00 CS FOR SENATE BILL NO. 138(FIN) 01 "An Act relating to the purposes, powers, and duties of the Alaska Gasline Development 02 Corporation; relating to an in-state natural gas pipeline, an Alaska liquefied natural gas 03 project, and associated funds; requiring state agencies and other entities to expedite 04 reviews and actions related to natural gas pipelines and projects; relating to the 05 authorities and duties of the commissioner of natural resources relating to a North Slope 06 natural gas project, oil and gas and gas only leases, and royalty gas and other gas 07 received by the state including gas received as payment for the production tax on gas; 08 relating to the tax on oil and gas production, on oil production, and on gas production; 09 relating to the duties of the commissioner of revenue relating to a North Slope natural 10 gas project and gas received as payment for tax; relating to confidential information and 11 public record status of information provided to or in the custody of the Department of 12 Natural Resources and the Department of Revenue; relating to apportionment factors of 01 the Alaska Net Income Tax Act; amending the definition of gross value at the 'point of 02 production' for gas for purposes of the oil and gas production tax; clarifying that the 03 exploration incentive credit, the oil or gas producer education credit, and the film 04 production tax credit may not be taken against the gas production tax paid in gas; 05 relating to the oil or gas producer education credit; requesting the governor to establish 06 an interim advisory board to advise the governor on municipal involvement in a North 07 Slope natural gas project; relating to the development of a plan by the Alaska Energy 08 Authority for developing infrastructure to deliver affordable energy to areas of the state 09 that will not have direct access to a North Slope natural gas pipeline and a 10 recommendation of a funding source for energy infrastructure development; 11 establishing the rural capital energy fund; requiring the commissioner of revenue to 12 develop a plan and suggest legislation for municipalities, regional corporations, and 13 residents of the state to acquire ownership interests in a North Slope natural gas pipeline 14 project; making conforming amendments; and providing for an effective date." 15 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 16  * Section 1. AS 31.25.005 is amended to read: 17 Sec. 31.25.005. Purpose. The corporation shall, for the benefit of the state, to 18 the fullest extent possible, 19 (1) develop and have primary responsibility for developing natural  20 gas pipelines, an Alaska liquefied natural gas project, and other transportation  21 mechanisms to deliver natural gas in-state for the maximum benefit of the people  22 of the state;  23 (2) when developing natural gas pipelines, an Alaska liquefied  24 natural gas project, and other transportation mechanisms to deliver natural gas  25 in-state, provide economic benefits in the state, and revenue to the state;  26 (3) assist the Department of Natural Resources and the  01 Department of Revenue to maximize the value of the state's royalty natural gas,  02 natural gas delivered to the state as payment of tax, and other natural gas  03 received by the state;  04 (4) advance an in-state natural gas pipeline as described in the July 1, 05 2011, project plan prepared under former AS 38.34.040 by the corporation while a 06 subsidiary of the Alaska Housing Finance Corporation, with modifications determined 07 by the corporation to be appropriate to develop, finance, construct, and operate an in- 08 state natural gas pipeline in a safe, prudent, economical, and efficient manner, for the 09 purpose of making natural gas, including propane and other hydrocarbons associated 10 with natural gas other than oil, available to Fairbanks, the Southcentral region of the 11 state, and other communities in the state at the lowest rates possible; 12 (5) advance an Alaska liquefied natural gas project by developing  13 infrastructure and providing related services, including services related to  14 transportation, liquefaction, a marine terminal, marketing, and commercial  15 support; if the corporation provides a service under this paragraph to the state, a  16 public corporation or instrumentality of the state, a political subdivision of the  17 state, or another entity of the state, the corporation may not charge a fee for the  18 service in an amount greater than the amount necessary to reimburse the  19 corporation for the cost of the service;  20 (6) [(2)] endeavor to develop natural gas pipelines and other 21 transportation mechanisms to deliver natural gas, including propane and other 22 hydrocarbons associated with natural gas other than oil, to public utility and industrial 23 customers in areas of the state to which the natural gas, including propane and other 24 hydrocarbons associated with natural gas other than oil, may be delivered at 25 commercially reasonable rates; and 26 (7) [(3)] endeavor to develop natural gas pipelines and other 27 transportation mechanisms that offer commercially reasonable rates for shippers and 28 access for shippers who produce natural gas, including propane and other 29 hydrocarbons associated with natural gas other than oil, in the state. 30  * Sec. 2. AS 31.25.010 is amended to read: 31 Sec. 31.25.010. Structure. The Alaska Gasline Development Corporation is a 01 public corporation and government instrumentality acting in the best interest of the  02 state for the purposes required by AS 31.25.005, located for administrative 03 purposes in the Department of Commerce, Community, and Economic Development, 04 but having a legal existence independent of and separate from the state. The 05 corporation may not be terminated as long as it has bonds, notes, or other obligations 06 outstanding. The corporation may dissolve when no bonds, notes, or other obligations 07 of the corporation or a subsidiary of the corporation are outstanding and the 08 corporation or a subsidiary of the corporation is no longer engaged in the 09 development, financing, construction, or operation of an in-state natural gas pipeline 10 or an Alaska liquefied natural gas project. Upon termination of the corporation, its 11 rights and property pass to the state. 12  * Sec. 3. AS 31.25.040 is amended by adding new subsections to read: 13 (c) To the maximum extent practicable, the board shall 14 (1) maximize the efficient use of state resources; and 15 (2) establish appropriate separation within the corporation by 16 separating personnel and functions, and by other means to the extent that separation 17 may be required by contract or applicable law for the purpose of screening and 18 preventing the exchange of commercially sensitive information when developing an 19 in-state natural gas pipeline, an Alaska liquefied natural gas project, and other 20 transportation mechanisms to deliver natural gas in the state. 21 (d) The board shall appoint a program director for an Alaska liquefied natural 22 gas project. The program director appointed under this section shall 23 (1) serve at the pleasure of the board; and 24 (2) report to the board and the executive director of the corporation. 25  * Sec. 4. AS 31.25.080(a) is amended to read: 26 (a) In addition to other powers granted in this chapter, the corporation may 27 (1) determine the form of ownership and the operating structure of an 28 in-state natural gas pipeline developed by the corporation and may enter into 29 agreements with other persons for joint ownership, joint operation, or both of an in- 30 state natural gas pipeline or an Alaska liquefied natural gas project; 31 (2) plan, finance, construct, develop, acquire, maintain, and operate a 01 pipeline system and other transportation mechanism, including pipelines, compressors, 02 storage facilities, and other related facilities, equipment, and works of public 03 improvement, in the state to facilitate production, transportation, and delivery of 04 natural gas or other related natural resources to the point of consumption or to the 05 point of distribution for consumption; 06 (3) lease or rent facilities, structures, and properties; 07 (4) exercise the power of eminent domain and file a declaration of 08 taking under AS 09.55.240 - 09.55.460 to acquire land or an interest in land that is 09 necessary for an in-state natural gas pipeline or an Alaska liquefied natural gas  10 project; the exercise of powers by the corporation under this paragraph may not 11 exceed the permissible exercise of the powers by the state; 12 (5) acquire, by purchase, lease, or gift, land, structures, real or personal 13 property, an interest in property, a right-of-way, a franchise, an easement, or other 14 interest in land, or an interest in or right to capacity in a pipeline system determined to 15 be necessary or convenient for the development, financing, construction, or operation 16 of an in-state natural gas pipeline project or an Alaska liquefied natural gas project 17 or part of an in-state natural gas pipeline project or an Alaska liquefied natural gas  18 project; 19 (6) transfer or otherwise dispose of all or part of an in-state natural gas 20 pipeline project, an Alaska liquefied natural gas project, or [DEVELOPED BY 21 THE CORPORATION OR TRANSFER OR OTHERWISE DISPOSE OF] an interest 22 in an asset of the corporation; 23 (7) elect to provide transportation of natural gas as a contract carrier, 24 common carrier, or otherwise; 25 (8) provide light, water, security, and other services for property of the 26 corporation; 27 (9) conduct hearings to gather and develop data consistent with the 28 purpose and powers of the corporation; 29 (10) advocate for new pipeline capacity before the Federal Energy 30 Regulatory Commission; 31 (11) make and execute agreements, contracts, and other instruments 01 necessary or convenient in the exercise of the powers and functions of the corporation 02 under this chapter, including a contract with a person, firm, corporation, governmental 03 agency, or other entity; 04 (12) sue and be sued in its own name; 05 (13) adopt an official seal; 06 (14) adopt bylaws for the regulation of its affairs and the conduct of its 07 business and adopt regulations and policies in connection with the performance of its 08 functions and duties; 09 (15) employ fiscal consultants, engineers, attorneys, appraisers, and 10 other consultants and employees that may, in the judgment of the corporation, be 11 required and fix and pay their compensation from funds available to the corporation; 12 (16) procure insurance against a loss in connection with its operation; 13 (17) borrow money as provided in this chapter to carry out its 14 corporate purposes and issue its obligations as evidence of borrowing; 15 (18) include in a borrowing the amounts necessary to pay financing 16 charges, to pay interest on the obligations, and to pay the interest, consultant, advisory, 17 and legal fees, and other expenses that are necessary or incident to the borrowing; 18 (19) receive, administer, and comply with the conditions and 19 requirements of an appropriation, gift, grant, or donation of property or money; 20 (20) do all acts and things necessary, convenient, or desirable to carry 21 out the powers expressly granted or necessarily implied in this chapter; 22 (21) invest or reinvest, subject to its contracts with noteholders and 23 bondholders, money or funds held by the corporation, including funds in the in-state 24 natural gas pipeline fund (AS 31.25.100) and the Alaska liquefied natural gas  25 project fund (AS 31.25.110), in obligations or other securities or investments in 26 which banks or trust companies in the state may legally invest funds held in reserves 27 or sinking funds or funds not required for immediate disbursement, and in certificates 28 of deposit or time deposits secured by obligations of, or guaranteed by, the state or the 29 United States; 30 (22) enter into, as it determines to be necessary or appropriate, any 31 swap or hedge, cap, or other contract providing for payments based on levels of or 01 changes in interest rates or indices or in the cost or price of any commodity, supply, or 02 expense expected to be used or incurred in connection with the acquisition, 03 construction, or operation of any facility or property owned, leased, or operated by the 04 corporation, or an option with respect to any of the foregoing;  05 (23) except as provided in (g) of this section, acquire an ownership  06 or participation interest in an Alaska liquefied natural gas project, natural gas  07 treatment facilities, natural gas pipeline facilities, liquefaction facilities, marine  08 terminal facilities related to the infrastructure of an Alaska liquefied natural gas  09 project, an entity or joint venture that has an ownership interest in or is engaged  10 in the planning, financing, acquisition, maintenance, construction, and operation  11 of an Alaska liquefied natural gas project; 12 (24) after consultation with the commissioner of revenue and the  13 commissioner of natural resources, enter into contracts relating to an Alaska  14 liquefied natural gas project, including contracts for services related to  15 operation, marketing, transportation, gas treatment, marine terminal operation,  16 or liquefaction. 17  * Sec. 5. AS 31.25.080(e) is amended to read: 18 (e) If commitments to acquire firm transportation capacity for the in-state  19 natural gas pipeline are received in an open season conducted by the corporation, the 20 corporation shall, within 10 days after accepting and executing the written 21 commitments received during the open season, report the results of the open season to 22 the president of the senate and the speaker of the house of representatives and inform 23 the public of the results of the open season through publication on the Internet website 24 of the corporation and in a press release or other announcement to the media. The 25 results made public must include the name of each prospective shipper, the amount of 26 capacity allocated, and the period of the commitment. If the corporation determines 27 that the commitments received during the open season are not sufficient to permit the 28 corporation to continue the development or construction of the natural gas pipeline, 29 the corporation shall report that to the legislature within 30 days. 30  * Sec. 6. AS 31.25.080 is amended by adding a new subsection to read: 31 (g) The power in (a)(23) of this section may not be exercised by an entity or 01 subsidiary of the corporation that is advancing the development an in-state natural gas 02 pipeline. 03  * Sec. 7. AS 31.25.090 is amended by adding a new subsection to read: 04 (i) Subject to limitations on the disclosure of confidential information in (g) 05 and (h) of this section, the corporation shall provide to the commissioner of natural 06 resources and the commissioner of revenue access to information that is related to the 07 development of contracts under AS 38.05.020(b)(10) and (11). 08  * Sec. 8. AS 31.25.100 is amended to read: 09 Sec. 31.25.100. In-state natural gas pipeline fund. The in-state natural gas 10 pipeline fund is established in the corporation and consists of money appropriated to 11 it. The corporation shall determine fund management and may contract with the 12 Department of Revenue for fund management. Unless otherwise provided by law, 13 money appropriated to the fund lapses into the general fund on the day this section is 14 repealed. Interest and other income received on money in the fund shall be separately 15 accounted for and may be appropriated to the fund. The corporation may use money 16 appropriated to the fund without further appropriation for the cost of managing the 17 fund and for the planning, financing, development, acquisition, maintenance, 18 construction, and operation of the [AN] in-state natural gas pipeline described in  19 AS 31.25.005(4) and for the purposes in AS 31.25.005(4), (6), and (7). 20  * Sec. 9. AS 31.25 is amended by adding a new section to read: 21 Sec. 31.25.110. Alaska liquefied natural gas project fund. The Alaska 22 liquefied natural gas project fund is established in the corporation and consists of 23 money appropriated to it. The corporation shall determine fund management and may 24 contract with the Department of Revenue for fund management. If money is 25 appropriated to the fund to finance the cost of an Alaska liquefied natural gas project, 26 the corporation shall create an account in the fund for that purpose and hold the money 27 appropriated for that purpose in that account. Interest and other income received on 28 money in the fund shall be separately accounted for and may be appropriated to the 29 fund. The corporation may use money appropriated to the fund without further 30 appropriation for the purpose of managing the fund, for purposes related to an Alaska 31 liquefied natural gas project, and for the purpose of transferring net revenue received 01 by the corporation related to equity interest, contracts, and other activities to the 02 appropriate fund as determined by the commissioner of revenue in consultation with 03 the commissioner of natural resources. 04  * Sec. 10. AS 31.25.120 is amended to read: 05 Sec. 31.25.120. Creation of subsidiaries. The corporation may create 06 subsidiary corporations for the purpose of developing, constructing, operating, and 07 financing in-state natural gas pipeline projects or other transportation mechanisms; for 08 the purpose of aiding in the development, construction, operation, and financing of in- 09 state natural gas pipeline projects; or for the purpose of acquiring [THE STATE'S 10 ROYALTY SHARE OF NATURAL GAS,] natural gas from the North Slope, and 11 natural gas from other regions of the state, including the state's outer continental shelf, 12 and making that natural gas available to markets in the state, including the delivery of 13 natural gas, including propane and other hydrocarbons associated with natural gas 14 other than oil, to coastal communities in the state, or for export. Subject to the  15 limitations for the use of money appropriated to the in-state natural gas pipeline  16 fund (AS 31.25.100) and the Alaska liquefied natural gas project fund  17 (AS 31.25.110), the [A SUBSIDIARY CORPORATION CREATED UNDER THIS 18 SECTION MAY BE INCORPORATED UNDER AS 10.20.146 - 10.20.166. THE] 19 corporation may transfer assets of the corporation to a subsidiary created under this 20 section. A subsidiary created under this section may borrow money and issue bonds as 21 evidence of that borrowing and has all the powers of the corporation that the 22 corporation grants to it. Unless otherwise provided by the corporation, the debts, 23 liabilities, and obligations of a subsidiary corporation created under this section are not 24 the debts, liabilities, or obligations of the corporation. 25  * Sec. 11. AS 31.25.140(c) is amended to read: 26 (c) To further ensure effective budgetary decision making by the legislature, 27 the board shall 28 (1) annually review the corporation's assets, including the assets of the 29 in-state natural gas pipeline fund under AS 31.25.100 and the Alaska liquefied  30 natural gas project fund under AS 31.25.110, to determine whether assets of the 31 corporation exceed an amount required to fulfill the purposes of the corporation as 01 defined in this chapter; in making its review, the board shall determine whether, and to 02 what extent, assets in excess of the amount required to fulfill the purposes of the 03 corporation during the next fiscal year are available without 04 (A) breaching an agreement entered into by the corporation; 05 (B) materially impairing the operations or financial integrity of 06 the corporation; or 07 (C) materially affecting the ability of the corporation to fulfill 08 the purposes of the corporation as defined in this chapter; 09 (2) specifically identify in the corporation's assets the amounts that the 10 board believes are necessary to meet the requirements of (1)(C) of this subsection; and 11 (3) present to the legislature by January 10 of each year a complete 12 accounting of all assets of the corporation, including assets of the in-state natural gas 13 pipeline fund under AS 31.25.100 and the Alaska liquefied natural gas project  14 fund under AS 31.25.110, and a report of the review and determination made under 15 (1) and (2) of this subsection; the accounting shall be audited by an independent 16 outside auditor. 17  * Sec. 12. AS 31.25.390 is amended by adding a new paragraph to read: 18 (7) "Alaska liquefied natural gas project" means a natural gas project 19 as described in AS 31.25.005(5) that includes collectively, the Prudhoe Bay unit gas 20 transmission line, the Point Thomson unit gas transmission line, a gas pipeline, the gas 21 treatment plant, a liquefied natural gas plant, and a marine terminal; in this paragraph, 22 (A) "gas pipeline" 23 (i) means the main natural gas pipeline from the outlet 24 flange of the gas treatment plant on the North Slope to the inlet flange 25 of the liquefied natural gas plant located in the Southcentral region of 26 the state, which shall have off-take points along the pipeline for 27 deliveries of gas in the state; 28 (ii) does not include any gas lines downstream of any 29 off-take point between the gas treatment plant and the liquefied natural 30 gas plant; 31 (B) "gas treatment plant" means those facilities and related 01 activities required to receive natural gas from the Prudhoe Bay unit gas 02 transmission line, the Point Thomson unit gas transmission line, and other 03 facilities, treat the natural gas to pipeline specifications, dispose of or deliver 04 by-products, deliver liquid products for further transportation, and deliver 05 treated natural gas for transportation through the gas pipeline; 06 (C) "liquefied natural gas plant" means the facility for 07 liquefying natural gas and includes structures, equipment, underlying land 08 rights, other associated systems, storage, and facilities for off-loading liquefied 09 natural gas; 10 (D) "marine terminal" means the terminal and those facilities 11 required to receive liquefied natural gas from the boundary of the liquefied 12 natural gas plant for marine transportation, including auxiliary vessels used in 13 the operation of the terminal; 14 (E) "Point Thomson unit gas transmission line" means a natural 15 gas transmission line from the outlet flange of the Point Thomson unit 16 production facility to the inlet flange of the gas treatment plant; and 17 (F) "Prudhoe Bay unit gas transmission line" means a natural 18 gas transmission line from the outlet flange of the Prudhoe Bay unit central gas 19 facility to the inlet flange of the gas treatment plant. 20  * Sec. 13. AS 37.05 is amended by adding a new section to article 6 to read: 21 Sec. 37.05.610. Rural capital energy fund. (a) The rural capital energy fund 22 is created as a special account in the general fund. The fund consists of the amount 23 determined and deposited in the fund under (b) of this section and interest earned on 24 the fund balance. The purpose of the fund is to provide a source from which the 25 legislature may appropriate money to develop infrastructure to deliver energy to areas 26 of the state that are not expected to have or do not have direct access to a North Slope 27 natural gas pipeline. 28 (b) The amount to be deposited in (a) of this section is 10 percent of the 29 revenue received from the state's royalty gas transported in an Alaska liquefied natural 30 gas project that remains after the payment to the Alaska permanent fund under 31 AS 37.13.010. 01 (c) The legislature may make appropriations from the rural capital energy fund 02 for the purpose described in (a) of this section. 03 (d) Nothing in this section creates a dedicated fund. 04 (e) In this section, 05 (1) "Alaska liquefied natural gas project" has the meaning given in 06 AS 31.25.390; 07 (2) "North Slope natural gas pipeline" has the meaning given in 08 AS 42.06.630. 09  * Sec. 14. AS 38.05.020(b) is amended to read: 10 (b) The commissioner may 11 (1) establish reasonable procedures and adopt reasonable regulations 12 necessary to carry out this chapter and, whenever necessary, issue directives or orders 13 to the director to carry out specific functions and duties; regulations adopted by the 14 commissioner shall be adopted under AS 44.62 (Administrative Procedure Act); 15 orders by the commissioner classifying land, issued after January 3, 1959, are not 16 required to be adopted under AS 44.62 (Administrative Procedure Act); 17 (2) enter into agreements considered necessary to carry out the 18 purposes of this chapter, including agreements with federal and state agencies; 19 (3) review any order or action of the director; 20 (4) exercise the powers and do the acts necessary to carry out the 21 provisions and objectives of this chapter; 22 (5) notwithstanding the provisions of any other section of this chapter, 23 grant an extension of the time within which payments due on any exploration license, 24 lease, or sale of state land, minerals, or materials may be made, including payment of 25 rental and royalties, on a finding that compliance with the requirements is or was 26 prevented by reason of war, riots, or acts of God; 27 (6) classify tracts for agricultural uses; 28 (7) after consulting with the Board of Agriculture and Conservation 29 (AS 03.09.010), waive, postpone, or otherwise modify the development requirements 30 of a contract for the sale of agricultural land if 31 (A) the land is inaccessible by road; or 01 (B) transportation, marketing, and development costs render 02 the required development uneconomic; 03 (8) reconvey or relinquish land or an interest in land to the federal 04 government if 05 (A) the land is described in an amended application for an 06 allotment under 43 U.S.C. 1617; and 07 (B) the reconveyance or relinquishment is 08 (i) for the purposes provided in 43 U.S.C. 1617; and 09 (ii) in the best interests of the state; 10 (9) lead and coordinate all matters relating to the state's review and 11 authorization of resource development projects; 12 (10) enter into commercial agreements with a duration of not more  13 than two years for project services related to a North Slope natural gas project;  14 (11) in consultation with the commissioner of revenue, participate  15 in the negotiation of agreements that include balancing, marketing, disposition of  16 natural gas, and offtake and contracts and development of terms for inclusion in  17 those proposed agreements and contracts associated with a North Slope natural  18 gas project; an agreement or contract negotiated under this paragraph to which  19 the state is a party is not effective unless the legislature authorizes the governor  20 to execute the agreement or contract;  21 (12) enter into confidentiality agreements to maintain the  22 confidentiality of information related to contract negotiations and contract  23 implementation associated with a North Slope natural gas project; information  24 under those confidentiality agreements is not subject to AS 40.25 (Alaska Public  25 Records Act), except that  26 (A) the terms of a proposed contract that the commissioner  27 presents to the legislature for the purpose of obtaining authorization for  28 the governor to execute are not confidential; and  29 (B) the commissioner may share confidential information  30 obtained under this paragraph with the legislature only in committees  31 held in executive session or under confidentiality agreements;  01 (13) exercise the powers and do the acts necessary to carry out the 02 provisions and objectives of AS 43.90 that relate to this chapter. 03  * Sec. 15. AS 38.05.020(b), as amended by sec. 14 of this Act, is amended to read: 04 (b) The commissioner may 05 (1) establish reasonable procedures and adopt reasonable regulations 06 necessary to carry out this chapter and, whenever necessary, issue directives or orders 07 to the director to carry out specific functions and duties; regulations adopted by the 08 commissioner shall be adopted under AS 44.62 (Administrative Procedure Act); 09 orders by the commissioner classifying land, issued after January 3, 1959, are not 10 required to be adopted under AS 44.62 (Administrative Procedure Act); 11 (2) enter into agreements considered necessary to carry out the 12 purposes of this chapter, including agreements with federal and state agencies; 13 (3) review any order or action of the director; 14 (4) exercise the powers and do the acts necessary to carry out the 15 provisions and objectives of this chapter; 16 (5) notwithstanding the provisions of any other section of this chapter, 17 grant an extension of the time within which payments due on any exploration license, 18 lease, or sale of state land, minerals, or materials may be made, including payment of 19 rental and royalties, on a finding that compliance with the requirements is or was 20 prevented by reason of war, riots, or acts of God; 21 (6) classify tracts for agricultural uses; 22 (7) after consulting with the Board of Agriculture and Conservation 23 (AS 03.09.010), waive, postpone, or otherwise modify the development requirements 24 of a contract for the sale of agricultural land if 25 (A) the land is inaccessible by road; or 26 (B) transportation, marketing, and development costs render 27 the required development uneconomic; 28 (8) reconvey or relinquish land or an interest in land to the federal 29 government if 30 (A) the land is described in an amended application for an 31 allotment under 43 U.S.C. 1617; and 01 (B) the reconveyance or relinquishment is 02 (i) for the purposes provided in 43 U.S.C. 1617; and 03 (ii) in the best interests of the state; 04 (9) lead and coordinate all matters relating to the state's review and 05 authorization of resource development projects; 06 (10) enter into commercial agreements with a duration of not more 07 than two years for project services related to a North Slope natural gas project; 08 (11) in consultation with the commissioner of revenue, participate in 09 the negotiation of agreements that include balancing, marketing, disposition of natural 10 gas, and offtake and contracts and development of terms for inclusion in those 11 proposed agreements and contracts associated with a North Slope natural gas project; 12 an agreement or contract negotiated under this paragraph to which the state is a party 13 is not effective unless the legislature authorizes the governor to execute the agreement 14 or contract; 15 (12) enter into confidentiality agreements to maintain the 16 confidentiality of information related to contract negotiations and contract 17 implementation associated with a North Slope natural gas project; information under 18 those confidentiality agreements is not subject to AS 40.25 (Alaska Public Records 19 Act), except that 20 (A) the terms of a proposed contract that the commissioner 21 presents to the legislature for the purpose of obtaining authorization for the 22 governor to execute are not confidential; and 23 (B) the commissioner may share confidential information 24 obtained under this paragraph with the legislature only in committees held in 25 executive session or under confidentiality agreements; 26 (13) in consultation with the commissioner of revenue, take  27 custody of gas delivered to the state under AS 43.55.014(b) and manage the  28 project services and disposition and sale of that gas;  29 (14) exercise the powers and do the acts necessary to carry out the 30 provisions and objectives of AS 43.90 that relate to this chapter. 31  * Sec. 16. AS 38.05.180(i) is amended to read: 01 (i) The commissioner may provide for the establishment of an exploration 02 incentive credit system under which a lessee of state land drilling an exploratory well 03 on that land may earn credits based on [UPON] the footage drilled and the region in 04 which the well is situated. The commissioner may also provide for credits to be earned 05 by persons performing geophysical work on state land, if that work is performed 06 during the two seasons immediately preceding an announced lease sale and on land 07 included within the sale area and the geophysical information is made public 08 following the sale. Credits may not exceed 50 percent of the cost of the drilling or 09 geophysical work. Credits may be used during a limited period established by the 10 commissioner and may be assigned during that period. Credits may be applied against 11 (1) royalty and rental payments for oil and gas or for gas only payable to the state or 12 (2) taxes payable under AS 43.55.011 [AS 43.55]. A credit may not exceed 50 percent 13 of the payment toward which it is being applied. Amounts due the Alaska permanent 14 fund (AS 37.13.010) shall be calculated before the application of credits under this 15 subsection. 16  * Sec. 17. AS 38.05.180 is amended by adding new subsections to read: 17 (hh) Notwithstanding (j) of this section, the commissioner may propose 18 modification to a lease from which a lessee has committed gas from that lease to a 19 North Slope natural gas project. A modification may be made under this subsection 20 only after the commissioner makes the written determination under (ii) of this section 21 that the lease may be modified. If a modification is made, the modification shall be in 22 effect during the initial project term that has acquired the major permits required for 23 the work plan and budget considered by the commissioner in the written determination 24 under (ii) of this section. A modification under this subsection may 25 (1) relate to switching between taking the state's royalty gas in value 26 and in-kind to ensure that the lessee, the state, or another person shall bear 27 proportionate costs for treatment, transportation, and liquefaction to the state's royalty 28 gas, and the state's actions do not unreasonably interfere with the long-term marketing 29 of natural gas by the lessee, the state, or another person; 30 (2) provide a method for establishing a fair market value for each 31 component of the state's royalty gas and appropriate adjustments to reflect fair market 01 deductions for reasonable costs for treatment, transportation, and liquefaction for the 02 state's royalty gas from the North Slope to the destination market; in this paragraph, 03 "reasonable costs for treatment, transportation, and liquefaction" may not be greater 04 than actual costs; 05 (3) modify net profit shares for oil and gas and sliding scale royalty 06 rates for gas by establishing fixed royalty rates that yield a value to the state that the 07 commissioner determines to be not less than the value the state would have received 08 under the terms of the lease before a modification under this subsection. 09 (ii) Before making a modification to a lease under (hh) of this section, the 10 commissioner shall make a written determination that the lease may be modified. The 11 determination by the commissioner must be based on a clear and convincing showing 12 by the lessee that 13 (1) the modification 14 (A) is in the best interests of the state; and 15 (B) will materially improve the likelihood of a successful North 16 Slope natural gas project; 17 (2) the North Slope natural gas project has sufficient 18 (A) financial commitment for a work plan and budget 19 necessary to support major permits and regulatory filings required by state and 20 federal agencies; and 21 (B) commitment of gas by lessees; and 22 (3) the lease will produce hydrocarbons that will be transported on the 23 North Slope natural gas project during the initial project term. 24  * Sec. 18. AS 38.05.180(hh), as enacted in sec. 17 of this Act, is amended to read: 25 (hh) Notwithstanding (j) of this section, the commissioner may propose 26 modification to a lease from which a lessee has committed gas from that lease to a 27 North Slope natural gas project. A modification may be made under this subsection 28 only after the commissioner makes the written determination under (ii) of this section 29 that the lease may be modified. If a modification is made, the modification shall be in 30 effect during the initial project that has acquired the major permits required for the 31 work plan and budget considered by the commissioner in the written determination 01 under (ii) of this section. A modification under this subsection may 02 (1) relate to switching between taking the state's royalty gas in value 03 and in-kind to ensure that the lessee, the state, or another person shall bear 04 proportionate costs for treatment, transportation, and liquefaction to the state's royalty 05 gas or gas delivered to the state under AS 43.55.014, and the state's actions do not 06 unreasonably interfere with the long-term marketing of natural gas by the lessee, the 07 state, or another person; 08 (2) provide a method for establishing a fair market value for each 09 component of the state's royalty gas and appropriate adjustments to reflect fair market 10 deductions for reasonable costs for treatment, transportation, and liquefaction for the 11 state's royalty gas from the North Slope to the destination market; in this paragraph, 12 "reasonable costs for treatment, transportation, and liquefaction" may not be greater 13 than actual costs; 14 (3) modify net profit shares for oil and gas and sliding scale royalty 15 rates for gas by establishing fixed royalty rates that yield a value to the state that the 16 commissioner determines to be not less than the value the state would have received 17 under the terms of the lease before a modification under this subsection. 18  * Sec. 19. AS 38.05.183(a) is amended to read: 19 (a) The sale, exchange, or other disposal of a mineral obtained by the state as a 20 royalty under AS 38.05.182, [OR] the sale, exchange, or other disposal in whole or in 21 part of a right to receive future mineral production under a state lease under this 22 chapter, or the sale, exchange, or other disposal of gas delivered to the state under  23 AS 43.55.014(b) shall be by competitive bid and the sale, exchange, or other disposal 24 made to the highest responsible bidder, except that competitive bidding is not required 25 when the commissioner, after prior written notice to the Alaska Royalty Oil and Gas 26 Development Advisory Board under AS 38.06.050, determines that the best interest of 27 the state does not require it or that no competition exists. 28  * Sec. 20. AS 38.05.183(c) is amended to read: 29 (c) If the commissioner determines that a sale, exchange, or other disposal of a 30 mineral obtained by the state as a royalty under AS 38.05.182, [OR] of a right to 31 receive future mineral production under a state lease under this chapter, or of gas  01 delivered to the state under AS 43.55.014(b) shall be made otherwise than by 02 competitive bid, and the Alaska Royalty Oil and Gas Development Advisory Board 03 has been notified in writing of that determination, the commissioner shall make public 04 in writing the specific findings and conclusions on [UPON] which that determination 05 is based. 06  * Sec. 21. AS 38.05.183(d) is amended to read: 07 (d) Oil or gas taken in kind by the state as its royalty share or gas delivered to  08 the state under AS 43.55.014(b) may not be sold or otherwise disposed of for export 09 from the state until the commissioner determines that the [ROYALTY-IN-KIND] oil 10 or gas is surplus to the present and projected intrastate domestic and industrial needs. 11 The commissioner shall make public, in writing, the specific findings and reasons on 12 which the determination is based. 13  * Sec. 22. AS 38.05.183(e) is amended to read: 14 (e) When a sale, exchange, or other disposal of oil or gas taken in kind by the 15 state as its royalty share, or a sale, exchange, or other disposal in whole or in part of a 16 right to receive future royalty oil or gas, under a state lease under this chapter is made 17 other than by competitive bid, or when a sale, exchange, or other disposal of gas  18 delivered to the state under AS 43.55.014(b) is made other than by competitive  19 bid, the sale, exchange, or other disposal shall be awarded by the commissioner to the 20 prospective buyer whose proposal offers the maximum benefits to citizens of the state. 21 The commissioner shall consider 22 (1) the cash value offered; 23 (2) the projected effects of the sale, exchange, or other disposal on the 24 economy of the state; 25 (3) the projected benefits of refining or processing the oil or gas in the 26 state; 27 (4) the ability of the prospective buyer to provide refined products or 28 by-products for distribution and sale in the state with price or supply benefits to the 29 citizens of the state; and 30 (5) the criteria listed in AS 38.06.070(a). 31 * Sec. 23. AS 38.05.965 is amended by adding new paragraphs to read: 01 (26) "initial project term" means the duration sufficient to support an 02 investment decision by the sponsors of a North Slope natural gas project to permit 03 realization of a competitive economic return, to enable necessary financing, and to 04 support agreements for the sale of hydrocarbons transported on a North Slope natural 05 gas project; 06 (27) "North Slope natural gas project" means a project to produce 07 natural gas from state oil and gas and gas only leases that include land north of 68 08 degrees North latitude for transport in a gaseous state from the North Slope;  09 (28) "project services" means services provided by a gas treatment 10 plant, pipeline, liquefaction facility, or marine terminal, marine transportation 11 services, or other services necessary to transport natural gas to market. 12  * Sec. 24. AS 38.34.020(a) is amended to read: 13 (a) A state agency or entity conducting a review or taking action relating to a  14 project under AS 31.25 (Alaska Gasline Development Corporation) [THE IN- 15 STATE NATURAL GAS PIPELINE PROJECT UNDER THIS CHAPTER] shall 16 expedite the review or action in a manner consistent with the timely completion of the 17 project. 18  * Sec. 25. AS 38.34.020(b) is amended to read: 19 (b) Notwithstanding any contrary provision of law, a state agency or entity 20 may not include in any project certificate, right-of-way, permit, or other authorization 21 a term or condition that is not required by law if the in-state gasline project 22 coordinator determines that the term or condition would prevent or impair, in any 23 significant respect, the expeditious construction and operation or expansion of a  24 project under AS 31.25 (Alaska Gasline Development Corporation) [THE IN- 25 STATE NATURAL GAS PIPELINE PROJECT]. 26  * Sec. 26. AS 38.34.020(c) is amended to read: 27 (c) Unless required by law, a state agency or entity may not add to, amend, or 28 abrogate any certificate, right-of-way, permit, or other authorization if the in-state 29 gasline project coordinator determines that the action would prevent or impair, in any 30 significant respect, the expeditious construction, operation, or expansion of a project  31 under AS 31.25 (Alaska Gasline Development Corporation) [THE IN-STATE 01 NATURAL GAS PIPELINE PROJECT]. 02  * Sec. 27. AS 40.25.100(a) is amended to read: 03 (a) Information in the possession of the Department of Revenue that discloses 04 the particulars of the business or affairs of a taxpayer or other person, including  05 information under AS 38.05.020(b)(11) that is subject to a confidentiality  06 agreement under AS 38.05.020(b)(12), is not a matter of public record, except as 07 provided in AS 43.05.230(i) or for purposes of investigation and law enforcement. The 08 information shall be kept confidential except when its production is required in an 09 official investigation, administrative adjudication under AS 43.05.405 - 43.05.499, or 10 court proceeding. These restrictions do not prohibit the publication of statistics 11 presented in a manner that prevents the identification of particular reports and items, 12 prohibit the publication of tax lists showing the names of taxpayers who are delinquent 13 and relevant information that may assist in the collection of delinquent taxes, or 14 prohibit the publication of records, proceedings, and decisions under AS 43.05.405 - 15 43.05.499. 16  * Sec. 28. AS 40.25.100(a), as amended by sec. 27 of this Act, is amended to read: 17 (a) Information in the possession of the Department of Revenue that discloses 18 the particulars of the business or affairs of a taxpayer or other person, including 19 information under AS 38.05.020(b)(11) that is subject to a confidentiality agreement 20 under AS 38.05.020(b)(12), is not a matter of public record, except as provided in 21 AS 43.05.230(i) or (k) or for purposes of investigation and law enforcement. The 22 information shall be kept confidential except when its production is required in an 23 official investigation, administrative adjudication under AS 43.05.405 - 43.05.499, or 24 court proceeding. These restrictions do not prohibit the publication of statistics 25 presented in a manner that prevents the identification of particular reports and items, 26 prohibit the publication of tax lists showing the names of taxpayers who are delinquent 27 and relevant information that may assist in the collection of delinquent taxes, or 28 prohibit the publication of records, proceedings, and decisions under AS 43.05.405 - 29 43.05.499. 30  * Sec. 29. AS 40.25.120(a) is amended to read: 31 (a) Every person has a right to inspect a public record in the state, including 01 public records in recorders' offices, except 02 (1) records of vital statistics and adoption proceedings, which shall be 03 treated in the manner required by AS 18.50; 04 (2) records pertaining to juveniles unless disclosure is authorized by 05 law; 06 (3) medical and related public health records; 07 (4) records required to be kept confidential by a federal law or 08 regulation or by state law; 09 (5) to the extent the records are required to be kept confidential under 10 20 U.S.C. 1232g and the regulations adopted under 20 U.S.C. 1232g in order to secure 11 or retain federal assistance; 12 (6) records or information compiled for law enforcement purposes, but 13 only to the extent that the production of the law enforcement records or information 14 (A) could reasonably be expected to interfere with enforcement 15 proceedings; 16 (B) would deprive a person of a right to a fair trial or an 17 impartial adjudication; 18 (C) could reasonably be expected to constitute an unwarranted 19 invasion of the personal privacy of a suspect, defendant, victim, or witness; 20 (D) could reasonably be expected to disclose the identity of a 21 confidential source; 22 (E) would disclose confidential techniques and procedures for 23 law enforcement investigations or prosecutions; 24 (F) would disclose guidelines for law enforcement 25 investigations or prosecutions if the disclosure could reasonably be expected to 26 risk circumvention of the law; or 27 (G) could reasonably be expected to endanger the life or 28 physical safety of an individual; 29 (7) names, addresses, and other information identifying a person as a 30 participant in the Alaska Higher Education Savings Trust under AS 14.40.802 or the 31 advance college tuition savings program under AS 14.40.803 - 14.40.817; 01 (8) public records containing information that would disclose or might 02 lead to the disclosure of a component in the process used to execute or adopt an 03 electronic signature if the disclosure would or might cause the electronic signature to 04 cease being under the sole control of the person using it; 05 (9) reports submitted under AS 05.25.030 concerning certain 06 collisions, accidents, or other casualties involving boats; 07 (10) records or information pertaining to a plan, program, or 08 procedures for establishing, maintaining, or restoring security in the state, or to a 09 detailed description or evaluation of systems, facilities, or infrastructure in the state, 10 but only to the extent that the production of the records or information 11 (A) could reasonably be expected to interfere with the 12 implementation or enforcement of the security plan, program, or procedures; 13 (B) would disclose confidential guidelines for investigations or 14 enforcement and the disclosure could reasonably be expected to risk 15 circumvention of the law; or 16 (C) could reasonably be expected to endanger the life or 17 physical safety of an individual or to present a real and substantial risk to the 18 public health and welfare; 19 (11) the written notification regarding a proposed regulation provided 20 under AS 24.20.105 to the Department of Law and the affected state agency and 21 communications between the Legislative Affairs Agency, the Department of Law, and 22 the affected state agency under AS 24.20.105; 23 (12) records that are 24 (A) proprietary, privileged, or a trade secret in accordance with 25 AS 43.90.150 or 43.90.220(e); 26 (B) applications that are received under AS 43.90 until notice is 27 published under AS 43.90.160; 28 (13) information of the Alaska Gasline Development Corporation 29 created under AS 31.25.010 or a subsidiary of the Alaska Gasline Development 30 Corporation that is confidential by law or under a valid confidentiality agreement; 31 (14) information under AS 38.05.020(b)(11) that is subject to a  01 confidentiality agreement under AS 38.05.020(b)(12). 02  * Sec. 30. AS 43.05.010 is amended to read: 03 Sec. 43.05.010. Duties of commissioner. The commissioner of revenue shall 04 (1) exercise general supervision and direct the activities of the 05 Department of Revenue; 06 (2) supervise the fiscal affairs and responsibilities of the department; 07 (3) prescribe uniform rules for investigations and hearings; 08 (4) keep a record of all departmental proceedings, record and file all 09 bonds, and assume custody of returns, reports, papers, and documents of the 10 department; 11 (5) adopt a seal and affix it to each order, process, or certificate issued 12 by the commissioner; 13 (6) keep a record of each order, process, and certificate issued by the 14 commissioner, and keep the record open to public inspection at all reasonable times; 15 (7) hold hearings and investigations necessary for the administration of 16 state tax and revenue laws; 17 (8) except as provided in AS 43.05.405 - 43.05.499 and in 18 AS 44.64.030, hear and determine appeals of a matter within the jurisdiction of the 19 Department of Revenue and enter orders on the appeals that are final unless reversed 20 or modified by the courts; 21 (9) issue subpoenas to require the attendance of witnesses and the 22 production of necessary books, papers, documents, correspondence, and other things; 23 (10) order the taking of depositions before a person competent to 24 administer oaths; 25 (11) administer oaths and take acknowledgments; 26 (12) request the attorney general for rulings on the interpretation of the 27 tax and revenue laws administered by the department; 28 (13) call upon the attorney general to institute actions for recovery of 29 unpaid taxes, fees, excises, additions to tax, penalties, and interest; 30 (14) issue warrants for the collection of unpaid tax penalties and 31 interest and take all steps necessary and proper to enforce full and complete 01 compliance with the tax, license, excise, and other revenue laws of the state; 02 (15) report to the legislature before February 15 of each year the total 03 amount of contributions reported and the total amount of credit claimed during the 04 previous calendar year under AS 43.20.014, AS 43.55.019, AS 43.56.018, 05 AS 43.65.018, AS 43.75.018, and AS 43.77.045;  06 (16) consult with the commissioner of natural resources on  07 negotiation of contracts and development of terms for inclusion in proposed  08 contracts associated with a North Slope natural gas project. 09  * Sec. 31. AS 43.05.010, as amended by sec. 30 of this Act, is amended to read: 10 Sec. 43.05.010. Duties of commissioner. The commissioner of revenue shall 11 (1) exercise general supervision and direct the activities of the 12 Department of Revenue; 13 (2) supervise the fiscal affairs and responsibilities of the department; 14 (3) prescribe uniform rules for investigations and hearings; 15 (4) keep a record of all departmental proceedings, record and file all 16 bonds, and assume custody of returns, reports, papers, and documents of the 17 department; 18 (5) adopt a seal and affix it to each order, process, or certificate issued 19 by the commissioner; 20 (6) keep a record of each order, process, and certificate issued by the 21 commissioner, and keep the record open to public inspection at all reasonable times; 22 (7) hold hearings and investigations necessary for the administration of 23 state tax and revenue laws; 24 (8) except as provided in AS 43.05.405 - 43.05.499 and in 25 AS 44.64.030, hear and determine appeals of a matter within the jurisdiction of the 26 Department of Revenue and enter orders on the appeals that are final unless reversed 27 or modified by the courts; 28 (9) issue subpoenas to require the attendance of witnesses and the 29 production of necessary books, papers, documents, correspondence, and other things; 30 (10) order the taking of depositions before a person competent to 31 administer oaths; 01 (11) administer oaths and take acknowledgments; 02 (12) request the attorney general for rulings on the interpretation of the 03 tax and revenue laws administered by the department; 04 (13) call upon the attorney general to institute actions for recovery of 05 unpaid taxes, fees, excises, additions to tax, penalties, and interest; 06 (14) issue warrants for the collection of unpaid tax penalties and 07 interest and take all steps necessary and proper to enforce full and complete 08 compliance with the tax, license, excise, and other revenue laws of the state; 09 (15) report to the legislature before February 15 of each year the total 10 amount of contributions reported and the total amount of credit claimed during the 11 previous calendar year under AS 43.20.014, AS 43.55.019, AS 43.56.018, 12 AS 43.65.018, AS 43.75.018, and AS 43.77.045; 13 (16) consult with the commissioner of natural resources on negotiation 14 of contracts and development of terms for inclusion in proposed contracts associated 15 with a North Slope natural gas project; 16 (17) direct the disposition of revenue received from gas delivered  17 to the state under AS 43.55.014(b) by entering into agreements with the  18 commissioner of natural resources related to the management of the custody and  19 disposition of gas delivered to the state under AS 43.55.014(b). 20 * Sec. 32. AS 43.05.230 is amended by adding a new subsection to read: 21 (k) The name of each person that the department has allowed to make an 22 election under AS 43.55.014(a) and the amount of gas produced from each lease or 23 property to which an effective election under AS 43.55.014 applies is public 24 information. 25  * Sec. 33. AS 43.20.144(f) is amended to read: 26 (f) The extraction factor of a taxpayer subject to this section is a fraction, 27 (1) the numerator of which is the sum of the following for the tax 28 period: 29 (A) the number of barrels of the taxpayer's oil (net of royalty to 30 an unrelated party) produced from or allocated to leases or properties of the 31 taxpayer in this state; and 01 (B) one-sixth of the number of Mcf of the taxpayer's gas,  02 excluding reinjected gas but including gas subject to an election under  03 AS 43.55.014, (net of royalty to an unrelated party) produced from or allocated 04 to leases or properties of the taxpayer in this state [, EXCLUDING 05 REINJECTED GAS]; and 06 (2) the denominator of which is the sum of the following for the tax 07 period: 08 (A) the number of barrels of oil of the taxpayer's consolidated 09 business (net of royalty to an unrelated party) produced from or allocated to 10 leases or properties of the taxpayer's consolidated business everywhere; and 11 (B) one-sixth of the number of Mcf of gas, excluding  12 reinjected gas but including gas subject to an election under AS 43.55.014, 13 of the taxpayer's consolidated business (net of royalty to an unrelated party) 14 produced from or allocated to leases or properties of the taxpayer's 15 consolidated business everywhere [, EXCLUDING REINJECTED GAS]. 16  * Sec. 34. AS 43.55.011(e) is amended to read: 17 (e) There is levied on the producer of oil or gas a tax for all oil and gas 18 produced each calendar year from each lease or property in the state, less any oil and 19 gas the ownership or right to which is exempt from taxation or constitutes a 20 landowner's royalty interest or for which a tax is levied by AS 43.55.014. Except as 21 otherwise provided under (f), (j), (k), (o), and (p) of this section, for oil and gas  22 produced 23 (1) before January 1, 2014, the tax is equal to the sum of 24 (A) the annual production tax value of the taxable oil and gas 25 as calculated under AS 43.55.160(a)(1) multiplied by 25 percent; and 26 (B) the sum, over all months of the calendar year, of the tax 27 amounts determined under (g) of this section; 28 (2) on and after January 1, 2014, and before January 1, 2022, the tax 29 is equal to the annual production tax value of the taxable oil and gas as calculated 30 under AS 43.55.160(a)(1) multiplied by 35 percent; 31 (3) on and after January 1, 2022, the tax for  01 (A) oil is equal to the annual production tax value of the  02 taxable oil as calculated under AS 43.55.160(h) multiplied by 35 percent;  03 (B) gas is equal to 13 percent of the gross value at the point  04 of production of the taxable gas; if the gross value at the point of  05 production of gas produced from a lease or property is less than zero, that  06 gross value at the point of production is considered zero for purposes of  07 this subparagraph. 08  * Sec. 35. AS 43.55.011(f) is amended to read: 09 (f) The levy of tax under (e) of this section for 10 (1) oil and gas produced before January 1, 2022, from leases or  11 properties that include land north of 68 degrees North latitude, other than [OIL 12 AND GAS PRODUCTION SUBJECT TO (i) OF THIS SECTION AND] gas subject 13 to (o) of this section, may not be less than 14 (A) [(1)] four percent of the gross value at the point of 15 production when the average price per barrel for Alaska North Slope crude oil 16 for sale on the United States West Coast during the calendar year for which the 17 tax is due is more than $25; 18 (B) [(2)] three percent of the gross value at the point of 19 production when the average price per barrel for Alaska North Slope crude oil 20 for sale on the United States West Coast during the calendar year for which the 21 tax is due is over $20 but not over $25; 22 (C) [(3)] two percent of the gross value at the point of 23 production when the average price per barrel for Alaska North Slope crude oil 24 for sale on the United States West Coast during the calendar year for which the 25 tax is due is over $17.50 but not over $20; 26 (D) [(4)] one percent of the gross value at the point of 27 production when the average price per barrel for Alaska North Slope crude oil 28 for sale on the United States West Coast during the calendar year for which the 29 tax is due is over $15 but not over $17.50; or 30 (E) [(5)] zero percent of the gross value at the point of 31 production when the average price per barrel for Alaska North Slope crude oil 01 for sale on the United States West Coast during the calendar year for which the 02 tax is due is $15 or less; and 03 (2) oil produced on and after January 1, 2022, from leases or  04 properties that include land north of 68 degrees North latitude, may not be less  05 than  06 (A) four percent of the gross value at the point of  07 production when the average price per barrel for Alaska North Slope  08 crude oil for sale on the United States West Coast during the calendar  09 year for which the tax is due is more than $25;  10 (B) three percent of the gross value at the point of  11 production when the average price per barrel for Alaska North Slope  12 crude oil for sale on the United States West Coast during the calendar  13 year for which the tax is due is over $20 but not over $25;  14 (C) two percent of the gross value at the point of production  15 when the average price per barrel for Alaska North Slope crude oil for  16 sale on the United States West Coast during the calendar year for which  17 the tax is due is over $17.50 but not over $20;  18 (D) one percent of the gross value at the point of production  19 when the average price per barrel for Alaska North Slope crude oil for  20 sale on the United States West Coast during the calendar year for which  21 the tax is due is over $15 but not over $17.50; or  22 (E) zero percent of the gross value at the point of  23 production when the average price per barrel for Alaska North Slope  24 crude oil for sale on the United States West Coast during the calendar  25 year for which the tax is due is $15 or less. 26  * Sec. 36. AS 43.55 is amended by adding a new section to read: 27 Sec. 43.55.014. Payment in gas of tax for gas. (a) For gas produced on and 28 after January 1, 2022, other than gas described in (e) of this section, the department 29 shall allow a producer to make an election, under regulations adopted by the 30 department, to pay in gas the production tax levied by this section in lieu of the tax 31 otherwise levied for the gas by AS 43.55.011(e). An election under this subsection 01 applies only to gas produced from oil and gas leases modified under AS 38.05.180(hh) 02 from which the commissioner of natural resources has determined to take royalty gas 03 in kind under AS 38.05.182. 04 (b) A production tax levied by this section is equal to 13 percent of the gas 05 otherwise taxable under AS 43.55.011(e)(3) produced from each oil and gas lease to 06 which an effective election under (a) of this section applies, when and as that gas is 07 produced. The producer shall pay the tax in gas by delivering that 13 percent of the 08 gas to the state at the point of production. 09 (c) The Department of Natural Resources shall manage under 10 AS 38.05.020(b)(13) the custody and disposition of gas delivered to the state under (b) 11 of this section. 12 (d) If a deficiency in a tax levied by this section is assessed, or if a provision 13 of this title providing for interest or a penalty based on a percentage of a tax liability or 14 tax deficiency applies to gas for which a tax is levied by this section, the amount of the 15 deficiency and the tax amount on which the interest or penalty percentage is calculated 16 is treated for the purpose only of that calculation as having been levied by 17 AS 43.55.011(e) rather than this section. 18 (e) This section does not apply to gas 19 (1) flared, released, or allowed to escape upstream of the point of 20 production of gas; or 21 (2) used in the operation of a lease or property in the state for drilling 22 for or producing oil or gas, or for repressuring a reservoir. 23  * Sec. 37. AS 43.55.019(a) is amended to read: 24 (a) A producer of oil or gas is allowed a credit against the tax levied by  25 AS 43.55.011(e) [DUE UNDER THIS CHAPTER] for cash contributions accepted for 26 (1) direct instruction, research, and educational support purposes, 27 including library and museum acquisitions, and contributions to endowment, by an 28 Alaska university foundation or by a nonprofit, public or private, Alaska two-year or 29 four-year college accredited by a regional accreditation association; 30 (2) secondary school level vocational education courses, programs, and 31 facilities by a school district in the state; 01 (3) vocational education courses, programs, equipment, and facilities 02 by a state-operated vocational technical education and training school, a nonprofit  03 regional training center recognized by the Department of Labor and Workforce  04 Development, and an apprenticeship program in the state that is registered with  05 the United States Department of Labor under 29 U.S.C. 50 - 50b (National  06 Apprenticeship Act); 07 (4) a facility or an annual intercollegiate sports tournament by a 08 nonprofit, public or private, Alaska two-year or four-year college accredited by a 09 regional accreditation association; 10 (5) Alaska Native cultural or heritage programs and educational 11 support, including mentoring and tutoring, provided by a nonprofit agency for public 12 school staff and for students who are in grades kindergarten through 12 in the state; 13 (6) education, research, rehabilitation, and facilities by an institution 14 that is located in the state and that qualifies as a coastal ecosystem learning center 15 under the Coastal America Partnership established by the federal government; and 16 (7) the Alaska higher education investment fund under AS 37.14.750. 17  * Sec. 38. AS 43.55.019(a), as amended by sec. 21, ch. 92, SLA 2010, sec. 14, ch. 7, 18 FSSLA 2011, sec. 17, ch. 74, SLA 2012, and sec. 37 of this Act, is amended to read: 19 (a) A producer of oil or gas is allowed a credit against the tax levied by  20 AS 43.55.011(e) due under this chapter for cash contributions accepted 21 (1) for direct instruction, research, and educational support purposes, 22 including library and museum acquisitions, and contributions to endowment, by an 23 Alaska university foundation or by a nonprofit, public or private, Alaska two-year or 24 four-year college accredited by a regional accreditation association; 25 (2) for secondary school level vocational education courses, programs, 26 and facilities by a school district in the state; 27 (3) for vocational education courses, programs, equipment, and  28 facilities by a state-operated vocational technical education and training school, a  29 nonprofit regional training center recognized by the Department of Labor and  30 Workforce Development, and an apprenticeship program in the state that is  31 registered with the United States Department of Labor under 29 U.S.C. 50 - 50b  01 (National Apprenticeship Act); and 02 (4) for the Alaska higher education investment fund under 03 AS 37.14.750. 04  * Sec. 39. AS 43.55.019(e) is amended to read: 05 (e) The credit under this section may not reduce a person's tax liability under 06 AS 43.55.011(e) [THIS CHAPTER] to below zero for any tax year. An unused credit 07 or portion of a credit not used under this section for a tax year may not be sold, traded, 08 transferred, or applied in a subsequent tax year. 09  * Sec. 40. AS 43.55.020(a) is amended to read: 10 (a) For a calendar year, a producer subject to tax under AS 43.55.011 shall pay 11 the tax as follows: 12 (1) for oil and gas produced before January 1, 2014, an installment 13 payment of the estimated tax levied by AS 43.55.011(e), net of any tax credits applied 14 as allowed by law, is due for each month of the calendar year on the last day of the 15 following month; except as otherwise provided under (2) of this subsection, the 16 amount of the installment payment is the sum of the following amounts, less 1/12 of 17 the tax credits that are allowed by law to be applied against the tax levied by 18 AS 43.55.011(e) for the calendar year, but the amount of the installment payment may 19 not be less than zero: 20 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 21 produced from leases or properties in the state outside the Cook Inlet 22 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 23 the greater of 24 (i) zero; or 25 (ii) the sum of 25 percent and the tax rate calculated for 26 the month under AS 43.55.011(g) multiplied by the remainder obtained 27 by subtracting 1/12 of the producer's adjusted lease expenditures for the 28 calendar year of production under AS 43.55.165 and 43.55.170 that are 29 deductible for the oil and gas under AS 43.55.160 from the gross value 30 at the point of production of the oil and gas produced from the leases or 31 properties during the month for which the installment payment is 01 calculated; 02 (B) for oil and gas produced from leases or properties subject 03 to AS 43.55.011(f), the greatest of 04 (i) zero; 05 (ii) zero percent, one percent, two percent, three 06 percent, or four percent, as applicable, of the gross value at the point of 07 production of the oil and gas produced from the leases or properties 08 during the month for which the installment payment is calculated; or 09 (iii) the sum of 25 percent and the tax rate calculated for 10 the month under AS 43.55.011(g) multiplied by the remainder obtained 11 by subtracting 1/12 of the producer's adjusted lease expenditures for the 12 calendar year of production under AS 43.55.165 and 43.55.170 that are 13 deductible for the oil and gas under AS 43.55.160 from the gross value 14 at the point of production of the oil and gas produced from those leases 15 or properties during the month for which the installment payment is 16 calculated; 17 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 18 each lease or property, the greater of 19 (i) zero; or 20 (ii) the sum of 25 percent and the tax rate calculated for 21 the month under AS 43.55.011(g) multiplied by the remainder obtained 22 by subtracting 1/12 of the producer's adjusted lease expenditures for the 23 calendar year of production under AS 43.55.165 and 43.55.170 that are 24 deductible under AS 43.55.160 for the oil or gas, respectively, 25 produced from the lease or property from the gross value at the point of 26 production of the oil or gas, respectively, produced from the lease or 27 property during the month for which the installment payment is 28 calculated; 29 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 30 (i) the sum of 25 percent and the tax rate calculated for 31 the month under AS 43.55.011(g) multiplied by the remainder obtained 01 by subtracting 1/12 of the producer's adjusted lease expenditures for the 02 calendar year of production under AS 43.55.165 and 43.55.170 that are 03 deductible for the oil and gas under AS 43.55.160 from the gross value 04 at the point of production of the oil and gas produced from the leases or 05 properties during the month for which the installment payment is 06 calculated, but not less than zero; or 07 (ii) four percent of the gross value at the point of 08 production of the oil and gas produced from the leases or properties 09 during the month, but not less than zero; 10 (2) an amount calculated under (1)(C) of this subsection for oil or gas 11 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 12 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 13 applicable, for gas or set out in AS 43.55.011(k)(1) or (2), as applicable, for oil, but 14 substituting in AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the 15 amount of taxable gas produced during the month for the amount of taxable gas 16 produced during the calendar year and substituting in AS 43.55.011(k)(1)(A) or 17 (2)(A), as applicable, the amount of taxable oil produced during the month for the 18 amount of taxable oil produced during the calendar year; 19 (3) an installment payment of the estimated tax levied by 20 AS 43.55.011(i) for each lease or property is due for each month of the calendar year 21 on the last day of the following month; the amount of the installment payment is the 22 sum of 23 (A) the applicable tax rate for oil provided under 24 AS 43.55.011(i), multiplied by the gross value at the point of production of the 25 oil taxable under AS 43.55.011(i) and produced from the lease or property 26 during the month; and 27 (B) the applicable tax rate for gas provided under 28 AS 43.55.011(i), multiplied by the gross value at the point of production of the 29 gas taxable under AS 43.55.011(i) and produced from the lease or property 30 during the month; 31 (4) any amount of tax levied by AS 43.55.011, net of any credits 01 applied as allowed by law, that exceeds the total of the amounts due as installment 02 payments of estimated tax is due on March 31 of the year following the calendar year 03 of production; 04 (5) for oil and gas produced on and after January 1, 2014, and before  05 January 1, 2022, an installment payment of the estimated tax levied by 06 AS 43.55.011(e), net of any tax credits applied as allowed by law, is due for each 07 month of the calendar year on the last day of the following month; except as otherwise 08 provided under (6) of this subsection, the amount of the installment payment is the 09 sum of the following amounts, less 1/12 of the tax credits that are allowed by law to be 10 applied against the tax levied by AS 43.55.011(e) for the calendar year, but the amount 11 of the installment payment may not be less than zero: 12 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 13 produced from leases or properties in the state outside the Cook Inlet 14 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 15 the greater of 16 (i) zero; or 17 (ii) 35 percent multiplied by the remainder obtained by 18 subtracting 1/12 of the producer's adjusted lease expenditures for the 19 calendar year of production under AS 43.55.165 and 43.55.170 that are 20 deductible for the oil and gas under AS 43.55.160 from the gross value 21 at the point of production of the oil and gas produced from the leases or 22 properties during the month for which the installment payment is 23 calculated; 24 (B) for oil and gas produced from leases or properties subject 25 to AS 43.55.011(f), the greatest of 26 (i) zero; 27 (ii) zero percent, one percent, two percent, three 28 percent, or four percent, as applicable, of the gross value at the point of 29 production of the oil and gas produced from the leases or properties 30 during the month for which the installment payment is calculated; or 31 (iii) 35 percent multiplied by the remainder obtained by 01 subtracting 1/12 of the producer's adjusted lease expenditures for the 02 calendar year of production under AS 43.55.165 and 43.55.170 that are 03 deductible for the oil and gas under AS 43.55.160 from the gross value 04 at the point of production of the oil and gas produced from those leases 05 or properties during the month for which the installment payment is 06 calculated, except that, for the purposes of this calculation, a reduction 07 from the gross value at the point of production may apply for oil and 08 gas subject to AS 43.55.160(f) or (g); 09 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 10 each lease or property, the greater of 11 (i) zero; or 12 (ii) 35 percent multiplied by the remainder obtained by 13 subtracting 1/12 of the producer's adjusted lease expenditures for the 14 calendar year of production under AS 43.55.165 and 43.55.170 that are 15 deductible under AS 43.55.160 for the oil or gas, respectively, 16 produced from the lease or property from the gross value at the point of 17 production of the oil or gas, respectively, produced from the lease or 18 property during the month for which the installment payment is 19 calculated; 20 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 21 (i) 35 percent multiplied by the remainder obtained by 22 subtracting 1/12 of the producer's adjusted lease expenditures for the 23 calendar year of production under AS 43.55.165 and 43.55.170 that are 24 deductible for the oil and gas under AS 43.55.160 from the gross value 25 at the point of production of the oil and gas produced from the leases or 26 properties during the month for which the installment payment is 27 calculated, but not less than zero; or 28 (ii) four percent of the gross value at the point of 29 production of the oil and gas produced from the leases or properties 30 during the month, but not less than zero; 31 (6) an amount calculated under (5)(C) of this subsection for oil or gas 01 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 02 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 03 applicable, for gas or set out in AS 43.55.011(k)(1) or (2), as applicable, for oil, but 04 substituting in AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the 05 amount of taxable gas produced during the month for the amount of taxable gas 06 produced during the calendar year and substituting in AS 43.55.011(k)(1)(A) or 07 (2)(A), as applicable, the amount of taxable oil produced during the month for the 08 amount of taxable oil produced during the calendar year; 09 (7) for oil and gas produced on or after January 1, 2022, an  10 installment payment of the estimated tax levied by AS 43.55.011(e), net of any tax  11 credits applied as allowed by law, is due for each month of the calendar year on  12 the last day of the following month; the amount of the installment payment is the  13 sum of the following amounts, less 1/12 of the tax credits that are allowed by law  14 to be applied against the tax levied by AS 43.55.011(e) for the calendar year, but  15 the amount of the installment payment may not be less than zero:  16 (A) for oil produced from leases or properties that include  17 land north of 68 degrees North latitude, the greatest of  18 (i) zero;  19 (ii) zero percent, one percent, two percent, three  20 percent, or four percent, as applicable, of the gross value at the  21 point of production of the oil produced from the leases or  22 properties during the month for which the installment payment is  23 calculated; or  24 (iii) 35 percent multiplied by the remainder obtained  25 by subtracting 1/12 of the producer's adjusted lease expenditures  26 for the calendar year of production under AS 43.55.165 and  27 43.55.170 that are deductible for the oil under AS 43.55.160(h)(1)  28 from the gross value at the point of production of the oil produced  29 from those leases or properties during the month for which the  30 installment payment is calculated, except that, for the purposes of  31 this calculation, a reduction from the gross value at the point of  01 production may apply for oil subject to AS 43.55.160(f) or  02 43.55.160(f) and (g);  03 (B) for oil produced before or during the last calendar year  04 under AS 43.55.024(b) for which the producer could take a tax credit  05 under AS 43.55.024(a), from leases or properties in the state outside the  06 Cook Inlet sedimentary basin, no part of which is north of 68 degrees  07 North latitude, other than leases or properties subject to AS 43.55.011(p),  08 the greater of  09 (i) zero; or  10 (ii) 35 percent multiplied by the remainder obtained  11 by subtracting 1/12 of the producer's adjusted lease expenditures  12 for the calendar year of production under AS 43.55.165 and  13 43.55.170 that are deductible for the oil under AS 43.55.160(h)(2)  14 from the gross value at the point of production of the oil produced  15 from the leases or properties during the month for which the  16 installment payment is calculated;  17 (C) for oil and gas produced from leases or properties  18 subject to AS 43.55.011(p), except as otherwise provided under (8) of this  19 subsection, the sum of  20 (i) 35 percent multiplied by the remainder obtained  21 by subtracting 1/12 of the producer's adjusted lease expenditures  22 for the calendar year of production under AS 43.55.165 and  23 43.55.170 that are deductible for the oil under AS 43.55.160(h)(3)  24 from the gross value at the point of production of the oil produced  25 from the leases or properties during the month for which the  26 installment payment is calculated, but not less than zero; and  27 (ii) 13 percent of the gross value at the point of  28 production of the gas produced from the leases or properties  29 during the month, but not less than zero;  30 (D) for oil produced from leases or properties in the state,  31 no part of which is north of 68 degrees North latitude, other than leases or  01 properties subject to (B) or (C) of this paragraph, the greater of  02 (i) zero; or  03 (ii) 35 percent multiplied by the remainder obtained  04 by subtracting 1/12 of the producer's adjusted lease expenditures  05 for the calendar year of production under AS 43.55.165 and  06 43.55.170 that are deductible for the oil under AS 43.55.160(h)(4)  07 from the gross value at the point of production of the oil produced  08 from the leases or properties during the month for which the  09 installment payment is calculated;  10 (E) for gas produced from each lease or property in the  11 state, other than a lease or property subject to AS 43.55.011(p), 13 percent  12 of the gross value at the point of production of the gas produced from the  13 lease or property during the month for which the installment payment is  14 calculated, but not less than zero;  15 (8) an amount calculated under (7)(C) of this subsection may not  16 exceed four percent of the gross value at the point of production of the oil and gas  17 produced from leases or properties subject to AS 43.55.011(p) during the month  18 for which the installment payment is calculated;  19 (9) for purposes of the calculation under (1)(B)(ii), (5)(B)(ii), and  20 (7)(A)(ii) of this subsection, the applicable percentage of the gross value at the  21 point of production is determined under AS 43.55.011(f)(1) or (2) but substituting  22 the phrase "month for which the installment payment is calculated" in  23 AS 43.55.011(f)(1) and (2) for the phrase "calendar year for which the tax is  24 due."  25  * Sec. 41. AS 43.55.020(g) is amended to read: 26 (g) Notwithstanding any contrary provision of AS 43.05.225, 27 (1) before January 1, 2014, an unpaid amount of an installment 28 payment required under (a)(1) - (3) of this section that is not paid when due bears 29 interest (A) at the rate provided for an underpayment under 26 U.S.C. 6621 (Internal 30 Revenue Code), as amended, compounded daily, from the date the installment 31 payment is due until March 31 following the calendar year of production, and (B) as 01 provided for a delinquent tax under AS 43.05.225 after that March 31; interest accrued 02 under (A) of this paragraph that remains unpaid after that March 31 is treated as an 03 addition to tax that bears interest under (B) of this paragraph; an unpaid amount of tax 04 due under (a)(4) of this section that is not paid when due bears interest as provided for 05 a delinquent tax under AS 43.05.225; 06 (2) on and after January 1, 2014, an unpaid amount of an installment 07 payment required under (a)(3), (5), [OR] (6), or (7) of this section that is not paid 08 when due bears interest (A) at the rate provided for an underpayment under 26 U.S.C. 09 6621 (Internal Revenue Code), as amended, compounded daily, from the date the 10 installment payment is due until March 31 following the calendar year of production, 11 and (B) as provided for a delinquent tax under AS 43.05.225 after that March 31; 12 interest accrued under (A) of this paragraph that remains unpaid after that March 31 is 13 treated as an addition to tax that bears interest under (B) of this paragraph; an unpaid 14 amount of tax due under (a)(4) of this section that is not paid when due bears interest 15 as provided for a delinquent tax under AS 43.05.225. 16  * Sec. 42. AS 43.55.020(h) is amended to read: 17 (h) Notwithstanding any contrary provision of AS 43.05.280, 18 (1) an overpayment of an installment payment required under (a)(1),  19 (2), (3), (5), (6), or (7) [(a)(1) - (3), (5) OR (6)] of this section bears interest at the rate 20 provided for an overpayment under 26 U.S.C. 6621 (Internal Revenue Code), as 21 amended, compounded daily, from the later of the date the installment payment is due 22 or the date the overpayment is made, until the earlier of 23 (A) the date it is refunded or is applied to an underpayment; or 24 (B) March 31 following the calendar year of production; 25 (2) except as provided under (1) of this subsection, interest with 26 respect to an overpayment is allowed only on any net overpayment of the payments 27 required under (a) of this section that remains after the later of March 31 following the 28 calendar year of production or the date that the statement required under 29 AS 43.55.030(a) is filed; 30 (3) interest is allowed under (2) of this subsection only from a date that 31 is 90 days after the later of March 31 following the calendar year of production or the 01 date that the statement required under AS 43.55.030(a) is filed; interest is not allowed 02 if the overpayment was refunded within the 90-day period; 03 (4) interest under (2) and (3) of this subsection is paid at the rate and in 04 the manner provided in AS 43.05.225(1). 05  * Sec. 43. AS 43.55.020(l) is amended to read: 06 (l) For oil and gas produced on [ON] and after January 1, 2014, and before  07 January 1, 2022, in making settlement with the royalty owner for oil and gas that is 08 taxable under AS 43.55.011, the producer may deduct the amount of the tax paid on 09 taxable royalty oil and gas, or may deduct taxable royalty oil or gas equivalent in 10 value at the time the tax becomes due to the amount of the tax paid. If the total 11 deductions of installment payments of estimated tax for a calendar year exceed the 12 actual tax for that calendar year, the producer shall, before April 1 of the following 13 year, refund the excess to the royalty owner. Unless otherwise agreed between the 14 producer and the royalty owner, the amount of the tax paid under AS 43.55.011(e) on 15 taxable royalty oil and gas for a calendar year, other than oil and gas the ownership or 16 right to which constitutes a landowner's royalty interest, is considered to be the gross 17 value at the point of production of the taxable royalty oil and gas produced during the 18 calendar year multiplied by a figure that is a quotient, in which 19 (1) the numerator is the producer's total tax liability under 20 AS 43.55.011(e)(2) [AS 43.55.011(e)] for the calendar year of production; and 21 (2) the denominator is the total gross value at the point of production 22 of the oil and gas taxable under AS 43.55.011(e) produced by the producer from all 23 leases and properties in the state during the calendar year. 24  * Sec. 44. AS 43.55.020 is amended by adding a new subsection to read: 25 (m) For oil and gas produced on and after January 1, 2022, in making 26 settlement with the royalty owner for oil and gas that is taxable under AS 43.55.011, 27 the producer may deduct the amount of the tax paid on taxable royalty oil and gas, or 28 may deduct taxable royalty oil or gas equivalent in value at the time the tax becomes 29 due to the amount of the tax paid. If the total deductions of installment payments of 30 estimated tax for a calendar year exceed the actual tax for that calendar year, the 31 producer shall, before April 1 of the following year, refund the excess to the royalty 01 owner. In making settlement with the royalty owner for gas that is taxable under 02 AS 43.55.014, the producer may deduct the amount of the gas paid as in kind tax on 03 taxable royalty gas or may deduct the gross value at the point of production of the gas 04 paid as in-kind tax on taxable royalty gas. Unless otherwise agreed between the 05 producer and the royalty owner, the amount of the tax paid under AS 43.55.011(e) on 06 taxable royalty oil for a calendar year, other than oil the ownership or right to which 07 constitutes a landowner's royalty interest, is considered to be the gross value at the 08 point of production of the taxable royalty oil produced during the calendar year 09 multiplied by a figure that is a quotient, in which 10 (1) the numerator is the producer's total tax liability under 11 AS 43.55.011(e)(3)(A) for the calendar year of production; and 12 (2) the denominator is the total gross value at the point of production 13 of the oil taxable under AS 43.55.011(e) produced by the producer from all leases and 14 properties in the state during the calendar year. 15  * Sec. 45. AS 43.55.030(a) is amended to read: 16 (a) A producer that produces oil or gas from a lease or property in the state 17 during a calendar year, whether or not any tax payment is due under AS 43.55.020(a) 18 for that oil or gas, shall file with the department on March 31 of the following year a 19 statement, under oath, in a form prescribed by the department, giving, with other 20 information required, the following: 21 (1) a description of each lease or property from which oil or gas was 22 produced, by name, legal description, lease number, or accounting codes assigned by 23 the department; 24 (2) the names of the producer and, if different, the person paying the 25 tax, if any; 26 (3) the gross amount of oil and the gross amount of gas produced from 27 each lease or property, separately identifying the gross amount of gas produced  28 from each oil and gas lease to which an effective election under AS 43.55.014(a)  29 applies, the amount of gas delivered to the state under AS 43.55.014(b), and the 30 percentage of the gross amount of oil and gas owned by the producer; 31 (4) the gross value at the point of production of the oil and of the gas 01 produced from each lease or property owned by the producer and the costs of 02 transportation of the oil and gas; 03 (5) the name of the first purchaser and the price received for the oil and 04 for the gas, unless relieved from this requirement in whole or in part by the 05 department; 06 (6) the producer's qualified capital expenditures, as defined in 07 AS 43.55.023, other lease expenditures under AS 43.55.165, and adjustments or other 08 payments or credits under AS 43.55.170; 09 (7) the production tax values of the oil and gas under AS 43.55.160(a)  10 or of the oil under AS 43.55.160(h), as applicable [AS 43.55.160]; 11 (8) any claims for tax credits to be applied; and 12 (9) calculations showing the amounts, if any, that were or are due 13 under AS 43.55.020(a) and interest on any underpayment or overpayment. 14  * Sec. 46. AS 43.55.160(a) is amended to read: 15 (a) For oil and gas produced before January 1, 2022, except [EXCEPT] as 16 provided in (b), (f), and (g) of this section, for the purposes of 17 (1) AS 43.55.011(e)(1) and (2) [AS 43.55.011(e)], the annual 18 production tax value of taxable oil, gas, or oil and gas produced during a calendar year 19 in a category for which a separate annual production tax value is required to be 20 calculated under this paragraph is the gross value at the point of production of that oil, 21 gas, or oil and gas taxable under AS 43.55.011(e), less the producer's lease 22 expenditures under AS 43.55.165 for the calendar year applicable to the oil, gas, or oil 23 and gas in that category produced by the producer during the calendar year, as 24 adjusted under AS 43.55.170; a separate annual production tax value shall be 25 calculated for 26 (A) oil and gas produced from leases or properties in the state 27 that include land north of 68 degrees North latitude, other than gas produced 28 before 2022 and used in the state; 29 (B) oil and gas produced from leases or properties in the state 30 outside the Cook Inlet sedimentary basin, no part of which is north of 68 31 degrees North latitude and that qualifies for a tax credit under AS 43.55.024(a) 01 and (b); this subparagraph does not apply to 02 (i) gas produced before 2022 and used in the state; or 03 (ii) oil and gas subject to AS 43.55.011(p); 04 (C) oil produced before 2022 from each lease or property in the 05 Cook Inlet sedimentary basin; 06 (D) gas produced before 2022 from each lease or property in 07 the Cook Inlet sedimentary basin; 08 (E) gas produced before 2022 from each lease or property in 09 the state outside the Cook Inlet sedimentary basin and used in the state, other 10 than gas subject to AS 43.55.011(p); 11 (F) oil and gas subject to AS 43.55.011(p) produced from 12 leases or properties in the state; 13 (G) oil and gas produced from leases or properties in the state 14 no part of which is north of 68 degrees North latitude, other than oil or gas 15 described in (B), (C), (D), (E), or (F) of this paragraph; 16 (2) AS 43.55.011(g), for oil and gas produced before January 1, 2014, 17 the monthly production tax value of the taxable 18 (A) oil and gas produced during a month from leases or 19 properties in the state that include land north of 68 degrees North latitude is the 20 gross value at the point of production of the oil and gas taxable under 21 AS 43.55.011(e) and produced by the producer from those leases or properties, 22 less 1/12 of the producer's lease expenditures under AS 43.55.165 for the 23 calendar year applicable to the oil and gas produced by the producer from 24 those leases or properties, as adjusted under AS 43.55.170; this subparagraph 25 does not apply to gas subject to AS 43.55.011(o); 26 (B) oil and gas produced during a month from leases or 27 properties in the state outside the Cook Inlet sedimentary basin, no part of 28 which is north of 68 degrees North latitude, is the gross value at the point of 29 production of the oil and gas taxable under AS 43.55.011(e) and produced by 30 the producer from those leases or properties, less 1/12 of the producer's lease 31 expenditures under AS 43.55.165 for the calendar year applicable to the oil and 01 gas produced by the producer from those leases or properties, as adjusted under 02 AS 43.55.170; this subparagraph does not apply to gas subject to 03 AS 43.55.011(o); 04 (C) oil produced during a month from a lease or property in the 05 Cook Inlet sedimentary basin is the gross value at the point of production of 06 the oil taxable under AS 43.55.011(e) and produced by the producer from that 07 lease or property, less 1/12 of the producer's lease expenditures under 08 AS 43.55.165 for the calendar year applicable to the oil produced by the 09 producer from that lease or property, as adjusted under AS 43.55.170; 10 (D) gas produced during a month from a lease or property in 11 the Cook Inlet sedimentary basin is the gross value at the point of production 12 of the gas taxable under AS 43.55.011(e) and produced by the producer from 13 that lease or property, less 1/12 of the producer's lease expenditures under 14 AS 43.55.165 for the calendar year applicable to the gas produced by the 15 producer from that lease or property, as adjusted under AS 43.55.170; 16 (E) gas produced during a month from a lease or property 17 outside the Cook Inlet sedimentary basin and used in the state is the gross 18 value at the point of production of that gas taxable under AS 43.55.011(e) and 19 produced by the producer from that lease or property, less 1/12 of the 20 producer's lease expenditures under AS 43.55.165 for the calendar year 21 applicable to that gas produced by the producer from that lease or property, as 22 adjusted under AS 43.55.170. 23  * Sec. 47. AS 43.55.160(e) is amended to read: 24 (e) Any adjusted lease expenditures under AS 43.55.165 and 43.55.170 that 25 would otherwise be deductible by a producer in a calendar year but whose deduction 26 would cause an annual production tax value calculated under (a)(1) or (h) of this 27 section of taxable oil or gas produced during the calendar year to be less than zero 28 may be used to establish a carried-forward annual loss under AS 43.55.023(b). 29 However, the department shall provide by regulation a method to ensure that, for a 30 period for which a producer's tax liability is limited by AS 43.55.011(j), (k), (o), or 31 (p), any adjusted lease expenditures under AS 43.55.165 and 43.55.170 that would 01 otherwise be deductible by a producer for that period but whose deduction would 02 cause a production tax value calculated under (a)(1)(C), (D), (E), [OR] (F), or (h)(3) 03 of this section to be less than zero are accounted for as though the adjusted lease 04 expenditures had first been used as deductions in calculating the production tax values 05 of oil or gas subject to any of the limitations under AS 43.55.011(j), (k), (o), or (p) that 06 have positive production tax values so as to reduce the tax liability calculated without 07 regard to the limitation to the maximum amount provided for under the applicable 08 provision of AS 43.55.011(j), (k), (o), or (p). Only the amount of those adjusted lease 09 expenditures remaining after the accounting provided for under this subsection may be 10 used to establish a carried-forward annual loss under AS 43.55.023(b). In this 11 subsection, "producer" includes "explorer." 12  * Sec. 48. AS 43.55.160(f) is amended to read: 13 (f) On and after January 1, 2014, in the calculation of an annual production tax 14 value of a producer under (a)(1)(A) or (h)(1) [(a)(1)] of this section, the gross value at 15 the point of production of oil or gas produced from a lease or property north of 68 16 degrees North latitude meeting one or more of the following criteria is reduced by 20 17 percent: (1) the oil or gas is produced from a lease or property that does not contain a 18 lease that was within a unit on January 1, 2003; (2) the oil or gas is produced from a 19 participating area established after December 31, 2011, that is within a unit formed 20 under AS 38.05.180(p) before January 1, 2003, if the participating area does not 21 contain a reservoir that had previously been in a participating area established before 22 December 31, 2011; (3) the oil or gas is produced from acreage that was added to an 23 existing participating area by the Department of Natural Resources on and after 24 January 1, 2014, and the producer demonstrates to the department that the volume of 25 oil or gas produced is from acreage added to an existing participating area. This 26 subsection does not apply to gas produced before 2022 that is used in the state or to  27 gas produced on and after January 1, 2022. A reduction under this subsection may 28 not reduce the gross value at the point of production below zero. In this subsection, 29 "participating area" means a reservoir or portion of a reservoir producing or 30 contributing to production as approved by the Department of Natural Resources. 31  * Sec. 49. AS 43.55.160(g) is amended to read: 01 (g) On and after January 1, 2014, in addition to the reduction under (f) of this 02 section, in the calculation of an annual production tax value of a producer under 03 (a)(1)(A) or (h)(1) [(a)(1)] of this section, the gross value at the point of production of 04 oil or gas produced from a lease or property north of 68 degrees North latitude that 05 does not contain a lease that was within a unit on January 1, 2003, is reduced by 10 06 percent if the oil or gas is produced from a unit made up solely of leases that have a 07 royalty share of more than 12.5 percent in amount or value of the production removed 08 or sold from the lease as determined under AS 38.05.180(f). This subsection does not 09 apply if the royalty obligation for one or more of the leases in the unit has been 10 reduced to 12.5 percent or less under AS 38.05.180(j) for all or part of the calendar 11 year for which the annual production tax value is calculated. This subsection does not 12 apply to gas produced before 2022 that is used in the state or to gas produced on and  13 after January 1, 2022. A reduction under this subsection may not reduce the gross 14 value at the point of production below zero. 15 * Sec. 50. AS 43.55.160 is amended by adding a new subsection to read: 16 (h) For oil produced on and after January 1, 2022, except as provided in (b), 17 (f), and (g) of this section, for the purposes of AS 43.55.011(e)(3), the annual 18 production tax value of oil taxable under AS 43.55.011(e) produced by a producer 19 during a calendar year 20 (1) from leases or properties in the state that include land north of 68 21 degrees North latitude is the gross value at the point of production of that oil, less the 22 producer's lease expenditures under AS 43.55.165 for the calendar year incurred to 23 explore for, develop, or produce oil or gas deposits located in the state north of 68 24 degrees North latitude or located in leases or properties in the state that include land 25 north of 68 degrees North latitude, as adjusted under AS 43.55.170; 26 (2) before or during the last calendar year under AS 43.55.024(b) for 27 which the producer could take a tax credit under AS 43.55.024(a), from leases or 28 properties in the state outside the Cook Inlet sedimentary basin, no part of which is 29 north of 68 degrees North latitude, other than leases or properties subject to 30 AS 43.55.011(p), is the gross value at the point of production of that oil, less the 31 producer's lease expenditures under AS 43.55.165 for the calendar year incurred to 01 explore for, develop, or produce oil or gas deposits located in the state outside the 02 Cook Inlet sedimentary basin and south of 68 degrees North latitude, other than oil or 03 gas deposits located in a lease or property that includes land north of 68 degrees North 04 latitude or that is subject to AS 43.55.011(p) or, before January 1, 2027, from which 05 commercial production has not begun, as adjusted under AS 43.55.170; 06 (3) from leases or properties subject to AS 43.55.011(p) is the gross 07 value at the point of production of that oil, less the producer's lease expenditures under 08 AS 43.55.165 for the calendar year incurred to explore for, develop, or produce oil or 09 gas deposits located in leases or properties subject to AS 43.55.011(p) or, before 10 January 1, 2027, located in leases or properties in the state outside the Cook Inlet 11 sedimentary basin, no part of which is north of 68 degrees North latitude from which 12 commercial production has not begun, as adjusted under AS 43.55.170; 13 (4) from leases or properties in the state no part of which is north of 68 14 degrees North latitude, other than leases or properties subject to (2) or (3) of this 15 subsection, is the gross value at the point of production of that oil less the producer's 16 lease expenditures under AS 43.55.165 for the calendar year incurred to explore for, 17 develop, or produce oil or gas deposits located in the state south of 68 degrees North 18 latitude, other than oil or gas deposits located in a lease or property in the state that 19 includes land north of 68 degrees North latitude, and excluding lease expenditures that 20 are deductible under (2) or (3) of this subsection or would be deductible under (2) or 21 (3) of this subsection if not prohibited by (b) of this section, as adjusted under 22 AS 43.55.170. 23  * Sec. 51. AS 43.55.165(e) is amended to read: 24 (e) For purposes of this section, lease expenditures do not include 25 (1) depreciation, depletion, or amortization; 26 (2) oil or gas royalty payments, production payments, lease profit 27 shares, or other payments or distributions of a share of oil or gas production, profit, or 28 revenue, except that a producer's lease expenditures applicable to oil and gas produced 29 from a lease issued under AS 38.05.180(f)(3)(B), (D), or (E) include the share of net 30 profit paid to the state under that lease; 31 (3) taxes based on or measured by net income; 01 (4) interest or other financing charges or costs of raising equity or debt 02 capital; 03 (5) acquisition costs for a lease or property or exploration license; 04 (6) costs arising from fraud, wilful misconduct, gross negligence, 05 violation of law, or failure to comply with an obligation under a lease, permit, or 06 license issued by the state or federal government; 07 (7) fines or penalties imposed by law; 08 (8) costs of arbitration, litigation, or other dispute resolution activities 09 that involve the state or concern the rights or obligations among owners of interests in, 10 or rights to production from, one or more leases or properties or a unit; 11 (9) costs incurred in organizing a partnership, joint venture, or other 12 business entity or arrangement; 13 (10) amounts paid to indemnify the state; the exclusion provided by 14 this paragraph does not apply to the costs of obtaining insurance or a surety bond from 15 a third-party insurer or surety; 16 (11) surcharges levied under AS 43.55.201 or 43.55.300; 17 (12) an expenditure otherwise deductible under (b) of this section that 18 is a result of an internal transfer, a transaction with an affiliate, or a transaction 19 between related parties, or is otherwise not an arm's length transaction, unless the 20 producer establishes to the satisfaction of the department that the amount of the 21 expenditure does not exceed the fair market value of the expenditure; 22 (13) an expenditure incurred to purchase an interest in any corporation, 23 partnership, limited liability company, business trust, or any other business entity, 24 whether or not the transaction is treated as an asset sale for federal income tax 25 purposes; 26 (14) a tax levied under AS 43.55.011 or 43.55.014; 27 (15) costs incurred for dismantlement, removal, surrender, or 28 abandonment of a facility, pipeline, well pad, platform, or other structure, or for the 29 restoration of a lease, field, unit, area, tract of land, body of water, or right-of-way in 30 conjunction with dismantlement, removal, surrender, or abandonment; a cost is not 31 excluded under this paragraph if the dismantlement, removal, surrender, or 01 abandonment for which the cost is incurred is undertaken for the purpose of replacing, 02 renovating, or improving the facility, pipeline, well pad, platform, or other structure; 03 (16) costs incurred for containment, control, cleanup, or removal in 04 connection with any unpermitted release of oil or a hazardous substance and any 05 liability for damages imposed on the producer or explorer for that unpermitted release; 06 this paragraph does not apply to the cost of developing and maintaining an oil 07 discharge prevention and contingency plan under AS 46.04.030; 08 (17) costs incurred to satisfy a work commitment under an exploration 09 license under AS 38.05.132; 10 (18) that portion of expenditures, that would otherwise be qualified 11 capital expenditures, as defined in AS 43.55.023, incurred during a calendar year that 12 are less than the product of $0.30 multiplied by the total taxable production from each 13 lease or property, in BTU equivalent barrels, during that calendar year, except that, 14 when a portion of a calendar year is subject to this provision, the expenditures and 15 volumes shall be prorated within that calendar year; 16 (19) costs incurred for repair, replacement, or deferred maintenance of 17 a facility, a pipeline, a structure, or equipment, other than a well, that results in or is 18 undertaken in response to a failure, problem, or event that results in an unscheduled 19 interruption of, or reduction in the rate of, oil or gas production; or costs incurred for 20 repair, replacement, or deferred maintenance of a facility, a pipeline, a structure, or 21 equipment, other than a well, that is undertaken in response to, or is otherwise 22 associated with, an unpermitted release of a hazardous substance or of gas; however, 23 costs under this paragraph that would otherwise constitute lease expenditures under (a) 24 and (b) of this section may be treated as lease expenditures if the department 25 determines that the repair or replacement is solely necessitated by an act of war, by an 26 unanticipated grave natural disaster or other natural phenomenon of an exceptional, 27 inevitable, and irresistible character, the effects of which could not have been 28 prevented or avoided by the exercise of due care or foresight, or by an intentional or 29 negligent act or omission of a third party, other than a party or its agents in privity of 30 contract with, or employed by, the producer or an operator acting for the producer, but 31 only if the producer or operator, as applicable, exercised due care in operating and 01 maintaining the facility, pipeline, structure, or equipment, and took reasonable 02 precautions against the act or omission of the third party and against the consequences 03 of the act or omission; in this paragraph, 04 (A) "costs incurred for repair, replacement, or deferred 05 maintenance of a facility, a pipeline, a structure, or equipment" includes costs 06 to dismantle and remove the facility, pipeline, structure, or equipment that is 07 being replaced; 08 (B) "hazardous substance" has the meaning given in 09 AS 46.03.826; 10 (C) "replacement" includes renovation or improvement; 11 (20) costs incurred to construct, acquire, or operate a refinery or crude 12 oil topping plant, regardless of whether the products of the refinery or topping plant 13 are used in oil or gas exploration, development, or production operations; however, if 14 a producer owns a refinery or crude oil topping plant that is located on or near the 15 premises of the producer's lease or property in the state and that processes the 16 producer's oil produced from that lease or property into a product that the producer 17 uses in the operation of the lease or property in drilling for or producing oil or gas, the 18 producer's lease expenditures include the amount calculated by subtracting from the 19 fair market value of the product used the prevailing value, as determined under 20 AS 43.55.020(f), of the oil that is processed; 21 (21) costs of lobbying, public relations, public relations advertising, or 22 policy advocacy. 23  * Sec. 52. AS 43.55.900(10) is amended to read: 24 (10) "gas processing plant" means a facility that 25 (A) extracts and recovers liquid hydrocarbons from a gaseous 26 mixture of hydrocarbons by gas processing; and 27 (B) is located upstream of the inlet of any pipeline  28 transporting gas to a gas treatment plant and upstream of the inlet of any gas 29 pipeline system transporting gas to a market; 30  * Sec. 53. AS 43.55.900(20) is amended to read: 31 (20) "point of production" means 01 (A) for oil, the automatic custody transfer meter or device 02 through which the oil enters into the facilities of a carrier pipeline or other 03 transportation carrier in a condition of pipeline quality; in the absence of an 04 automatic custody transfer meter or device, "point of production" means the 05 mechanism or device to measure the quantity of oil that has been approved by 06 the department for that purpose, through which the oil is tendered and accepted 07 in a condition of pipeline quality into the facilities of a carrier pipeline or other 08 transportation carrier or into a field topping plant; 09 (B) for gas [, OTHER THAN GAS DESCRIBED IN (C) OF 10 THIS PARAGRAPH,] that is 11 (i) not subjected to or recovered by mechanical 12 separation or run through a gas processing plant, the farthest upstream  13 of the first point where the gas is accurately metered, the inlet of any 14 pipeline transporting the gas to a gas treatment plant, or the inlet  15 of any gas pipeline system transporting gas to a market; 16 (ii) subjected to or recovered by mechanical separation 17 but not run through a gas processing plant, the farthest upstream of  18 the first point where the gas is accurately metered after completion of 19 mechanical separation, the inlet of any pipeline transporting the gas  20 to a gas treatment plant, or the inlet of any gas pipeline system  21 transporting gas to a market; 22 (iii) run through a gas processing plant, the farthest  23 upstream of the first point where the gas is accurately metered 24 downstream of the plant, the inlet of any pipeline transporting the  25 gas to a gas treatment plant, or the inlet of any gas pipeline system  26 transporting gas to a market [; 27 (C) FOR GAS RUN THROUGH AN INTEGRATED GAS 28 PROCESSING PLANT AND GAS TREATMENT FACILITY THAT DOES 29 NOT ACCURATELY METER THE GAS AFTER THE GAS PROCESSING 30 AND BEFORE THE GAS TREATMENT, THE FIRST POINT WHERE GAS 31 PROCESSING IS COMPLETED OR WHERE GAS TREATMENT BEGINS, 01 WHICHEVER IS FURTHER UPSTREAM];  02  * Sec. 54. AS 43.55.900 is amended by adding a new paragraph to read: 03 (25) "gas treatment plant" means a facility that performs gas treatment, 04 regardless of whether the facility also performs gas processing. 05  * Sec. 55. AS 43.90.900(18) is amended to read: 06 (18) "point of production" has the meaning given in AS 43.55.900 as  07 that section read on June 8, 2007; 08  * Sec. 56. AS 43.98.030(c) is amended to read: 09 (c) A taxpayer acquiring a transferable tax credit certificate may use the credit 10 or a portion of the credit to offset taxes imposed under AS 21.09.210, AS 21.66.110, 11 AS 43.20, AS 43.55.011 [AS 43.55], AS 43.56, AS 43.65, AS 43.75, and AS 43.77. 12 Except as provided in (e) of this section, any portion of the credit not used may be 13 used at a later period or transferred under (b) of this section. 14  * Sec. 57. AS 31.25.080(f) is repealed. 15  * Sec. 58. The uncodified law of the State of Alaska is amended by adding a new section to 16 read: 17 REQUESTING THE GOVERNOR TO ESTABLISH AN INTERIM ADVISORY 18 BOARD. The legislature requests the governor to establish an interim advisory board under 19 AS 44.19.028 to advise the governor on municipal involvement in a North Slope natural gas 20 project. Members of the advisory board may include representatives of municipalities, the 21 commissioner of natural resources, the commissioner of revenue, representatives of oil and 22 gas and gas only lessees on the North Slope, and representatives of other persons expected to 23 be directly involved in the development of a North Slope natural gas project. In this section, 24 "North Slope natural gas project" has the meaning given in AS 38.05.965, as amended by sec. 25 23 of this Act. 26  * Sec. 59. The uncodified law of the State of Alaska is amended by adding a new section to 27 read: 28 PLAN AND RECOMMENDATIONS TO THE LEGISLATURE ON 29 INFRASTRUCTURE NEEDED TO DELIVER AFFORDABLE ENERGY TO AREAS IN 30 THE STATE THAT DO NOT HAVE DIRECT ACCESS TO A NORTH SLOPE NATURAL 31 GAS PIPELINE. (a) The Alaska Energy Authority, in consultation with the Alaska Gasline 01 Development Corporation, the Alaska Industrial Development and Export Authority, and the 02 Department of Revenue, shall develop a plan for developing infrastructure to deliver more 03 affordable energy to areas of the state that are not expected to have direct access to a North 04 Slope natural gas pipeline. The plan must identify ownership options, different energy 05 sources, including fossil fuels, hydro projects, tidal, and other alternative energy sources, and 06 describe and recommend the means for generating, delivering, receiving, and storing energy 07 in the most cost-efficient manner. The Alaska Energy Authority may consider the 08 development of regional energy systems that can receive and store bulk fuel in quantity and 09 distribute that fuel as needed within the region. 10 (b) The Alaska Energy Authority, in consultation with the Department of Revenue, 11 shall recommend a plan for funding the design, development, and construction of the required 12 infrastructure and may identify a source of rent, royalty, income, or tax received by the state 13 that may be appropriated by the legislature to implement the plan. 14 (c) The Alaska Energy Authority shall provide the plan and suggested legislation for 15 the design, development, construction, and financing of the required infrastructure to the 16 legislature before January 1, 2017. 17  * Sec. 60. The uncodified law of the State of Alaska is amended by adding a new section to 18 read: 19 DEVELOPMENT OF A PLAN FOR MUNICIPALITIES, REGIONAL 20 CORPORATIONS, AND RESIDENTS TO PARTICIPATE IN THE OWNERSHIP OF A 21 NORTH SLOPE NATURAL GAS PIPELINE. (a) At the time the commissioner of natural 22 resources submits the first agreement or contract to the legislature for approval under 23 AS 38.05.020(b)(11), enacted by sec. 14 of this Act, the commissioner of revenue shall 24 present a plan and suggested legislation to allow a municipality, regional corporation, or 25 resident of the state to participate as a co-owner in a North Slope natural gas pipeline. The 26 plan must include the recommendations of the commissioner as to 27 (1) the means by which a municipality, regional corporation, or resident may 28 invest in the North Slope natural gas pipeline; for a resident, the means may include providing 29 an option to designate an amount of a permanent fund dividend to be deducted for the 30 investment; 31 (2) whether the ownership interest in a North Slope natural gas pipeline should 01 be acquired from the portion of a North Slope natural gas pipeline acquired by the state, 02 through the purchase of stock in a publicly traded corporation that invests in a North Slope 03 natural gas pipeline, or some other means; 04 (3) the means for providing notice to a municipality, regional corporation, or 05 resident receiving an ownership interest that explains the type of ownership interest and the 06 rights and obligations related to that ownership interest; 07 (4) whether the ownership interest received by a municipality, regional 08 corporation, or resident may be transferred or assigned to another person and the means for 09 transferring the interest; 10 (5) the means by which the proportional share of a dividend or other income 11 may be distributed to a municipality, regional corporation, resident, or transferee of an interest 12 if the municipality, regional corporation, or resident receives an ownership interest acquired 13 by the state in a North Slope natural gas pipeline and the state receives a dividend or other 14 income from its ownership interest, and whether the payment should be subject to interest if 15 not timely distributed; 16 (6) the means by which the commissioner may identify a publicly traded 17 corporation that has an ownership interest in a North Slope natural gas pipeline that is subject 18 to investment by a municipality, regional corporation, or a resident under the proposed plan; 19 and 20 (7) the means by which an individual may qualify as a resident for purposes of 21 investing in an ownership interest. 22 (b) In this section, 23 (1) "North Slope natural gas pipeline" means a natural gas pipeline project that 24 transports natural gas produced in the state north of 68 degrees North latitude to a market in 25 the state or to tidewater for export from the state including a facility in the state for liquefying 26 natural gas for transport; 27 (2) "regional corporation" means a regional corporation organized under 43 28 U.S.C. 1606(a) as amended. 29 * Sec. 61. The uncodified law of the State of Alaska is amended by adding a new section to 30 read: 31 TRANSITION: REGULATIONS. The Department of Revenue and the Department of 01 Natural Resources may adopt regulations to implement this Act. The regulations take effect 02 under AS 44.62 (Administrative Procedure Act), but not before the effective date of the 03 provisions of this Act being implemented. 04  * Sec. 62. Sections 1 - 14, 16, 17, 23 - 27, 29, 30, 37, 39, and 55 - 61 of this Act take effect 05 immediately under AS 01.10.070(c). 06  * Sec. 63. Section 38 of this Act takes effect January 1, 2021. 07 * Sec. 64. Except as provided in secs. 62 and 63 of this Act, this Act takes effect January 1, 08 2015.