Gov. Mike Dunleavy has added a surprise twist in his effort to create a new state agency.
Dunleavy said in a promotional video that a tax on farming will “hopefully sooner rather than later” pay for his plan to create a new state Department of Agriculture in Alaska.
In the 9-minute state-produced video advocating for the creation of the new department, the governor acknowledged the plan is to tax farmers.
The state already has a Division of Agriculture, which falls under the Department of Natural Resources. Separating it out from under DNR would require a new commissioner and quite possibly some additional state bureaucrats.
“For those that fear this is going to cost an extraordinary amount of money, we’re basically going to move the division into its own department stand it up and then put the focus on what is needed to make sure the department works well for farmers,” said Dunleavy. “And then be able to grow that sector where eventually, hopefully sooner rather than later, some of the proceeds from what the farmers are growing begins to help to pay for that department.”
Gov. Dunleavy issued a response to clarify his statement: “The ‘Proceeds’ that I was referencing in my video had to do with agricultural land sales to help underwrite aspects of the ag department. not new taxes. If anyone understands me, they will know that taxes, especially on a small and growing business, is not something I was alluding to. This is to clarify that so that there is no future misunderstanding.”
Here’s the video:
Taking some of the farmer’s “proceeds” sounds like a tax on their income and would require additional bureaucrats to collect and account for the taxes.
Former President Ronald Reagan once warned when government gets involved in “helping” the private sector, it often taxes the very industry it purports to help.
“If it moves tax it, if it keeps moving regulate it, and if stops moving subsidize it,” said Reagan of government’s approach to helping industry.
Dunleavy has been short on specifics on how newly created government bureaucrats will help grow Alaska agriculture. He has provided no particular plan or called for new regulations or farm subsides. But his inference that he’ll tax farmers if his plan works was new information in this department rollout.
Department of Natural Resources Commissioner John Boyle testified to the Senate Finance Committee that there would be no cost to create the department of Agriculture because existing staff would be transferred and reclassified. The start-up cost would be minimal, he said.
That contradicts the earlier statement from the Governor’s Office that it would cost $2.7 million.
Critics of the plan say Alaska has a poor record of using government to prop up industry, especially agriculture.
History is littered with stories of politicians promising to grow the private sector by hiring more bureaucrats only to see government over regulate, pick winners and losers among competitors, and raise taxes on the very industry it was supposed to help.
“I think you all know that I’ve always felt the nine most terrifying words in the English language are: I’m from the government and I’m here to help,” said Reagan.
Dunleavy appears to have little support from legislators for his Department of Agriculture expansion plan. Only Republican State Sen. Shelley Hughes, whose district has a heavy farm presence, has openly supported the governor on this issue.
This may be why Dunleavy is selling his plan so hard. Last week, his office posted a short video on Facebook asking Alaskans to help him lobby the Legislature to approve his executive order. This week, he produced the long video of himself explaining his hopes for food security through creation of a department dedicated to farming.
The state faces a $536 million deficit for spending, and legislators appear to favor massive increases to the state Department of Education, which may mean new taxes on Alaskans in the form of a drastically reduced Permanent Fund dividend.
Alaska leads the nation in the number of state government employees per capita by a large margin. The state has five times as many as some states and double the number of state employees of most states. And the governor has already created one additional department in his six years in office, when he split the Department of Health and Social Services into two separate agencies.
Dunleavy says it’s about prioritizing state’s food security.
The Legislature may vote to reject the executive order; that vote is done in a joint session of the House and Senate, which may occur on March 18.
Unless rejected by a majority of lawmakers by March 22, 60 days after the order was signed by the governor, the Department of Agriculture would become official on July 1.
Dan Fagan reports and writes columns for Must Read Alaska. He’s covered Alaska politics for close to 30-years. He currently hosts a morning drive radio talk show on 1020 am 92.5 and 104.5 fm on KVNT. For news tips, email Dan at [email protected].
Always knew Mike was a squishy that got elected to do Democrats’ deeds. This loser is going get us a Democrat elected after he leaves.
Well, this is an easy “no” vote.
This is a baffling move. More government and more taxes does not help or encourage farming and ranching in a state where both are not thriving, but barely surviving. Whomever is advising the governor on this one is feeding him bad advice.
🦃
Thank you for the information Mr. Fagan.
Got to keep government down in the whole, as its nature is greedy, rapacious and a dead hand. It is like a mafia.
I see another seafood plant boondoggle, writ even larger.
“Please, have another helping of Delta barley!”
The State of Alaska has a Dept. of Commerce & Economic Development. Can any of you state 1 thing that department has brought to Alaska in terms of business? I can’t. The government is proposing another department that will cost and do nothing. Sorry Governor, it’s a NO!
I was generally in favor of getting the Department of Ag going and in better position to advocate for the sale of good quality ground owned by DNR for agriculture but adding taxes to an industry that you have said you would like to see expand is mind-boggling.
This man was/is/always will be an empty suit broken by Giessel.
As I’ve said many times before, the best Democrats in Alaska have Rs after their names.
Agriculture is here and food is kind of important. In the last few decades we see some successful value-added businesses like Delta Meat and Sausage, Alaska Flour and Alaska Range Dairy gain a foothold in the market. Even in this harsh climate we can do many competitive things successfully-sugar beets, potatoes, carrots, barley, beef. If we only develop the markets or make the decision to pay the little extra to not be totally dependent on Big Ag. Alaska grass fed beef is superior but won’t financially compete with an Amarillo feedlot (from which the smell extends about 10 miles down wind). Family farmers are being pushed out of America, just like they were largely squeezed out of the Matanuska Valley, and for now we have the open land for them to prosper. As the sign above the airport entrance in Dutch Harbor announces: ‘Opportunity Abounds’, so, too, is this potential available if we can only nurture it.