Parnell spars with House Democrats over research tax credits

Governor Sean Parnell today (Thursday) lashed out at legislators critical of a bill to provide tax credits to companies that do research and development in Alaska.

The governor said he was “extremely disappointed” in some Representatives for questioning his administration’s truthfulness during floor debate on House Bill 118.

“Usually when a legislator has a concern like that, where they feel like they have been given incorrect information and they think it’s intentional, they would call me, they would come see me,” said Parnell. “That’s not happened in this case. And for a member to stand up on the floor and impugn the motivations of others, I think it violates their own legislative rules, but certainly there’s a better way to handle it.”

HB 118 was introduced last year at the governor’s request. The bill provides credits up to $10-million per year to companies for qualified research and development projects. The idea is to stimulate new investment and help diversify Alaska’s oil driven economy.

But when it reached the House floor yesterday (Wednesday), members of the Democratic Minority said the administration hadn’t provided enough information about how the tax credits would be doled out and to whom. There was some concern that oil companies would be able to use the credits on top of existing, similar tax breaks.

Anchorage Representative Les Gara said the administration didn’t have its facts straight.

“At the Labor & Commerce Committee, they said if you took the state credit you didn’t get the federal credit. In the Finance Committee, they said if you take the state credit you do get the federal credit,” said Gara. “In the Labor & Commerce Committee, they said if you take this credit you get to add it to all your other credits. In the Finance Committee, they told us if you take this credit you don’t get to add it to your other credits.”

Anchorage Representative Mike Doogan said he didn’t trust the administration, specifically the Department of Revenue, which he said “lied” to him.

Revenue Commissioner Bryan Butcher said the confusion may have been because the Department of Commerce presented the bill last session, while his department presented it this year.

“So we can’t speak specifically to everything that’s been said in every office, but certainly we have never lied to Representative Doogan,” Butcher said.

The bill passed the House on a 23-12 vote last night (Wednesday). It could come up for a reconsideration vote before it goes to the Senate.