Posted November 1, 2007
Mat-Su Valley News

Some would argue that the current Special Legislative Session on Oil and Gas Taxes is only about the oil industry and the tax rate that should be paid for the extraction of Alaska’s principle resources. But if we stop and have another look at it, what we see is that there is a much larger and more important message that will come from all of this: What kind of a business climate does Alaska present to the rest of the world? Are we a State that believes in strong, durable, partnerships with companies and investors in all industries as a means of ensuring the long-term economic prosperity of Alaska and her citizens; or is Alaska a place where taxes and “red tape” will set the tone of business?

At present, Alaska is trying to attract business partners to invest billions in building a natural gas pipeline to take North Slope gas to market. With a gas pipeline could come new satellite industries like plastics and manufacturing. Alaska is also trying to attract new investment dollars in the traditional oil and gas industry so that oil will continue to flow in the TAPS and natural gas consumers in south-central will have enough supply to meet their needs. More oil in the TAPS means the Valdez terminal continues to operate and the refineries continue to make gas for Alaska consumers. More natural gas supply for south-central Alaska means costs go down and plants like Agrium can
re-start and run at full capacity; once again employing hundreds. On the timber side, Alaska currently has a golden opportunity to revitalize the timber products industry by attracting new businesses developing bio-mass technology. Alternative energy companies are also looking at Alaska as a possible place to develop things like new nuclear battery technologies that can bring low cost power to Bush communities. All of these wonderful things are poised to bring Alaska into a new generation of prosperity and economic diversity! But these wonderful things won’t happen for Alaska if businesses and investors get mixed messages from our politicians about how “open for business” Alaska really is.

No government, regardless of the size, has ever taxed its way to prosperity. Not a single one, anywhere, period. Over the centuries, many have tried, and all have ultimately failed. Alaska will be no different. Our elected officials need to take a hard look at the message they are sending to businesses outside the oil and gas industry. Are we telling them that Alaska is a place where we are tough but fair, or are we telling them that Alaska is a place where they can count on the rules always changing after investments have been made and the contracts always being subject to political whim?

Alaska has many positive things to offer businesses in all sectors, but we have limitations as well. We have limited infrastructure, harsh weather, and great distances to travel to reach our prospective markets. We have a small population and an even smaller skilled labor force. But Alaska is long on “Can Do” spirit and pure grit. If we put our minds to it, we make it happen. So let’s tell our Legislators that we need them to put politics aside, get focused on the BIG picture, and build a solid business climate that will attract new diverse industries to Alaska. This isn’t just about oil and gas taxes anymore.

Corri Feige
Chickaloon