HB 440: "An Act relating to certain audits regarding oil and gas royalty and net profits and to audits regarding costs relating to exploration incentive credits and oil and gas exploration licenses; and providing for an effective date."
00HOUSE BILL NO. 440 01 "An Act relating to certain audits regarding oil and gas royalty and net profits 02 and to audits regarding costs relating to exploration incentive credits and oil and 03 gas exploration licenses; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. AS 38.05.036(a) is amended to read: 06 (a) The department may conduct audits regarding [DEPARTMENT OF 07 REVENUE SHALL AUDIT REPORTS, PAYMENTS, AND PAYMENTS DUE 08 RELATING TO] royalty and net profits under [OIL AND GAS CONTRACTS, 09 AGREEMENTS, OR LEASES UNDER] this chapter and regarding costs related to 10 oil and gas exploration licenses and exploration incentive credits under this 11 chapter or under AS 41.09. For purposes of audit under this section, the 12 department may examine the books, papers, records, or memoranda of a person 13 regarding matters related to the audit. For purposes of audit under this section, 14 the records and premises where a business is conducted shall be open at all
01 reasonable times for inspection by the department . 02 * Sec. 2. AS 38.05.036(b) is amended to read: 03 (b) The Department of Revenue may obtain from the department [INSPECT 04 ALL REPORTS AND OTHER] information [FILED IN SUPPORT OF OR] relating 05 to royalty and net profits payments and to exploration incentive credits under this 06 chapter or under AS 41.09 , whether or not that information is confidential . The 07 Department of Revenue may use the information in carrying out its functions and 08 responsibilities under AS 43 , and shall hold that information confidential to the extent 09 required by an agreement with the department or by AS 38.05.035(a)(9), 10 AS 41.09.010(d), [UNDER OIL AND GAS AGREEMENTS, CONTRACTS, OR 11 LEASES, OR BY THIS CHAPTER] or AS 43.05.230. 12 * Sec. 3. AS 38.05.036(c) is amended to read: 13 (c) The department may obtain from the Department of Revenue all [ALL] 14 information obtained [BY THE DEPARTMENT OF REVENUE] under AS 43 relating 15 to royalty and net profits and to exploration incentive credits. The department may 16 use the information for purposes of carrying out its responsibilities and functions 17 under this chapter and AS 41.09 [PAYMENTS, INCLUDING INFORMATION 18 OBTAINED UNDER AS 43, MAY BE MADE AVAILABLE TO THE 19 DEPARTMENT, IN THE FORM OF SUMMARIES AND, WHEN IN 20 FURTHERANCE OF THE DEPARTMENT'S ROYALTY AND NET PROFITS 21 FUNCTIONS, RELEVANT PORTIONS OF THE AUDITS]. Information made 22 available to the department that was obtained under AS 43 is confidential and subject 23 to the provisions of AS 43.05.230. 24 * Sec. 4. AS 38.05.036 is amended by adding new subsections to read: 25 (f) Except as otherwise provided in this section or in connection with official 26 investigations or proceedings of the department, it is unlawful for a current or former 27 officer, employee, or agent of the state to divulge information obtained by the 28 department as a result of an audit under this section that is required by an agreement 29 with the department or by AS 38.05.035(a)(9) or AS 41.09.010(d) to be kept 30 confidential. 31 (g) Nothing in this section prohibits the publication of statistics in a manner
01 that maintains the confidentiality of information to the extent required by an agreement 02 with the department or by AS 38.05.035(a)(9) or AS 41.09.010(d). 03 (h) A wilful violation of (f) of this section is punishable by a fine of not more 04 than $5,000, or by imprisonment for not more than two years, or both. 05 (i) In the course of carrying out its responsibilities under this section, the 06 department may subpoena any person to appear and produce books, records, papers, 07 or memoranda bearing upon matters relating to an audit under this section and to give 08 testimony or answer interrogatories under oath regarding those matters. The 09 department may administer oaths to persons who are so subpoenaed. A subpoena 10 issued under this section may compel attendance of a witness or production of a 11 document or thing, located either inside or outside the state, to the maximum extent 12 permitted by law. 13 (j) A subpoena may be served by the commissioner of public safety or a peace 14 officer designated by the commissioner of public safety, by a person designated by the 15 department, or as otherwise provided by law. A subpoena may also be served by 16 registered or certified mail for delivery restricted only to the person subpoenaed. The 17 return delivery receipt must be addressed so that the receipt is returned to the 18 department. 19 (k) If a person who is subpoenaed neglects or refuses to obey the subpoena 20 issued as provided in this section, the department may report the fact to the superior 21 court or the appropriate court of another jurisdiction, and may seek an order from the 22 court compelling obedience to the subpoena. The court, to the maximum extent 23 permitted by law, may compel obedience to the subpoena to the same extent as 24 witnesses may be compelled to obey the subpoenas of the court. 25 (l) The department may conduct audits under this section concurrently with 26 Department of Revenue audits or investigations under AS 43. 27 * Sec. 5. AS 43.05.040(a) is amended to read: 28 (a) The department may examine the books, papers, records, or memoranda 29 of any person to ascertain the correctness of a return filed or to determine whether a 30 tax [OR A PAYMENT FOR OIL OR GAS ROYALTY OR NET PROFITS SHARES 31 UNDER A CONTRACT, AGREEMENT, OR LEASE UNDER AS 38.05] is due, or
01 in an investigation or inspection in connection with tax matters [OR MATTERS 02 RELATING TO OIL AND GAS ROYALTY OR NET PROFITS UNDER 03 CONTRACTS, AGREEMENTS, OR LEASES UNDER AS 38.05]. The records and 04 the premises where a business is conducted shall be open at all reasonable times for 05 official inspection, and the department may subpoena any person to appear and 06 produce books, records, papers, or memoranda bearing upon tax matters [OR 07 MATTERS RELATING TO OIL AND GAS ROYALTY OR NET PROFITS UNDER 08 CONTRACTS, AGREEMENTS, OR LEASES UNDER AS 38.05], and to give 09 testimony or answer interrogatories under oath respecting tax matters [OR MATTERS 10 RELATED TO OIL AND GAS ROYALTY OR NET PROFITS UNDER 11 CONTRACTS, AGREEMENTS, OR LEASES UNDER AS 38.05], and the department 12 may administer oaths to persons who are so subpoenaed. A subpoena issued under this 13 section may compel attendance of a witness or production of a document or thing, 14 located either inside or outside the state, to the maximum extent permitted by law. 15 * Sec. 6. AS 43.05.230(a) is amended to read: 16 (a) It is unlawful for a current or former officer, employee, or agent of the 17 state to divulge the amount of income or the particulars set out or disclosed in a report 18 or return made under this title, except 19 (1) in connection with official investigations or proceedings of the 20 department, whether judicial or administrative, involving taxes due under this title; 21 (2) in connection with official investigations or proceedings of the child 22 support enforcement agency, whether judicial or administrative, involving child support 23 obligations imposed or imposable under AS 25 or AS 47; 24 (3) as provided in AS 38.05.036 pertaining to audit functions of the 25 Department of Natural Resources ; 26 (4) as provided in AS 43.05.400 - 43.05.499; and 27 (5) as otherwise provided in this section. 28 * Sec. 7. AS 38.05.036(d), 38.05.036(e), and AS 43.05.010(15) are repealed. 29 * Sec. 8. TRANSITION. (a) Litigation, hearings, investigations, and other proceedings 30 pending under a law amended or repealed by this Act, or in connection with functions 31 transferred by this Act, continue in effect and may be continued and completed
01 notwithstanding a transfer or amendment or repeal provided for in this Act. 02 (b) Contracts, rights, liabilities, and obligations created by or under a law amended 03 or repealed by this Act and in effect on June 30, 1998 remain in effect notwithstanding this 04 Act's taking effect. Records and appropriations of agencies of the state whose functions are 05 transferred under this Act shall be transferred to implement the provisions of this Act. 06 * Sec. 9. This Act takes effect July 1, 1998.