Coalition backs mix of cuts, Permanent Fund restructure

Alaska needs a combination of unpopular actions to fix budget issues, according to Jim Jansen, Co-Chair of the KEEP Alaska Competitive Coalition.

Jansen, who is also the board chairman for the trucking company Lynden Inc., spoke to a special joint luncheon of the Kenai and Soldotna Chambers of Commerce Monday, explaining KEEP’s mission to “solve Alaska’s fiscal crisis now, but don’t destroy our resource industries in the process.”

The fiscal problems can’t be solved by cuts alone, Jansen said. KEEP is supporting a fiscal solution that cuts government spending and restructures the earnings of the Permanent Fund in order to ensure that Alaska is a competitive place for the resource industries to invest.

“Alaska is better with oil,” Jansen said throughout the presentation.

KEEP is a group of corporations, unions, businesses and individuals, but do not receive any funding from the oil industry, Jansen said.

“The oil industry has paid for almost 90 percent of Alaska’s government since the pipeline was built. … Oil has funded our schools, roads, airports and public safety … has allowed us the luxury of not having to pay state income taxes and have the lowest fuel taxes in the nation … and has funded Alaska’s $55 billion Permanent Fund,” Jansen said.

Jansen and KEEP recommend that the Legislature look to capitalize on Alaska’s strengths by marketing the state’s resources, maintaining stable and competitive tax policies, balancing a sustainable budget and by stopping threats to resource industries with uncompetitive taxes.

“If most of your revenue and most of your jobs come from the resource industries, you can’t tax away their incentive to invest and expect to have a sustainable economy,” Jansen said.

The joint chamber meeting drew a full room at the Kenai Visitor Center, including Kenai Peninsula Borough Mayor Mike Navarre, who thanked Jansen for his presentation.

“I appreciate you coming out and sharing this. I think that we need a comprehensive plan, which is what you’re talking about,” Navarre said. “When we talk about squeezing down the operating budget, though, it’s much easier said than done. There are things that aren’t in the budget now that probably need to be addressed.”

According to KEEP, it takes a substantial annual industry investment to keep production levels on the North Slope stable, which is maintained with a durable and competitive tax policy for the oil companies.

“We have to stop trying to balance the budget on the backs of the industry. …It’s been a great ride,” Jansen said. “But it’s not sustainable.”

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