You don't see this every day

Posted by Editorial_Page_Staff

Posted: February 13, 2007 - 4:59 pm

Here’s something you don’t see every day in the Alaska Legislature. Someone introduces a bill that is sure to rile one of the state’s most powerful industries and, right away, it gets 15 of Alaska’s 20 state senators as co-sponsors.

That’s the case with SB 80. It would ban oil companies from taking a tax deduction for repairs made necessary by slipshod maintenance.

The measure aims to keep North Slope producers from writing off expenses for fixing Prudhoe Bay pipelines after BP’s corner-cutting maintenance allowed corrosion to eat holes in them. The leaks forced BP to shut in a good portion of Alaska’s oil production for weeks.

Even more unusual, SB80’s prime sponsor is a back-bencher, Kenai’s Tom Wagoner. He’s one of the five Republicans who are on the outs because they did not support fellow Republican Lyda Green’s successful, bipartisan bid for Senate President.

Those who run the House or Senate generally don’t spend a lot of time working on bills put forward by the minority. Sometimes, a legislator in the minority will try to improve the odds for a bill by seeking a majority member to be the prime sponsor.

This tax bill marks a new low in the political popularity and clout of Alaska’s major oil producers. The oil industry once held sway over the Legislature; any proposed tax increase was dead on arrival. But last year, as oil prices spiked, lawmakers saw billions of dollars draining away due to an overly generous state tax structure and passed a big tax increase. (It took the industry’s remaining legislative clout to prevent an even more costly tax bill.)

Senate President Green’s support for the bill is another head-spinner -- she was a strong defender of the oil industry in last year’s tax fight. The only senators who aren’t on board are Republicans Cowdery, Bunde and McGuire of Anchorage and Democrat Hoffman of Bethel.

The oil industry can’t look to the House for much help to fight this year’s tax change. A total of 16 lawmakers, most of whom are Republicans, have signed on to the House version of the same bill, HB128. All told, a majority of Alaska legislators- 32 of 60 – already support the legislation, including the presiding officers of both houses.

That’s not to say the bill will pass in exactly the form it was introduced. Anchorage Democratic Sen. Hollis French, a persistent critic of the oil industry, expects the measure will be fine-tuned to deal with technical questions as it goes through committees.

One oil industry source suggested that opposing the widely-supported bill is like throwing yourself in front of a train. Sen. French looked at the lineup of support for the measure, including both presiding officers, and said, “I’d love to have that happen on one of my bills.”

-- Matt Zencey, editorial writer

You don't see this every day

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