Yesterday, former Governor Sarah Palin made her return to Alaska politics on the Bob and Mark Show, coming out strongly in defense of the oil tax system she helped to create, Alaska’s Clear and Equitable Share. ACES was designed to provide Alaskans with a fair share of the state’s oil wealth, after a decade in which the industry paid little, if any, production tax at some of North America’s largest fields.
Under ACES, the state accumulated more than $17 billion in savings while investing in new schools, roads, and other critical infrastructure. In contrast, since passing Senate Bill 21, the state has experienced extreme budget deficits. This year, the state faces a $2.3 billion cash shortfall, with endless deficits on the horizon, according to the Alaska Department of Revenue.
Today, former Governor Palin reflected on ACES. “It was non-partisan,” Ms. Palin said. “That was the beauty of it too. People who understood ACES and supported it, it didn’t matter what party affiliation you were. It was just common sense and math … to show that both oil companies and service companies and the State of Alaska benefit.”
Just this week, John Minge, the president of BP America, acknowledged that profit margins in Alaska have been “very good.” He said BP would be prioritizing capital investments in areas with the greatest returns, including Alaska (https://tinyurl.com/nublulq).
Executives from ConocoPhillips have also acknowledged that Alaska under ACES had “strong cash margins” and “very good rates of return” when speaking to audiences outside of Alaska. (3/23/11 ConocoPhillips investor conference call.) These comments are in stark contrast to testimony they provided to the legislature when supporting SB 21.
Initially Sean Parnell was also a supporter of ACES. A December 20, 2009 article in the Petroleum News, reported that Parnell had “already discussed ACES with 10 oil companies. Of those, he said, “four to five” thought the tax system was “just fine,” while “two or three” thanked the state for the tax credit program, and two companies wanted to see ACES changed.”
Asked why Parnell had a change of heart, Palin said “Bless his heart. Remember that Sean Parnell came from the oil industry. He was an employee of ConocoPhillips lobbying for the cause there.”
Indeed, Parnell was the Director of Government Relations for ConocoPhillips, before joining the Murkowski Administration as the Deputy Director of the state’s Division of Oil and Gas. He left that job to become a partner in the global law and lobbying firm Patton and Boggs, which represents the Alaska interests of Exxon Mobil Corp.
Alaskans will have the opportunity to repeal the Oil Tax Giveaway that Parnell championed after becoming governor. Fifty thousand Alaskans signed a petition to put the repeal on the upcoming August 19 ballot.
“I’m happy to weigh in on this subject…and let people know how wrongheaded this will be if we start caving in to those who we respect, who we partner with, that’s the oil companies. But – they’re doing just fine and our Constitution lays out that perfect blueprint for Alaska to be solvent and sovereign and with the use of resources that benefits the owners – the residents” said Ms.Palin.
She urged Alaskans to “push back.”
Listen to former Governor Palin’s comments here: https://tinyurl.com/q6oay4r