Governor’s Oil Tax Plan Meets Legislative Opposition

No new support for Governor Parnell’s oil tax plan has shown up in the Senate during the Special Legislative Session that began this week.  The bill now before the Resources Committee has actually gotten bad reviews from those who previously supported the administration.

Anchorage Republican Lesil McGuire said the bill the governor introduced on Wednesday was – quote – “half-baked.”

As a member of the Resources and Finance Committees in the Senate,  McGuire saw two plans emerge during the regular session this year – and she voted against both of them.   But in a Resources meeting today  she advised Revenue Commissioner Bryan Butcher and his staff to come up with their own tax plan and listen to their own advisers.

It’s frustrating.  Because you’re in a position where you’re trying to sell a bill that I don’t think you understand the ins and the outs of it.  And I think that is an unfortunate position for you to be in,  for you both to be in.  I think it’s n  unfortunate position for us to be in and I think it’s a tremendous waste of government money and time.

McGuire said she still remains in alignment with the governor’s idea that the state should have a more-competitive tax regime.

I make these comments to say that, If we’re serious about this – and we should be because this is the economy of our state – this isn’t the way to do it.  And we all know it’s going to end in a trainwreck, and now it’s just a matter of who gets to be blamed for it, and I think that’s silly.

Butcher explained the governor’s bill reflected an attempt to work within the structure and concepts of the bills with which the legislature was already familiar.    And later in the meeting, he said the oil industry needs to provide factual information to support their indications there will be more investment with lower taxes.

We can lay out what we think the problem is, we can lay out what we believe the solution is, but ultimately companies are going to have to come forward and make a compelling case as to why passing this makes sense.  And government isn’t going to play the major role in that piece.

Resources Chairman Joe Paskvan said he will not schedule any other hearings on the bill until the Department of Revenue provides documents supporting the bill.  He suggested the next meeting will likely be sometime in the middle of next week.