Sen. Murkowski Special Edition eNewsletter 10/03/08

Congress passes economic recovery plan

During the six years I have had the privilege of representing Alaskans in the United States Senate, I have had to cast many tough votes, but few as complex or far-reaching as the vote on an economic rescue plan. Over the past week, hundreds of Alaskans contacted my offices, and many of those callers, emailers and letter writers encouraged me to vote against a bailout for Wall Street that rewards the mismanagement of our financial institutions. After the After the Administration initially proposed a package that failed to include adequate oversight, the Senate and House negotiators significantly changed the bill.

The rescue bill passed the Senate Wednesday night by a 75-to-24 vote, and today the House of Representatives approved the legislation, 263 - 171, sending it to the White House where President Bush signed it into law.

It became clear to me that all Americans are impacted by the crisis that has hit our financial system. From Maine, where state transportation bonds have no market, to Ohio, where a children’s hospital can’t get construction financing, this is a crisis of national and international proportions.

But there is also much at risk in Alaska. Not only our multi-billion dollar Permanent Fund but our retirement funds, pensions, 529 savings accounts for our children’s education and Alaska Native corporations’ investments are all impacted by the turbulence in our financial markets. Congress needed to enact legislation that would stabilize the economy, get credit moving in the markets, provide greater oversight and not reward the reckless behavior of some corporate CEOs. I believe this bill puts us on the right track.

Congress also approves Exxon Valdez tax relief and Secure Rural Schools funding

The financial rescue bill also included a tax extenders package that will continue several expiring tax benefits to small businesses and others,  provide energy conservation and renewable energy incentives and provide another one-year fix to keep the alternative minimum tax from raising taxes on millions more Americans. Importantly, it also contains a proposal I and Senator Stevens  authored  that will give the plaintiffs in the Exxon Valdez oil spill case the ability to increase retirement contributions and provide tax relief through income averaging.   

While I was extremely disappointed in the Supreme Court’s decision to reduce the punitive damage award to the victims of the Exxon Valdez oil spill, our provision will help lessen the tax burden and allow the 30,000 plaintiffs to keep more of the compensation they receive. Plaintiffs will be able to income average settlement payouts over a three-year period, contribute up to $100,000 of their settlement to a qualifying retirement account or pension plan and avoid having to pay self-employment taxes or payroll taxes on any payouts from this case.

The legislation also includes a provision that will extend through September 30, 2011, the Secure Rural Schools and Community Self Determination Act, which provides federal assistance to communities and schools adjacent to National Forests. Alaska has about 22 million acres of National Forest lands, divided among the Tongass and Chugach National Forests, and a new funding formula will increase Alaska’s share of the pie. The bill also will fund at the maximum level authorized by law the Payments in Lieu of Taxes (PILT) program, which is administered by the U.S. Department of the Interior and directly benefits Alaska communities.