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Governor: "I Will Veto a Gross Tax on Oil"
Murkowski Reiterates Stance on PPT & PCE Link, Questions Legislature's Vote


August 04, 2006
Friday AM


Alaska Governor Frank H. Murkowski said today that he will veto a gross tax on oil production. He also asked for an explanation why the Senate Special Committee on Natural Gas voted down (7-5) the Stranded Gas Act Development Act amendment package that committee members had crafted earlier Thursday evening.




"Yesterday, the House Finance Committee moved a form of PPT out of committee. So progress is being made," Murkowski said. "Today there was a call from some in the House for their Senate colleagues to substitute a gross tax for what appears likely to pass the House and move to the Senate.

"I will veto a gross tax on oil if it comes across my desk because it will not get us the North Slope investment we desperately need.

"If Alaskans do not get a change to the oil severance tax in this special session, I will call the Legislature back on August 11 to get it done," Murkowski said. "They have been at it for six months. Alaskans want the Economic Limit Factor (ELF) system fixed now."

In addition to PPT, the governor spoke to reporters about the developments in the Senate Special Committee on Natural Gas, which voted down a Stranded Gas Development Act committee substitute which they had crafted provision by provision.

"I would like to publicly acknowledge the hard work done by Senator Ralph Seekins to get a package of amendments. He held round table discussions among experts on both sides of each major issue that Alaskans indicated they cared most about during the public comment period."

The governor asked why the Senate Special Committee on Natural voted down the committee substitute after separately approving each provision of the package.

The committee voted to include in the committee substitute provisions on:

  • oil fiscal certainty
  • gas fiscal certainty
  • work commitments
  • project labor agreements limiting the scope of arbitration
  • extending the life of the Municipal Advisory Group (MAG)
  • calculating education funding.

"The fiscal certainty on oil, MAG extension and calculation of education funding were also approved by the entire Senate in the last special session," Murkowski said. "So it seems very strange that after approving each individual section of the committee substitute, the committee voted 7-5 not to advance the bill to the floor.

"Where were their amendments or objections if they did not agree with the committee substitute the committee was fashioning? I want, and think all Alaskans are entitled to, an answer.

"Legislators should ask themselves: With all the issues that become law around here, why wasn't the most important issue ever to come before them not worthy of advancing to the Senate for full debate?

"The administration has done what the Stranded Gas Development Act has asked of us. We have followed the process for soliciting applications, reviewing prospective proposals and completing a contract with the producers to get Alaska a gas pipeline. I've also got an agreement to double the producers' severance tax.

"I shudder to think of what may happen if we do not come to a consensus and move this project forward. Alaskans have want a gas pipeline now," Murkowski said. "Are legislators listening?"


Source of News:

Office of the Governor

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Ketchikan, Alaska