Legislature(2017 - 2018)BARNES 124
03/08/2017 06:00 PM House RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| HB111 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 111 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
March 8, 2017
6:11 p.m.
MEMBERS PRESENT
Representative Andy Josephson, Co-Chair
Representative Geran Tarr, Co-Chair
Representative Dean Westlake, Vice Chair
Representative Justin Parish
Representative Chris Birch
Representative David Talerico
MEMBERS ABSENT
Representative Harriet Drummond
Representative DeLena Johnson
Representative George Rauscher
Representative Chris Tuck (alternate)
Representative Mike Chenault (alternate)
COMMITTEE CALENDAR
HOUSE BILL NO. 111
"An Act relating to the oil and gas production tax, tax
payments, and credits; relating to interest applicable to
delinquent oil and gas production tax; and providing for an
effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 111
SHORT TITLE: OIL & GAS PRODUCTION TAX;PAYMENTS;CREDITS
SPONSOR(s): RESOURCES
02/08/17 (H) READ THE FIRST TIME - REFERRALS
02/08/17 (H) RES, FIN
02/08/17 (H) TALERICO OBJECTED TO INTRODUCTION
02/08/17 (H) INTRODUCTION RULED IN ORDER
02/08/17 (H) SUSTAINED RULING OF CHAIR Y23 N15 E2
02/08/17 (H) RES AT 1:00 PM BARNES 124
02/08/17 (H) Heard & Held
02/08/17 (H) MINUTE(RES)
02/13/17 (H) RES AT 1:00 PM BARNES 124
02/13/17 (H) Heard & Held
02/13/17 (H) MINUTE(RES)
02/17/17 (H) RES AT 1:00 PM BARNES 124
02/17/17 (H) Heard & Held
02/17/17 (H) MINUTE(RES)
02/20/17 (H) RES AT 1:00 PM BARNES 124
02/20/17 (H) Heard & Held
02/20/17 (H) MINUTE(RES)
02/22/17 (H) RES AT 1:00 PM BARNES 124
02/22/17 (H) Heard & Held
02/22/17 (H) MINUTE(RES)
02/22/17 (H) RES AT 6:30 PM BARNES 124
02/22/17 (H) Heard & Held
02/22/17 (H) MINUTE(RES)
02/24/17 (H) RES AT 1:00 PM BARNES 124
02/24/17 (H) Heard & Held
02/24/17 (H) MINUTE(RES)
02/27/17 (H) RES AT 1:00 PM BARNES 124
02/27/17 (H) Heard & Held
02/27/17 (H) MINUTE(RES)
02/27/17 (H) RES AT 7:00 PM CAPITOL 106
02/27/17 (H) Heard & Held
02/27/17 (H) MINUTE(RES)
03/01/17 (H) RES AT 1:00 PM BARNES 124
03/01/17 (H) Heard & Held
03/01/17 (H) MINUTE(RES)
03/01/17 (H) RES AT 6:00 PM BARNES 124
03/01/17 (H) Heard & Held
03/01/17 (H) MINUTE(RES)
03/06/17 (H) RES AT 1:00 PM BARNES 124
03/06/17 (H) Scheduled but Not Heard
03/06/17 (H) RES AT 6:30 PM BARNES 124
03/06/17 (H) Heard & Held
03/06/17 (H) MINUTE(RES)
03/08/17 (H) RES AT 1:00 PM BARNES 124
03/08/17 (H) RES AT 6:00 PM BARNES 124
WITNESS REGISTER
JEREMY PRICE, State Director
Americans for Prosperity
Juneau, Alaska
POSITION STATEMENT: Testified in opposition to HB 111.
SAM MALONEY
Anchorage, Alaska
POSITION STATEMENT: Testified in opposition to HB 111.
PAT SCHLICHTING
Delta Junction, Alaska
POSITION STATEMENT: Testified in support of HB 111.
RICK SOLIE
Fairbanks, Alaska
POSITION STATEMENT: Testified in opposition to HB 111.
ACTION NARRATIVE
6:11:40 PM
CO-CHAIR GERAN TARR called the House Resources Standing
Committee meeting to order at 6:11 p.m. Representatives Tarr,
Birch, Parish, Talerico, and Josephson were present at the call
to order. Representative Westlake arrived as the meeting was in
progress.
HB 111-OIL & GAS PRODUCTION TAX;PAYMENTS;CREDITS
6:12:14 PM
CO-CHAIR TARR announced that the only order of business would be
HOUSE BILL NO. 111, "An Act relating to the oil and gas
production tax, tax payments, and credits; relating to interest
applicable to delinquent oil and gas production tax; and
providing for an effective date."
6:12:26 PM
JEREMY PRICE, State Director, Americans for Prosperity,
testified in opposition to HB 111. He stated that the bill
would increase taxes on an industry that is critical to Alaska's
future. He explained that he grew up in Alaska and he hopes his
children will have the same opportunities within the state. He
said that the future of Alaska depends on the decisions made
regarding bills like HB 111. He added that he wants a bright
future for the state and his family. He expressed his view that
a bright future requires a stable economic environment for
businesses to succeed, and HB 111 would do the opposite.
6:15:15 PM
SAM MALONEY testified in opposition to HB 111. He commented
that the proposed bill is bad for the overall economy of the
state and his personal economics. He explained that his
associate's degree in welding and nondestructive testing from
[University of Alaska Anchorage] (UAA) helped him find a job and
purchase his first home. His work led him to Nikiski,
Anchorage, and the North Slope. He stated that despite a drop
in oil prices, oil companies were still investing in new energy
in Alaska leading to more jobs for young Alaskans. He stated
that in the summer of 2016 oilfields were slowing down, so he
enrolled in the process technology program at UAA to establish a
more stable career for himself as a plant operator. He
expressed his uncertainty that there will be a career
opportunity for him after he graduates in 2018, because oil
companies may not continue to invest in Alaska. He urged the
committee to encourage private investment rather than increase
taxes and to vote against HB 111.
6:18:28 PM
PAT SCHLICHTING testified in support of HB 111. He stated that
he supports changes to the current oil and gas tax. He offered
his opinion that under the current system, the state does not
get an equitable return; the state is paying producers to take
its resources. He acknowledged that some people think it is
unfair to change the tax structure so often. He remarked, "If
you do the job right the first time, you won't have to do it
over." He stated his support for: an equitable tax rate for
the state's resources; reducing tax credits; using other
helpful, productive and lucrative ways to incentivize; and
expediting audits and collections of back oil taxes. He offered
his opinion that the state should be receiving billions of
dollars more in income. He compared Alaska's budget situation
to a bleeding trauma victim. He remarked, "The wound needs to
be stopped, but it seems like ... the demands are just to go to
the blood bank and not to stop the bleeding." He explained that
the bleeding is the oil credits that are being banked.
6:21:27 PM
RICK SOLIE testified in opposition to HB 111. He noted that he
is a member of the mining industry. He offered his
understanding that a stable tax climate is important and the
changes proposed in HB 111 would lead to instability. He noted
that HB 111 would substantially increase taxes, and every time
there is a state fiscal crisis there is a targeted tax; he
expressed his belief that targeted taxes are not fair. He
suggested that revenue needs to be raised in a broad-based
manner either through the Alaska Permanent Fund or another tax
mechanism. He stated that data shows that state, federal, and
local governments take in more money than industry at most oil
price levels. He described the current system as unfair to the
oil and gas industry because the industry doesn't see much of
the result of its endeavors. He noted that profit is good; oil
companies make profits to pay their shareholders and taxes to
the state. He recalled his experience on a borough assembly
that worked to support the community with revenues from the
state. He remarked, "Those oil taxes, you can increase them
today, but if you don't have production tomorrow, you won't have
the ability to support your schools and your roads and to have
nice ski hills..." He expressed that HB 111 is an imprudent tax
bill and is a "grab" at an industry that has provided many
benefits to the state for years. He urged the committee to
rethink how to create a stable tax structure for business in the
state and the oil industry.
[HB 111 was held over.]
6:27:43 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 6:27 p.m.
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