A group has proposed an initiative that would raise state taxes on the largest oil companies. An application was submitted on Friday for legislation that would be called the Fair Share Act. If it’s certified and is supported by enough petition signatures, it would be on the ballot next year.
Anchorage lawyer Robin Brena, a primary sponsor of the initiative, said the state receives less as a share of gross oil sales than it has historically.
“We’re too low from any perspective,” he said. “We would be getting a far higher share if we were in Norway, if we were in North Dakota, if we were in any place, pretty much.”
The initiative would raise the minimum tax from 4% to between 10% and 15%, based on the price of oil. And it would eliminate oil tax credits for the Prudhoe Bay, Kuparuk and Alpine fields.
“There is no reason for Prudhoe Bay, the largest conventional oil field in North America and the crown jewel of Alaska that has been in production for almost 50 years, to be getting credits,” said Brena.
The initiative would require all of the major producers to publicly reveal their revenues and costs in the state.
Kara Moriarty, president of the Alaska Oil and Gas Association, said fairness is in the eye of the beholder, and that the initiative would hurt the industry.
“I don’t know how any industry in Alaska can sustain a billion-dollar-plus increase in taxes and not have an impact on investing and spending, which then of course trickles down to production, which then trickles down to jobs,” she said.
Moriarty said more fields would be hit by tax hikes as they’re developed in the future.
BP Alaska spokeswoman Megan Baldino said the the company is still reviewing the initiative, but its initial analysis shows a $1 billion to $2 billion increase to industry.
“These costs will stunt investment and make Alaska far less competitive,” she said in an emailed statement.
Lt. Gov. Kevin Meyer has 60 days to decide whether to certify the initiative application. If it’s certified, the initiative petition would require more than 28,000 signatures for the initiative to be placed on the ballot.
Elizabeth Harball of Alaska Public Media contributed to this report.