of investments
… But the major North Slope oil producers have committed to invest more than $5 billion in new projects to put more oil into the pipeline NOW if there’s meaningful oil tax reform.
… While tax incentives have spurred exploration on the North Slope, it can take a decade or more to bring a new oil field on-line
… and even the new independent companies leading the charge in exploration have testified the current tax structure is a serious impediment to attracting investment capital and developing any potential finds.
Oil tax reform = more long-term jobs, business opportunities and state services for ALL ALASKANS to enjoy, and a sustainable economy for generations to come …