Palin energy bill proposes replacing lost aviation revenue

Gov. Sarah Palin proposed waving state fuel taxes for a year, but she wants to make up lost aviation fuel tax revenue for the state's municipal airports - including tens of thousands of dollars for Juneau International Airport.

In her energy relief bill now being considered in a special session of the Alaska Legislature, Palin proposed allocating $150,00 to make up for lost money from aviation fuel taxes shared with local airports.

Juneau would be in line to receive more than half of that amount, according to Jerry Burnett of the Department of Revenue. He addressed the Senate Finance Committee on Thursday.

Ketchikan, another of the large municipal airports, also would get a significant amount, he said.

Alaska taxes aviation gas at 4.7 cents per gallon, and jet fuel at 3.2 cents per gallon. When Palin announced her plan to suspend collection of fuel taxes for a year as part of her energy relief package, most of the attention surrounded the 8 cents per gallon road fuel tax. Revenue officials worried that municipally owned airports such as Juneau also would be hurt.

Juneau has the largest municipal airport in the state. The bigger airports in Anchorage and Fairbanks are state-owned.

The problem with suspending the tax is that 60 percent of the tax is shared with the local airports for operating expenses. For some, that's a crucial part of their budgets, Burnett said.

The administration is asking for an appropriation to make up the lost money so pilots will still get the tax savings, but airports won't be hurt, he said.

"The administration did not believe airports should be losing a source of funds that some of them rely on," he said.