Palin Promotions

Alaska Senate Bill 21 has been re-written to reduce the oil tax base rate from 35% to 33%, the Alaska Dispatch reported on April 4. The changes could cost the state an additional $1 billion over the next six years, according to the State’s Department of Revenue, in Pat Forgey’s report filed on April 6. The bill is estimated to cost the state between $5.7 billion and $6 billion over the next six years. Ordinary Alaskans have been protesting SB-21 as well.

One of the bill’s chief proponents “House Resources Committee Co-chair Eric Feige, R-Chickaloon, said that if Alaska took $1 billion less in taxes from oil companies, that money would all be reinvested in Alaska,” Forgey reported.

But, “the tax cut is to oil companies’ profits, they’ll have to pay income tax on that money. The federal corporate income tax rate is 35 percent, though companies had varying effective tax rates. Therefore, a billion dollar tax cut would leave companies with only $650 million available to be invested in Alaska, in theory, if they choose to do so.”

The entire point of Alaska’s Clear and Equitable Share (ACES) – one of Gov. Palin’s three core accomplishments while in office – is to give oil companies the opportunity to buy down their tax burden by reinvesting in Alaska.

Meanwhile, Forgey reported on April 6 that the House in the dark of night passed an Amendment to SB-21 that requires state auditors checking companies’ tax returns to use oil industry figures and not their own. “The amendment was proposed by Rep. Mike Hawker, R-Anchorage. His wife is a business and financial analyst for ConocoPhillips, the state’s largest oil producer. According to Hawker’s financial disclosure filings, she earned between $100,000 and $200,000 from her ConocoPhillips job last year,” Forgey reported.

The language of this amendment was in the Petroleum Profits Tax (PPT) of 2006. Out of the PPT was born the Corrupt Bastards Club (CBC) and the VECO scandal. It appears Alaska Governor Sean Parnell along with his henchmen and women in both houses are gearing up to launch CBC 2.0.

Another Dispatch article filed on April 4 by Laurel Andrews delineated in detail how Alaska’s laws foster conflicts of interest in the legislature. Legislators cannot simply recuse themselves from a vote. The Uniform Rules require unanimous consent from the requestor’s colleagues, however, a legislator is free to abstain from voting altogether absent a request to recuse.

Alaskans Awake and Protesting

Alaskans are awake to what is going on with SB-21 and have protest in at least two cities. Some have organized under the banner of “AKBackbone,” which is comprised of Republicans, Democrats, and Independents.

You can follow AKBackbone on Facebook and Twitter.

AK Backbone has been conducting rallies and protests throughout the state and the Dispatch provided photos from Anchorage, all courtesy of Clark James Mishner.

These photos in which protesters burn a symbolic $5.5 billion check in Homer are courtesy of Bob Shavelson.

H/T Lynda Armstrong, “I Stand With Sarah: a Tribute” Facebook Group for story leads.

Alaska Governor Sean Parnell has Alaska’s Clear and Equitable Share (ACES) in his cross hair again, Alex DeMarban, of the Alaska Dispatch reported on February 24 and February 25.

Alaska now has a $16.5 billion surplus thanks to the Palin administration’s ACES. It is one of Gov. Palin’s signature accomplishments. But, Gov. Parnell is an old oil man and has long argued that the ACES “over-taxes” the oil industry discouraging production. He introduced Senate Bill 21 to overturn ACES, representing the third year of attempts to gut the tax system, which supplanted the Petroleum Profits Tax. Parnell claims that gutting ACES will cost the state “only” $500 million per year in lost revenue, but the state’s Department of Revenue pegs the number at $900 million.

Alaska State Senator Bill Wielechowski defended ACES at a Chamber of Commerce Luncheon this past Monday, saying, “Parnell’s proposal will fail because it strikes tax credits that force companies to reinvest in Alaska. Without that incentive, oil companies will be able to take their tax break — potentially worth hundreds of millions of dollars a year each for BP, Exxon and Conoco — and invest that money anywhere in the world they want.” Andrew Halcro – a long-time enemy of Gov. Palin is in Parnell’s camp.

Alaska’s Bob and Mark Show has covered the issue over these past three years, and their thoughts on Parnell’s attempt to destroy ACES have appeared many times on US for Palin. The duo, who have been friends with the Palins for over 16 years said last year, “The oil companies are going to throw the bank at the candidates they know they can control. It will be the Corrupt Bastards Club Version 2.0.”

The danger now, is that Parnell has enough people in the Alaska statehouse arrayed against ACES that it could be overturned, whereas his prior attempts failed miserably, with the second attempt ending in abandonment by none other than Parnell. It appears that Bob and Mark’s predictions are coming true and CBC 2.0 is in full swing.

Oil companies get a credit for developing in Alaska. The big three oil companies tend to warehouse the resource which belongs to the people of the state, per the Alaska State Constitution. Oil companies profit handsomely under ACES, beating the global average by $12 per barrel, DeMarban reported.

ACES is a graduated tax system, whereby taxes on oil and gas revenues increase as the value of the resource increases – in the case of oil above $52 per barrel. A portion of this money goes into state savings and another portion is distributed to all Alaskans via the Permanent Fund Dividend (PFD). Another point often missed when discussing ACES is that it contains a built-in incentive to explore and drill new fields by levying little or no tax when these operations are being conducted. Tax credits are given to develop new infrastructure and reinvest in existing infrastructure.

ACES was developed with strong bi-partisan support to supplant the Petroleum Profits Tax. Governor Palin signed ACES into law on December 19, 2007.

For further background, see: Alaska Dispatch Myth Busts Parnell, MAC and others on ACES.

Alaskan readers are urged to call their representatives and state senators and tell them to say NO to SB-21.

H/T Lynda Armstrong, “I Stand With Sarah: a Tribute” Facebook Group

Alaska Governor Sean Parnell yesterday abandoned his own effort to destroy ACES in a Special Legislative Session he called for the purpose, Alaskan talk show hosts Bob and Mark reported this morning as they opened their broadcast. Alaska Senator Hollis French was “stunned that Parnell quit on his proposal so soon.” Other legislators shared French’s surprise – and relief – the talk show hosts reported. Gov. Parnell assigned blame to the Alaska Senate for the failure of his attempt to provide give-aways to the oil companies and said he “would not rule another Special Legislative Session later this year.”

“Parnell is a sneaky SOB. He’s not dumb, but he knows who he works for,” Bob and Mark said. “Don’t get too happy. They’ll be back. They plan to wait for people who will do their bidding for them.”

Corrupt Bastards Club Version 2.0

Bob and Mark warned their listeners that legislative district lines are being re-drawn and voters should know where their candidates are getting money from. “Re-districting is very complicated, but voters need to know for the August primaries and the November general. The oil companies are going to throw the bank at the candidates they know they can control. It will be the Corrupt Bastards Club Version 2.0. They’re re-grouping. They’ll try [to] dupe you and scare you.”

Gov. Palin wrote about the original Corrupt Bastards Club in Going Rogue:

we promised to shine a bright spotlight on ethics reform and to clean up the favor factory known as the Capitol Building. An undercover FBI investigation of the Alaska State Legislature was bubbling to the surface at the offices of state legislators–five Republicans & one Democrat. It turned out that the feds had been investigating links between some lawmakers and VECO Corporation, the oil field services giant. The warrants authorized agents to search computer filed personal communications, and official reports, as well as any items emblazoned with the phrase “Corrupt Bastards Club,” or “CBC.”

The CBC had started as a barroom joke. The name stuck–and some of the lawmakers thought it was so funny they had hats printed up that said “CBC.” It wasn’t so funny after the feds showed up (Palin, 2009, p. 112).

“Pay attention to who’s got all the money,” Bob and Mark said. “[AK Representative] Pete Peterson is being redistricted and has to run against Lance Pruitt. The Republican running in my district is wonderful, but I have that little thing that tells me something is going on.”

Though ACES went unscathed through two years of attempts on it, Bob and Mark warned that its enemies are “waiting. They’re in no hurry.”

The 16 to 20 independent companies are the ones most eager to drill, the duo noted. The big three oil companies have tended toward warehousing the resource.

“Don’t drop your guard. They’re going to strategize during the summer – in the fall election season, it will hit like a ton of bricks. The lobbyists are the point men. Follow the money!”

“Parnell decided to take his ball and go home. Right on! It’s good – for now,” they concluded.

ACES is one of Gov. Palin’s signature accomplishments, along with the ethics reform she brought to Alaska’s Executive Branch in the wake of the CBC scandal, and the Randy Ruederich era of the Alaska Oil and Gas Conservation Commission.

References:

Palin, S. L. H. (2009). Going Rogue: An American Life. (New York: Harper). p. 113.