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More Alaska Production Act is signed into law

Posted: May 21, 2013 - 1:09pm  |  Updated: May 22, 2013 - 12:03am

Governor Sean Parnell signed into law several bills Tuesday including the More Alaska Production Act that would enact tax reform for the state’s oil industry.

During a luncheon of the Chamber of Commerce in Anchorage, Parnell outlined his five-year fiscal plan before signing Senate Bill 21.

“This was quite a year of legislative accomplishment,” Parnell said. “We are accomplishing so much together.”

Before the chamber he called the bill signing Tuesday as a “package of opportunity” and the year as a “comeback.”

“Oil producers, if you want the tax incentives, there’s no try,” said Parnell, “there’s only do. Get that oil flowing.”

The reform aims to benefit legacy corporations, small and explorer programs throughout the state to increase overall gas production that has abated over the past several years.

“The industry truly believes that if Alaska had a more competitive environment, more investment would come to the state to increase production,” Alaska Oil and Gas Association executive director Kara Moriarty told the Empire. “Without question, the bill is better than our current tax structure.”

The bill would enact tax cuts across the board to interest rates, taxes paid under the Alaska Net Income Tax act and provide expansive credits.

“We definitely believe Senate bill 21 will put Alaska back into the game,” Moriarty said.

At a rally in front of the chamber building in Anchorage, Rep. Les Gara (D-Anchorage) decried the bill during a phone interview saying, “it’s a pure giveaway.”

“The Legislature should have written a smarter bill,” he said, “this one gives away $1-2 billion a year with no requirement that companies reinvest that money in Alaska.”

Democrats proposed tax rules that would require investment in Alaska for reasonable tax breaks.

Parnell also signed HB 4, a bill that would authorize the Alaska Gasline Development Corporation, an independent state organization, to develop an in-state gas pipeline project; SB 27 and HB 129 that would facilitate an expedited permitting process.

Parnell also sign the budget for the 2014 fiscal year today.

Contact reporter Kenneth Rosen at 523-2250 or at kenneth.rosen@juneauempire.com.

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