Friday, June 20, 2008

Governor Sarah Palin Releases New Energy Assistance Proposal; $1,200 Check For Each Eligible Alaskan, One Year Suspension Of State Fuel Tax

Update August 8th: State legislature passes final energy assistance bill. Updated post HERE.


On Friday June 20th, 2008, Alaska Governor Sarah Palin released her new energy assistance program. The highlights: A one-time $1,200 check for each eligible Alaskan, and a one-year suspension of the eight-cents-per-gallon state fuel tax. Media stories published by the Anchorage Daily News' Alaska Politics blog, the Fairbanks Daily News-Miner, and KTUU Channel 2. Opinion published by the Voice Of The Times.

Previous posts on this issue from May 16th and from June 19th.

According to the Governor's official press release, the legislation is intended to be a starting point for a discussion with the legislature about how to provide relief from high energy costs to working Alaskans and their families. Click HERE to view copy of the draft bill in PDF format.

As the fiscal year winds down, Alaskans are assured of surpluses beyond the billions of dollars put into savings and funding for priorities such as forward funding education and municipal revenue sharing,” Governor Palin said. “With savings and funding priorities covered, I am confident that Alaskans, who are the owners of our resources, can spend their resource revenue better than government can”, Palin continued.

She then added, “We can afford to share resource wealth with Alaskans and to temporarily suspend the state fuel tax. It is my hope these items would be implemented by September. We look forward to working with legislators in the coming weeks to find the best possible solution to provide short-term energy relief.”

Governor Palin had originally proposed to issue each qualifying Alaskan an energy debit card worth $1,200, but this idea was dropped due to legislative objections, excessive administrative costs, and projected difficulty in using the cards in many rural Alaska communities.

Like the rejected debit card proposal, this proposed payment to Alaskans is also expected to cost $729 million of the state’s resource wealth. Suspending the eight-cents-per-gallon state fuel tax for one year beginning August 2008 would save Alaskans about another $40 million in state fuel taxes.

Eligibility: From the draft bill:

- Anyone already deemed eligible to receive a Permanent Fund Dividend for 2008.
- Not filed for a PFD, but applies for the rebate under a form to be provided. The form will have to be postmarked by November 30th, 2008
- Meets all three of the following criteria for Alaska residency:
-- Present in the state on the date of application.
-- Present in the state for at least 180 days at the time of application.
-- Intend to make a home in Alaska for at least 12 months.

Note that these criteria remain subject to legislative approval.

Governor Palin and the administration will continue reviewing a proposal to make grants to utilities and introduce bills for the legislature to consider next month. This means that her other proposal to provide $475 million in grants to electric utilities, expected to result in a 60 percent reduction for all ratepayers, is still on the table, although it could emerge in a different form.

In addition to this short-term relief, efforts are ongoing toward a long-term energy plan for the state. That initiative is being directed by Steve Haagenson, who was appointed the State’s Energy Coordinator in March. Haagenson, who also serves as Executive Director of the Alaska Energy Authority, is developing a statewide plan to reduce energy costs, promote conservation and secure long-term supply solutions for each region of the state. Results of his work are expected by the end of this year.

In addition, it was announced that the Division of Investments will be amending its regulations to allow for low-interest loans to commercial fishermen to purchase more fuel-efficient engines. This proposal has no financial impact on the state’s budget.

Public Reaction: Some Interior and Bush residents are expected to object to the rebate, since they would get the same amount of money as those living in South Central Alaska, even though their energy expenses are three to five times higher than those in South Central.

(1). The Voice Of The Times in this post is critical of the proposal, considering it a giveaway. However, they customarily object to such giveaways as a matter of principle. And to pile on Palin even more, in this other post, published on the same day, they attempt once again to compare Sarah Palin to Hugo Chavez, falsely portraying her as a socialist, even though Palin respects the free market and free speech far more than Chavez.

(2). As of this post, the Alaska Politics thread has absolutely blown up with 122 comments. Most are supportive of Palin's proposal, although some object rather strenuously. One Fairbanks resident literally chimped out in opposition, but it looks like his was one of the estimated 10 comments already deleted by ADN staff.

Commentary: First, Interior and Bush residents are misinformed about our energy costs down here in Anchorage. One lady commented that she pays about $180 per month in energy costs, so I don't know where the Fairbanks folks got the impression that we only pay $90 per month. My combined costs for gas and electric, even during high summer, are around $120. Yes, the Interior pays more than we do in Anchorage, but the difference has been exaggerated, just like the Holocaust.

To try and insert a regional or local variation into each and every energy rebate would complicate the program and increase the bureaucracy. For Interior residents, a $1,200 rebate is still better than a $0 dollar rebate. We in South Central are not unsympathetic towards your plight, but work with your lawmakers and impress upon them the urgency of getting you more energy alternatives to drive down costs for a permanent solution.

1 comment:

  1. About the statement the lady from anchorage made about cost differences, I live in the interior and my electric bill alone in the winter is over 500.00a month and my fuel bill is over 1,000.00 a month just to keep us warm and it don't even do that! Last winter times were so tough we had to keep our heater below 50degrees (wearing our outdoor clothes inside!) when its 50 below outside! We busted three water pipes inside our home on three separate occasions and it flooded our home all three times.
    We didn't file insurance claims on any of them in fear of a rate increase, We just couldn't afford for that to happen!
    My husband and I have 6 kids of our own and one niece under our roof we have never had any assistance from any agency ever to help us survive in this cold desolate place but we need it now! I am here to tell you many families aren't going to survive another winter with those kind of fuel and electric costs! If you have never been somewhere really cold then most people will never understand what 50 & 60 below 0 feels like, you walk out your door and your clothes harden and your eyelashes instantly freeze with tiny icicles hanging off of them and your bones just ache with pain its flat out freezing and deadly. I always think of Alaska in the same light as the Dennis Quaid movie "The Day After Tomorrow" because thats what it feels like here! I'm very scared for my family with the upcoming winter. My question to our government is: how many families are going to have to freeze to death this winter inside our homes with 50 & 60 below weather before you do something about this!? We fully support any kind of relief for Alaskans and we sure as heck aren't going to whine that it isn't enough because we need any kind of help we can get! I am making a plea to the Alaskans who are fighting the energy relief bill please stop! The more you complain the longer it's going to take for the families of Alaska to get the help we need before the upcoming winter hits.

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