Economic Limit Factor

Taken directly from the Fall 2004 public opinion surveys, the results clearly indicate at least 74% of survey responders think Alaska should get a fair severance tax for OUR oil.   Farther down the page, see what the legislature did (or more specifically failed to do) about this important issue.

(Q)  With the current economic limit factor (ELF), oil companies pay the same percentage of severance tax for $40/barrel oil as they do for $12/barrel oil.  Should this percentage be modified so that when profits increase due to higher oil prices the people of Alaska benefit more fairly from these increased profits?  (698 responses) 

 

(A)    Modify ELF:  74%                Keep ELF same:  11%                Don’t Know:  15%

 

(Q)  At $35/barrel, Alaska’s oil companies take roughly $1.7 billion more in profits from Alaska North Slope crude oil than the state takes in total revenue for OUR oil.  Do you think the Alaska legislature should adjust its oil tax structure to help generate additional revenue from OUR resource to benefit all Alaskans?  (670 responses) 

 

(A)    Yes:  78%                No:  15%                Don’t Know:  7%

To help reduce the deficit budget, 18% of the public said the legislature should consider modifying or completely eliminate the economic limit factor (ELF) on oil royalties paid the  state.  This change could allow a more fair severance tax on the oil owned by ALL Alaskans. 

(Q)  How would you balance the state budget? (You may circle more than one answer)  (1078 responses)

 

(A)

a.  State Income Tax:  14% 

b.  Cut state government spending:  40%  

c.  State Sales Tax:  14%  

d.  Using a portion of your Permanent Fund Dividend:  9% 

e.  Modify or eliminate the economic limit factor (ELF) on oil royalties paid the  state:  18%

f.  Miscellaneous New State Taxes or user fees:  5%

The majority do not believe the argument that modifying the ELF would make oil companies leave the state.

(Q)  Do you think that changes to the current economic limit factor (ELF) would discourage oil companies from continued investment in Alaska?  (675 responses)

  

(A)  Yes:  22%                No:  45%                Don’t Know:  33%

Now let's see what the legislature actually did (or did NOT do) about this important issue.  Follow the hyperlink then click on journal pages to see what action was taken or how legislators actually voted. 

HB 300 would eliminate the economic limit factor (ELF).  Assigned to four committees by Republican Speaker of the House Pete Kott of Anchorage.  Four committee hearings is a guaranteed death for any proposed legislation.  After this move, HB 300 was withdrawn by the sponsor.

 

HB 441  Would make modest changes to the severance tax paid by oil companies.  Was assigned to four committees by Republican Speaker of the House Pete Kott of Anchorage, and died in the first (W&M) committee of referral.  The House Ways & Means Committee is co-chaired by Republican Representative Mike Hawker of Anchorage and Republican Representative Bruce Weyhrauch of Juneau.  See “hot button issue” for complete details. 

 

SB 321 Would make modest changes to the severance tax paid by oil companies to the benefit of ALL Alaskans, but died in the first committee of referral.  The Senate Resources Committee is chaired by Republican Senator Scott Ogan of Palmer.  See “hot button issue” for complete details.

Votes for these and other major bills that passed either the House or Senate are recorded on the Watchdog page for all to see. 

Why do candidates often say one thing to get elected and then vote the opposite when in Juneau?  A lot of this mystery can be solved by visiting the APOC web site.  The Alaska Public Offices Commission post campaign finance records for each legislator that shows where the money comes from.  When comparing survey results, voting records, and campaign finance, with legislation passed (or not passed), a vivid picture of the incumbent emerges for all to see.   

Incumbent legislators that went against the public's wishes will soon be asking for your vote.  The decision to retain them is entirely up to YOU!  Make an informed choice and do what's right for Alaska's future at each election!  A list of all legislators sorted by community and election schedules has been provided for Alaska Voters convenience.  

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