A Citizen’s Guide

The Greater Fairbanks Chamber of Commerce plans to weigh in on the tax debate next week.

The committee responsible for fostering dialogue between the chamber and various government groups wrote a letter on Friday asking the state not to raise taxes on the oil industry during the current special session. Two members of the committee work for BP and ConocoPhillips.

The larger board of directors plans to vote on Monday to decide whether to send the letter as written or make changes.

State lawmakers are in Juneau deciding whether or not to revise the Petroleum Production Tax responsible for generating state revenue from oil and gas production.

Gov. Sarah Palin called for the special session because she believed the tax did not work as intended and had been tainted by several legislators now facing corruption charges related to their votes last year.

The letter from the Fairbanks chamber takes issue with both those assumptions.

In the letter, however, the chamber “applauds” state efforts to improve information sharing between oil companies and the government and among government agencies, and “supports” state efforts to hire auditors with more expertise.

With the letter, the Fairbanks chamber joins the Alaska State Chamber of Commerce and the Anchorage Chamber of Commerce in bringing the views of the business community to the debate.

All three chambers share similar opinions, including opposition to the tax increase and the need for better auditors. But each chamber took individual approaches in their opinions.

The Fairbanks chamber said the Petroleum Production Tax didn’t bring in as much revenue as expected because costs for labor and materials increased in the past year, but added that additional taxes wouldn’t alleviate those problems.

The Anchorage chamber said if legislators are unsure of the effectiveness of the tax, they should wait to make changes and not increase the tax simply because of the “circumstances surrounding its passage.”

The state chamber expressed a similar sentiment in its letter to Palin.

Reading the letter to lawmakers this week, President and CEO Wayne Stevens, said, “The concern is that while you and the Legislature work to restore pubic faith, outcomes based more on emotion than economics will further chill the oil investment climate.”

Both the Anchorage and state chambers asked lawmakers not to make any tax changes without also creating a fiscal plan for managing the extra revenue generated through those taxes.

Contact staff writer Eric Lidji at 459-7504.