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District 6 hopefuls differ on oil taxes

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Posted: Thursday, November 1, 2012 12:37 am | Updated: 11:52 am, Mon Jan 21, 2013.

FAIRBANKS – As with almost every other race in Alaska this year, the biggest difference between candidates for House District 6 largely comes down to oil taxes.

Rep. Eric Feige, R-Chickaloon, and Democratic challenger Jamey Duhamel may share a lot in common — a similar approach to energy relief and capital projects — but they differ on whether the state should lower oil taxes in a bid to increase production and investment.

District 6 is one of Alaska’s larger districts, spanning from Delta Junction south to Valdez and west from the Richardson Highway into the eastern region of the Mat-Su Borough.

Feige, who was first elected in 2010, is a commercial pilot and says many people feel the sting of high energy costs. But says his biggest reason for running is to reduce oil taxes.

“The biggest priority is to reduce the oil taxes and get the economy moving again,” he said “The price is well over a hundred dollars a barrel and things are booming. Why are they not booming in Alaska? Why isn’t Alaska going gangbusters?”

He blames the state’s large take of profits and, in an earlier interview with the News-Miner, said he favored lowering the government’s oil tax take by at least 15 percent.

Duhamel, a 36-year-old mother of four boys, has experience in social work, advocating for at-risk youth and families, as well as in community organizing. It’s Duhamel’s first foray into state elected office, and she said her priorities are largely in energy relief, bettering education and promoting agriculture in the district. She believes the oil tax system could be changed but not at the risk of undercutting the state’s revenue.

“I feel the oil tax structure should be tweaked but should not be severed. That money comes straight out of what we need to keep Alaska a healthy and livable place,” she said. “It could drain our savings accounts and even our Permanent Fund. I’m in favor of whatever we can do to keep our revenues high so we can reinvest in Alaska itself.”

Duhamel believes the state should be involved in building Alaska’s economy through heavy investment in capital projects, education and energy programs, which are all made possible by the state’s revenues.

“When we give away $2 billion, that’s an anti-development stance,” she said. “We need investment, we need roads, we need schools. In my opinion we don’t need to give money back, and if we do, we better be darn sure that that money is going to be reinvested in the state in some way.”

Feige, too, sees the benefit of the state when it comes to developing capital projects, but he says private industry and the economics of projects should lead.

Feige, who co-chairs the House Resource Committee, said growing public concern about the direction of oil taxes with the so-called

“$2 billion giveaway” will mean that any legislation will likely tie tax relief to increased production.

“They (the voters) don’t want it to be a giveaway and want some sort of specific performance that they (oil producers) have to achieve before they can get a tax break,” he said. “I think that will achieve what the public is looking for, but that all depends on who we get in the Senate.”

Aside from the issue of oil taxes, neither candidate has toed the party line. They both say they are most interested in finding solutions that are the best fit for their district.

During the most recent legislative session, Feige departed from the House majority in voting “no” on House Bill 9, a bill that would have continued work on the small-diameter natural gas pipeline from the North Slope to Anchorage. Feige said he didn’t vote for it because it didn’t carry any benefit for his district.

“I believe that a large-diameter pipeline that goes to Valdez is the ultimate project,” he said. “The economics is tremendously different. We’re going to be able to sell more gas at a better profit as opposed.”

Duhamel is one of a minority group of Democrats to say direct energy vouchers are a bad idea, as does Feige. She said such spending, which could be in the hundreds of millions, wouldn’t be the best investment for the state.

“I feel like we should be making the most economical decisions for the state, and I don’t know if energy vouchers are the best choice,” she said. “I think what it requires is a lot more scrutiny to make sure that we’re not spending a lot of unnecessary money.”

Contact staff writer Matt Buxton at 459-7544 or follow him on Twitter:

@FDNMpolitics.

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