Oil Industry Targets Senators in Alaska Oil Tax Fight

The energy industry is making a concerted push to defeat state senators in Alaska who have blocked a $2 billion tax cut favored by oil producers.

Through television and radio ads and direct mail, industry-linked advocacy groups are spending hundreds of thousands of dollars to urge Alaska’s 506,000 voters to cast their ballots for “oil tax reform.” That would entail ousting a bipartisan group of 16 state senators in the 20-member chamber, all but one of whom are up for re-election this year, political experts say.

The big three energy companies—Exxon Mobil Corp., XOM -1.45% ConocoPhillips, COP -1.32% and BP BP.LN -1.40% PLC—can’t legally make direct donations to campaigns. But oil-company-employee political-action committees have made contributions, energy executives have held fundraisers and two Republican senate candidates work for the industry.

“We’re proud that we’ve been part of the Alaska family of companies that has brought this wealth to its people,” said Bob Bell, a Republican Senate candidate from Anchorage whose engineering firm did nearly $1 million in work for BP last year and who favors the tax cut.

But the targeted senators raised and spent more than their challengers according to the latest campaign-spending reports, although a last-minute surge of spending could change that balance. They have received backing in part from government-employee unions, which have grown along with government payrolls because of an influx of oil taxes. The taxes and other oil-related payments account for 90% of state revenue.

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