As we mature into modern statehood, or our middle adolescence, or late pre-adolescence as a state, we do well to consider the things we have perhaps outgrown and update them or trade them in for something new. This includes old timey tax structures. Our state’s motor fuel and marine fuel tax has not changed since the 1970s.
Senate Bill 115 is legislation to increase Alaska’s motor fuel tax from 8 to 16 cents per gallon for highway fuel and from 5 to 10 cents for marine use fuel. Heard February 3 in the Senate Finance Committee, it will be heard again on February 21. Alaskans enjoy the lowest motor fuel tax in the nation. In a state with tremendous land and marine highway infrastructure needs, having the lowest tax nationwide is not an honest or sensible way to meet our challenges. SB 115 would bump the state up from having the lowest to the second-lowest motor fuel tax in the nation and could raise over $30 million per year. It is not going to break the bank for users of motor fuel, and it is not going to save our state from our overall financial disarray, but it will be an excellent start.
Drivers of Electric Vehicles, those emissaries from the future, will probably be required to pay an increased vehicle registration fee. Discussion during the initial hearing leads one to believe a committee substitute introduced on February 21 will reflect a $100 increase for EVs each biennial registration period over their gassy counterparts. For equity in creating a fee structure vs. a per-gallon tax, the legislature should consider that EVs are light vehicles and dole out less wear and tear on our roads than traditional cars and trucks, and especially those cars and trucks using studded tires. Also, EVs do not cost future Earth dwellers untold harm because they are not emitting deadly pollutants. I am not sure how to build this statement into statute, aside from not passing absurd punitive fees, which could stifle a nascent form of clean mobility.
There will be some who claim that EVs are owned primarily by the wealthy who can afford a higher fee. This may be true, though I know of numerous middle-income families who have consciously chosen to invest in an EV, as a measure to also invest in their children’s future. Whatever way we want to shake it, SB 115 should not be used to make EV ownership more burdensome to middle and low middle and low income Alaskans who will be taking advantage of EVs as the price of ownership continues to decline.
Estimates from the bill presentation are that 28,000 EVs reside in Alaska. I have no idea where that estimate came from, as it seems astronomically high. Perhaps they include rechargeable remote-controlled cars people buy their kids for Christmas. If that number for actual EV cars on the roads of AK is true, well, then that is good.
Of separate note, SB 115 looks like as good a legal vehicle as any to attach language that would increase the refined fuel surcharge. It is a 1 cent fee on all refined fuel sold, transferred, or used at the wholesale level in the state, which helps support our oil and hazardous substance spill clean-up efforts and spill prevention and preparedness activities. A recent presentation to the House Finance budget subcommittee assigned to look at the Department of Environmental Conservation budget made it clear that without increased revenue, our oil spill prevention fund will run in the red by 2024.
Increasing the refined fuel surcharge by a few cents will help safeguard our salmon habitat from oil spills. Increasing the motor fuel tax will provide state coffers with additional money. Both will come out of your pocket and the pocket of your brother trucker and your fellow traveler and those idling their autos in interminable kid-pick-up lines at local schools. The benefits will flow back to you in the form of resource protection and solvent state services. Those brandishing social media pitchforks against any taxes call this Socialism, others call it Adulting.
We will see how it goes,
Louie Flora
Government Affairs Director,
The Alaska Center
P.S. MARK YOUR CALENDARS! On Thursday 2/27 at noon, we will hold an hour-long legislative session conference call with myself, and The Alaska Center’s Political and Campaigns Director, Jenny-Marie Stryker. Jenny Marie and I will offer a brief update on the session and take your questions. Phone-in information to follow!
Bills/Hearings to Watch
Monday, February 17
9:00 a.m. Senate Railbelt Electric Systems Special Committee
SB 123ELECTRIC RELIABILITY ORGANIZATIONS
-- Public Testimony --
1:00 p.m. House Resources Committee
HB 138 NATIONAL RESOURCE WATER DESIGNATION
-- Testimony <Invitation Only> --
3:30 p.m. Senate Resources Committee
SB 145REGISTRATION OF BOATS: EXEMPTION
-- Public Testimony --
SB 70 REPEAL IND. OCEAN POLLUTION MONITORS/FEE
-- Testimony <Invitation Only> --
+Presentation
The Spill Prevention & Response (SPAR) Program
by the Department of Environmental Conservation
-- Testimony <Invitation Only> --
5:30 p.m. Senate Environmental Conservation Finance Subcommittee
+Department of Environmental Conservation Budget
Overview
-- Testimony <Invitation Only>
Tuesday, February 18th
8:00 a.m. House Tribal Affairs Special Committee
+Presentation: Alaska Tribal Child Welfare Compact
-- Testimony <Invitation Only> --
HB 221STATE RECOGNITION OF TRIBES TELECONFERENCED
-- Public Testimony --
11:00 House/Senate Joint Session
Annual Address by the Honorable Lisa Murkowski, U.S. Senator
3:00 p.m. House State Affairs
SB 144 ESTABLISH JUNE 7 AS WALTER HARPER DAY
HB 74REPEAL IND. OCEAN POLLUTION MONITORS/FEE
-- Public Testimony --
Wednesday, February 19th
9:00 a.m. Senate Railbelt Electric Systems Special Committee
SB 123 ELECTRIC RELIABILITY ORGANIZATIONS
3:00 p.m. Senate Resources Committee
+Presentation:Revenue from Alaska's Resources by the Department of Natural Resources & the Department of Revenue
-- Testimony <Invitation Only> --
SB 155EXPLORATION & MINING RIGHTS; ANNUAL LABOR
-- Public Testimony --
Thursday, February 20th
9:00 a.m. Senate Finance Committee
+AIDEA & Alaska Development Team
- Commissioner Julie Anderson, DCCED
- Deputy Commissioner John Springsteen, DCCED
- Tom Boutin, Executive Director, AIDEA
10:15 a.m. House Energy Special Committee
HB 151ELECTRIC RELIABILITY ORGANIZATIONS
-- Public & Invited Testimony--
HB 232 MUNICIPAL TAX CREDITS
-- Public & Invited Testimony --
1:00 p.m. House Transportation Committee
"An Act relating to the Alaska marine highway system; establishing the Alaska Marine Highway System Corporation; and providing for an effective date."
<Pending Introduction & Referral>
9:00 a.m. Senate Finance
SB 104 APPROPRIATION LIMIT
SB 115 MOTOR FUEL TAX
3:30 p.m. Senate Resources Committee
SB 171 INDUSTRIAL HEMP PROGRAM; MANUFACTURING
-- Public Testimony --
SB 161 GEOTHERMAL RESOURCES
-- Public Testimony --
SB 150 INTENSIVE MGMT SURCHARGE/REPEAL TERM DATE
-- Testimony <Invitation Only> --
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