Representative Ivy Spohnholz's 2016 Summer Survey

Rep. Ivy SpohnholzOver the past two years we have cut more than 21% of the state’s operating budget.  This has amounted to about $1.16 billion in reduced expenditures.  The Governor vetoed another $1.29 billion on June 29th, 2016, including half the appropriation for the Permanent Fund Dividend. The operating budget is now about $4.2 billion in unrestricted general funds for the upcoming fiscal year.  The cuts the legislature made were necessary in order to right Alaska’s fiscal ship.  However, the “easy” cuts are gone, and no amount of cutting will fill the estimated multi-billion dollar deficit.

Governor Walker has called the legislature back into a special session to address the estimated $3.5 billion deficit which is currently being financed by our rainy-day savings account.  The items on the agenda include restructuring the PFD, a variety of revenue raising measures, and changes to our oil and gas tax and subsidy regimes. Which of the Governor’s proposals do you think we should adopt? Please take 2 minutes to complete the following survey to help me know where the District stands. 

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1. Do you support a $1500 cap on the Permanent Fund Dividend? The deficit would be reduced by about $1 billion. ***



2. Do you support a $1000 cap on the Permanent Fund Dividend? The deficit would be reduced by about $1.5 billion. ***



3. Do you support instituting a state income tax? Income taxes you pay to the state would be deductible off of your federal income taxes. At the proposed rate of 6% of federal tax, this would reduce the deficit by about $205 million in fiscal year 2019. It would cost the average Alaskan less than 1% of their yearly income. *



4. Do you support instituting a state income tax at a proposed rate of 15% of federal taxes? This would reduce the deficit by about $600 million in fiscal year 2019. It would cost the average Alaskan around than 2.5% of their yearly income. **



5. Do you support a state-wide sales tax? It would likely contain exemptions for necessities. At a 3% rate, this would reduce the deficit by about $400 million. However, it is unclear at this time what the exact proposed rate and exemptions would be.



6. Do you support raising the gasoline tax from 8 cents to 16 cents? Alaska currently has the lowest gasoline tax in the nation, this increase would put us at the second lowest tax in the nation. This measure would reduce the deficit by $43 million. *



7. Do you support increasing the alcohol tax by 25 cents per drink and the cigarette taxes by $1 per pack? The alcohol tax increase would mean that a six-pack of beer would increase in cost by $1.50. These ideas are estimated to reduce the deficit by $70 million. *



8. Do you support changing mining taxes and fees? The proposed measure would collect about $7 million in additional in revenue that would reduce the deficit. *



9. Do you support increasing taxes and fees charged to the commercial fishing industry? The proposed measure would roughly increase by 20% the amount the industry currently pays and reduce the deficit by around $20 million. *



10. Do you support changing the tax and subsidy structures for the oil and gas industries? The current proposals for this would reduce the deficit by $200-600 million. ***




Comments (please, expand on your answers, especially if you marked “maybe” on one or more responses):
Thank you for taking the time to respond to this survey! Please provide me with your contact information so I can send you a copy of the results. Name [REQUIRED]
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* The estimated deficit reductions are taken from the May 24, 2016 Walker administration presentation before the House Finance Committee.

** Estimated revenue for this question is taken from background documents for HB 365.

*** The estimated deficit reductions for these questions are taken from the non-partisan Rasmuson Foundation’s Plan4Alaska challenge. You can take the challenge yourself at challenge.plan4Alaska.com.