Just hours after the 27th Alaska Legislature adjourned in the early morning hours amidst acrimony and stalemate on key issues, top legislators were back in the Capitol again Monday to lay the groundwork for fights to come in a special session beginning Wednesday.
Gov. Sean Parnell called the session just after 1 a.m. after failing to persuade the Legislature to adopt two of his priority bills, reducing oil taxes and developing a small gas pipeline.
While there appears to be wide philosophical differences on those issues, a third bill in the special session agenda that would toughen penalties for human trafficking is expected to pass easily.
The House of Representatives last year passed Parnell’s House Bill 110 offering the oil industry $2 billion a year in tax breaks after legislators blamed declining oil production on the state’s Alaska’s Clear and Equitable Share oil tax.
Sen. Bert Stedman, R-Sitka, called that bill a “staggering” reduction and said a similar bill had no chance in the full Legislature.
“If it’s just 110 again, there’s not the votes in the Senate,” he said.
Senate President Gary Stevens, R-Kodiak, breezily dismissed accusations from House leaders they were the reason why there was no oil tax agreement.
“Is it our fault for not passing bad legislation?” he asked. “Yes, I take full responsibility for that.”
House Speaker Mike Chenault, R-Nikiski, said he doubted the old House Bill 110 could pass the House again, but didn’t know what kind of bill Parnell would introduce.
Chenault said he remains committed to lowering oil taxes enough to get oil companies to invest more in Alaska and produce more oil.
“That’s our revenue stream, that’s our blood,” he said.
Parnell said he saw hope an agreement could be reached.
The Senate this year passed an oil tax reduction for new fields, but it failed in the House.
“Because of the Senate action there’s a new dynamic at work that might lead to a compromise that might produce new production of oil,” Parnell said.
Also on the agenda is House Bill 9, creating a new in-state, small-diameter pipeline that’s a pet project of Chenault.
His bill passed the House easily, but faced harsh criticism from House Democrats and senators.
It also faced changes in the Senate that Chenault found unacceptable.
“Basically, they neutered it,” he said.
Stedman called it an expensive bill that was unlikely to work, and likened it to the Alaska Gasline Inducement Act both he and Chenault opposed and see as a failure.
That act, known as AGIA, was sponsored by former Gov. Sarah Palin and is the ongoing effort to bring Alaska a big natural gas pipeline, either across Canada or to an LNG export terminal in Alaska.
“I’m not interested in AGIA version two, where we get up one day and were out $400 million and all we have to show for it is a paper to hang on the wall,” Stedman said.
Parnell’s special session call identified by bill number House Bill 9, the in-state pipeline, and House Bill 259, the human trafficking bill.
Both technically expired when the session adjourned Monday, but Parnell said the Legislature could suspend the rules and resurrect those bills.
House Democrats said they would object, which could speed the session beginning tomorrow to a conclusion, if not necessarily to success for Parnell’s agenda.
• Contact reporter Pat Forgey at 523-2250 or at email@example.com.