00 HOUSE BILL NO. 111 01 "An Act relating to the oil and gas production tax, tax payments, and credits; relating to 02 interest applicable to delinquent oil and gas production tax; and providing for an 03 effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05  * Section 1. AS 43.05.225 is amended to read: 06 Sec. 43.05.225. Interest. Unless otherwise provided, 07 (1) a delinquent tax 08 (A) under this title, before January 1, 2014, bears interest in 09 each calendar quarter at the rate of five percentage points above the annual rate 10 charged member banks for advances by the 12th Federal Reserve District as of 11 the first day of that calendar quarter, or at the annual rate of 11 percent, 12 whichever is greater, compounded quarterly as of the last day of that quarter; 13 (B) under this title, on and after January 1, 2014, except as 14 provided in (C) of this paragraph, bears interest in each calendar quarter at the 01 rate of three percentage points above the annual rate charged member banks 02 for advances by the 12th Federal Reserve District as of the first day of that 03 calendar quarter; 04 (C) under AS 43.55, on and after January 1, 2017, 05 [(i) FOR THE FIRST THREE YEARS AFTER A TAX 06 BECOMES DELINQUENT,] bears interest in each calendar quarter at 07 the rate of seven percentage points above the annual rate charged 08 member banks for advances by the 12th Federal Reserve District as of 09 the first day of that calendar quarter, compounded quarterly as of the 10 last day of that quarter; [AND 11 (ii) AFTER THE FIRST THREE YEARS AFTER A 12 TAX BECOMES DELINQUENT, DOES NOT BEAR INTEREST;] 13 (2) the interest rate is 12 percent a year for 14 (A) delinquent fees payable under AS 05.15.095(c); and 15 (B) unclaimed property that is not timely paid or delivered, as 16 allowed by AS 34.45.470(a). 17  * Sec. 2. AS 43.55.011(f) is amended to read: 18 (f) The levy of tax under (e) of this section for 19 (1) oil and gas produced before January 1, 2018 [JANUARY 1, 20 2022], from leases or properties that include land north of 68 degrees North latitude, 21 other than gas subject to (o) of this section, may not be less than 22 (A) four percent of the gross value at the point of production 23 when the average price per barrel for Alaska North Slope crude oil for sale on 24 the United States West Coast during the calendar year for which the tax is due 25 is more than $25; 26 (B) three percent of the gross value at the point of production 27 when the average price per barrel for Alaska North Slope crude oil for sale on 28 the United States West Coast during the calendar year for which the tax is due 29 is over $20 but not over $25; 30 (C) two percent of the gross value at the point of production 31 when the average price per barrel for Alaska North Slope crude oil for sale on 01 the United States West Coast during the calendar year for which the tax is due 02 is over $17.50 but not over $20; 03 (D) one percent of the gross value at the point of production 04 when the average price per barrel for Alaska North Slope crude oil for sale on 05 the United States West Coast during the calendar year for which the tax is due 06 is over $15 but not over $17.50; or 07 (E) zero percent of the gross value at the point of production 08 when the average price per barrel for Alaska North Slope crude oil for sale on 09 the United States West Coast during the calendar year for which the tax is due 10 is $15 or less; and 11 (2) oil and gas produced on and after January 1, 2018, and before 12 January 1, 2022, from leases or properties that include land north of 68 degrees North 13 latitude, may not be less than five [(A) FOUR] percent of the gross value at the point 14 of production [WHEN THE AVERAGE PRICE PER BARREL FOR ALASKA 15 NORTH SLOPE CRUDE OIL FOR SALE ON THE UNITED STATES WEST 16 COAST DURING THE CALENDAR YEAR FOR WHICH THE TAX IS DUE IS 17 MORE THAN $25; 18 (B) THREE PERCENT OF THE GROSS VALUE AT THE 19 POINT OF PRODUCTION WHEN THE AVERAGE PRICE PER BARREL 20 FOR ALASKA NORTH SLOPE CRUDE OIL FOR SALE ON THE UNITED 21 STATES WEST COAST DURING THE CALENDAR YEAR FOR WHICH 22 THE TAX IS DUE IS OVER $20 BUT NOT OVER $25; 23 (C) TWO PERCENT OF THE GROSS VALUE AT THE 24 POINT OF PRODUCTION WHEN THE AVERAGE PRICE PER BARREL 25 FOR ALASKA NORTH SLOPE CRUDE OIL FOR SALE ON THE UNITED 26 STATES WEST COAST DURING THE CALENDAR YEAR FOR WHICH 27 THE TAX IS DUE IS OVER $17.50 BUT NOT OVER $20; 28 (D) ONE PERCENT OF THE GROSS VALUE AT THE 29 POINT OF PRODUCTION WHEN THE AVERAGE PRICE PER BARREL 30 FOR ALASKA NORTH SLOPE CRUDE OIL FOR SALE ON THE UNITED 31 STATES WEST COAST DURING THE CALENDAR YEAR FOR WHICH 01 THE TAX IS DUE IS OVER $15 BUT NOT OVER $17.50; OR 02 (E) ZERO PERCENT OF THE GROSS VALUE AT THE 03 POINT OF PRODUCTION WHEN THE AVERAGE PRICE PER BARREL 04 FOR ALASKA NORTH SLOPE CRUDE OIL FOR SALE ON THE UNITED 05 STATES WEST COAST DURING THE CALENDAR YEAR FOR WHICH 06 THE TAX IS DUE IS $15 OR LESS]. 07  * Sec. 3. AS 43.55.011 is amended by adding a new subsection to read: 08 (q) The amount of tax determined under (f) of this section may not be reduced 09 by the application of a credit authorized under this chapter. The total amount of tax 10 credits that may be applied against the tax levied by (e) of this section for a calendar 11 year may not exceed the sum of the amount of the tax credits or fractions of tax credits 12 that are allowed under AS 43.55.020(a) to be subtracted in calculating the installment 13 payments of estimated tax for each month in the calendar year. 14  * Sec. 4. AS 43.55.020(a) is amended to read: 15 (a) For a calendar year, a producer subject to tax under AS 43.55.011 shall pay 16 the tax as follows: 17 (1) for oil and gas produced before January 1, 2014, an installment 18 payment of the estimated tax levied by AS 43.55.011(e), net of any tax credits applied 19 as allowed by law, is due for each month of the calendar year on the last day of the 20 following month; except as otherwise provided under (2) of this subsection, the 21 amount of the installment payment is the sum of the following amounts, less 1/12 of 22 the tax credits that are allowed by law to be applied against the tax levied by 23 AS 43.55.011(e) for the calendar year, but the amount of the installment payment may 24 not be less than zero: 25 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 26 produced from leases or properties in the state outside the Cook Inlet 27 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 28 the greater of 29 (i) zero; or 30 (ii) 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; 07 (B) for oil and gas produced from leases or properties subject 08 to AS 43.55.011(f), the greatest of 09 (i) zero; 10 (ii) zero percent, one percent, two percent, three 11 percent, or four percent, as applicable, of the gross value at the point of 12 production of the oil and gas produced from the leases or properties 13 during the month for which the installment payment is calculated; or 14 (iii) the sum of 25 percent and the tax rate calculated for 15 the month under AS 43.55.011(g) multiplied by the remainder obtained 16 by subtracting 1/12 of the producer's adjusted lease expenditures for the 17 calendar year of production under AS 43.55.165 and 43.55.170 that are 18 deductible for the oil and gas under AS 43.55.160 from the gross value 19 at the point of production of the oil and gas produced from those leases 20 or properties during the month for which the installment payment is 21 calculated; 22 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 23 each lease or property, 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 under AS 43.55.160 for the oil or gas, respectively, 30 produced from the lease or property from the gross value at the point of 31 production of the oil or gas, respectively, produced from the lease or 01 property during the month for which the installment payment is 02 calculated; 03 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 04 (i) the sum of 25 percent and the tax rate calculated for 05 the month under AS 43.55.011(g) multiplied by the remainder obtained 06 by subtracting 1/12 of the producer's adjusted lease expenditures for the 07 calendar year of production under AS 43.55.165 and 43.55.170 that are 08 deductible for the oil and gas under AS 43.55.160 from the gross value 09 at the point of production of the oil and gas produced from the leases or 10 properties during the month for which the installment payment is 11 calculated, but not less than zero; or 12 (ii) four percent of the gross value at the point of 13 production of the oil and gas produced from the leases or properties 14 during the month, but not less than zero; 15 (2) an amount calculated under (1)(C) of this subsection for oil or gas 16 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 17 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 18 applicable, for gas or set out in AS 43.55.011(k) for oil, but substituting in 19 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 20 gas produced during the month for the amount of taxable gas produced during the 21 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 22 during the month for the amount of taxable oil produced during the calendar year; 23 (3) an installment payment of the estimated tax levied by 24 AS 43.55.011(i) for each lease or property is due for each month of the calendar year 25 on the last day of the following month; the amount of the installment payment is the 26 sum of 27 (A) the applicable tax rate for oil provided under 28 AS 43.55.011(i), multiplied by the gross value at the point of production of the 29 oil taxable under AS 43.55.011(i) and produced from the lease or property 30 during the month; and 31 (B) the applicable tax rate for gas provided under 01 AS 43.55.011(i), multiplied by the gross value at the point of production of the 02 gas taxable under AS 43.55.011(i) and produced from the lease or property 03 during the month; 04 (4) any amount of tax levied by AS 43.55.011, net of any credits 05 applied as allowed by law, that exceeds the total of the amounts due as installment 06 payments of estimated tax is due on March 31 of the year following the calendar year 07 of production; 08 (5) for oil and gas produced on and after January 1, 2014, and before 09 January 1, 2022, an installment payment of the estimated tax levied by 10 AS 43.55.011(e), net of any tax credits applied as allowed by law, is due for each 11 month of the calendar year on the last day of the following month; except as otherwise 12 provided under (6) of this subsection, 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 to be 14 applied against the tax levied by AS 43.55.011(e) for the calendar year, but the amount 15 of the installment payment may not be less than zero: 16 (A) for oil and gas not subject to AS 43.55.011(o) or (p) 17 produced from leases or properties in the state outside the Cook Inlet 18 sedimentary basin, other than leases or properties subject to AS 43.55.011(f), 19 the greater of 20 (i) zero; or 21 (ii) 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; 28 (B) for oil and gas produced from leases or properties subject 29 to AS 43.55.011(f), the greatest of 30 (i) zero; 31 (ii) the [ZERO] percent [, ONE PERCENT, TWO 01 PERCENT, THREE PERCENT, OR FOUR PERCENT, AS] 02 applicable under AS 43.55.011(f) [, OF THE GROSS VALUE AT 03 THE POINT OF PRODUCTION OF THE OIL AND GAS 04 PRODUCED FROM THE LEASES OR PROPERTIES DURING THE 05 MONTH FOR WHICH THE INSTALLMENT PAYMENT IS 06 CALCULATED]; or 07 (iii) 35 percent multiplied by the remainder obtained by 08 subtracting 1/12 of the producer's adjusted lease expenditures for the 09 calendar year of production under AS 43.55.165 and 43.55.170 that are 10 deductible for the oil and gas under AS 43.55.160 from the gross value 11 at the point of production of the oil and gas produced from those leases 12 or properties during the month for which the installment payment is 13 calculated, except that, for the purposes of this calculation, a reduction 14 from the gross value at the point of production may apply for oil and 15 gas subject to AS 43.55.160(f) or (g); 16 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for 17 each lease or property, the greater of 18 (i) zero; or 19 (ii) 35 percent multiplied by the remainder obtained by 20 subtracting 1/12 of the producer's adjusted lease expenditures for the 21 calendar year of production under AS 43.55.165 and 43.55.170 that are 22 deductible under AS 43.55.160 for the oil or gas, respectively, 23 produced from the lease or property from the gross value at the point of 24 production of the oil or gas, respectively, produced from the lease or 25 property during the month for which the installment payment is 26 calculated; 27 (D) for oil and gas subject to AS 43.55.011(p), the lesser of 28 (i) 35 percent multiplied by the remainder obtained by 29 subtracting 1/12 of the producer's adjusted lease expenditures for the 30 calendar year of production under AS 43.55.165 and 43.55.170 that are 31 deductible for the oil and gas under AS 43.55.160 from the gross value 01 at the point of production of the oil and gas produced from the leases or 02 properties during the month for which the installment payment is 03 calculated, but not less than zero; or 04 (ii) four percent of the gross value at the point of 05 production of the oil and gas produced from the leases or properties 06 during the month, but not less than zero; 07 (6) an amount calculated under (5)(C) of this subsection for oil or gas 08 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 09 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 10 applicable, for gas or set out in AS 43.55.011(k) for oil, but substituting in 11 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 12 gas produced during the month for the amount of taxable gas produced during the 13 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 14 during the month for the amount of taxable oil produced during the calendar year; 15 (7) for oil and gas produced on or after January 1, 2022, an installment 16 payment of the estimated tax levied by AS 43.55.011(e), net of any tax credits applied 17 as allowed by law, is due for each month of the calendar year on the last day of the 18 following month; except as otherwise provided under (10) of this subsection, the 19 amount of the installment payment is the sum of the following amounts, less 1/12 of 20 the tax credits that are allowed by law to be applied against the tax levied by 21 AS 43.55.011(e) for the calendar year, but the amount of the installment payment may 22 not be less than zero: 23 (A) for oil produced from leases or properties subject to 24 AS 43.55.011(f), the greatest of 25 (i) zero; 26 (ii) five [ZERO] percent [, ONE PERCENT, TWO 27 PERCENT, THREE PERCENT, OR FOUR PERCENT, AS 28 APPLICABLE,] of the gross value at the point of production of the oil 29 produced from the leases or properties during the month for which the 30 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 under AS 43.55.160(h)(1) from the gross value at 04 the point of production of the oil produced from those leases or 05 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 08 subject to AS 43.55.160(f) or 43.55.160(f) and (g); 09 (B) for oil produced before or during the last calendar year 10 under AS 43.55.024(b) for which the producer could take a tax credit under 11 AS 43.55.024(a), from leases or properties in the state outside the Cook Inlet 12 sedimentary basin, no part of which is north of 68 degrees North latitude, other 13 than leases or properties subject to AS 43.55.011(o) or (p), the greater of 14 (i) zero; or 15 (ii) 35 percent multiplied by the remainder obtained by 16 subtracting 1/12 of the producer's adjusted lease expenditures for the 17 calendar year of production under AS 43.55.165 and 43.55.170 that are 18 deductible for the oil under AS 43.55.160(h)(2) from the gross value at 19 the point of production of the oil produced from the leases or properties 20 during the month for which the installment payment is calculated; 21 (C) for oil and gas produced from leases or properties subject 22 to AS 43.55.011(p), except as otherwise provided under (8) of this subsection, 23 the sum of 24 (i) 35 percent multiplied by the remainder obtained by 25 subtracting 1/12 of the producer's adjusted lease expenditures for the 26 calendar year of production under AS 43.55.165 and 43.55.170 that are 27 deductible for the oil under AS 43.55.160(h)(3) from the gross value at 28 the point of production of the oil produced from the leases or properties 29 during the month for which the installment payment is calculated, but 30 not less than zero; and 31 (ii) 13 percent of the gross value at the point of 01 production of the gas produced from the leases or properties during the 02 month, but not less than zero; 03 (D) for oil produced from leases or properties in the state, no 04 part of which is north of 68 degrees North latitude, other than leases or 05 properties subject to (B), (C), or (F) of this paragraph, the greater of 06 (i) zero; or 07 (ii) 35 percent multiplied by the remainder obtained by 08 subtracting 1/12 of the producer's adjusted lease expenditures for the 09 calendar year of production under AS 43.55.165 and 43.55.170 that are 10 deductible for the oil under AS 43.55.160(h)(4) from the gross value at 11 the point of production of the oil produced from the leases or properties 12 during the month for which the installment payment is calculated; 13 (E) for gas produced from each lease or property in the state 14 outside the Cook Inlet sedimentary basin, other than a lease or property subject 15 to AS 43.55.011(o) or (p), 13 percent of the gross value at the point of 16 production of the gas produced from the lease or property during the month for 17 which the installment payment is calculated, but not less than zero; 18 (F) for oil subject to AS 43.55.011(k), for each lease or 19 property, the greater of 20 (i) zero; or 21 (ii) 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 under AS 43.55.160 for the oil produced from the lease or 25 property from the gross value at the point of production of the oil 26 produced from the lease or property during the month for which the 27 installment payment is calculated; 28 (G) for gas subject to AS 43.55.011(j) or (o), for each lease or 29 property, the greater of 30 (i) zero; or 31 (ii) 13 percent of the gross value at the point of 01 production of the gas produced from the lease or property during the 02 month for which the installment payment is calculated; 03 (8) an amount calculated under (7)(C) of this subsection may not 04 exceed four percent of the gross value at the point of production of the oil and gas 05 produced from leases or properties subject to AS 43.55.011(p) during the month for 06 which the installment payment is calculated; 07 (9) for purposes of the calculation under (1)(B)(ii), (5)(B)(ii), and 08 (7)(A)(ii) of this subsection, the applicable percentage of the gross value at the point 09 of production is determined under AS 43.55.011(f)(1) or (2) but substituting the 10 phrase "month for which the installment payment is calculated" in AS 43.55.011(f)(1) 11 and (2) for the phrase "calendar year for which the tax is due"; 12 (10) an amount calculated under (7)(F) or (G) of this subsection for oil 13 or gas subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by 14 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as 15 applicable, for gas, or set out in AS 43.55.011(k) for oil, but substituting in 16 AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the amount of taxable 17 gas produced during the month for the amount of taxable gas produced during the 18 calendar year and substituting in AS 43.55.011(k) the amount of taxable oil produced 19 during the month for the amount of taxable oil produced during the calendar year; 20 (11) for purposes of the calculation under (5)(B)(ii) or (7)(A)(ii) of  21 this subsection, a credit under this chapter may not be applied to reduce an  22 installment payment to less than the applicable percentage under AS 43.55.011(f).  23  * Sec. 5. AS 43.55.023(b) is amended to read: 24 (b) [BEFORE JANUARY 1, 2014, A PRODUCER OR EXPLORER MAY 25 ELECT TO TAKE A TAX CREDIT IN THE AMOUNT OF 25 PERCENT OF A 26 CARRIED-FORWARD ANNUAL LOSS. FOR LEASE EXPENDITURES 27 INCURRED ON AND AFTER JANUARY 1, 2014, AND BEFORE JANUARY 1, 28 2016, TO EXPLORE FOR, DEVELOP, OR PRODUCE OIL OR GAS DEPOSITS 29 LOCATED NORTH OF 68 DEGREES NORTH LATITUDE, A PRODUCER OR 30 EXPLORER MAY ELECT TO TAKE A TAX CREDIT IN THE AMOUNT OF 45 31 PERCENT OF A CARRIED-FORWARD ANNUAL LOSS.] For lease expenditures 01 incurred [ON AND AFTER JANUARY 1, 2016,] to explore for, develop, or produce 02 oil or gas deposits located north of 68 degrees North latitude, a producer or explorer 03 may elect to take a tax credit in the amount of 15 [35] percent of a carried-forward 04 annual loss. [FOR LEASE EXPENDITURES INCURRED ON OR AFTER 05 JANUARY 1, 2014, AND BEFORE JANUARY 1, 2017, TO EXPLORE FOR, 06 DEVELOP, OR PRODUCE OIL OR GAS DEPOSITS LOCATED SOUTH OF 68 07 DEGREES NORTH LATITUDE, A PRODUCER OR EXPLORER MAY ELECT TO 08 TAKE A TAX CREDIT IN THE AMOUNT OF 25 PERCENT OF A CARRIED- 09 FORWARD ANNUAL LOSS.] For lease expenditures incurred [ON OR AFTER 10 JANUARY 1, 2017,] to explore for, develop, or produce oil or gas deposits located 11 south of 68 degrees North latitude, a producer or explorer may elect to take a tax credit 12 in the amount of 15 percent of a carried-forward annual loss, except that a credit for 13 lease expenditures incurred to explore for, develop, or produce oil or gas deposits 14 located in the Cook Inlet sedimentary basin may only be taken if the expenditure is 15 incurred before January 1, 2018. A credit under this subsection may be applied against 16 a tax levied by AS 43.55.011(e). For purposes of this subsection, 17 (1) a carried-forward annual loss is the amount of a producer's or 18 explorer's adjusted lease expenditures under AS 43.55.165 and 43.55.170 for a 19 previous calendar year that was not deductible in calculating production tax values for 20 that calendar year under AS 43.55.160; 21 (2) for lease expenditures incurred on or after January 1, 2017, any 22 reduction under AS 43.55.160(f) or (g) is added back to the calculation of production 23 tax values for that calendar year under AS 43.55.160 for the determination of a 24 carried-forward annual loss. 25  * Sec. 6. AS 43.55.023(d) is amended to read: 26 (d) A person that is entitled to take a tax credit under this section that wishes 27 to transfer the unused credit to another person [OR OBTAIN A CASH PAYMENT 28 UNDER AS 43.55.028] may apply to the department for a transferable tax credit 29 certificate. A person that is entitled to take a tax credit under (a) or (l) of this  30 section that wishes to obtain a cash payment under AS 43.55.028 may apply to  31 the department for a transferable tax credit certificate. An application under this 01 subsection must be in a form prescribed by the department and must include 02 supporting information and documentation that the department reasonably requires. 03 The department shall grant or deny an application, or grant an application as to a lesser 04 amount than that claimed and deny it as to the excess, not later than 120 days after the 05 latest of (1) March 31 of the year following the calendar year in which the qualified 06 capital expenditure or carried-forward annual loss for which the credit is claimed was 07 incurred; (2) the date the statement required under AS 43.55.030(a) or (e) was filed for 08 the calendar year in which the qualified capital expenditure or carried-forward annual 09 loss for which the credit is claimed was incurred; or (3) the date the application was 10 received by the department. If, based on the information then available to it, the 11 department is reasonably satisfied that the applicant is entitled to a credit, the 12 department shall issue the applicant a transferable tax credit certificate for the amount 13 of the credit. A certificate issued under this subsection does not expire. 14  * Sec. 7. AS 43.55.024(j) is amended to read: 15 (j) A producer may apply against the producer's tax liability for the calendar 16 year under AS 43.55.011(e) a tax credit in the amount specified in this subsection for 17 each barrel of oil taxable under AS 43.55.011(e) that does not receive a reduction in 18 the gross value at the point of production under AS 43.55.160(f) or (g) and that is 19 produced during a calendar year after December 31, 2013, from leases or properties 20 north of 68 degrees North latitude. A tax credit under this subsection may not reduce a 21 producer's tax liability for a calendar year under AS 43.55.011(e) below the amount 22 calculated under AS 43.55.011(f). The amount of the tax credit for a barrel of taxable 23 oil subject to this subsection produced during a month of the calendar year is 24 (1) [$8 FOR EACH BARREL OF TAXABLE OIL IF THE 25 AVERAGE GROSS VALUE AT THE POINT OF PRODUCTION FOR THE 26 MONTH IS LESS THAN $80 A BARREL; 27 (2) $7 FOR EACH BARREL OF TAXABLE OIL IF THE AVERAGE 28 GROSS VALUE AT THE POINT OF PRODUCTION FOR THE MONTH IS 29 GREATER THAN OR EQUAL TO $80 A BARREL, BUT LESS THAN $90 A 30 BARREL; 31 (3) $6 FOR EACH BARREL OF TAXABLE OIL IF THE AVERAGE 01 GROSS VALUE AT THE POINT OF PRODUCTION FOR THE MONTH IS 02 GREATER THAN OR EQUAL TO $90 A BARREL, BUT LESS THAN $100 A 03 BARREL; 04 (4)] $5 for each barrel of taxable oil if the average gross value at the 05 point of production for the month is [GREATER THAN OR EQUAL TO $100 A 06 BARREL, BUT] less than $110 a barrel; 07 (2) [(5)] $4 for each barrel of taxable oil if the average gross value at 08 the point of production for the month is greater than or equal to $110 a barrel, but less 09 than $120 a barrel; 10 (3) [(6)] $3 for each barrel of taxable oil if the average gross value at 11 the point of production for the month is greater than or equal to $120 a barrel, but less 12 than $130 a barrel; 13 (4) [(7)] $2 for each barrel of taxable oil if the average gross value at 14 the point of production for the month is greater than or equal to $130 a barrel, but less 15 than $140 a barrel; 16 (5) [(8)] $1 for each barrel of taxable oil if the average gross value at 17 the point of production for the month is greater than or equal to $140 a barrel, but less 18 than $150 a barrel; 19 (6) [(9)] zero if the average gross value at the point of production for 20 the month is greater than or equal to $150 a barrel. 21  * Sec. 8. AS 43.55.028(a) is amended to read: 22 (a) The oil and gas tax credit fund is established as a separate fund of the state. 23 The purpose of the fund is to purchase transferable tax credit certificates issued under 24 AS 43.55.023 for a tax credit earned under AS 43.55.023(a) or (l) and production 25 tax credit certificates issued under AS 43.55.025 and to pay refunds and payments 26 claimed under AS 43.20.046, 43.20.047, or 43.20.053. 27  * Sec. 9. AS 43.55.028(e) is amended to read: 28 (e) The department, on the written application of a person to whom a 29 transferable tax credit certificate has been issued under AS 43.55.023(d) or former 30 AS 43.55.023(m) or to whom a production tax credit certificate has been issued under 31 AS 43.55.025(f), may use available money in the oil and gas tax credit fund to 01 purchase, in whole or in part, the certificate. The department may not purchase a total 02 of more than $35,000,000 [$70,000,000] in tax credit certificates from a person in a 03 calendar year. Before purchasing a certificate or part of a certificate, the department 04 shall find that 05 (1) the calendar year of the purchase is not earlier than the first 06 calendar year for which the credit shown on the certificate would otherwise be allowed 07 to be applied against a tax; 08 (2) the application is not the result of the division of a single entity into 09 multiple entities that would reasonably be expected to apply as a single entity if the 10 $35,000,000 [$70,000,000] limitation in this subsection did not exist; 11 (3) the applicant's total tax liability under AS 43.55.011(e), after 12 application of all available tax credits, for the calendar year in which the application is 13 made is zero; 14 (4) the applicant's average daily production of oil and gas taxable 15 under AS 43.55.011(e) during the calendar year preceding the calendar year in which 16 the application is made was not more than 15,000 [50,000] BTU equivalent barrels; 17 and 18 (5) the purchase is consistent with this section and regulations adopted 19 under this section. 20  * Sec. 10. AS 43.55.150 is amended by adding a new subsection to read: 21 (d) For purposes of calculating the tax under this chapter, the gross value at 22 the point of production may not be less than zero. 23  * Sec. 11. AS 43.55.028(g)(3) is repealed. 24  * Sec. 12. The uncodified law of the State of Alaska is amended by adding a new section to 25 read: 26 APPLICABILITY. (a) The limitations on the use of tax credits in AS 43.55.011(q), 27 added by sec. 3 of this Act, and the adjustment to the calculation of a tax payment under 28 AS 43.55.020(a)(11), added by sec. 4 of this Act, apply to credits applied to reduce a tax 29 liability for a tax year starting on or after the effective date of secs. 3 and 4 of this Act. 30 (b) AS 43.55.023(b), as amended by sec. 5 of this Act, applies to lease expenditures 31 incurred on or after the effective date of sec. 5 of this Act. 01  * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 02 read: 03 TRANSITION. Notwithstanding AS 43.55.023(d), as amended by sec. 6 of this Act, 04 and AS 43.55.028(a), as amended by sec. 8 of this Act, the Department of Revenue may 05 purchase a transferable tax credit certificate that was issued under AS 43.55.023(d) for a 06 credit earned under AS 43.55.023(b) before the effective date of secs. 6 and 8 of this Act, 07 under AS 43.55.023(d) and 43.55.028(a), as those subsections read on the day before the 08 effective date of secs. 6 and 8 of this Act. 09  * Sec. 14. The uncodified law of the State of Alaska is amended by adding a new section to 10 read: 11 RETROACTIVITY. Section 1 of this Act is retroactive to January 1, 2017. 12  * Sec. 15. Sections 1 and 14 of this Act take effect immediately under AS 01.10.070(c). 13  * Sec. 16. Except as provided in sec. 15 of this Act, this Act takes effect January 1, 2018.