Comment Letter on HB 2119 Transportation Resources, Export Fuel Tax

February 17, 2022

Re: HB 2119 Transportation Resources, Export Fuel Tax

Dear Chair Fey, Ranking Minority Member Barkis, and Members of the House Transportation Committee:

The Resource Development Council for Alaska, Inc. (RDC) is writing to urge you to oppose a proposal within HB 2119 that would establish an unprecedented export fuel tax on Pacific Northwest states, including Alaska. 

RDC is a statewide trade association comprised of individuals and companies from Alaska’s fishing, tourism forestry, mining, and oil and gas industries. RDC’s membership includes Alaska Native corporations, local communities, organized labor, and industry support firms. RDC’s purpose is to encourage a strong, diversified private sector in Alaska and expand the state’s economic base through the responsible development of our natural resources. Many of our members are based in rural and remote areas of Alaska, where the cost of living, especially fuel prices, are already many times higher than costs in the contiguous United States. While Alaska has a few small refineries, they supply only a portion of the needs for our economy and Alaska relies on much of its refined fuel products to be imported, including from Washington. 

Alaska and Washington have long been economic trade partners and we hope that continues. Yet, this proposed export fuel tax will have negative impacts on the Alaska economy. The fast-track nature of this proposal threatens that longstanding relationship and could lead to retaliation. This proposal is especially problematic when historic inflation and other global concerns have caused the price of fuel to rise significantly over the past year. It is deeply concerning that Washington would attempt to make their Alaskan partners unfairly pay for its in-state transportation projects.    

RDC is concerned this proposed tax unconstitutionally burdens interstate commerce. Imposing this tax will unfairly discriminate against Alaskans who rely on exported fuel to supply our residential and commercial needs. At six cents per gallon on all refined fuel exports, including gasoline, diesel, aviation gas and other fuel products, multiplied by millions of gallons over time, this proposal will have significant impacts on Alaskans. These are not mere incidental effects and it is clear there are other means available for Washington to advance its local purposes, as this proposed tax is just one part of a larger proposal to pay for in-state transportation projects.  

For these reasons, RDC urges the Committee and other Washington lawmakers to oppose this proposal. Thank you for the opportunity to comment.

Sincerely,