State of Alaska DOT Wants to Tax Aircraft Owners/Operators

AKBill

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AKBill
State of Alaska DOT has 3 new proposals out that will increase taxes for owners/operators.
Proposal 1. 14% fuel tax increase.
Proposal 2. $150 a year tax for each aircraft (registration fee)
Proposal 3. Landing fee ($ yet to be determined)

Like most states today Alaska is in the Red.

A 14% increase in fuel would be about $.91 per gallon at the current price of $6.50gal. So at 75hrs a year and 8gph that's about $540 on top of what I would pay today. 69% of the folks polled as of today would vote for this.

20% polled elected for the $150 a year registration fee and 11% polled elected landing fees.

I don't see how they could effectively enforce a landing fee.

I guess if it comes to a vote on a state ballot I'll vote for the $150 registration fee.

Wondering what they are doing in the lower 48 as far as taxes to aircraft owners.
 
A landing fee will cost more to administer than it raises.
A good time to own a mogas capable plane.
 
State of Alaska DOT has 3 new proposals out that will increase taxes for owners/operators.
Proposal 1. 14% fuel tax increase.
Proposal 2. $150 a year tax for each aircraft (registration fee)
Proposal 3. Landing fee ($ yet to be determined)

Like most states today Alaska is in the Red.

A 14% increase in fuel would be about $.91 per gallon at the current price of $6.50gal. So at 75hrs a year and 8gph that's about $540 on top of what I would pay today. 69% of the folks polled as of today would vote for this.

20% polled elected for the $150 a year registration fee and 11% polled elected landing fees.

I don't see how they could effectively enforce a landing fee.

I guess if it comes to a vote on a state ballot I'll vote for the $150 registration fee.

Wondering what they are doing in the lower 48 as far as taxes to aircraft owners.

Well they are broke because of the royalties on oil are way down. So who will support the government? rich boys and their toys.
 
Well they are broke because of the royalties on oil are way down. So who will support the government? rich boys and their toys.

It's Alaska, the government can shrink to live within their budget.
 
AKBill, here's a cut and paste from an email I got from the DOT Deputy Commissioner after I wrote to ask him about what the General Fund contributes to DOT Aviation.

Thank you for reaching out with your questions. Here’s the quick answers:


- Our rural airport system (240 state owned/operated airports excludes Anchorage & Fairbanks International) costs the state ~$40M annually. Our airport leasing revenue is ~$5.5M each year and the state also collects ~$4.5M in aviation fuel tax. Thus, the GF subsidy is ~$30M annually and is reflected in the funding of the aviation component with DOT.

- Similar to the aviation leasing revenue, the registration revenue generated by this proposal (~$1.2-1.5M) will flow directly to the rural airport system and not to the general fund.

- Of note – the aviation fuel tax revenue DOES go directly to the GF initially, but flows into a designated fund that ensures it comes back to DOT for the operation of airports. FAA requires that all revenue generated by an aviation system be reinvested back into that system.


Additional answers to frequently asked questions are also posted at the following link.


https://aws.state.ak.us/OnlinePublicNotices/Notices/View.aspx?id=187638
 
I pay a registration fee in Ma.Not to happy about it,but much better than continually paying increasing taxes on av gas.unfortunatly Ma. Likes to do both.
 
It's Alaska, the government can shrink to live within their budget.
Shrink to fit the revenue? Local and/or state gov't? Not likely, unless there is a long and sustained recession. More likely to raise taxes or borrow. Or both.
 
Don't worry. Once the state ledger is back in the black, they will quickly rescind these new fees.
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It's Alaska, the government can shrink to live within their budget.

Quite the opposite imo.
The industrial base in Alaska is small and in much of the State the government is an important employer, and public spending is a significant part of community economies. I think that makes it difficult to cut. Now that hydrocarbon royalties and energy sector employment taxes are falling the always unpopular hunt for new tax sources is underway.
 
In the 35 years of big oil taxes the intrastructure of the State grew beyond what oil taxes in 2017 can maintain. 90% of the State's General Fund comes from oil taxes. Production is falling off, our past governor crafted an oil tax reform plan, and then prices crashed. A perfect storm for economic hard times. And we're in it. I have my issues with the revenue proposals but there's no question the State is in money trouble. And every Alaskan is partly responsible. We elected the baboons that got us here.
 
I was thinking more like Saudi Arabia...with parkas (insulated burqas?)
letusseeherenow, Venezuela is all about corruption, Saudi is all about revenue without effort, Alaska is more about denial as in "no we don't need to allow more oil development because the stuff we have will last forever" and now they are finding out that it won't. There are some reasons for the attitude since the resources at Prudhoe turned out to be much larger than initially estimated. I'm sure that people on the outside looking in thought more oil would continually be found. The really bad news is that if the pipeline is ever shut down then major oil production is done. It would be very difficult to restart the pipeline once the oil freezes.
 
And it isn't easy to get from place to place in the absence of roads without airports. A pickle indeed. I suspect the solution is going to wind up coming partially out of my own wallet. Privatize the profits, socialize the losses.
 
Are you certain about the amount the price of fuel will go up if the tax goes up 14%? Your calculations suggest that the price of fuel is 100% tax, and I strongly doubt that.

That said, government is always looking for more money. And, as noted above, we all know that airplane owners are rich :) . $150/year registration strikes me as a little high. But, like a gas tax, it is easier to administer than a landing fee.
 
I was in AK a year or 2 ago & saw a good handful of protesters in Anchorage, signs & all. The driver said they were protesting the idea of reducing the ‘permanent fund’ payout to AK residents. Once that $$ is flowing, hard to slow it down.
 
Have they stopped paying out the dividend yet ?
 
No, I'm sure it's still payed out. They had been talking about reducing it some, I don't think that idea went very far. As it was explained to me, for a family of 4 say, it can be a meaningful chunk of change.

I was in AK a while back while a dozen eggs were 38 cents at the local Wal-Mart, in WI. Since I was at the Anchorage Wal-Mart I thought I would compare this known price, the same were $1.97. Even with a few tax breaks one has to deal with higher costs.
 
Are you certain about the amount the price of fuel will go up if the tax goes up 14%? Your calculations suggest that the price of fuel is 100% tax, and I strongly doubt that.

That said, government is always looking for more money. And, as noted above, we all know that airplane owners are rich :) . $150/year registration strikes me as a little high. But, like a gas tax, it is easier to administer than a landing fee.

I think I got the calculation right %14 of current price $6.50 is $.91. So 75hrs at 8gph at $.91 more per gal is $546. Knowing the way the politics goes here we will end up paying the fuel tax..:( I would gladly pay the $150.

Have they stopped paying out the dividend yet ?
I

Yes we still get the PFD but the state is taking 1/2 to help pay budget deficits.
 
I think I got the calculation right %14 of current price $6.50 is $.91. So 75hrs at 8gph at $.91 more per gal is $546. Knowing the way the politics goes here we will end up paying the fuel tax..:( I would gladly pay the $150.

Yes, but that's 14% of the total price. Not a 14% increase in the tax on the fuel. Or are you not paying a fuel tax now?
 
Yes, but that's 14% of the total price. Not a 14% increase in the tax on the fuel. Or are you not paying a fuel tax now?
Guess you got me on that one, I'll need to see what we already pay and go from there, by bad....:lol:
 
I guess if it comes to a vote on a state ballot I'll vote for the $150 registration fee.

Wondering what they are doing in the lower 48 as far as taxes to aircraft owners.

Iowa has a graduated registration fee, depending on the aircraft's age and list price when new:
  • Older than 30 years is the sweet spot, the fee is only $35
  • Between 4 to 29 years, Manufacturers list X .25%, which can easily cost a thousand dollars or more
  • Less than 4 years, it's still more, but not more than $5000.
 
Nebraska definitely wants their sales/use tax when you purchase the airplane. However there is no state registration or additional state taxes.
 
And it isn't easy to get from place to place in the absence of roads without airports. A pickle indeed. I suspect the solution is going to wind up coming partially out of my own wallet. Privatize the profits, socialize the losses.

If government stuck to buying just things like roads and other public works, government would be incredibly cheap. The argument that we’d all be roadless without taxes is silly but oft stated.

We have 25 nuclear carriers and their entire set of escorts and screening vessels as well as the subs protecting them, and aircraft aboard. And that’s even a drop in the military budget. Which dwarfs stuff like ... roads.

I always laugh when someone smart enough to do the math thinks asphalt is the main reason for government. It might be one of the most useful things, but it isn’t really the thing that drives utterly insane levels of government debt.
 
If government stuck to buying just things like roads and other public works, government would be incredibly cheap. The argument that we’d all be roadless without taxes is silly but oft stated.

We have 25 nuclear carriers and their entire set of escorts and screening vessels as well as the subs protecting them, and aircraft aboard. And that’s even a drop in the military budget. Which dwarfs stuff like ... roads.

I always laugh when someone smart enough to do the math thinks asphalt is the main reason for government. It might be one of the most useful things, but it isn’t really the thing that drives utterly insane levels of government debt.
25?

Yeah, defense (read a strong offense beats a strong defense most days so that’s really what we’ve got) is a huge part of the federal budget and revenue. An economic study of the industrial-military complex would be a scary read and I’m not gonna do it.
 

Hmm. Just looked. I misread an article a while back and it’s 11. Plus another 8 or 9 amphibious assault ships that are mini-carriers not classified as such.

So 19 or 20 carrier-like ships and certainly all would be considered carriers when compared to anything else in the world fleet. Even our small carriers are as big as most.

Five times as many as the next largest fleet, which is interestingly, France. Or Japan. Both at 4 but France is planning more. Japan isn’t.

UK is broke. They have one and a second in sea trials.

Russia is broke. Same deal. One.

We’re financing it all on our debt, and paying for the “defense” of most of our “allies”. (Read: Oil shipping and whatever the hell we’re doing rattling sabers with China near Japan and south of there where they’re building whole islands out of dredging.)

Not that this is anything new, but we’ve quintupled down on the carriers for whatever reason. Part of it is 11 is about the right number to have one carrier group in every major sea area, at all times with retrofits and what not.

We’re broke too, we’re just pretending we aren’t. Spending a lot of damn money.

We probably shouldn’t even mention F-35...
 
Iowa has a graduated registration fee, depending on the aircraft's age and list price when new:
  • Older than 30 years is the sweet spot, the fee is only $35
  • Between 4 to 29 years, Manufacturers list X .25%, which can easily cost a thousand dollars or more
  • Less than 4 years, it's still more, but not more than $5000.
Wow newer plane owners really must be rich...:)
 
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Hmm. Just looked. I misread an article a while back and it’s 11. Plus another 8 or 9 amphibious assault ships that are mini-carriers not classified as such.

So 19 or 20 carrier-like ships and certainly all would be considered carriers when compared to anything else in the world fleet. Even our small carriers are as big as most.

Five times as many as the next largest fleet, which is interestingly, France. Or Japan. Both at 4 but France is planning more. Japan isn’t.

UK is broke. They have one and a second in sea trials.

Russia is broke. Same deal. One.

We’re financing it all on our debt, and paying for the “defense” of most of our “allies”. (Read: Oil shipping and whatever the hell we’re doing rattling sabers with China near Japan and south of there where they’re building whole islands out of dredging.)

Not that this is anything new, but we’ve quintupled down on the carriers for whatever reason. Part of it is 11 is about the right number to have one carrier group in every major sea area, at all times with retrofits and what not.

We’re broke too, we’re just pretending we aren’t. Spending a lot of damn money.

We probably shouldn’t even mention F-35...

No argument on the "broke and pretending we aren't bit", but we're spending far more on FICA, Medicare, Medicaid, and the related entitlement programs (and we are obligated to by law) than on defense. I'm not saying we should be spending all we are on defense, but just for proportion... This is a bit dated but the scale is still the same:

John
 
I still like the Will Rogers quote "We don't get all the government we pay for. And we should be grateful!"
 
No argument on the "broke and pretending we aren't bit", but we're spending far more on FICA, Medicare, Medicaid, and the related entitlement programs (and we are obligated to by law) than on defense. I'm not saying we should be spending all we are on defense, but just for proportion... This is a bit dated but the scale is still the same:

John

Oh, I’m aware. But waking people up requires something they can see, touch, etc.

They intuitively know a massive capital ship that operates a small city on board, along with all of the escorts, aircraft, supplies, logistics, etc is a massive undertaking.

Most don’t realize we have 20 and that’s 5 times anything our allies have.

Only after they kinda “get it” that we’re buying stuff like that on debt, do you mention the entitlement programs dwarf ALL of defense.
 
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