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KNBA News - Gov. Bill Walker warns Legislators spending savings without new revenues is a bad plan

May 16, 2016

Governor warns Legislators lack of new revenues jeopardizes Alaska's prosperity; Proposal to cut tax credits for oil and gas producers moves in Legislature; Legislators pass criminal justice reform legislation; Elder concerned broadband access threatens cultural heritage

 Governor Walker says prolonged fiscal uncertainty mars Alaskan economic outlook 

By Joaqlin Estus, KNBA - Anchorage

Governor Bill Walker Saturday warned legislators a proposal to spend savings without coming up with new revenues to address the state’s 4-billion-dollar budget deficit will have serious, long-term consequences.
 

In a letter to lawmakers, Walker said prolonging the fiscal uncertainty is hampering recovery by limiting development and investment in the state. Walker said bond rating companies have warned that if the state doesn’t come up with a long-term fiscal plan, they will lower the state’s credit rating, which makes it more expensive for the state to borrow money. He says the lack of investment and higher cost of borrowing money jeopardizes the state’s biggest possible remedy to the crisis – construction and operation of a gas line.

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House approves plan to cut tax credits for oil and gas producers

Associated Press

The Alaska House of Representatives Friday voted 25 to 12 to approve legislation that would phase out most existing oil and gas tax credits. The proposal is expected to save between $5 million and $25 million in the fiscal year that starts July 1 and increase to as much as $470 million in savings in fiscal year 2021.

The proposal would stop companies producing more than 15,000 barrels of oil per day from collecting net operating loss credits, which allow producers to reduce their effective production tax rate to zero. The proposal would also reorganize the tax structure for Cook Inlet drilling operations by 2019.

The Senate began reviewing the bill over the weekend.

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Legislators pass criminal justice reform legislation

Associated Press

The state Legislature has approved sweeping changes to the state's criminal justice system. On Friday, the Senate agreed to changes made to a bill in the House. The House passed the bill last week. It next goes to the governor for consideration. The bill was based on changes recommended by a criminal justice commission. The bill is geared toward arresting growth within the state prison system and addressing recidivism.

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A concern over broadband coming to Native villages

By Tim Ellis, KUAC - Fairbanks

The biggest local internet-service provider in northernmost Alaska expects high demand for the broadband connections it will be offering early next year, especially from customers that need a lot of bandwidth.

“Everybody is enthusiastic about this project that is a heavy user of broadband. The schools, libraries, clinics – all of those are anchor institutions,” said  Jens Laipeneks, who directs operations for Arctic Slope Telephone Association Cooperative.

He says ASTAC has been upgrading its system over the past year or so to transition from the satellite-based system it now uses to provide internet and wireless service to one that uses a subsea fiber-optic cable that Anchorage-based Quintillion Networks will be laying off the coast of northern Alaska this year.

“The capacity that we’re going to have access to is much, much greater than everything that was done over the satellite,” said Laipeneks.

He says that’s good news to residential customers who’ve had to deal with the slow, balky and expensive internet connections for such bandwidth-hogging uses as streaming video.

“…Netflix, gaming – y’know, things that require very quick response times.”*

Laipeneks says the fiber-optic cable is more dependable and less-expensive to maintain, enabling ASTAC to offer its 1,000 or so customers twice as much bandwidth for about the same price they’re paying today.

The cable also will bring broadband to four coastal communities that’ve never had real broadband before: Nome, Kotzebue, Point Hope and Barrow.

Steve Oomittuk was born and raised in Point Hope. And he has some reservations about broadband coming to the village.

“I just feel that high technology is good, y’know, but there’s a time and place that it should be used.”

Oomittuk is an Inupiaq whale hunter who’s served as mayor of his community and now works as a schoolteacher. He agrees broadband could improve education. But he’s concerned it’ll aggravate the problem of young people in the village losing touch with their cultural identity.

“I try to let the younger generation understand that they have an identity that should never be forgotten. And (they) have a rich history, a rich culture.”

Oomittuk says young people in Point Hope, like their counterparts everywhere else in the world, already are constantly glued to their cell phones.