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CSSB 138(FIN) am: "An Act relating to the purposes, powers, and duties of the Alaska Gasline Development Corporation; relating to an in-state natural gas pipeline, an Alaska liquefied natural gas project, and associated funds; requiring state agencies and other entities to expedite reviews and actions related to natural gas pipelines and projects; relating to the authorities and duties of the commissioner of natural resources relating to a North Slope natural gas project, oil and gas and gas only leases, and royalty gas and other gas received by the state including gas received as payment for the production tax on gas; relating to the tax on oil and gas production, on oil production, and on gas production; relating to the duties of the commissioner of revenue relating to a North Slope natural gas project and gas received as payment for tax; relating to confidential information and public record status of information provided to or in the custody of the Department of Natural Resources and the Department of Revenue; relating to apportionment factors of the Alaska Net Income Tax Act; amending the definition of gross value at the 'point of production' for gas for purposes of the oil and gas production tax; clarifying that the exploration incentive credit, the oil or gas producer education credit, and the film production tax credit may not be taken against the gas production tax paid in gas; relating to the oil or gas producer education credit; requesting the governor to establish an interim advisory board to advise the governor on municipal involvement in a North Slope natural gas project; relating to the development of a plan by the Alaska Energy Authority for developing infrastructure to deliver affordable energy to areas of the state that will not have direct access to a North Slope natural gas pipeline and a recommendation of a funding source for energy infrastructure development; establishing the Alaska affordable energy fund; requiring the commissioner of revenue to develop a plan and suggest legislation for municipalities, regional corporations, and residents of the state to acquire ownership interests in a North Slope natural gas pipeline project; making conforming amendments; and providing for an effective date."

00                     CS FOR SENATE BILL NO. 138(FIN) am                                                                  
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 Alaska affordable energy fund; requiring the commissioner of revenue                                   
12 to 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. Alaska affordable energy fund. (a) The Alaska affordable                                   
22       energy fund is created as a special account in the general fund. The fund consists of                             
23       the amount determined and deposited in the fund under (b) of this section and interest                            
24       earned on the fund balance. The purpose of the fund is to provide a source from which                             
25       the legislature may appropriate money to develop infrastructure to deliver energy to                              
26       areas of the state that are not expected to have or do not have direct access to a North                          
27       Slope 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 Alaska affordable                                      
02       energy fund 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. For those citizens for whom there is no economically viable                          
08 infrastructure available, the plan must recommend the means for directly underwriting the                               
09 energy costs of the citizens to make their energy costs more affordable. The Alaska Energy                              
10 Authority may consider the development of regional energy systems that can receive and store                            
11 bulk fuel in quantity and distribute that fuel as needed within the region.                                             
12       (b)  The Alaska Energy Authority, in consultation with the Department of Revenue,                                 
13 shall recommend a plan for funding the design, development, and construction of the required                            
14 infrastructure and may identify a source of rent, royalty, income, or tax received by the state                         
15 that may be appropriated by the legislature to implement the plan.                                                      
16       (c)  The Alaska Energy Authority shall provide the plan and suggested legislation for                             
17 the design, development, construction, and financing of the required infrastructure to the                              
18 legislature before January 1, 2017.                                                                                     
19    * Sec. 60. The uncodified law of the State of Alaska is amended by adding a new section to                         
20 read:                                                                                                                   
21       DEVELOPMENT OF A PLAN FOR MUNICIPALITIES, REGIONAL                                                                
22 CORPORATIONS, AND RESIDENTS TO PARTICIPATE IN THE OWNERSHIP OF A                                                        
23 NORTH SLOPE NATURAL GAS PIPELINE. (a) At the time the commissioner of natural                                           
24 resources submits the first agreement or contract to the legislature for approval under                                 
25 AS 38.05.020(b)(11), enacted by sec. 14 of this Act, the commissioner of revenue shall                                  
26 present a plan and suggested legislation to allow a municipality, regional corporation, or                              
27 resident of the state to participate as a co-owner in a North Slope natural gas pipeline. The                           
28 plan must include the recommendations of the commissioner as to                                                         
29            (1)  the means by which a municipality, regional corporation, or resident may                                
30 invest in the North Slope natural gas pipeline; for a resident, the means may include providing                         
31 an option to designate an amount of a permanent fund dividend to be deducted for the                                    
01 investment;                                                                                                             
02            (2)  whether the ownership interest in a North Slope natural gas pipeline should                             
03 be acquired from the portion of a North Slope natural gas pipeline acquired by the state,                               
04 through the purchase of stock in a publicly traded corporation that invests in a North Slope                            
05 natural gas pipeline, or some other means;                                                                              
06            (3)  the means for providing notice to a municipality, regional corporation, or                              
07 resident receiving an ownership interest that explains the type of ownership interest and the                           
08 rights and obligations related to that ownership interest;                                                              
09            (4)  whether the ownership interest received by a municipality, regional                                     
10 corporation, or resident may be transferred or assigned to another person and the means for                             
11 transferring the interest;                                                                                              
12            (5)  the means by which the proportional share of a dividend or other income                                 
13 may be distributed to a municipality, regional corporation, resident, or transferee of an interest                      
14 if the municipality, regional corporation, or resident receives an ownership interest acquired                          
15 by the state in a North Slope natural gas pipeline and the state receives a dividend or other                           
16 income from its ownership interest, and whether the payment should be subject to interest if                            
17 not timely distributed;                                                                                                 
18            (6)  the means by which the commissioner may identify a publicly traded                                      
19 corporation that has an ownership interest in a North Slope natural gas pipeline that is subject                        
20 to investment by a municipality, regional corporation, or a resident under the proposed plan;                           
21 and                                                                                                                     
22            (7)  the means by which an individual may qualify as a resident for purposes of                              
23 investing in an ownership interest.                                                                                     
24       (b)  In this section,                                                                                             
25            (1)  "North Slope natural gas pipeline" means a natural gas pipeline project that                            
26 transports natural gas produced in the state north of 68 degrees North latitude to a market in                          
27 the state or to tidewater for export from the state including a facility in the state for liquefying                    
28 natural gas for transport;                                                                                              
29            (2)  "regional corporation" means a regional corporation organized under 43                                  
30 U.S.C. 1606(a) as amended.                                                                                              
31    * Sec. 61. The uncodified law of the State of Alaska is amended by adding a new section to                         
01 read:                                                                                                                   
02       TRANSITION: REGULATIONS. The Department of Revenue and the Department of                                          
03 Natural Resources may adopt regulations to implement this Act. The regulations take effect                              
04 under AS 44.62 (Administrative Procedure Act), but not before the effective date of the                                 
05 provisions of this Act being implemented.                                                                               
06    * Sec. 62. Sections 1 - 14, 16, 17, 23 - 27, 29, 30, 37, 39, and 55 - 61 of this Act take effect                   
07 immediately under AS 01.10.070(c).                                                                                      
08    * Sec. 63. Section 38 of this Act takes effect January 1, 2021.                                                    
09    * Sec. 64. Except as provided in secs. 62 and 63 of this Act, this Act takes effect January 1,                     
10 2015.