Alaska House approves bill to rewrite oil, gas credits

  • Sunday, May 15, 2016 9:02pm
  • News

JUNEAU — The Alaska House of Representatives has approved legislation that would phase out most existing oil and gas tax credits.

The amended proposal is expected to save between $5 million and $25 million in the fiscal year that starts July 1 and increasing to as much as $470 million of savings in fiscal year 2021. The House on Friday approved a modified version of the bill after a 25-12 vote.

“We were able to get to that common place where we could agree,” said Rep. Paul Seaton, R-Homer, one of the bill’s two Republican sponsors. “Everybody was a little bit out of their comfort zone, but it was, you know, a compromise.”

The new bill replaces Gov. Bill Walker’s original version, which promised savings as high as $305 million in the next fiscal year, with savings rising to as much as $515 million in fiscal year 2019. The rules committee’s version promised savings of up to $10 million in the next fiscal year, rising to $370 million by fiscal year 2022.

The proposal by Seaton and Rep. Tammie Wilson, R-North Pole, would stop companies producing more than 15,000 barrels of oil per day from collecting net operating loss credits, which allow producers to reduce their effective production tax rate to zero. Net operating loss credits are designed to help companies just starting operations, but because oil prices are so low, major North Slope oil producers are losing money, making them eligible.

Under the Wilson-Seaton proposal, oil companies would be encouraged to sell their outstanding credits for cash, something they might need as oil prices stay low. The proposal would also reorganize the tax structure for Cook Inlet drilling operations by 2019 when limits on oil and gas taxes in the region expire.

The Senate is scheduled to hear the amended bill Saturday.

More in News

Rep. Bill Elam speaks during a legislative update to the joint Kenai and Soldotna chambers of commerce in Kenai, Alaska, on Wednesday, June 18, 2025. (Jake Dye/Peninsula Clarion)
‘Nothing prepares you’

Rep. Bill Elam reports back on his freshman session in the Alaska House of Representatives.

The entrance to the Kenai Chamber of Commerce and Visitor Center is barricaded on Overland Avenue in Kenai, Alaska, on Thursday, Nov. 21, 2024. (Jake Dye/Peninsula Clarion)
Kenai OKs $75 fine for cutting through parking lots

The move comes after months of action to prevent drivers from crossing through the parking lot of the Kenai Chamber of Commerce and Visitor Center.

Erin Thompson (courtesy)
Erin Thompson to serve as regional editor for Alaska community publications

Erin Thompson is expanding her leadership as she takes on editorial oversight… Continue reading

A woman stands with her sign held up during a rally in support of Medicaid and South Peninsula Hospital on Wednesday, June 18, 2025 in Homer, Alaska. (Chloe Pleznac/Homer News)
Homer residents rally in support of South Peninsula Hospital and Medicaid

The community gathered on Wednesday in opposition to health care cuts that threaten rural hospitals.

Hunter Kirby holds up the hatchery king salmon he bagged during the one-day youth fishery on the Ninilchik River on Wednesday, June 7, 2023 in Ninilchik, Alaska. Photo by Mike Booz
Ninilchik River closed to sport fishing

The closure is in effect from June 23 through July 15.

Señor Panchos in Soldotna, Alaska, is closed on Wednesday, June 4, 2025. (Jake Dye/Peninsula Clarion)
Soldotna restaurant owner remains in ICE custody; federal charges dropped

Francisco Rodriguez-Rincon was accused of being in the country illegally and falsely claiming citizenship on a driver’s license application.

Brent Johnson speaks during a meeting of the Kenai Peninsula Borough Assembly in Soldotna, Alaska, on Tuesday, April 1, 2025. (Jake Dye/Peninsula Clarion)
Borough to provide maximum funding for school district

The Kenai Peninsula Borough School District will receive less money from the state this year than it did last year.

Jake Dye/Peninsula Clarion
Pool manager and swim coach Will Hubler leads a treading water exercise at Kenai Central High School on Tuesday.
Pools, theaters, libraries in jeopardy as cuts loom

The district issued “notices of non-retention” to all its pool managers, library aides and theater technicians.

Most Read