It is ironic that a Governor who is trying to increase Alaska’s competitiveness for oil investment dollars with the one hand is undermining it with the other. Yet, that is exactly what Governor Parnell is preparing to do in the coming legislative session.
The Governor correctly has identified Alaska’s current oil tax structure as an impediment to attracting the investment dollars that Alaska needs to stabilize Alaska’s current oil production levels. Most anticipate that he will announce specific proposed reforms to address the problem sometime this coming week. Continue reading
Casey Reynolds asked me to join him on his talk radio show this morning to discuss yesterday’s analysis by the Legislative Finance Division of the Governor’s proposed FY 2014 budget and the fiscal issues that face the state this coming legislative session.
While preparing to join the show earlier this morning , I wrote briefly about the Leg Finance report . My summary: Continue reading
I had the opportunity yesterday to present before the second day of Lead: North’s “Investment Inquiry.” For those that aren’t familiar, Lead: North is a project of the Institute of the North, which is designed to “act as a platform from which young Alaskans, ages 21-40, are educated about – and engaged in – their responsibilities to one another, their community, and state.” Continue reading
Paul Jenkins, from the Anchorage Daily Planet, is sitting in as guest host this week on The Mike Pocaro Radio Show and asked me to join him yesterday (1.9.2013) afternoon to talk about Alaska fiscal policy. The Planet had editorialized earlier in the day (“More Swell News“) on the report on Alaska fiscal policy released last week by the University of Alaska’s Institute for Social and Economic Research (“Maximum Sustainable Yield: FY 2014 Update“).
The Daily Planet’s editorial concluded: Continue reading
In an editorial Sunday, the Fairbanks News-Miner focused on fiscal reform, the issue that, in my opinion, is the most important this coming legislative session (yes, even more important than oil tax reform, although that is a close second).
I have only one disagreement with the editorial — the assertion that “the crisis is not yet upon us.” As the graphic from the ISER study discussed in the editorial makes clear, the deficits are clearly in sight and the only time to address them is now, while oil revenues remain relatively high. But other than for that matter of perspective, the News-Miner gets it. The full editorial follows: Continue reading
The University of Alaska – Anchorage’s Institute of Social and Economic Research (ISER) today issued its FY 2014 update on sustainable spending levels. The conclusion, “[i]n fiscal year 2014, Alaska’s state government can afford to spend about $5.5 billion.”
The comparable number in the Governor’s proposed budget is $6.5 billion, and the Governor has said that he would accept the Legislature raising that number even higher (to $7 billion). Continue reading
As noted on these pages previously, I write a bi-monthly column on oil & gas issues for the Alaska Business Monthly. This is the fourth column, originally published in the January 2013 print edition and available online here.
The last column in this series (“Out of Alignment,” Alaska Business Monthly, November 2012) focused on the reasons why Alaska oil policy is misaligned with the objective of maximizing the development of the state’s oil and gas resources.
The column discussed the state’s attempted use of two tools—tax credits and direct regulatory intervention—to steer investment to Alaska and why those tools have failed to produce significant results in terms of increased production. As I explained, the state’s use of the tools has been similar to backseat driving—and just about as successful.
The column also briefly mentioned a potential solution to the state’s alignment problem—developing a means for the state to co-invest alongside industry in the development of the state’s oil and gas resources. This month’s column further explains that concept. Continue reading