Reason #6 to Repeal: It’s a massive giveaway of our wealth with no strings attached.

Billions -- For What?

SB 21 will cost Alaskans an estimated $4.5 billion in the first 5 years alone - and this number could be much higher depending on the price of oil. After that, billions more will be given to the most profitable corporations in the world - with no strings attached. Alaskans are not guaranteed anything in return – no increased production, no more jobs, no more investment. If oil prices increase, the loss to Alaskans will grow ever steeper, up to $2 to $3 billion per year. This is money we could invest in roads, schools, growing our Permanent Fund, more affordable energy, public safety … you name it.

Reason #5: State Capital Projects Created 148,000 Alaskan Jobs under ACES

State Capital Projects Created 148,000 Alaskan Jobs under ACES

An estimated 148,000 private sector jobs have been created from state investment in critical infrastructure projects since the passage of ACES in 2007, according to a newly released report from the non-partisan Legislative Research Services.  For the most part, these are construction jobs that last for the duration of the capital works project. 

 
ACES, which is short for Alaska’s Clear and Equitable Share, has enabled the state to invest in new roads, schools, and harbors, pay off debts and save for the future. The state collected $20 billion more under ACES than it would have under ELF, a former oil tax system. This has led to record levels of job creation.

Supporters of Senate Bill 21, the Oil Tax Giveaway, paint ACES as bad for the economy. This report demonstrates those claims are absolutely false. With our fair share of oil profits, we have invested in critical infrastructure across the state, laying a strong foundation for economic growth and creating nearly 150,000 jobs.

University of Alaska economist Dr. Scott Goldsmith provided the economic multipliers used in the report, which details the close relationship between public infrastructure projects and job creation.

Creating jobs for Alaskans and spurring long-term economic growth should be a top priority for all elected officials. ACES achieved both these goals in impressive fashion, which makes the passage of Senate Bill 21 this past session even more puzzling. Fortunately Alaskans will have the opportunity to dismantle this misguided policy next fall with the repeal of SB 21.

Reason #4 to Repeal the Giveaway

Investment Soared under ACES

Under our former tax system—Alaska’s Clear and Equitable Share or ACES—oil industry investment in Alaska increased to all-time highs. Capital investment grew by nearly 70% in 7 years. This demonstates just how successful ACES was in spurring investment in Alaska’s oil patch.

SB 21 lacks the incentives ACES had to boost investment in Alaska. It gives away Alaskans’ wealth without any guarantee of increased investment, new jobs, or more oil in the pipeline. Simply put, it's a bad business deal.

 

 

Oil industry investment urged under ACES.

Parnell's Oil Wealth Giveaway Puts Alaska Jobs at Risk

Reason #3 to Repeal Senate Bill 21, The Oil Wealth Giveaway

It Puts Job Growth in Alaska’s Oil Patch at Risk

The number of jobs in Alaska’s oil patched grew to the highest level in state history under our former tax system, Alaska’s Clear and Equitable Share (ACES).  Oil industry employment skyrocketed from 11,600 jobs in July 2007 to more than 14,700 in July 2013.  This is because ACES rewarded oil industry investment in Alaska with lower taxes.  Senate Bill 21 lacks this feature and risks the gains we’ve made in high-paying jobs for Alaskans.  SB 21 – it’s bad business for Alaska.