Lowered Taxes Could Put Alaska's Credit Rating At Risk

A legislative agency has concluded a reduced oil tax could put Alaska's credit rating at risk.
by | September 29, 2011

A non-partisan Alaskan legislative research group has found that the state's credit rating could be in jeopardy if proposed reductions in oil taxes become law, Alaska Public Radio reports.

The controversial bill, pioneered by Governor Sean Parnell, could result in the state losing as much as $2 billion in revenue, according to the research agency's report. The report warns that loss of income could reflect poorly on the state in the eyes of credit agencies.

State senator Bill Wielechowski told APRN a lowered credit rating could mean an extensive hydroelectric project could cost an extra $300 million dollars because of the increased interest rates. He asserted that Alaska needs the oil tax revenue to pay for that project and others while protecting jobs in the state.

"These are the governor's numbers. And the governor's numbers show that we will be losing billions of dollars. The governor's numbers show that within the next decade, the state will be broke," Wielechowski told the radio network.

Parnell's office did not respond to requests for comments, APRN reported.

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