At Alaska governor candidate forum, Gara and Walker advocate tax changes

In a Wednesday candidate forum hosted in Fairbanks by the Alaska Chamber, Democratic governor candidate Les Gara and independent candidate Bill Walker said that if elected, they would seek new state revenue to pay for a variety of projects and reverse years of cuts to state services.

Both men are seeking to unseat incumbent Republican Gov. Mike Dunleavy, who has advocated service cuts and opposes taxes not approved by a statewide vote. Also competing in the Nov. 8 general election is Republican candidate Charlie Pierce. 

Neither Dunleavy nor Pierce appeared at Wednesday’s forum. Pierce did not respond to invitations from the Alaska or Fairbanks chambers, and Dunleavy was touring storm damage in western Alaska.

Gara and Walker have repeatedly criticized Dunleavy for failing to attend candidate forums and events but withheld criticism of his absence on Wednesday, saying that his decision to focus on the aftermath of Typhoon Merbok is appropriate.

Dunleavy finished first in the Aug. 16 statewide primary, followed by Gara and Walker. The incumbent’s absence left his challengers with an open forum.

“This is a state that 20,000 more people have left in the last three years under this governor than have moved here,” Gara said, explaining the need for a change in policy.

“And part of that has been the decimation of the capital and construction budget that puts people to work,” he said.

Thanks to a surge in oil prices due to the Russian invasion of Ukraine, state lawmakers this spring approved almost $1 billion in state spending on renovation and construction projects statewide.

That’s a huge change from recent years, when the state spent as little as $107 million. 

Gara and Walker each said the state needs a stable fiscal plan in order to reliably pay for services, including construction and maintenance. Counting on the Russian invasion isn’t a fiscal strategy, Gara said.

During Wednesday’s debate, a member of the audience asked what the candidates would do to address the closures of bathrooms at roadside highway pullouts. The question garnered quiet laughter from some attendees, but Gara and Walker addressed it earnestly.

“That started on my watch,” Walker said, speaking about his first term in office.

During that term, which ran from 2014 through 2018, oil prices plummeted and Walker directed service cuts, including to the maintenance of roadside bathrooms.

That made many Alaskans unhappy.

“I found out how many people in Valdez had my cellphone number,” Walker said, drawing laughs.

“But that’s a terrible message to send to our visitors, and it is a terrible burden on the roadhouses,” he said.

“We need to stop being a 19th century state,” Gara said of the closures. “We need to bring sanitation across the state. We need to have the amenities that people love in the state, that make people want to live here. And that is not free.”

Another member of the audience asked the obvious followup question: How will they pay for their ideas?

Gara’s proposal is to reform the state’s oil tax system. Doing so, he said, could save $1.2 billion per year and free up revenue for a variety of programs.

“We should be equal partners with our oil industry. They’re good neighbors, but right now, we’re junior partners,” he said.

Though Dunleavy was not present, he has advocated cuts to services and a smaller payout formula for the Permanent Fund dividend. He opposes even small tax increases without a statewide vote. This year, when the Alaska Legislature voted to increase a tax on e-cigarettes, Dunleavy vetoed it.

Walker said he thinks a “hard look” at tax credits is warranted, but he doesn’t want to promise something he can’t deliver. A proposal similar to Gara’s failed to receive a hearing in the Alaska Legislature this year, he noted, and legislative action would be needed to implement Gara’s system.

He said he prefers multiple smaller revenue changes rather than “pulling one lever all the way down.”

He said he would support “broad-based revenue options,” a term that some legislators have used as a euphemism for a statewide income tax or sales tax.

“You know, there’s only so many ways you can earn revenue for our government,” Walker said. “One is resources, which we’ve been doing. And the other is to capture some sort of sales or income taxes, some sort of use tax, something seasonal.”

During his prior term as governor, “we talked about a seasonal sales tax. We looked at everything under the sun, and it’s just a matter of what is palatable to the Legislature that we can work collaboratively and get through,” he said.

Correction: Gara’s oil tax reforms involve changes to the state’s per-barrel tax credit, part of the state’s oil tax system. The initial version of this article incorrectly stated that the credits are paid to producers.

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