JUNEAU, Alaska — The state Senate decided at the last possible moment Thursday not to have a floor debate on one of its key pieces of legislation in the 2012 session -- oil tax reform.
The bill had finally come out of committee Wednesday evening, and its failure to reach the Senate floor Thursday was a big surprise to everyone.
It's a sign of how nervous and how careful everyone is, during the negotiation of a bill that could cost the state hundreds of millions, even billions of dollars.
By late Thursday afternoon, attempts to get Senate Bill 192 to the Senate floor were completely dropped, and the measure was sent to the Rules Committee for more negotiations.
There isn't much time left, with just three days left in this legislative session. Gov. Sean Parnell has said that if Senate Bill 192 isn't delivered to the House of Representatives by Sunday, it won't be part of any special session -- and the oil companies will have to wait at least another year to find out what their tax structure will be.
On Tuesday, Rep. Les Gara (D-Anchorage) described the revisiting of oil taxes year after year as potentially damaging to the state. He warned that with a "constantly dangling carrot," lawmakers may actually be encouraging oil companies to delay investment, hoping they'll get a better deal next year.
If Gara's right, the state could be contributing to the very problem it's seeking to solve: declining North Slope oil production, which has diminished from peak production of 2 million barrels a day in the late 1980s to 575,000 barrels a day today -- and continues to fall 6 percent a year.
There's widespread agreement among lawmakers that oil companies are now probably taxed too high when oil prices are $120 or more. SB 192 seeks to change that by slightly lowering the state's oil taxes at higher prices, and also having the progressivity rate flatten out.