The Weekly Top 3
The Weekly Top 3
The Weekly Top 3 (10.6.2025)
Welcome to The Weekly Top 3 — our look at the top 3 things on our mind here at Alaskans for Sustainable Budgets — for the week of October 6, 2025.
This week, our top 3 issues are these: 1) we explain how the current candidates for Governor have lost sight of former Governor Jay Hammond’s vision for Alaska that put Alaska families first (2:05); 2) we explain how some in the oil industry are trying to rewrite the history behind SB21 (21:21); and 3) we discuss how Governor Dunleavy is failing to do his part to help resolve the state’s fiscal problems (39:35).
The Weekly Top 3 is a regular weekly segment on The Michael Dukes Show. The Show broadcasts on Facebook and YouTubeLive as well as via streaming audio from the Show’s website weekdays from 6–8am. We join Michael weekly in the first hour of Tuesday’s show, from 6:25–7am, for a discussion between the two of us about our three issues.
Hi. This is Brad Gaelley, Managing Director of Alaskans for Sustainable Budgets. Welcome to the Weekly Top Three. The top three things on our mind here at Alaskans for Sustainable Budgets for the week of October 6th, 2025. The weekly top three is a regular segment on the Michael Duke Show. The show broadcasts on both Facebook Live and YouTube Live, as well as via streaming audio from the show's website weekdays from 6 to 8 a.m. I join Michael weekly in the first hour of Tuesday show from 6.10 to 7 a.m. for a discussion between the two of us about our three issues. We post the podcast of our discussion following the show on the Alaskans for Sustainable Budgets Facebook, YouTube, SoundCloud, Spotify, and Substack pages. Also on the Alaskan's for Sustainable Budgets website, as well as the project page on national blog site, medium.com. You can find past episodes of the weekly top three also at the same locations. Keep in mind that in addition to these podcasts, during the week, you can also unfollow and participate in the discussion with us of these and other issues affecting Alaska's fiscal and economic condition by following us on the Alaskans for Sustainable Budgets Facebook page and through our posts on Twitter. This week our top three issues are these. First, we explain how the current candidates for governor have lost sight of former Governor Jay Hammond's vision for Alaska and put Alaska families first. Second, we explain how some in the oil industry are trying to rewrite the history behind SB 21. And third, we discussed how Governor Dunleady is failing to do his part to resolve the state's fiscal problems. And now let's join Michael.
SPEAKER_00:Let's get started. Number one of the weekly top three. And um the biggest problem I think that we have right now, and you kind of summate it here, is that we don't have a Jay Hammond anymore. And I think it's showing. Let's see what's going on here. Let's get started, Brad.
SPEAKER_01:Well, over the past week we've seen a number of candidates speaking. We had a forum. There was a forum for the candidates up in Fairbanks. There's been Dave Bronson's announced and had uh had various statements. And start of what I'm starting to realize is we don't have a Jay Hammond anywhere in this group. Jay Hammond, when you go back and read Diping Diapering the Devil and all of the various writings that he did, Jay Hammond had a had a had a core vision. And that core vision was about the PFD, about the about the state's wealth. That's a PFD was like the equivalent of a lower 48 family oil trust. These things are fairly common in the lower 48. When a family uh owns uh oil royalties or own owns working interests, the the proceeds are collected in a trust. Trust proceeds are sometimes invested like we do with the permanent fund. The trust proceeds ultimately are distributed to the to the family uh on a distributional basis similar to the PFD. And so the the PFD is sort of like a family trust. We're collecting all the all the wealth, the collectively, the wealth that the family owns, and then we're distributing a portion of it, uh, at least a portion of it, to uh to the family through a mechanism that looks a lot like the PFD. It distributes commonly owned wealth to designated beneficiaries. It ensures, and like the PFD, it ensures that at least some share of the wealth reaches all in the family, uh, in rather than being diverted to the benefit of only some. That's sort of the core principle of the PFD, that that a portion of the state's wealth is supposed to be distributed so that the benefit so that Alaska families all benefit to some degree from the state's wealth, uh instead of it being diverted as as as Jay and others, Hammond and others were concerned, instead of it being diverted by the legislature or by government to only a select few that at least through the PFD Corps was going to be distributed to Alaska families and benefit Alaska families. It is a way of looking at Alaska families first, Alaska families first, Alaska families uh at the center. Uh what this state is about is looking out for Alaska families and taking care of Alaska families and ensuring that a portion of the commonly held wealth goes to all uh Alaska families. None of the candidates, none of the candidates in the various statements they've made over the course of the last week, or at least since I've been following them since they made their announcements, none of the candidates have that core belief. All of them are talking about various things like resource development. They're talking about issues out there, resource development, a capital budget, uh uh something else, something else, something else, education in the case of Tom Begage. And they're taking those and then saying, oh, these benefit Alaska families like this. They're backing into benefits to Alaska families out of and and to some degree making them up uh out of out of these various things that that they support or they propose. None of them are starting at the core of Alaska families and saying, okay, Alaska families at least get some share of the commonly held wealth, period. And then we're gonna look, we're we're gonna do other things and look out for Alaska families in other ways. None of them are starting with Alaska families at the center like Hammond did and and looking outward. They're all starting with these other things, these various other interests, and then trying to make up some story about how that improves the lives of Alaska families. That's just that's disturbing. I mean, we've lost Hammond. If we don't, if we don't, if we don't get a candidate, a candidate that starts looking at Alaska families first, um, and then looks out for Alaska families and and and builds from there, we're gonna have lost Jay Hammond. We're gonna have lost the genius that Jay Hammond that Jay Hammond brought to this state. And we're gonna just we're just gonna divide up into all of these various special interests that everybody's looking out for and trying to back in about how that relates to Alaska families, and then just sort of battle out about which special interest gets the most votes.
SPEAKER_00:Well, it's a justifying Alaska families sort of get lost in the process. Yeah, it becomes a justification for all the government spend. No matter what you wear on your lapel, what your animal is on your lapel, it's all about, you know, kind of, it seems like, about protecting the government spend, and here's our justification for it.
SPEAKER_01:Or in in Sydney Canada's case, protecting the resource industries. The resource industries, I mean, Hammond's vision was the resource industries there are there to enhance Alaska families. They are there to help support Alaska and help support Alaska families. It was Alaska families first, resources. We have resources, great, let's develop them, let's improve the lives of Alaska families with Alaska resources. It some of these candidates have just sort of taken that and gone off in let's do the resources, let's protect the resources, let's protect resource development. And oh yeah, maybe there's some benefits to Alaska families out of that later on. But but but you know, the the the benefit is to resources first. So it's not just not just the spend, it's not just K-12 or the capital budget and click Bishop's case or or you know various other things Adam Crumb's resource development and and and so on and so forth. It's not it's not it's not just the spend, it's resource development, it's all these other special interests out there that that they try to back in and say, oh, well, this protects Alaska families this way. But it doesn't. Hammond had the vision that I think is is unique, makes Alaska unique, uh, and is and is tremendously strong for Alaska families of putting them at the center of this. None of the candidates are doing that. None of the candidates that that I've seen thus far are doing this. Jeff Lanfield had a quote. I've got Lanfield and I are having this debate about PFTs anyway, but Lan Lanfield had this quote about Dave Bronson that I just thought uh uh uh was was very telling. When he was done, he's talking about Bronson, when he was done speaking, speaking at his at his announcement, he took questions from the crowd, he did a decent job answering them. When I asked, when I Lanfield asked his position about the dividend, which at two and a half billion would cost the state nearly half its revenues this year, and so on and so forth. Like other Republican candidates, uh uh uh Bronson struggled. He said he wants to see a large dividend, but acknowledged the state also has to pay for its obligations. He also joked that no one in the room needed the dividend. There is the core of our problem. It's it's the top 20% don't need the dividend, the resource industries don't need the dividend, the the non-residents don't need the non-residence industry, tourism, fishing, and so on don't need the dividend. I guess oil's a big non-resident industry too. Don't need the dividend. So why do we care? Yeah, yeah, yeah, yeah. We'd like a dividend, yeah, yeah, yeah. We'd like to back it and help last the families, but it's not at the core of how we think about these issues. We think about these issues about resource development, capital improvement, capital spending, K through 12. Just, you know, we think about these, uh, about these issues about how to do government spending, or in the case of the resource industries, how to limit government revenue. And and and we've forgotten what the Hammond vision of looking after Alaska families first. So I I I really, you know, as I as I as this has dawned on me over the course of the last week, I've really started to despair that we're gonna find a way out of this box uh uh in this election cycle. Because we don't have a lot, we don't have candidates who who who have that who have that vision.
SPEAKER_00:Well, if I hear one more candidate, and this is the really the the this has become the the uh uh the you know the soup de jour for all the Republican candidates when you start talking about, well, how do we pay for it all? Because we are asking that question of every candidate, how do you pay for what's going on? And if I hear one more person talk about how, oh, we're gonna develop the resources, well, that's great 10 years down the road. How does that help us between now and the 10-year mark? And it just seems like these, again, they have no, they have no grasp, they have no idea what they're gonna do in the interim. Um, I mean, I think Berta Debt is probably the only one that's come up with at least any kind of fractional plan, which includes zero-based budgeting and some other things, which I think are good. But again, if you're going to pay a full PFD, there's going to have to be a whole lot cut out of government, or it's going to have to be a whole new revenue stream to make it work. And nobody seems to have that answer. Hammond, Hammond had it clear.
SPEAKER_01:Hammond was the PFD comes first. Sharing the wealth, the commonly owned wealth, with Alaska families so that they at least have some benefit out of the commonly owned wealth. It's not all diverted to special interests. Hammond had that vision clear. You start with the PFD. And then he said, look, if you want to spend more than that, then you're going to have to tax people. You don't cut the PFD. You don't take out of the people's hands the share of the wealth that that has been created by the PFD to make sure that they get at least some share of it. What's going on is is the exact reverse of Hammond. We're saying PFD cuts first, take the wealth out of the hands of Alaska families and divert it to the special interests. And so we're we're just we're adrift on the PFD. I mean, everybody now says, oh, you can't tax to pay a PFD. We don't tax to pay a PFD. The PFD comes from the permanent fund, earnings off the permanent fund. It's already paid for. We don't need taxes to pay the PFD. What taxes are for are to pay for the additional government that that we've created along.
SPEAKER_00:Right. And what instead what they're doing is taxing our PFD. That's what they're doing. They're taxing it. They're just taking it at the point at the source point so that you don't see it. They're withholding it so you don't see it. And then they start screaming about, well, if you want more, then we'll have to tax you for it. So it's a show game. It is.
SPEAKER_01:It's a it's they've they've managed, and it's the top 20% who don't care. I mean, Robson was clear, it's the top 20% who don't care about the top about the PFD, the non-residents and the non-resident industries and the and the resource industries that don't care about the PFD. They just care about making sure they don't get taxed. And so and so they've managed to reverse the narrative having to be growing rolling over in his grave. They managed to reverse the narrative so that so that the PFD comes last. And if you and if and if the PFD is being cut, the only way to save the PFD is through taxing somebody else to cover the PFD. That's not how the PFD is set up legally. That's not how the PFD was envisioned. It was not the genius behind Hammond's behind Hammond's vision. The genius behind Hammond's vision was look, we got resourced wealth, it's commonly owned. We're going to make sure that Alaska families get a share of it before we start giving it up to all the special interests, the legislatively approved special interests. We're going to make sure Alaskans get a share of it. Period. End of statement. And if government needs more than tax to pay for the additional government. That's the way the statute's set up. That's the way, that's the way it operated up until Bill Walker, you know, decided to change it. But now that Walker decided to change it, we've got everybody's brother jumping on that. And all the Republican candidates, from what from what you look at, all the Republican candidates saying, well, it's too bad, but but you know, it comes last and we don't want to raise taxes to pay for it. You shouldn't have to raise taxes to pay for it because it's already paid for. And and and all this, all this junk is just, well, we've lost the vision.
SPEAKER_00:Well, that's a critical point. The fact that it's already paid for. That's the thing that I think you know, you and I have probably been missing more than anything else, is that it you don't have to tax for the PFD because it's already been paid for. But what's happened is they've snuck in there and they've taken the money out of the cookie jar, and now they say, well, if you want that, you got a tax to pay for. We already took it. And so we didn't have to fight the fight over taxes and have a battle over each and every spending item because we just took it from you. And now if you want it back, now you got to tax yourself. And that's that's the false dichotomy. That's a that's a brilliant uh deduction there.
SPEAKER_01:Yeah, it I it and all you have to do to understand that is to go back to Hammond. Hammond said it's like a family trust, a lower 48 family trust. We have set up a trust that's for the benefit of Alaska families, that provides for the distribution, sets rules for the distribution of to Alaska families. Now it's set by statute, so it can be changed, but until it's changed, these are the rules of the trust in how that portion of the wealth is to be is to be distributed. Period. End of statement. Done. That's the core. Now, if you want to do this other stuff, then then go raise taxes to pay for this other stuff. You'll find that you can't raise taxes to pay for this other stuff. And so you won't do all that stuff. But don't mess with the core. And we've got no candidates to understand who understand that concept.
SPEAKER_00:Okay, Brad Keithley, Alaskans for sustainable budget's the weekly topic. I mean, that's kind of a again a brilliant, you know, a brilliant take on that is that, you know, the PFD is already paid for. It's already, I mean, we didn't have to generate, and now they're again they're they're presenting us with this false dichotomy of do you want to uh do you want to be taxed to get that full PFD instead of we should have gotten the PFD first, and then there should have been an argument about all this other stuff that they want to pay for. That's where the taxes should have come from.
SPEAKER_01:Yeah, and that was Hammond. I mean, that was Hammond's vision. You go back and you read Diabring the Devil. He says that. He says, look, PFD comes first, PFD's poor. If you want to pay, if you want additional government on top of what traditional revenues and and the portion of the permanent fund earnings that would go to government, if you want additional, if you want additional spending on top of that, then you tax for it. There's a great line in there, and I'm not going to get it exactly correct, but the but the sum of the substance of it is there's no greater curb on spending than taxation. And if you have to tax for that additional money, you're going to curb spending because people are going to say, no, I don't want to pay a tax for that, or I don't want to pay this much tax, you know, figure it out within within within this revenue structure. And and Hammond understood that that the curb was on spending would be through, would be through the taxes. And so, you know, and and so those who would be taxed, the resource industries, the the non-residents in the top 20%, who get taxed very lightly using PFP cuts, those who would be taxed said, uh-uh, we don't want to be taxed. Let's figure out a way to curb this back. And it's, you know, 2017 with Walker or 2016 with Walker, and 2017 with Natasha von Emhoff and Click Bishop and uh in the Senate that that flip this around and say, oh no, PFD spending. PFD isn't PFD isn't a a uh uh uh designated income that goes to Alaska families. PFD spending and it comes last. It's the last is the marginal spend. And so whatever we have left over can go to the PFD. That is not the vision that Hammond had. That is not what the statute says, but it's what it got corrupted into being. And none of these candidates, I mean, so 2018, one of the reasons I supported Dunleavy in 2018 was he talked a lot about Hammond and he still had that vision. He's long since lost it, but he still had that vision in 2018. We had a candidate in 2018 that was a Hammond candidate. We don't have a Hammond candidate in uh in this election cycle yet. None of these candidates are talking, are are talking are are starting with the Hammond vision and building out from that. None of these candidates are starting with Alaska families at the core.
SPEAKER_00:Yeah. Well, and that's again part and parcel of the problem is that they've all lost the, you know, they get down there and they get subsumed into the machine, and and the next thing you know, they're, you know, they're or they're they get the recall effort or whatever it was, they get it, they get frightened and nobody wants to fight it anymore. They all start, they all start looking the same. Like I said, all the Republican candidates now are talking about resource development instead of controlling spending uh or anything else. It's all about resource. Well, well, we just we'll just feed more money into the machine. Well, what about all the other parts of it? What about the spending? What about a revenue cap? What about a uh a co? What about you know, putting more money in and getting more money out of the uh oil, revisiting the oil taxation? I mean, these are things that we were supposed to do every 10 years, and now it's antithetical. Every time this happens, we have to have some kind of huge fight about how the oil companies are going to pick up and take their toys and go somewhere else every 10 years. And, you know, it's it's just it's sad that we keep coming back to this. Do you not remember this fight 10 years ago? Now they're benefiting. We all need to we need to keep opening up the hood and looking under the hood. This thing's got to go.
SPEAKER_01:Yep. And we need to start with the core. I mean, we need to go back to and and reread Diaping the Devil and reread Hammond again. We need to start at the core with Alaska families. The resources are great. They're great for the for the impact they can have on Alaska families. And and the PFD is central to that in terms of distributing a portion of that commonly held wealth, making sure Alaska families get it uh before before the the fights start about how to diverting it to special interests. We need to start at the core with Alaska families and what the impact is on Alaska families. Yeah.
SPEAKER_00:Let's uh continue on here. Brad Keithley, Alaskans full sustainable budgets. The weekly top three continues on with number two. On with number two, which is somebody and some people are trying to rewrite history. What do you mean by that, Brad? What do you mean they're trying to rewrite the history? What's what's going on here?
SPEAKER_01:So, Rebecca Logan, who's the executive director of the uh Alaska uh industry uh alliance, uh, the term, the brief term we used uh around the state for to describe that group as the alliance. Rebecca Logan wrote uh a piece uh in the landmine, uh the head of the headline of which is Alaska's oil projects deliver revenue and jobs we depend on. And it's really sort of a it doesn't identify it as such, but it's sort of a rebuttal to a piece I wrote the week before, uh pointing out that that the share of revenues under SB21, the share of revenues that Alaskans are receiving, share of growth revenues that Alaska's Alaskans are receiving under SB21 as it's playing out in its second decade is declining significantly, not only from not only from the sort of the baseline of the prior period of the prior 10 years under SB21, but also from the pre-ACES period, which is sort of what people who were working on SB21 back in the early 2010s said we want to get back to. We want to move back away from ACES back to where from where ACES took us back over to where we were before ACES. And and my column pointed out, or my article pointed out, that we're not getting back to anything. We're not even revenues under gross uh the Alaskan share of gross revenues are declining further under the second decade of ACES, not or second decade of SB21, uh not even reaching what they were what they were in the first decade of SP21 and not reaching what they were uh in the in the pre-ACES period. So, and pointing out that it's the provisions of SB21, the various provisions of SB21 that are causing that to occur, and that we need to go in, we need to lift the hood under SB21 and and and re-jigger it to get it back to where it was at least in the first 10 years in terms of the amount of state revenue being produced, uh, and re-jigger it and and make sure that it works as it was intended. We recall the battle cry back in 2013, 2014 when we were going through the legislative session that passed SP21 and then the the initiative to undo SP21, the recall petition in 2014 to redo SP21. The battle cry was we're yes, we're taking a hit in terms of production taxes from uh from ACEs, but don't worry about that. It's going to result in increased production, and when it results in increased production, we're gonna have increased revenues out of that. And that and we're not and we're not doing that. We're in fact, as we've talked on the show, production tax revenues are going are going down significantly over this decade and continue going down over the over the next decade. So Rebecca wrote a response to that and and and basically said it doesn't address the fundamental argument of the point of all tax reform was to increase production, which we've done, which we're doing in the process of doing, to increase production, which would then benefit Alaska families. Go back to the Hammond division, would benefit Alaska families by increasing revenues to Alaska families. Her article really doesn't, her commentary doesn't really uh respond to that point. What it says is that we're getting some revenues. We're getting we're getting production taxes, we're getting royalties, and and and we're getting jams from from all of this. But it doesn't, it doesn't meet the argument that was that that that was raised in 2013 and 2014, increased production is going to mean increased revenues. It doesn't meet that at all. It just says, look, you're getting some. Be happy.
SPEAKER_00:You're getting some revenue. Yeah. When I read it, that's what my takeaway was. Oh, we should just be happy we're getting something was essentially the gist of the entire article. Not it didn't deliver on the promises that we were supposedly put on there, but hey, look, we are getting this and this and this. And you know, it's kind of misleading because other projects always take more time to get the money. You know, I mean, it just it seems like excuse itis, is what it seems like.
SPEAKER_01:Yeah, it's changed, it's changing, it's an attempt to change the argument that underpinned SP21 back in 2013 and 2014, which is reduced production taxes for maces levels will result in each increased production and will benefit Alaska's through increased revenue. It's trying to change that argument. It's trying to say, it's trying to say the argument now is reduced production taxes will result in increased uh increased uh production levels, which it's doing, and you'll get something out of that. You Alaskans will get something out of that. Just be happy with what with whatever you get out of that. It's take it's trying to rewrite history to write out the piece where a you will benefit, benefit, you Alaskans will benefit from from increased revenues along with along with that uh increased production. There's another thing, and this gets into a little bit of the weeds about why SB21 is is working differently in its second decade, but it it there's a piece in here that says second or third, the eight years with no production tax point talking point is misleading. Large projects everywhere, Alaska, Asia, Latin America, North Sea, typically recover their spent development costs before paying production taxes. That's not entirely correct. There's usually an amortization of production taxes as opposed to a complete recovery. But but but what that art what that misses and what and what she doesn't mention anywhere in the commentary is the compounding effect on top of that, on top of recovering your production costs of what's called the gross value reduction provision in SV21. And what the gross value reduction provision is essentially doing as it kicks in is creating a seven-year tax-free holiday for producers on new on new production. Not a reduction in production taxes, but but essentially a tax-free holiday uh over the over the first seven years. That's not that's unlike anything else that I've seen uh in the international sector in terms of in terms of incentives for uh in terms of incentives for oil development. So not only, I mean, the the argument is, well, you're just you're we're we're getting what happens internationally. No, we're not. We're giving what happens internationally, basically. Alaskans are giving what happens internationally. No, we're not. We're giving more than that. We're giving a can this compounding effect of the of the G VR that's creating a huge amount of production tax holiday during the early years of the of the production cycle on these fields. And that's when most of the production occurs. You and I talked on a on the show before that 75% of PICA, the projected peak of production uh is going to occur before production taxes ever kick in. Uh seven years down the road, eight years down the road. So it's this defense is you know, you're getting something, be happy. Well, we're not getting Alaskans to go back to the Hammond, the Hammond visions. Let's start with Alaskans. Alaskans are not getting what they were promised in 2013 and 2014. And we need to go in. We don't need to, we don't need to go back to ACEs. Nobody's arguing about going back to ACES, but we need to go in and we need to revise SB21 to ensure that Alaskans get what they were promised at the time that they, at the time that the legislature voted for SB21 and at the time that Alaskans defeated the effort to undo SB21.
SPEAKER_00:Well, I mean, this is no surprise that Rebecca, Rebecca Logan from the Alliance is making these arguments because that's what she gets paid for, right? I mean, they are looking out for their best interest. That's what they that's what companies are supposed to do when they're in these kind of uh things. They're supposed to argue from their best position for their shareholders. So kudos to her. Unfortunately. Unfortunately, like you said, she's only telling about half the story and spinning it just the right way. And shame on us if we take it at complete and total face value. I mean, again, I don't remember who it was that said it, but somebody has said that we should be looking under the hood every 10 years at oil. I think it was Stedman actually that said something along the lines of we should open crack it open and look at it every 10 years to make sure that it's working the way that it was intended for both parties. And yet every time we start talking about this, the the industry, the alliance, the the Aoga, the all the other, you know, all the other different entities, they all start screaming bloody murder, like, and we're gonna take our toys and go. To which I say, okay, you know, if that's what you want to do, but we we have a finite resource. We should all be getting what we deserve in that regard.
SPEAKER_01:Well, we should all be getting at least what was promised in that regard, right? I mean, SB21, the industry wasn't shy. When when when ACES was putting investment away from Alaska and was disincentivizing development in Alaska, the industry wasn't shy about standing up and saying, look, we got to change. This has gone wrong. This this oil tax regime is going wrong. We need to change it. And they weren't shy about pushing for that, and they weren't shy about uh about advocating for that. Well, now the SP 21 regime has gone wrong in terms of what it's delivering for Alaskans. It's not delivering the promise of 2013 and 14 that if we increase that that we will that we will reduce production taxes, that'll result in an increase in production levels, and it will result the the the you know, sort of the back-end piece for Alaskans, it will result in increased revenues for Alaska. It's not. It's resulting in some revenues, yes, but it's not resulting in increased revenues for Alaska. You can see that from easily from both the 10-year revenue forecast from DOR and from the analysis that DOR did of the Pika and Willow fields. It's not increasing revenue for Alaska. And it's the compounding effect. It's the compounding, we we gave a lot. I mean, we we created a lot of incentives, a lot of different incentives. Sort of, it was sort of like, you know, throw it on the wall and see what works in terms of incentives to get to get dollars coming back into Alaska. And we threw a bunch of incentives on the wall. And now what's happening is they're having this compounding effect of reducing revenues, reducing tax revenues uh below the levels, uh, below the levels that they were.
SPEAKER_00:It remind me, wasn't there something well, because we were throwing a lot of stuff at the wall to see what would stick. Wasn't there some conversation about one time when they basically said, well, you know, we'll just try it. And if it doesn't work, we can always come back, right? We can always re you know, wasn't there always a discussion of this can be changed in the future if it doesn't work out quite right? I seem to remember some kind of conversation about that. And yet when we come back around to revisit, they're like, you can't do that.
SPEAKER_01:Yeah, let's it there was a conversation like that in 2013. I I want to say it was Mache that was saying that in 2013, uh, during the legislative cycle. But also there was that same conversation. When did we go through when did we have that um uh initiative to try to un to try to change the oil tax code? In 2020 or 2022, my my memory. 2020, I think. All right. Whenever it was, we had people then, and I and I remember the chairman of Doyan or the president of Doyan specifically saying this look, if it doesn't work, we'll change it. We'll be we'll be among the first advocates for changing it. If it's not if it's not resulting in in what in what you know the statute, what what the goals were in 2013 and 14, we'll be among the first advocates for changing that. Never heard from them again since. Yeah, but we can see but we can clearly see the revenues going down. So it's it's yeah, we're getting revenues, yeah, we're getting jobs, but we're not getting what we were promised in 2013 and 14.
SPEAKER_00:Brian's comment is maybe you should be happy you are getting something should become the tagline of the Juno clown posse. That should you and that's kind of what they've said along the whole lines, right? I mean, you've got a robust$1,000 PFD, right? You've got a robust PFD. That was Natasha von Treggi there that dropped that little bomb on us, you know. Oh, your PFD is robust. Thank you. Thank you, Calvin, Calvin von Imhoff, uh, for your uh for your gracious gift to us, the uh community. Uh, but yeah, maybe we should just be happy we're getting something, should be the new battle cry of the legislature.
SPEAKER_01:And that's what they're that's what they're trying to tell us. We should be happy we're getting the PFD we're getting. Oh, aren't you lucky? I mean, as opposed to Hammond's vision, uh, we start with the PFD. That's every Alaska family's share of the commonly held wealth. Period. End of statement. But we're gonna make sure that everybody gets something before we before we you know use the rest of it off on all these on all the special interests. And Hammond went through a list of special interests that he anticipated would would would grab for it, and sure enough, they've been grabbing for it. But but you know, instead of that, instead of that vision, and and and in 2013 and 14, we're gonna get, you know, as as the industry gets increased production and increased revenues from that increased production, we're gonna get an increased uh uh same share. Our share of that of that of those revenues are gonna are gonna go up as well. Asking share of those revenues are gonna go up as well. Now you're you're you know, Brian's exactly right. Now it's be happy. Be happy you're getting anything. Be happy you're getting the portion of the PFD of the of the of the commonly owned wealth. Be happy you're getting the chair of it you're getting, be happy you're getting you know the alliance, be happy you're getting any revenues, be happy you're getting jobs. Just just just take it. Just just be satisfied with what you're getting. And um, and that's I mean, that's just 180 degrees out of out of sync that we're having started this.
SPEAKER_00:That makes me think of close your eyes and think of England, dear. I mean, that's what it feels like sometimes is just close your eyes and think of England. Uh, you know, be happy that that this is all we're doing to you, kind of thing. I I mean, that's what it feels like. Uh and again, going back to what you were first talking about with all this different, you know, machinations of the special interests, you know, be lucky that we give you any of this and we should be doing it because we know better than you how all that money should be spent, and you couldn't possibly make your own decisions with it. Only we in our infinite wisdom can create the programs that will make your life better.
SPEAKER_01:Yeah. And and and you know, to go back to the first segment again, I all the candidates are buying into that. All the candidates are buying into that. I mean, the candidates here saying, oh, additional oil development, that'll do it. Additional resource development, that'll do it. Have they looked the revenues at the impact on Alaskans of additional resource development under the oil code? Additional oil development actually takes actually reduces production taxes even further because it keeps generating all of those additional deductions and credits out there that that compounding deductions and credits that uh SB21 provides for. Have they looked at what that really does to Alaskans? Have they looked at the mineral code and see the minute share of mineral revenues that Alaskans get out of that? It's just like, you know, be happy you're having some activity in your state. Hammond's vision was we start with Alaska families, we start with worrying about them first, and and then, you know, all that stuff, all the rest of stuff is for the benefit of Alaska families. Resource development is for the benefit of Alaska families. Start at that core. Now it seems like all of those things are the center of the universe. And Alaska families just sort of be happy. You're getting any part of it because the because the center of the universe is resource development. That's that's really what we want. You're the center of the reforce, center of the universe is the capital budget. That's really what we want to do. And a lot and and I'll tell you how that sort of benefits Alaska family somewhere along the way. It's backwards. We've got this backwards.
SPEAKER_00:Yeah. Um, Leila just said, in the 1960s, my parents paid 25% of their income to the state, and the state provided almost no services, some wildlife management, boarding schools for village students, and really bad roads. That's our future if we try and fund the state on income taxes. That's exactly where we're headed. Only with the current service level of state, income taxes will need to be considerably more than 25%, and good luck living on what's left after the feds take that cut, too.
SPEAKER_01:No, no. Income taxes don't need to be 25%. Income taxes, it depends on how you do them. Sales taxes would be about two to three percent. I think um uh uh uh Ben Carpenter's sales tax was two or three percent. I can't remember which. Yeah. Sales taxes would need to be about that level to cover the deficit. Income taxes would need to be about four to five percent. What people don't understand is that is that when you tax, a big portion of the revenue you're you're generating through tax is coming from non-residents, 10 to 15 percent, depending upon how you structure the tax. And that's reducing the burden on Alaska families, and it's broadening the base so that the overall level of tax needed across that broader base is much lower than uh than people speculate. So I mean it's a scare mon scaremongering to start talking about 25% taxes. That's not that's not what's required.
SPEAKER_00:Okay, uh, we're continuing one final segment. Brad Keithly, our guest. We got about uh eight, nine minutes here for number three, uh, which is a whole lot of too little, too late from the governor. All of a sudden he's gonna start talking tough. Uh, Brad, what do you got here?
SPEAKER_01:So in the last week, the governor did uh a veto of the uh out-of-state business tax that uh the internet tax that had passed the legislature with with fairly healthy majorities, not veto-proof majorities, but fairly healthy majorities. Uh and the governor uh uh vetoed that, uh, saying he's not going to engage in sort of this one at a time tax uh tax uh policy. Uh he's only going to do it in connection with a total fiscal plan and put together a total fiscal plan. If you want to do these taxes, you need to do it as part of a total fiscal plan. Um and referred again to you know this hope, this this letter that he put out at the end of last session saying, I want a joint fiscal plan team between the administration and the legislature. The problem with this is the governor has not come to the table with his part of the of the fiscal plan. He got very, very close in 2023, sort of as a follow-up to the 2021 uh uh uh legislative, fiscal policy working group. They came up with a bunch of recommendations. The governor in 2023, during the 2023 legislature came, legislative session came very, very close. A uh article from April 27th, 2023, headlined long and opponent of tax hikes. Alaska Governor Mike Dunley now believes they are needed. Uh, says Alaska governor, Alaska Governor Mike Dunley, once a staunch opponent of tax increases, said Thursday that they are now a core part of any long-term fiscal plan. Speaking in a news conference, the governor said that there's a broad recognition in the legislature and in his office that the state can no longer rely on commodities such as oil to balance the state's budget. Dunley confirmed prior reports that he intends to propose a statewide sales tax, saying work on the proposal could be done today or Friday. It was not clear when this idea would be introduced in the legislature. Dunley said I would start off with a low percentage of sales tax, probably one percent. And the reason I say that is it's really about stabilizing uh our fiscals instead of raise instead of raising new revenues was the was the context of that. The governor almost came to the table in 2023 with with his aunt into the game of how we were going to resolve the state's fiscal situation. But then he backed off. That never got introduced. That he was speaking, it never got introduced. And he since backed off, and they've since made comments about various other uh revenue proposals that had been put on the table in 2021 by uh his um uh commissioner of revenue were no longer on the table, and or she had misspoken about talking about those revenue options. I mean, they just backed completely away from that. So when the governor talks now about about you know the leg we're I'm not gonna approve the internet tax or any other taxes on a standalone basis, then we have a complete fiscal plan. Well, the governor's got to come to the table with his ante as part of that fiscal plan. And he laid it out. I mean, if you want to know what that ante is, if if if the governor's people are watching and want to know what the hell I'm talking about, it's 2023. Live up to what you said you were gonna do in 2023. Once you come to the table with that, then you've got the ability to say, okay, any other ideas? And and the ability to say, look, I'm willing to put this on the table, but we're also gonna have a spending cap and other things uh associated with it. Until he does that, he's just he's he's part of the problem. He's not part of the solution. This one-off, this one-off veto of efforts that the legislature is making to build pieces of a fiscal plan because vetoing them because they're not a whole fiscal plan is just is part of the problem. I mean, what happens is the legislature says, hey, what if we do this and and raise additional revenues this way? Governor says, no, it's not part of the total fiscal plan. What happens in the next legislature? More PFD cuts. He's just we're we're backing continually into deeper and deeper PFD cuts the longer we put this off. Governor was there. If we're if he's really serious about about this, about having a fiscal plan, if he's really serious about bringing this together, he needs to put that back on the table. He needs to go back to where he was in 2023 and put that back on the table. You know, Ben Carpenter picked up on that and tried to push that in the legislature, tried to push that as sales tax in the legislature. And he got out in front and he got shot by being out in front because the governor backed off of it uh uh after after making that statement. So you're gonna find it.
SPEAKER_00:Yeah, no, he tried to take it even further because he was very clear. This has to be part of a full a full fiscal plan. He wasn't advocating just for a tax in and of itself. He was saying he took the governor's call and said, we need to do it as a full fiscal plan. This is just part of it. And they still riddled him full of bullets, right? I mean, that was, you know, that was the thing. I don't I don't think that there's any political will to deal with any of this in the legislature. They're gonna ride this blimp right into the ground, is what they're gonna do.
SPEAKER_01:Yep, maybe so. But if the governor's serious about leading on this issue, which he says he is, if the governor is serious about stepping forward and and as governor, as governors are supposed to do, making things happen, making the government function, making it work, as governors are supposed to do to do that, uh, if he's really serious about doing that, he needs to go back and get a hold of his 2023 self. Um and and and fulfill the promise he made then about it was gonna be on the table uh by Friday of that week. I mean, evidently they've written it, or evidently they've written most of it. Um and and if you don't, if if you've lost that draft, go pick up Ben's uh because he had written it in legislation and and use that. Put that on the table and say, okay, this is part of how we're gonna go forward. I'm gonna couple it with the spending cap and this stuff and that stuff, and and and and and start taking the initiative to get this resolved as opposed to sitting back and just kicking off the legislature one at a time. There's not only not only no will in the legislature to solve this thing because you're gonna get shot by the governor if you do, or or you're not gonna get backed up by the governor if you do, Ben Carpenter's experience. There's not only no will in the legislature to do this, there's no will in the governor's office to do this. I mean, he's just sitting back and picking off the legislature's efforts at at single shots one at a time, uh, uh saying they aren't part of a complete plan. We were there in 2023. Go back, go back there if you will, if you really want to solve this.
SPEAKER_00:Uh all right, Brad Keithley, final thoughts here. We're about 90 seconds uh final thoughts on this week's top three.
SPEAKER_01:We need a Hammond. We need a Hammond that puts Alaska families first. You know, just like Donald Trump says we need to put Americans first, we need we need somebody in this state that we're gonna put Alaska families first, not the Alaska resource industry, not the Alaska capital budget, not this, not that. We're gonna start with Alaska families, just like Hammond did. We're gonna make sure that they have a share of the commonly held wealth. And then we're gonna we're gonna build out from there. But we're gonna start in the beginning with Alaska families, and we're gonna think about what benefits Alaska families as opposed to all these other special interests who then come in with back-end stories about, oh, well, I think this benefits Alaska families. This way.
SPEAKER_00:Are we gonna find somebody like that? Is the question, Brad, though. I mean, right? I mean, I have some hopes, but I mean, I just don't know if we have enough time to change people's, you know, to change the direction or hearts and minds or whatever. I'm doing my best, but even some of the candidates that I'm encouraged by are not seeing the full vision of what you're talking about. And that is that is a problem. All right, Brad. Well, um, don't lose hope, my friend. We could just keep we just keep pumping the pump. That's all we can do, right?
SPEAKER_01:Yeah, well, yeah. I mean, it's we can keep pointing out the issues. But what I think, what I think we're doing on this program is pointing out the issues and pointing out where where things are things are going wrong. I mean, the industry, the old industry said with SP21, look, Alaskans are gonna benefit in this way. You're gonna you're gonna get as production levels increase, revenues are gonna increase as a result of the way the production production tax is gonna work. It hasn't happened. Alaskans didn't get what they got. So, you know, we're gonna keep calling out when when when that happens and pointing out how you actually put Alaskans first. As opposed to all of these, all of these special interests out there.
SPEAKER_00:Well, that would be unique. Putting Alaskans first, that's uh I mean, I'm sure they say that to themselves, but at the same time they're at the cocktail parties with all the top 20% donors, and they're like, Oh, yes, we're we're putting Alaskans first, just uh hand me another caveat.
SPEAKER_01:So or or like or like the mayor didn't and said, Well, there's nobody in this room that needs a dividend. So y'all y'all know what I'm saying, right?
SPEAKER_00:Yeah, y'all know what I'm saying. So we don't really care about the PFD. We're just saying it because you know we need to for election purposes. Um, all right. Well, it is what it is. All right, Brad. Thank you so much for coming on board. We appreciate it. Uh, thanks for being part of it today. Absolutely, Michael. See you later.
SPEAKER_01:Well, that's a wrap for another week's edition of the weekly top three from Alaskans for Sustainable Budgets. Thank you again for joining us. Remember that you can find past episodes on our YouTube, SoundCloud, Spotify, and Substack pages. And keep track of us during the week on Facebook and Twitter. This has been Brad Keithley, Managing Director of Alaskans for Sustainable Budgets. We look forward to you joining us again next week on the weekly top three.
