CSHB 306(FIN): "An Act relating to the review and administration of tax credit programs; requiring the Department of Revenue to report indirect expenditures; relating to the duties of state agencies; requiring the legislative finance division to analyze certain indirect expenditures; relating to lapse dates for appropriations for capital projects; repealing the insurance tax education credit, the income tax education credit, the veteran employment tax credit, the oil or gas producer education credit, the property tax education credit, the mining business education credit, the fisheries business education credit, the fisheries business tax credit for scholarship contributions, the fisheries business salmon product development tax credit, the fisheries business salmon utilization tax credit, the fisheries business landing tax credit for scholarship contributions, the fisheries resource landing tax credit for the fisheries resource harvested under the community development quota, the fisheries resource landing tax education credit, and the film production tax credit; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 306(FIN) 01 "An Act relating to the review and administration of tax credit programs; requiring the 02 Department of Revenue to report indirect expenditures; relating to the duties of state 03 agencies; requiring the legislative finance division to analyze certain indirect 04 expenditures; relating to lapse dates for appropriations for capital projects; repealing 05 the insurance tax education credit, the income tax education credit, the veteran 06 employment tax credit, the oil or gas producer education credit, the property tax 07 education credit, the mining business education credit, the fisheries business education 08 credit, the fisheries business tax credit for scholarship contributions, the fisheries 09 business salmon product development tax credit, the fisheries business salmon 10 utilization tax credit, the fisheries business landing tax credit for scholarship 11 contributions, the fisheries resource landing tax credit for the fisheries resource 12 harvested under the community development quota, the fisheries resource landing tax
01 education credit, and the film production tax credit; and providing for an effective 02 date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 21.06.110 is amended to read: 05 Sec. 21.06.110. Director's annual report. As early in each calendar year as is 06 reasonably possible, the director shall prepare and deliver an annual report to the 07 commissioner, who shall notify the legislature that the report is available, showing, 08 with respect to the preceding calendar year, 09 (1) a list of the authorized insurers transacting insurance in this state, 10 with a summary of their financial statement as the director considers appropriate; 11 (2) the name of each insurer whose certificate of authority was 12 surrendered, suspended, or revoked during the year and the cause of surrender, 13 suspension, or revocation; 14 (3) the name of each insurer authorized to do business in this state 15 against which delinquency or similar proceedings were instituted and, if against an 16 insurer domiciled in this state, a concise statement of the facts with respect to each 17 proceeding and its present status; 18 (4) a statement in regard to examination of rating organizations, 19 advisory organizations, joint underwriters, and joint reinsurers as required by 20 AS 21.39.120; 21 (5) the receipt and expenses of the division for the year; 22 (6) recommendations of the director as to amendments or 23 supplementation of laws affecting insurance or the office of director; 24 (7) statistical information regarding health insurance, including the 25 number of individual and group policies sold or terminated in the state; this paragraph 26 does not authorize the director to require an insurer to release proprietary information; 27 (8) the annual percentage of health claims paid in the state that meets 28 the requirements of AS 21.36.495(a) and (d); 29 (9) the total amount of contributions reported and the total amount of 30 credit claimed under AS 21.96.075 [AS 21.96.070 AND 21.96.075]; and
01 (10) other pertinent information and matters the director considers 02 proper. 03 * Sec. 2. AS 21.09.210(j) is amended to read: 04 (j) The provisions of AS 21.96.075 [AS 21.96.070 AND 21.96.075] apply to a 05 taxpayer who is required to pay a tax due under this section. 06 * Sec. 3. AS 24.20.231 is amended to read: 07 Sec. 24.20.231. Duties. The legislative finance division shall 08 (1) analyze the budget and appropriation requests of each department, 09 institution, bureau, board, commission, or other agency of state government; 10 (2) analyze the revenue requirements of the state; 11 (3) provide the finance committees of the legislature with 12 comprehensive budget review and fiscal analysis services; 13 (4) cooperate with the office of management and budget in establishing 14 a comprehensive system for state budgeting and financial management as set out in 15 AS 37.07 (Executive Budget Act); 16 (5) complete studies and prepare reports, memoranda, or other 17 materials as directed by the Legislative Budget and Audit Committee; 18 (6) with the governor's permission, designate the legislative fiscal 19 analyst to serve ex officio on the governor's budget review committee; [AND] 20 (7) identify the actual reduction in state expenditures in the first fiscal 21 year following a review under AS 44.66.040 resulting from that review and inform the 22 Legislative Budget and Audit Committee of the amount of the reduction; and 23 (8) not later than the first legislative day of each first regular 24 session of each legislature, conduct a review in accordance with AS 24.20.235 of 25 the report provided to the division under AS 43.05.095. 26 * Sec. 4. AS 24.20 is amended by adding a new section to read: 27 Sec. 24.20.235. Indirect expenditure report. (a) Every two years, the 28 legislative finance division shall deliver to the chair of the finance committee in each 29 house of the legislature a report analyzing the indirect expenditure report created 30 under AS 43.05.095 for the appropriate agencies listed in this subsection. The first 31 review shall occur in the calendar year set out after each agency's name, as follows,
01 and subsequent reviews of each agency shall occur every six years: 02 (1) Department of Commerce, Community, and Economic 03 Development, 2015; 04 (2) Department of Fish and Game, 2015; 05 (3) Department of Health and Social Services, 2015; 06 (4) Department of Labor and Workforce Development, 2015; 07 (5) Department of Revenue, 2015; 08 (6) Alaska Court System, 2017; 09 (7) Department of Administration, 2017; 10 (8) Department of Education and Early Development, 2017; 11 (9) Department of Environmental Conservation, 2017; 12 (10) Department of Natural Resources, 2017; 13 (11) Department of Transportation and Public Facilities, 2017; 14 (12) all remaining agencies, 2019. 15 (b) The report prepared under this section must provide 16 (1) an estimate of the revenue foregone by the state because of the 17 indirect expenditure; 18 (2) an estimate of the monetary benefit of the indirect expenditure to 19 the recipients of the benefit of the indirect expenditure; 20 (3) a determination of whether the legislative intent of the indirect 21 expenditure is being met and, if necessary, a determination of why the legislative 22 intent of the indirect expenditure is not being met; 23 (4) a recommendation as to whether each indirect expenditure should 24 be continued, modified, or terminated, a basis for the recommendation, and the 25 expected effect on the economy of the state if the recommendation is executed; and 26 (5) an explanation of the methodology and assumptions used in 27 preparing the report. 28 * Sec. 5. AS 37.05.316 is amended by adding a new subsection to read: 29 (c) An appropriation or allocation for a grant to a named recipient that is not a 30 municipality lapses if substantial, ongoing work on the project has not begun within 31 five years after the effective date of the appropriation or allocation.
01 * Sec. 6. AS 37.25.020 is amended to read: 02 Sec. 37.25.020. Unexpended balances of appropriation for capital projects. 03 An appropriation made for a capital project is valid for the life of the project and the 04 unexpended balance shall be carried forward to subsequent fiscal years if substantial, 05 ongoing work on the project has begun within five years after the effective date of 06 the appropriation. Between July 1 and August 31 of each fiscal year, a statement 07 supporting the amount of the unexpended balance required to complete the projects for 08 which the initial appropriation was made and the amount that may be lapsed shall be 09 recorded with the Department of Administration. 10 * Sec. 7. AS 43.05 is amended by adding a new section to read: 11 Sec. 43.05.095. Indirect expenditure report. (a) The commissioner shall, not 12 later than July 1 before the first regular session of each legislature, submit a report to 13 the chair of the finance committee of each house of the legislature and to the 14 legislative finance division that states, for each indirect expenditure made by the state, 15 (1) the name of the indirect expenditure; 16 (2) a brief description of the indirect expenditure; 17 (3) the statutory authority for the indirect expenditure; 18 (4) the date the statute authorizing the indirect expenditure is to be 19 repealed, if applicable; 20 (5) the intent of the legislature in enacting the statute authorizing the 21 indirect expenditure; 22 (6) the public purpose served by the indirect expenditure; 23 (7) the estimated annual effect on revenue of the indirect expenditure 24 for the previous five fiscal years, excluding the fiscal year immediately preceding the 25 date the report is due; 26 (8) the estimated cost to administer the indirect expenditure, if 27 applicable; 28 (9) the number of beneficiaries of the indirect expenditure. 29 (b) For purposes of (a) of this section, federal tax credits adopted under 30 AS 43.20.021 shall be reported in the aggregate. 31 (c) A department, agency, or public corporation of the state shall, upon the
01 request of the commissioner, provide the records, reports, data analysis, or other 02 information necessary for the commissioner to complete the report required by this 03 section. The commissioner may enter into a confidentiality agreement if necessary to 04 obtain information or a record required to prepare the report under this section. 05 (d) In this section, "indirect expenditure" means an express provision of state 06 law that results in foregone revenue for the state by providing 07 (1) a tax credit or other credit; 08 (2) an exemption, but does not include federal tax exemptions adopted 09 by reference in AS 43.20.021; 10 (3) a discount; 11 (4) a deduction, but does not include a deduction incurred in the 12 ordinary course of business used in the calculation of net income for a tax or a royalty 13 levied under AS 38 or this title; 14 (5) a differential allowance. 15 * Sec. 8. AS 43.75.035(e) is amended to read: 16 (e) Qualified investment costs upon which a tax credit is claimed under this 17 section may not be considered for another tax credit in this title. A tax credit applied 18 under this section [TOGETHER WITH A TAX CREDIT APPLIED UNDER 19 AS 43.75.036] may not exceed 50 percent of the taxpayer's tax liability incurred for 20 the processing of salmon during the tax year. 21 * Sec. 9. AS 43.75.035(h) is amended to read: 22 (h) The amount of a tax credit recaptured under (g)(1) - (3) of this section may 23 not be included in the determination of the amount of that tax credit that is allowable 24 under this section [OR AS 43.75.036]. 25 * Sec. 10. AS 43.75.130(f) is amended to read: 26 (f) For purposes of this section, tax revenue collected under AS 43.75.015 27 from a person entitled to a credit under AS 43.75.035 [, 43.75.036, OR AS 43.98.030] 28 shall be calculated as if the person's tax were collected without applying the credit; tax 29 revenue collected does not include the amount of a tax credit recaptured under 30 AS 43.75.035(g) [OR 43.75.036(g)]. 31 * Sec. 11. AS 43.77.050(b) is amended to read:
01 (b) The tax collected under this chapter shall be paid into a separate account in 02 the general fund. The annual balance in the account may be appropriated by the 03 legislature for revenue sharing under AS 43.77.060. [THE AMOUNT OF ALL TAX 04 CREDITS APPROVED BY THE COMMISSIONER UNDER AS 43.77.040(b) 05 SHALL BE DEDUCTED FROM AMOUNTS PAID TO MUNICIPALITIES UNDER 06 AS 43.77.060(a) - (c).] 07 * Sec. 12. AS 43.77.060(e) is amended to read: 08 (e) For purposes of this section, tax revenue collected under AS 43.77.010 09 from a person entitled to a credit under AS 43.77.045 [AS 43.77.035, 43.77.045, OR 10 AS 43.98.030] shall be calculated as if the person's tax had been collected without 11 applying the credits. 12 * Sec. 13. AS 24.20.271(12); AS 43.20.048; AS 43.75.032, 43.75.036, 43.75.130(b); 13 AS 43.77.035; AS 43.98.030; AS 44.25.100, 44.25.105, 44.25.110, 44.25.115, 44.25.120, 14 44.25.125, 44.25.130, 44.25.135, 44.25.140, 44.25.145, 44.25.150, 44.25.190; and 15 AS 44.33.231(c) are repealed. 16 * Sec. 14. AS 21.66.110(b); AS 21.96.070, 21.96.075(c)(2); AS 43.05.010(15); 17 AS 43.20.014; AS 43.55.019; AS 43.56.018; AS 43.65.018; AS 43.75.018, 43.75.130(g); 18 AS 43.77.045, and 43.77.060(e) are repealed. 19 * Sec. 15. AS 43.75.035 and 43.75.130(f) are repealed. 20 * Sec. 16. AS 43.77.040 is repealed. 21 * Sec. 17. The uncodified law of the State of Alaska is amended by adding a new section to 22 read: 23 TRANSITION. A taxpayer that accrues a credit authorized by a statute repealed by 24 secs. 13 - 16 of this Act before the effective date of the repeal of the credit under this Act, but 25 whose tax year ends on or after the effective date of the repeal of the credit under this Act, 26 may take the tax credit in the tax year the taxpayer accrues the credit, or, if the credit may be 27 carried forward, the credit may be carried forward in accordance with the statute under which 28 it was accrued. 29 * Sec. 18. CONTINGENCY. The repeal made in sec. 15 of this Act is contingent on 30 passage by the Twenty-Eighth Alaska State Legislature in the Second Regular Session and 31 enactment into law of a bill extending the repeal of AS 43.75.035.
01 * Sec. 19. Sections 8 - 10, 12, and 13 of this Act take effect December 31, 2016. 02 * Sec. 20. Sections 1, 2, and 14 of this Act take effect December 31, 2018. 03 * Sec. 21. If sec. 15 of this Act takes effect under sec. 18 of this Act, it takes effect 04 December 31, 2020. 05 * Sec. 22. Sections 11 and 16 of this Act take effect December 31, 2020. 06