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Democrats call on House to Stop Historic Cut to PFD
Republican Majority puts outside interests ahead of Alaskan interests
ANCHORAGE: Last night, after agreeing to continue paying out millions in subsidies to the oil industry, the Senate passed a Permanent Fund restructuring plan that cuts the Permanent Fund Dividend for every man, woman and Alaskan child.
“Where are Republicans’ priorities? Reaching into the Permanent Fund should be the last option,” said Casey Steinau, Chair of the Alaska Democratic Party. “Why does the Republican majority think it is okay to pick the pockets of every Alaskan man, woman and child while preserving massive giveaways to the oil industry?”
Alaska’s oil tax credit system has become a substantial expense and is set to cost the State of Alaska hundreds of millions of dollars a year into the foreseeable future. In the next fiscal year, the State is expected to gift an estimated $825 million in refundable tax credits, while the state is forecasted to only recoup $54 million in production taxes. FY 2017 will be the third year in a row that production tax revenues are less than credit payments. The provisions passed by the Republican led Legislature requires the State of Alaska to cover a third of oil industry losses and increases the state’s fiscal liability to the oil industry to over a billion dollars.
“Democrats have been clear,” said Steinau. “We must work together to develop a fair and sustainable fiscal plan. The plan to cut the PFD while subsidizing the oil industry unfairly targets hardworking middle class families, seniors living on a fixed income who should never have to choose between food and heating their homes, and children who have yet to take their first steps.”
According to an Alaska Department of Labor and Workforce Development study non residents accounted for 35% of the oil industry workforce. Democrats offered amendments to incentivize local hire which were rejected by the Republican Majority in the House.
“Legislators were elected to serve Alaskans who proudly call our state home,” said Steinau. “Not only is the Republican Majority taking money out of our economy and sending it right to Houston and London, they’re taking away our families’ opportunities to save for a college education, find relief from high energy costs, and invest in local small businesses.”
The plan passed by the Senate ties the PFD to dwindling royalty revenue.
“Tying the PFD to royalties is a huge mistake and marks the beginning of the end for the dividend,” said Steinau. “We strongly urge Alaskans to contact their legislators and use their voices to tell them this is not okay.”