Sen. Ted Stevens told the Alaska Legislature on Wednesday, March 22, that the state stands to receive less federal funding in the future and should rely more on its own money generators.
The Alaska Permanent Fund is viewed in Washington as a source for supporting state construction of roads, bridges and other capital projects, said Stevens, R-Alaska.
"Many see our projected $1.4 billion annual surplus, plus $34 billion in the permanent fund, and with the increasing price of electricity, gasoline and heating oil, and ask: Why send federal money to Alaska when they're not willing to spend their own funds?" he said.
Congress is preoccupied with an $8 trillion debt and providing U.S. troops with the equipment and resources needed to fight in the Middle East, Stevens said.
The state should "inflation-proof" the permanent fund and then direct money toward projects that would lead to more revenue, Stevens suggested.
"We've got a lot of problems that haven't been met. And we've got good income now. And (at) this time we ought to do things to enhance our ability to get future income," he said.
Some of the examples he gave were providing incentives for oil producers to explore leases for more oil and invest in coal gasification projects, and developing a natural gas pipeline to deliver the resources to markets in the Midwest.
House Minority Leader and gubernatorial candidate Ethan Berkowitz, D-Anchorage, said the state should continue socking money into the permanent fund because it creates a renewable resource out of a nonrenewable resource.
"We need to build the permanent fund as big as we can possibly get it," he said.
As Washington enters its 25th year of the debate on oil drilling in the Arctic National Wildlife Refuge, oil companies may lose interest in fighting the issue if this Congress cannot pass legislation to open the area, Stevens said.
This year could be different because petroleum prices continue to be high and a sentiment exists to rely more on domestic supply, Stevens said.
But backers of ANWR drilling may run into similar problems if there are not enough supporters in the House to pass a budget reconciliation with ANWR provisions, he added.
The Alaska House Finance Committee is set to add a $600 million savings plan to a fast-track supplemental spending bill.
Finance Committee Co-Chairman Mike Chenault, R-Nikiski, said he wants to take the money off the table now before lawmakers get their hands on it later this session.
"The longer it sits out there, the longer and the better chance we as a Legislature can find something we really love and we really want to fund," he said.
Legislators such as Chenault say they are repeatedly hounded by their constituents to save money while the state is rolling in surplus revenue earned from high oil prices.
Saving a significant chunk of the surplus has been a mantra of Republicans, Democrats and the administration since January, but ideas vary on where to place it.
Chenault suggested setting aside half of the $600 million for education funding in fiscal year 2008 and placing the rest in an account in the Alaska Housing Finance Corp. that can be used for general needs.
The Legislature created an education fund last session to "forward fund" needs for grades K-12. Some $400 million from oil surplus revenues was added to the fund through the fast-track supplemental bill.
House Majority Leader Ethan Berkowitz, D-Anchorage, said putting the money in a fund for short-term education needs would not yield any returns on the investment.
Senate OKs bill to allow fishermenmultiple permits
The Alaska Senate voted 17-2 Monday, March, 20, to allow commercial salmon fishermen holding two permits to obtain additional fishing privileges from the state Board of Fisheries.
But the bill - which would allow fishermen to apply for more time, gear and area to fish - is on hold while Senate Minority Leader Johnny Ellis, D-Anchorage, is reconsidering his vote.
The bill passed the House of Representatives during the 2005 legislative session.
Ellis said Monday he is rethinking House Bill 251 after hearing fellow Democrat Lyman Hoffmann, of Bethel, speak out against it on the Senate floor Monday. Hoffmann and Sen. Gretchen Guess, R-Anchorage, voted against the bill.
The bill's proponents contend that it's just. For example, anyone who has two permits must pay twice as much for that privilege, United Fishermen of Alaska President Bobby Thorstenson has said in previous reports.
Clearing a way for tourist tax
An Alaska lawmaker wants to be sure a proposed statewide cruise ship tax referendum is legal, and is asking Congress to clarify its position on the matter.
The Alaska House Transportation Committee on Tuesday, March 21, passed Palmer Republican Rep. Carl Gatto's resolution meant to protect a proposed head tax from legal challenges if voters approve it.
The initiative slated to be on the November ballot would charge cruise ship companies operating in Alaska a $50 tax per passenger.
The Maritime Transportation Security Act of 2002 contains a provision that was designed to invalidate a tax levied by Yakutat on cruise ships that did not call on any of its ports but still sailed through its waters.
Gatto, sponsor of House Joint Resolution 18, wrote the legislation to ask Congress to clarify or repeal the measure. The provision, inserted by Sen. Ted Stevens, R-Alaska, says taxes cannot be levied on the industry unless the vessels call on a city's ports.
An argument has been made that the measure in the act could lead to courts invalidating the ballot initiative, Gatto said.
The cruise ship industry opposes the ballot initiative, saying the tax would be passed on to passengers and some may choose less expensive trips.
Reported by the Juneau Empire