With the significant loss at the polls for Ballot Measure 1, a major increase in oil production taxes is again off the table, for now, but that doesn't mean the Legislature won't revisit the topic in some form given the state's dire fiscal situation.

Known by its bill name as the Fair Share Act, the citizen-led initiative to sharply raise oil taxes on the three largest North Slope fields, Ballot Measure 1 lost by more than a 15-point margin.

Kara Moriarty, CEO of the Alaska Oil and Gas Association and campaign manager for the Ballot Measure 1 opposition group OneAlaska, said the second citizen-led attempt to overturn the current oil tax system known as Senate Bill 21 didn't lose by a wider margin than the first for anyone one reason; rather, OneAlaska's messaging resonated with Alaskans for a wide variety of reasons, she said.

Many "No" voters were concerned about the potential long-term impact to the Permanent Fund and the dividend; others were worried about the prospect of less North Slope activity and fewer jobs, and some feared the potential secondary economic impacts given the oil industry's large presence in the state, according to Moriarty,

"Ballot Measure 1 demonstrated there is broad opposition to that specific proposal across regions, across parties," she said, also noting the OneAlaska campaign won in 30 of the 40 state House districts.

"Given its complexity it took a while to unpack what it meant and to demonstrate the massive tax increase that it was."

Vote Yes for Alaska's Fair Share chair Robin Brena could not be reached for comment in time for this story.

Specifically, the Fair Share Act sought to increase both the current 4 percent gross minimum and the tiered net profits tax rates on large, mature North Slope fields. Initiative backers stressed that SB 21 has resulted in the state receiving less than 20 percent of the gross revenue from North Slope oil in recent years, while historically the state has gotten 28 percent of that pie.

The ballot measure sponsors estimated the tax change would've generated about $1.1 billion per year in additional revenue over the long-term. They argued SB 21 has cost the state about $3 billion per year since it became law in 2014 and as a result Alaska receives about half of the overall oil revenue that other states collect.

The first attempt to repeal SB 21 via referendum failed by a five-point margin in the August 2014 primary election. Moriarty said the overall economic upheaval of 2020 also likely made some voters hesitant to support additional taxes.

"Why would we be raising taxes on any industry at this time?" she said.

Alaska Labor Department data indicates Alaska's oil industry has shed roughly 3,000 jobs this year.

Whether or not the issue is a primary debate in Juneau next winter will likely depend on whether Republicans can form a lasting caucus around the small, 21-member majority they would hold based on current election results. That party majority includes Kodiak Rep. Louise Stutes, who has caucused sided with Democrats on many issues in recent years.

A majority coalition of Republicans, Democrats and independents was formed — largely to oppose Gov. Mike Dunleavy's aggressive budget plan — to lead the House in early 2019 that was in-part built on the agreement that oil taxes would not be brought up.

While some of the same, more moderate Republicans who agreed to break from the party caucus nearly two years ago remain in the Legislature, the state's fiscal situation has continued to deteriorate to the point that broader revenue discussions are almost certainly to be had at some level.

The State of Alaska is projected to end 2021 with approximately $600 million in savings outside of the Permanent Fund Earnings Reserve Account and have a deficit of more than $2 billion in the upcoming 2022 fiscal year, according to Legislative Finance Division estimates.

Moriarty said industry leaders are ready to debate oil taxes in the Legislature — where she insists it should happen — like they have always been.

"I think we are fully expecting some conversation and we look forward to having that kind of discussion in the legislative realm where everything can truly be evaluated and weighed in a legislative process," she said. "We've never shied away from that conversation and we wouldn't shy away from it this session."

In the Senate, the PFD fractured the mostly Republican majority last year and is likely to continue to be a major sticking point in forming a majority caucus despite Republicans continuing to hold a 13-7 majority in the chamber.

Dunleavy opposed the Fair Share Act and has strongly resisted other tax proposals but his administration has attempted to push much of the fiscal planning to the Legislature after his cuts-first proposal to reach full PFDs was rejected last year and the state's finances are worse yet.