The Alaska Dispatch this morning has a good summary of the current status of ACES reform. See Do Alaskans care about changing the state’s oil tax?, Alaska Dispatch, Feb. 22, 2011.
One of the recurring themes from those who oppose the HB 110, the Governor’s bill, is summed up in the article by a quote from Rep. Scott Kawasaki, a Fairbanks Democrat. According to the article, Kawasaki “is one committee member who has raised concerns that there’s nothing to suggest the industry will invest more in Alaska if taxes are changed.”
It is hardly surprising that the producers are unwilling to make long term commitments in response to HB 110. The legislation itself does not ensure a long term commitment to reform. It proposes to change the tax code for tomorrow, but there is no commitment to maintaining that change over the long term.
Bottom Line: In order to attract significant, sustained, long term investment, the State needs to demonstrate its own long term commitment to reform.