Sen. Dyson pleased with oil tax outcome

Wednesday, April 17, 2013 - 19:00

The 2012 elections brought new representation to the Alaska Senate, along with new leadership which made the First Session of the 28th Alaska Legislature far more productive than the last six years, a trend we want to see continue.

I served in the Republican Senate Majority of the 28th Alaska Legislature as the Chairman of State Affairs, providing legislative and fiscal oversight of programs and activities of the Office of Governor, and Departments of Public Safety, Corrections and Transportation with respect to Public Facilities. I also served as Vice-Chair of the Resources committee which took a leading role in the oil tax reform legislation.

The three priorities of the Senate Majority were to increase oil production, address in-state energy needs, and control state spending. The Republican Majority made progress in each of these areas by adjournment. The decisions made this year will benefit Alaskans for generations to come.

I supported the change in the state’s oil taxes. The debate on SB 21 was thoughtful and well-argued by proponents of retaining the present earnings and decline rate of oil production, and those preferring to defer income today with the expectation of increased oil production and earnings over a much longer period of time.

The old system, ACES, was not working well in that the state “gave away” $3 billion in tax credits with no new oil production. The new tax system under SB 21 cures this deficiency by sunsetting the tax credit provisions that did not require oil production, raising the base tax rate from 25% to 35%, and providing a $5 per barrel credit for every new barrel of oil produced. The old “progressivity” is gone. These modifications should result in more oil production from the old and new oil fields. If production increases by 50,000 barrels per day, the State income should about equal what it was under ACES.

The Senate Majority responded to in-state energy needs by passing bills to provide trucking of liquefied natural gas (LNG) and propane from the North Slope to the Interior, and authorizing continued work on an in-state gas pipeline. Additionally, the legislature appropriated funds for the Susitna/Watana Hydroelectric project to continue permitting and design of what will be the supplier of roughly half of the entire energy demand of Alaska’s most populous region.

With Alaska’s oil production down, the Majority recognized the unsustainable financial situation faced by the State and made difficult decisions to avoid unacceptable losses of service to the public. Money for state services in the operating budget went from a 6.4-percent rate of growth over the last 10 years down to a fraction of a percent for FY 2014.

While this year’s Capital Budget was $2.2 billion, a reduction of $1.1 billion over last year, Senate District F received a good amount of capital money for roads, school safety and technology upgrades, fire service needs, senior living facility improvements, library and other community needs.

The Senate Majority firmly believes the U.S. Constitution should be held in the highest regard. With ever-increasing federal overreach, the Senate Majority is committed to fighting against federal encroachment on Second Amendment rights, land and natural resources, and environmental issues.

As part of our effort to stop this ever-growing federal overreach in Alaska, the Republican Majority passed two pieces of legislation I sponsored. These included the following:

* Senate Joint Resolution 2: Limit Federal Intervention

This bill affirms the broad support of Alaskans and their elected representatives for the strategy and efforts of the Governor, Attorney General and Commissioner of Natural Resources to protect Alaska’s economic freedom from federal government overreach in the management of state resources and urges Congress and the President of the United States to restrain federal intervention into state resource management that threatens our security and prosperity.


* Senate Joint Resolution 6: Oppose Executive Orders on Gun Control

The Alaska State Legislature urges the United States Congress to not relinquish to the office of the President of the United States the legislative duty of the United States Congress to safeguard our most fundamental right to own and bear arms established in the Second Amendment of the U.S. Constitution and urges the President of the United States to refrain from any further efforts to restrict firearms ownership.

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