Oil taxes, gas pipelines and education funding were just a few of the topics two of the Peninsula’s state legislators addressed at a town hall meeting Thursday in Soldotna.
House Speaker Rep. Mike Chenault, R-Nikiski, and Rep. Kurt Olson, R-Soldotna, listened to about a dozen residents speak about issues affecting them, answered public questions about state issues and discussed the Legislature’s progress about halfway into its current Juneau session.
Chenault said the meeting helped him get a better picture about what’s on residents’ minds.
“This is why I like to come back to the district and have these types of meetings — I wish we could have one a week,” Chenault said after the meeting. “Then maybe we could carry the dialogue and get off the one type issue. Everyone here has a concern and this is a part of our opportunity to talk with them.”
Chenault said he was comfortable with the progress lawmakers have made in Juneau, but a number of issues are still up in the air, including his work on gas pipeline legislation.
“I think things are alright,” he said. “We’re on schedule to pass the operating budget next week over to the Senate, which is the normal schedule. We’ll wait on the capital budget — we haven’t seen that, but it usually comes toward the end of the session.”
Perhaps the biggest issue Chenault and Olson discussed involved changes to the state’s oil tax structure.
The Senate Resources Committee recently approved Senate Bill 192, which seeks to attract more oil development and exploration investment to the North Slope where fields are declining at 6 to 8 percent a year by offering a more attractive oil tax structure. The Senate Finance Committee will pick up the bill next week.
“We are going to fix what comes out of the Senate,” Olson said after the meeting. “When we changed the taxes several years ago, Alberta did the same thing. It took Alberta a year and a half to figure out that it wasn’t working, that the companies were leaving. Alberta went back in and found a sweet spot ... where it raised them more revenue, but it was enough to where the companies could show whatever profit amount they were looking for.”
Olson said the amount of Alaskan workers and companies rapidly developing North Dakota fields should be a hint for the state to seriously reconsider its tax structure. He said he was willing to sacrifice his summer for an extended session to do so, although that’s not preferable.
“I think we’ll be staying down there until we do,” he said of making those changes. “The only thing that is keeping us a float is the high price of oil.”
Chenault shared a similar sentiment, but added he couldn’t say for sure what will happen. That depends on “what they give us,” he said.
“I’m hoping the Senate does something that’s meaningful and that we can pass some kind of an oil tax, but we will wait on that,” he said. “Will that keep us down there? I don’t know. If it doesn’t do anything then we may leave, and if we don’t get it on time, then we are going to have to have time to go through the process to determine what’s in the bill and what’s not.
“Maybe we don’t take it up and worry about it next year. I hate to say that, but it certainly could happen.”
Olson and Chenault also fielded several questions about the state’s various gas line proposals.
“I’m pushing forward with the bullet line concept just simply because that is what the law (the Alaska Gasline Inducement Act) allows me to do today,” Chenault said.
Chenault said he wanted more Alaskans to be working on those projects, including recent Cook Inlet exploration and production.
“We want Alaskans to be working, but I think we know too that if you bring a jack-up rig that it doesn’t matter who brings it or where it comes from, usually they have a crew that works on them,” he said. “Our hope is that over time if we can keep them in Cook Inlet long enough that one, Alaskans start working on those and two, that Alaskans get a lot of that onshore work.
“If they do find gas and we either do have to put in platforms or figure out another way to bring that gas onshore that Alaskans will be involved in those projects.”
Concerns about the education system, graduation rates and increased funding for districts also dominated the meeting.
Chenault remained optimistic education would see increased funding levels, “whether that be the (Base Student Allowance) increase or transportation or some other type of energy (credit).”
“There are a number of different issues out there, but it is just how do we put together the right fix,” he said explaining what might be a good fix for the Kenai Peninsula Borough School District might not work for Anchorage or Juneau districts. “The BSA doesn’t fix all school districts so how do we try to do that and still get the Legislature’s concerns about increasing the graduation rate?”
Olson said he was pleased KPBSD has already made certain cuts “other districts are just starting to look at.”
“We’ve swallowed the bullet, we’ve done a lot of our own maintenance where others are waiting for the state to pay for it,” he said. “What are we going to do? We are going to do whatever we can to help the district.”
Chenault also said he was frustrated with some aspects of the No Child Left Behind Act, but didn’t throw his whole support behind the state seeking a waiver from it as several others have done.
He said NCLB isn’t the “right fix” in regards to Alaska’s diverse education system and there should be other considerations taken other than a full waiver.
“I think all of us want to provide a good education for our kids, but it is how do you provide that and the federal one size fits all doesn’t fit for Alaska,” he said.