00 Enrolled SB 138
01 Relating to the limitation on the value of property taxable by a municipality; relating to the
02 Alaska Gasline Development Corporation; relating to an in-state natural gas pipeline, an
03 Alaska liquefied natural gas project, and associated funds; requiring state agencies and other
04 entities to expedite reviews and actions related to natural gas pipelines and projects; making
05 certain contracts by the Department of Natural Resources and the Department of Law not
06 subject to the State Procurement Code; relating to the authorities and duties of the
07 commissioner of natural resources relating to a North Slope natural gas project, oil and gas
08 and gas only leases, and royalty gas and other gas received by the state including gas received
09 as payment for the production tax on gas; relating to a report and recommendations by the
10 commissioner of natural resources regarding the delivery and availability of North Slope
11 natural gas in the state, including the identification of risks and recommendations for
12 mitigation; relating to the tax on oil and gas production, on oil production, and on gas
01 production; relating to the duties of the commissioner of revenue relating to a North Slope
02 natural gas project and gas received as payment for tax; relating to confidential information
03 and public record status of information provided to or in the custody of the Department of
04 Natural Resources and the Department of Revenue; relating to apportionment factors of the
05 Alaska Net Income Tax Act; amending the definition of gross value at the "point of
06 production" for gas for purposes of the oil and gas production tax; clarifying that the
07 exploration incentive credit, the oil or gas producer education credit, and the film production
08 tax credit may not be taken against the gas production tax paid in gas; relating to the oil or gas
09 producer education credit; requiring the commissioner of revenue to provide a report to the
10 legislature on financing options for state ownership and participation in a North Slope natural
11 gas project; requesting the governor to establish an advisory planning group to advise the
12 governor on municipal involvement in a North Slope natural gas project; relating to the
13 development of a plan by the Alaska Energy Authority for developing infrastructure to deliver
14 affordable energy to areas of the state that will not have direct access to a North Slope natural
15 gas pipeline and a recommendation of a funding source for energy infrastructure
16 development; establishing the Alaska affordable energy fund; requiring the Department of
17 Transportation and Public Facilities to evaluate certain bridges and infrastructure related to an
18 Alaska liquefied natural gas project; requiring the commissioner of revenue to develop a plan
19 and suggest legislation for municipalities, regional corporations, and residents of the state to
20 acquire ownership interests in a North Slope natural gas pipeline project; relating to the duties
21 of the Oil and Gas Competitiveness Review Board; making conforming amendments; and
22 providing for an effective date.
23
01 _______________
02 * Section 1. AS 29.45.080(c) is amended to read:
03 (c) A municipality may levy and collect a tax on the full and true value of that
04 portion of taxable property taxable under AS 43.56 as assessed by the Department of
05 Revenue which value, when combined with the value of property otherwise taxable by
06 the municipality, does not exceed the product of the percentage determined in (f) of
07 this section [225 PERCENT] of the average per capita assessed full and true value of
08 property in the state multiplied by the number of residents of the taxing municipality.
09 * Sec. 2. AS 29.45.080(d) is amended to read:
10 (d) Each [BY FEBRUARY 1 OF EACH] assessment year, a taxing
11 municipality shall inform the Department of Revenue, by
12 (1) February 1, which method of taxation the municipality will use;
13 and
14 (2) May 1, the
15 (A) total value of the municipality's locally assessed
16 property tax base; and
17 (B) payment amount for the principal of and interest on
18 bonds that the municipality intends to apply in its mill rate calculation for
19 the fiscal year corresponding to the tax year for which the assessment
20 method selected by the municipality under this section will apply.
21 * Sec. 3. AS 29.45.080 is amended by adding a new subsection to read:
22 (f) The percentage in (c) of this section is based on the total tax rate
23 established by the municipality and levied each year under AS 43.56.010(b) and is as
24 follows:
25 If the tax rate determined under AS 43.56.010(b) is: The percentage is:
26 Not more than 18.0 mills 375 percent
27 More than 18.0 mills but not more than 19.0 mills 300 percent
28 More than 19.0 mills 225 percent
29 * Sec. 4. AS 29.45.090(b) is amended to read:
30 (b) A municipality, or combination of municipalities occupying the same
31 geographical area, in whole or in part, may not levy taxes
01 (1) that will result in tax revenues from all sources exceeding $1,500 a
02 year for each person residing within the municipal boundaries; or
03 (2) on [UPON] value that, when combined with the value of property
04 otherwise taxable by the municipality, exceeds the product of the percentage
05 determined in (e) of this section [225 PERCENT] of the average per capita assessed
06 full and true value of property in the state multiplied by the number of residents of the
07 taxing municipality.
08 * Sec. 5. AS 29.45.090(c) is amended to read:
09 (c) The commissioner shall apportion the lawful levy and equitably divide the
10 tax revenues on the basis of need, services performed, and other considerations in the
11 public interest if two or more municipalities occupying the same geographical area, in
12 whole or in part, attempt to levy a tax
13 (1) the combined levy of which would result in tax revenues from all
14 sources exceeding $1,500 a year for each person residing within the municipal
15 boundaries; or
16 (2) on [UPON] value that, when combined with the value of property
17 otherwise taxable by the municipality, exceeds the product of the percentage
18 determined in (e) of this section [225 PERCENT] of the average per capita assessed
19 full and true value of property in the state multiplied by the number of residents of the
20 taxing municipality.
21 * Sec. 6. AS 29.45.090 is amended by adding a new subsection to read:
22 (e) The percentage in (b) and (c) of this section is based on the total tax rate
23 established by the municipality and levied each year under AS 43.56.010(b) and is as
24 follows:
25 If the tax rate determined under AS 43.56.010(b) is: The percentage is:
26 Not more than 18.0 mills 375 percent
27 More than 18.0 mills but not more than 19.0 mills 300 percent
28 More than 19.0 mills 225 percent
29 * Sec. 7. AS 31.25.005 is amended to read:
30 Sec. 31.25.005. Purpose. The corporation shall, for the benefit of the state, to
31 the fullest extent possible,
01 (1) develop and have primary responsibility for developing natural
02 gas pipelines, an Alaska liquefied natural gas project, and other transportation
03 mechanisms to deliver natural gas in-state for the maximum benefit of the people
04 of the state;
05 (2) when developing natural gas pipelines, an Alaska liquefied
06 natural gas project, and other transportation mechanisms to deliver natural gas
07 in-state, provide economic benefits in the state and revenue to the state;
08 (3) assist the Department of Natural Resources and the
09 Department of Revenue to maximize the value of the state's royalty natural gas,
10 natural gas delivered to the state as payment of tax, and other natural gas
11 received by the state;
12 (4) advance an in-state natural gas pipeline as described in the July 1,
13 2011, project plan prepared under former AS 38.34.040 by the corporation while a
14 subsidiary of the Alaska Housing Finance Corporation, with modifications determined
15 by the corporation to be appropriate to develop, finance, construct, and operate an in-
16 state natural gas pipeline in a safe, prudent, economical, and efficient manner, for the
17 purpose of making natural gas, including propane and other hydrocarbons associated
18 with natural gas other than oil, available to Fairbanks, the Southcentral region of the
19 state, and other communities in the state at the lowest rates possible;
20 (5) advance an Alaska liquefied natural gas project by developing
21 infrastructure and providing related services, including services related to
22 transportation, liquefaction, a marine terminal, marketing, and commercial
23 support; if the corporation provides a service under this paragraph to the state, a
24 public corporation or instrumentality of the state, a political subdivision of the
25 state, or another entity of the state, the corporation may not charge a fee for the
26 service in an amount greater than the amount necessary to reimburse the
27 corporation for the cost of the service;
28 (6) [(2)] endeavor to develop natural gas pipelines and other
29 transportation mechanisms to deliver natural gas, including propane and other
30 hydrocarbons associated with natural gas other than oil, to public utility and industrial
31 customers in areas of the state to which the natural gas, including propane and other
01 hydrocarbons associated with natural gas other than oil, may be delivered at
02 commercially reasonable rates; and
03 (7) [(3)] endeavor to develop natural gas pipelines and other
04 transportation mechanisms that offer commercially reasonable rates for shippers and
05 access for shippers who produce natural gas, including propane and other
06 hydrocarbons associated with natural gas other than oil, in the state.
07 * Sec. 8. AS 31.25.010 is amended to read:
08 Sec. 31.25.010. Structure. The Alaska Gasline Development Corporation is a
09 public corporation and government instrumentality acting in the best interest of the
10 state for the purposes required by AS 31.25.005, located for administrative
11 purposes in the Department of Commerce, Community, and Economic Development,
12 but having a legal existence independent of and separate from the state. The
13 corporation may not be terminated as long as it has bonds, notes, or other obligations
14 outstanding. The corporation may dissolve when no bonds, notes, or other obligations
15 of the corporation or a subsidiary of the corporation are outstanding and the
16 corporation or a subsidiary of the corporation is no longer engaged in the
17 development, financing, construction, or operation of an in-state natural gas pipeline
18 or an Alaska liquefied natural gas project. Upon termination of the corporation, its
19 rights and property pass to the state.
20 * Sec. 9. AS 31.25.020(a) is amended to read:
21 (a) The corporation shall be governed by a board of directors consisting of
22 (1) five public members; and
23 (2) two individuals designated by the governor that are each the head
24 of a principal department of the state, except that the commissioner of natural
25 resources and the commissioner of revenue may not be designated to serve on the
26 board [UNLESS THE PROJECT FOR WHICH A LICENSE IS ISSUED UNDER
27 AS 43.90 HAS BEEN ABANDONED OR IS NO LONGER RECEIVING THE
28 INDUCEMENTS IN AS 43.90.110(a) OR THE COMMISSIONER OF NATURAL
29 RESOURCES AND THE COMMISSIONER OF REVENUE ARE NO LONGER
30 SIGNATORIES ON A VALID CONTRACT UNDER AS 43.90].
31 * Sec. 10. AS 31.25.040 is amended by adding new subsections to read:
01 (c) To the maximum extent practicable, the board shall
02 (1) maximize the efficient use of state resources; and
03 (2) establish appropriate separation within the corporation by
04 separating personnel and functions and by other means to the extent that separation
05 may be required by contract or applicable law for the purpose of screening and
06 preventing the exchange of commercially sensitive information when developing an
07 in-state natural gas pipeline, an Alaska liquefied natural gas project, and other
08 transportation mechanisms to deliver natural gas in the state.
09 (d) The board may appoint a program director for an Alaska liquefied natural
10 gas project. The board may appoint a separate program director for an in-state natural
11 gas pipeline as described in the July 1, 2011, project plan prepared under former
12 AS 38.34.040 and defined in AS 31.25.390. A program director appointed under this
13 section shall
14 (1) serve at the pleasure of the board; and
15 (2) report to the executive director of the corporation.
16 * Sec. 11. AS 31.25.050 is amended to read:
17 Sec. 31.25.050. Legal counsel. Except as provided in (b) of this section, the
18 [THE] corporation shall retain legal counsel to advise the corporation in legal matters
19 and represent it in litigation.
20 * Sec. 12. AS 31.25.050 is amended by adding a new subsection to read:
21 (b) The attorney general shall
22 (1) be the legal counsel for the corporation for legal services related to
23 the development of contracts and agreements by the corporation that relate to an
24 Alaska liquefied natural gas project; and
25 (2) consult with the corporation when procuring outside counsel for
26 legal services for the corporation related to an Alaska liquefied natural gas project.
27 * Sec. 13. AS 31.25.080(a) is amended to read:
28 (a) In addition to other powers granted in this chapter, the corporation may
29 (1) determine the form of ownership and the operating structure of an
30 in-state natural gas pipeline developed by the corporation and may enter into
31 agreements with other persons for joint ownership, joint operation, or both of an in-
01 state natural gas pipeline or an Alaska liquefied natural gas project;
02 (2) plan, finance, construct, develop, acquire, maintain, and operate a
03 pipeline system and other transportation mechanism, including pipelines, compressors,
04 storage facilities, and other related facilities, equipment, and works of public
05 improvement, in the state to facilitate production, transportation, and delivery of
06 natural gas or other related natural resources to the point of consumption or to the
07 point of distribution for consumption;
08 (3) lease or rent facilities, structures, and properties;
09 (4) exercise the power of eminent domain and file a declaration of
10 taking under AS 09.55.240 - 09.55.460 to acquire land or an interest in land that is
11 necessary for an in-state natural gas pipeline or an Alaska liquefied natural gas
12 project; the exercise of powers by the corporation under this paragraph may not
13 exceed the permissible exercise of the powers by the state;
14 (5) acquire, by purchase, lease, or gift, land, structures, real or personal
15 property, an interest in property, a right-of-way, a franchise, an easement, or other
16 interest in land, or an interest in or right to capacity in a pipeline system determined to
17 be necessary or convenient for the development, financing, construction, or operation
18 of an in-state natural gas pipeline project or an Alaska liquefied natural gas project
19 or part of an in-state natural gas pipeline project or an Alaska liquefied natural gas
20 project;
21 (6) transfer or otherwise dispose of all or part of an in-state natural gas
22 pipeline project, an Alaska liquefied natural gas project, or [DEVELOPED BY
23 THE CORPORATION OR TRANSFER OR OTHERWISE DISPOSE OF] an interest
24 in an asset of the corporation;
25 (7) elect to provide transportation of natural gas as a contract carrier,
26 common carrier, or otherwise;
27 (8) provide light, water, security, and other services for property of the
28 corporation;
29 (9) conduct hearings to gather and develop data consistent with the
30 purpose and powers of the corporation;
31 (10) advocate for new pipeline capacity before the Federal Energy
01 Regulatory Commission;
02 (11) make and execute agreements, contracts, and other instruments
03 necessary or convenient in the exercise of the powers and functions of the corporation
04 under this chapter, including a contract with a person, firm, corporation, governmental
05 agency, or other entity;
06 (12) sue and be sued in its own name;
07 (13) adopt an official seal;
08 (14) adopt bylaws for the regulation of its affairs and the conduct of its
09 business and adopt regulations and policies in connection with the performance of its
10 functions and duties;
11 (15) employ fiscal consultants, engineers, attorneys, appraisers, and
12 other consultants and employees that may, in the judgment of the corporation, be
13 required and fix and pay their compensation from funds available to the corporation;
14 (16) procure insurance against a loss in connection with its operation;
15 (17) borrow money as provided in this chapter to carry out its
16 corporate purposes and issue its obligations as evidence of borrowing;
17 (18) include in a borrowing the amounts necessary to pay financing
18 charges, to pay interest on the obligations, and to pay the interest, consultant, advisory,
19 and legal fees, and other expenses that are necessary or incident to the borrowing;
20 (19) receive, administer, and comply with the conditions and
21 requirements of an appropriation, gift, grant, or donation of property or money;
22 (20) do all acts and things necessary, convenient, or desirable to carry
23 out the powers expressly granted or necessarily implied in this chapter;
24 (21) invest or reinvest, subject to its contracts with noteholders and
25 bondholders, money or funds held by the corporation, including funds in the in-state
26 natural gas pipeline fund (AS 31.25.100) and the Alaska liquefied natural gas
27 project fund (AS 31.25.110), in obligations or other securities or investments in
28 which banks or trust companies in the state may legally invest funds held in reserves
29 or sinking funds or funds not required for immediate disbursement, and in certificates
30 of deposit or time deposits secured by obligations of, or guaranteed by, the state or the
31 United States;
01 (22) enter into, as it determines to be necessary or appropriate, any
02 swap or hedge, cap, or other contract providing for payments based on levels of or
03 changes in interest rates or indices or in the cost or price of any commodity, supply, or
04 expense expected to be used or incurred in connection with the acquisition,
05 construction, or operation of any facility or property owned, leased, or operated by the
06 corporation, or an option with respect to any of the foregoing;
07 (23) except as provided in (g) of this section, acquire an ownership
08 or participation interest in an Alaska liquefied natural gas project, natural gas
09 treatment facilities, natural gas pipeline facilities, liquefaction facilities, marine
10 terminal facilities related to the infrastructure of an Alaska liquefied natural gas
11 project, or an entity or joint venture that has an ownership interest in or is
12 engaged in the planning, financing, acquisition, maintenance, construction, and
13 operation of an Alaska liquefied natural gas project;
14 (24) after consultation with the commissioner of revenue and the
15 commissioner of natural resources, enter into contracts relating to an Alaska
16 liquefied natural gas project, including contracts for services related to
17 operation, marketing, transportation, gas treatment, marine terminal operation,
18 or liquefaction.
19 * Sec. 14. AS 31.25.080(e) is amended to read:
20 (e) If commitments to acquire firm transportation capacity for the in-state
21 natural gas pipeline are received in an open season conducted by the corporation, the
22 corporation shall, within 10 days after accepting and executing the written
23 commitments received during the open season, report the results of the open season to
24 the president of the senate and the speaker of the house of representatives and inform
25 the public of the results of the open season through publication on the Internet website
26 of the corporation and in a press release or other announcement to the media. The
27 results made public must include the name of each prospective shipper, the amount of
28 capacity allocated, and the period of the commitment. If the corporation determines
29 that the commitments received during the open season are not sufficient to permit the
30 corporation to continue the development or construction of the natural gas pipeline,
31 the corporation shall report that to the legislature within 30 days.
01 * Sec. 15. AS 31.25.080 is amended by adding a new subsection to read:
02 (g) The power in (a)(23) of this section may not be exercised by an entity or
03 subsidiary of the corporation that is advancing the development of an in-state natural
04 gas pipeline.
05 * Sec. 16. AS 31.25.090 is amended by adding a new subsection to read:
06 (i) Subject to limitations on the disclosure of confidential information in (g)
07 and (h) of this section, the corporation shall provide to the commissioner of natural
08 resources and the commissioner of revenue access to information that is related to the
09 development of contracts under AS 38.05.020(b)(10) and (11).
10 * Sec. 17. AS 31.25.100 is amended to read:
11 Sec. 31.25.100. In-state natural gas pipeline fund. The in-state natural gas
12 pipeline fund is established in the corporation and consists of money appropriated to
13 it. The corporation shall determine fund management and may contract with the
14 Department of Revenue for fund management. Unless otherwise provided by law,
15 money appropriated to the fund lapses into the general fund on the day this section is
16 repealed. Interest and other income received on money in the fund shall be separately
17 accounted for and may be appropriated to the fund. The corporation may use money
18 appropriated to the fund without further appropriation for the cost of managing the
19 fund and for the planning, financing, development, acquisition, maintenance,
20 construction, and operation of the [AN] in-state natural gas pipeline described in
21 AS 31.25.005(4) and for the purposes in AS 31.25.005(4), (6), and (7).
22 * Sec. 18. AS 31.25 is amended by adding a new section to read:
23 Sec. 31.25.110. Alaska liquefied natural gas project fund. The Alaska
24 liquefied natural gas project fund is established in the corporation and consists of
25 money appropriated to it. The corporation shall determine fund management and may
26 contract with the Department of Revenue for fund management. If money is
27 appropriated to the fund to finance the cost of an Alaska liquefied natural gas project,
28 the corporation shall create an account in the fund for that purpose and hold the money
29 appropriated for that purpose in that account. Interest and other income received on
30 money in the fund shall be separately accounted for and may be appropriated to the
31 fund. The corporation may use money appropriated to the fund without further
01 appropriation for the purpose of managing the fund, for purposes related to an Alaska
02 liquefied natural gas project, and for the purpose of transferring net revenue received
03 by the corporation related to equity interests, contracts, and other activities to the
04 appropriate fund of the state as determined by the commissioner of revenue in
05 consultation with the commissioner of natural resources.
06 * Sec. 19. AS 31.25.120 is amended to read:
07 Sec. 31.25.120. Creation of subsidiaries. The corporation may create
08 subsidiary corporations for the purpose of developing, constructing, operating, and
09 financing in-state natural gas pipeline projects or other transportation mechanisms; for
10 the purpose of aiding in the development, construction, operation, and financing of in-
11 state natural gas pipeline projects; or for the purpose of acquiring [THE STATE'S
12 ROYALTY SHARE OF NATURAL GAS,] natural gas from the North Slope, and
13 natural gas from other regions of the state, including the state's outer continental shelf,
14 and making that natural gas available to markets in the state, including the delivery of
15 natural gas, including propane and other hydrocarbons associated with natural gas
16 other than oil, to coastal communities in the state, or for export. Subject to the
17 limitations for the use of money appropriated to the in-state natural gas pipeline
18 fund (AS 31.25.100) and the Alaska liquefied natural gas project fund
19 (AS 31.25.110), the [A SUBSIDIARY CORPORATION CREATED UNDER THIS
20 SECTION MAY BE INCORPORATED UNDER AS 10.20.146 - 10.20.166. THE]
21 corporation may transfer assets of the corporation to a subsidiary created under this
22 section. A subsidiary created under this section may borrow money and issue bonds as
23 evidence of that borrowing and has all the powers of the corporation that the
24 corporation grants to it. Unless otherwise provided by the corporation, the debts,
25 liabilities, and obligations of a subsidiary corporation created under this section are not
26 the debts, liabilities, or obligations of the corporation.
27 * Sec. 20. AS 31.25.140(c) is amended to read:
28 (c) To further ensure effective budgetary decision making by the legislature,
29 the board shall
30 (1) annually review the corporation's assets, including the assets of the
31 in-state natural gas pipeline fund under AS 31.25.100 and the Alaska liquefied
01 natural gas project fund under AS 31.25.110, to determine whether assets of the
02 corporation exceed an amount required to fulfill the purposes of the corporation as
03 defined in this chapter; in making its review, the board shall determine whether, and to
04 what extent, assets in excess of the amount required to fulfill the purposes of the
05 corporation during the next fiscal year are available without
06 (A) breaching an agreement entered into by the corporation;
07 (B) materially impairing the operations or financial integrity of
08 the corporation; or
09 (C) materially affecting the ability of the corporation to fulfill
10 the purposes of the corporation as defined in this chapter;
11 (2) specifically identify in the corporation's assets the amounts that the
12 board believes are necessary to meet the requirements of (1)(C) of this subsection; and
13 (3) present to the legislature by January 10 of each year a complete
14 accounting of all assets of the corporation, including assets of the in-state natural gas
15 pipeline fund under AS 31.25.100 and the Alaska liquefied natural gas project
16 fund under AS 31.25.110, and a report of the review and determination made under
17 (1) and (2) of this subsection; the accounting shall be audited by an independent
18 outside auditor.
19 * Sec. 21. AS 31.25.390 is amended by adding a new paragraph to read:
20 (7) "Alaska liquefied natural gas project" means a natural gas project
21 as described in AS 31.25.005(5) that includes collectively, the Prudhoe Bay unit gas
22 transmission line, the Point Thomson unit gas transmission line, a gas pipeline, the gas
23 treatment plant, a liquefied natural gas plant, and a marine terminal; in this paragraph,
24 (A) "gas pipeline"
25 (i) means the main natural gas pipeline from the outlet
26 flange of the gas treatment plant on the North Slope to the inlet flange
27 of the liquefied natural gas plant located in the Southcentral region of
28 the state, which shall have offtake points along the pipeline for
29 deliveries of gas in the state;
30 (ii) does not include any gas lines downstream of any
31 offtake point between the gas treatment plant and the liquefied natural
01 gas plant;
02 (B) "gas treatment plant" means those facilities and related
03 activities required to receive natural gas from the Prudhoe Bay unit gas
04 transmission line, the Point Thomson unit gas transmission line, and other
05 facilities, treat the natural gas to pipeline specifications, dispose of or deliver
06 by-products, deliver liquid products for further transportation, and deliver
07 treated natural gas for transportation through the gas pipeline;
08 (C) "liquefied natural gas plant" means the facility for
09 liquefying natural gas and includes structures, equipment, underlying land
10 rights, other associated systems, storage, and facilities for off-loading liquefied
11 natural gas;
12 (D) "marine terminal" means the terminal and those facilities
13 required to receive liquefied natural gas from the boundary of the liquefied
14 natural gas plant for marine transportation, including auxiliary vessels used in
15 the operation of the terminal;
16 (E) "Point Thomson unit gas transmission line" means a natural
17 gas transmission line from the outlet flange of the Point Thomson unit
18 production facility to the inlet flange of the gas treatment plant; and
19 (F) "Prudhoe Bay unit gas transmission line" means a natural
20 gas transmission line from the outlet flange of the Prudhoe Bay unit central gas
21 facility to the inlet flange of the gas treatment plant.
22 * Sec. 22. AS 36.30.850(b) is amended by adding new paragraphs to read:
23 (47) contracts for professional and technical services by the
24 Department of Natural Resources to support the development of agreements and
25 contracts under AS 38.05.020(b)(10) and (11);
26 (48) contracts of the Department of Law developed with client
27 participation for legal services related to an Alaska liquefied natural gas project as that
28 project is defined in AS 31.25.390, except that, to the extent practicable, the
29 Department of Law shall use the procurement process under AS 36.30.320 with the
30 participation of the client.
31 * Sec. 23. AS 37.05 is amended by adding a new section to article 6 to read:
01 Sec. 37.05.610. Alaska affordable energy fund. (a) The Alaska affordable
02 energy fund is created as a special account in the general fund. The fund consists of
03 the amount determined and deposited in the fund under (b) of this section and interest
04 earned on the fund balance. The purpose of the fund is to provide a source from which
05 the legislature may appropriate money to develop infrastructure to deliver energy to
06 areas of the state that are not expected to have or do not have direct access to a North
07 Slope natural gas pipeline.
08 (b) The amount to be deposited in (a) of this section is 20 percent of the
09 revenue received from the state's royalty gas transported in an Alaska liquefied natural
10 gas project that remains after the payment to the Alaska permanent fund under
11 AS 37.13.010.
12 (c) The legislature may make appropriations from the Alaska affordable
13 energy fund for the purpose described in (a) of this section.
14 (d) Nothing in this section creates a dedicated fund.
15 (e) In this section,
16 (1) "Alaska liquefied natural gas project" has the meaning given in
17 AS 31.25.390;
18 (2) "North Slope natural gas pipeline" has the meaning given in
19 AS 42.06.630.
20 * Sec. 24. AS 38.05.020(b) is amended to read:
21 (b) The commissioner may
22 (1) establish reasonable procedures and adopt reasonable regulations
23 necessary to carry out this chapter and, whenever necessary, issue directives or orders
24 to the director to carry out specific functions and duties; regulations adopted by the
25 commissioner shall be adopted under AS 44.62 (Administrative Procedure Act);
26 orders by the commissioner classifying land, issued after January 3, 1959, are not
27 required to be adopted under AS 44.62 (Administrative Procedure Act);
28 (2) enter into agreements considered necessary to carry out the
29 purposes of this chapter, including agreements with federal and state agencies;
30 (3) review any order or action of the director;
31 (4) exercise the powers and do the acts necessary to carry out the
01 provisions and objectives of this chapter;
02 (5) notwithstanding the provisions of any other section of this chapter,
03 grant an extension of the time within which payments due on any exploration license,
04 lease, or sale of state land, minerals, or materials may be made, including payment of
05 rental and royalties, on a finding that compliance with the requirements is or was
06 prevented by reason of war, riots, or acts of God;
07 (6) classify tracts for agricultural uses;
08 (7) after consulting with the Board of Agriculture and Conservation
09 (AS 03.09.010), waive, postpone, or otherwise modify the development requirements
10 of a contract for the sale of agricultural land if
11 (A) the land is inaccessible by road; or
12 (B) transportation, marketing, and development costs render
13 the required development uneconomic;
14 (8) reconvey or relinquish land or an interest in land to the federal
15 government if
16 (A) the land is described in an amended application for an
17 allotment under 43 U.S.C. 1617; and
18 (B) the reconveyance or relinquishment is
19 (i) for the purposes provided in 43 U.S.C. 1617; and
20 (ii) in the best interests of the state;
21 (9) lead and coordinate all matters relating to the state's review and
22 authorization of resource development projects;
23 (10) enter into commercial agreements with a duration of not more
24 than two years for project services related to a North Slope natural gas project;
25 (11) in consultation with the commissioner of revenue, participate
26 in the negotiation of agreements that include balancing, marketing, disposition of
27 natural gas, and offtake and contracts and development of terms for inclusion in
28 those proposed agreements and contracts associated with a North Slope natural
29 gas project; an agreement or contract negotiated under this paragraph to which
30 the state is a party is not effective unless the legislature authorizes the governor
31 to execute the agreement or contract;
01 (12) enter into confidentiality agreements to maintain the
02 confidentiality of information related to contract negotiations and contract
03 implementation associated with a North Slope natural gas project; information
04 under those confidentiality agreements is not subject to AS 40.25.100 - 40.25.295
05 (Alaska Public Records Act), except that
06 (A) the terms of a proposed contract that the commissioner
07 presents to the legislature for the purpose of obtaining authorization for
08 the governor to execute are not confidential and must be made available to
09 the public at least 90 days before the proposed effective date for the terms;
10 and
11 (B) the commissioner may share confidential information
12 obtained under this paragraph with members of the legislature, their
13 agents, and contractors on request under confidentiality agreements,
14 either in committees held in executive session or individually;
15 (13) consult with the Alaska Gasline Development Corporation in
16 the development of agreements or contracts under (10) or (11) of this subsection
17 for project services related to a gas treatment plant, pipeline, liquefaction facility,
18 marine terminal, or marine transportation services necessary to transport
19 natural gas to market;
20 (14) exercise the powers and do the acts necessary to carry out the
21 provisions and objectives of AS 43.90 that relate to this chapter.
22 * Sec. 25. AS 38.05.020(b), as amended by sec. 24 of this Act, is amended to read:
23 (b) The commissioner may
24 (1) establish reasonable procedures and adopt reasonable regulations
25 necessary to carry out this chapter and, whenever necessary, issue directives or orders
26 to the director to carry out specific functions and duties; regulations adopted by the
27 commissioner shall be adopted under AS 44.62 (Administrative Procedure Act);
28 orders by the commissioner classifying land, issued after January 3, 1959, are not
29 required to be adopted under AS 44.62 (Administrative Procedure Act);
30 (2) enter into agreements considered necessary to carry out the
31 purposes of this chapter, including agreements with federal and state agencies;
01 (3) review any order or action of the director;
02 (4) exercise the powers and do the acts necessary to carry out the
03 provisions and objectives of this chapter;
04 (5) notwithstanding the provisions of any other section of this chapter,
05 grant an extension of the time within which payments due on any exploration license,
06 lease, or sale of state land, minerals, or materials may be made, including payment of
07 rental and royalties, on a finding that compliance with the requirements is or was
08 prevented by reason of war, riots, or acts of God;
09 (6) classify tracts for agricultural uses;
10 (7) after consulting with the Board of Agriculture and Conservation
11 (AS 03.09.010), waive, postpone, or otherwise modify the development requirements
12 of a contract for the sale of agricultural land if
13 (A) the land is inaccessible by road; or
14 (B) transportation, marketing, and development costs render
15 the required development uneconomic;
16 (8) reconvey or relinquish land or an interest in land to the federal
17 government if
18 (A) the land is described in an amended application for an
19 allotment under 43 U.S.C. 1617; and
20 (B) the reconveyance or relinquishment is
21 (i) for the purposes provided in 43 U.S.C. 1617; and
22 (ii) in the best interests of the state;
23 (9) lead and coordinate all matters relating to the state's review and
24 authorization of resource development projects;
25 (10) enter into commercial agreements with a duration of not more
26 than two years for project services related to a North Slope natural gas project;
27 (11) in consultation with the commissioner of revenue, participate in
28 the negotiation of agreements that include balancing, marketing, disposition of natural
29 gas, and offtake and contracts and development of terms for inclusion in those
30 proposed agreements and contracts associated with a North Slope natural gas project;
31 an agreement or contract negotiated under this paragraph to which the state is a party
01 is not effective unless the legislature authorizes the governor to execute the agreement
02 or contract;
03 (12) enter into confidentiality agreements to maintain the
04 confidentiality of information related to contract negotiations and contract
05 implementation associated with a North Slope natural gas project; information under
06 those confidentiality agreements is not subject to AS 40.25.100 - 40.25.295 (Alaska
07 Public Records Act), except that
08 (A) the terms of a proposed contract that the commissioner
09 presents to the legislature for the purpose of obtaining authorization for the
10 governor to execute are not confidential and must be made available to the
11 public at least 90 days before the proposed effective date for the terms; and
12 (B) the commissioner may share confidential information
13 obtained under this paragraph with members of the legislature, their agents,
14 and contractors on request under confidentiality agreements, either in
15 committees held in executive session or individually;
16 (13) consult with the Alaska Gasline Development Corporation in the
17 development of agreements or contracts under (10) or (11) of this subsection for
18 project services related to a gas treatment plant, pipeline, liquefaction facility, marine
19 terminal, or marine transportation services necessary to transport natural gas to
20 market;
21 (14) in consultation with the commissioner of revenue, take
22 custody of gas delivered to the state under AS 43.55.014(b) and manage the
23 project services and disposition and sale of that gas;
24 (15) exercise the powers and do the acts necessary to carry out the
25 provisions and objectives of AS 43.90 that relate to this chapter.
26 * Sec. 26. AS 38.05 is amended by adding a new section to read:
27 Sec. 38.05.023. Terms in an agreement or contract related to a North
28 Slope natural gas project. (a) An agreement or contract to which the state or an
29 entity of the state is a party that is negotiated under AS 38.05.020(b)(11) must include
30 a requirement that the state or an entity of the state shall have access to data developed
31 under the agreement or contract in which the state or an entity of the state has directly
01 participated financially. Access by the state or an entity of the state to the data must be
02 on the same or substantially similar terms applicable to any other party in a North
03 Slope natural gas project.
04 (b) A proposed agreement or contract associated with a North Slope natural
05 gas project may not include a provision that changes the property tax on property that
06 was previously taxable under AS 43.56.
07 (c) A proposed agreement or contract associated with a North Slope natural gas
08 project must provide the means for allocating infrastructure costs between the state
09 and other parties in the project. The allocation must take into consideration the extent
10 to which infrastructure is used by the project and used by the public and the difference
11 between the normal expected or actual life-cycle costs for the infrastructure as used by
12 the project and the expected or actual life-cycle costs of the same infrastructure if
13 subject only to general public use. The proposed agreement or contract may not
14 require the state to pay infrastructure costs that are directly related to the project and
15 not designed for general public use in a proportionate amount that is greater than the
16 state's share of participation in the project.
17 (d) An agreement or contract to which the state or an entity of the state is a
18 party that is negotiated under AS 38.05.020(b)(11) must include principles based on
19 commercially reasonable terms for delivering natural gas to public utilities in the state
20 when the demand for natural gas by the utilities exceeds the amount of the state's
21 royalty natural gas and natural gas delivered to the state as payment of tax that is
22 available in a North Slope natural gas project.
23 * Sec. 27. AS 38.05.180(i) is amended to read:
24 (i) The commissioner may provide for the establishment of an exploration
25 incentive credit system under which a lessee of state land drilling an exploratory well
26 on that land may earn credits based on [UPON] the footage drilled and the region in
27 which the well is situated. The commissioner may also provide for credits to be earned
28 by persons performing geophysical work on state land, if that work is performed
29 during the two seasons immediately preceding an announced lease sale and on land
30 included within the sale area and the geophysical information is made public
31 following the sale. Credits may not exceed 50 percent of the cost of the drilling or
01 geophysical work. Credits may be used during a limited period established by the
02 commissioner and may be assigned during that period. Credits may be applied against
03 (1) royalty and rental payments for oil and gas or for gas only payable to the state or
04 (2) taxes payable under AS 43.55.011 [AS 43.55]. A credit may not exceed 50 percent
05 of the payment toward which it is being applied. Amounts due the Alaska permanent
06 fund (AS 37.13.010) shall be calculated before the application of credits under this
07 subsection.
08 * Sec. 28. AS 38.05.180 is amended by adding new subsections to read:
09 (hh) Notwithstanding (j) of this section, the commissioner may propose
10 modification to a lease from which a lessee has committed gas from that lease to a
11 North Slope natural gas project. A modification may be made under this subsection
12 only after the commissioner makes the written determination under (ii) of this section
13 that the lease may be modified. If a modification is made, the modification shall be in
14 effect during the initial project term that has acquired the major permits required for
15 the work plan and budget considered by the commissioner in the written determination
16 under (ii) of this section. A modification under this subsection may
17 (1) relate to switching between taking the state's royalty gas in value
18 and in kind to ensure that the lessee, the state, or another person shall bear
19 proportionate costs for treatment, transportation, and liquefaction to the state's royalty
20 gas or gas delivered to the state under AS 43.55.014, and the state's actions do not
21 unreasonably interfere with the long-term marketing of natural gas by the lessee, the
22 state, or another person;
23 (2) provide a method for establishing a fair market value for each
24 component of the state's royalty gas and appropriate adjustments to reflect fair market
25 deductions for reasonable costs for treatment, transportation, and liquefaction for the
26 state's royalty gas from the North Slope to the destination market; in this paragraph,
27 "reasonable costs for treatment, transportation, and liquefaction" may not be greater
28 than actual costs;
29 (3) modify net profit shares for oil and gas and sliding scale royalty
30 rates for gas by establishing fixed royalty rates that yield a value to the state that the
31 commissioner determines to be not less than the value the state would have received
01 under the terms of the lease before a modification under this subsection.
02 (ii) Before making a modification to a lease under (hh) of this section, the
03 commissioner shall make a written determination that the lease may be modified. The
04 determination by the commissioner must be based on a clear and convincing showing
05 by the lessee that
06 (1) the modification
07 (A) is in the best interests of the state; and
08 (B) will materially improve the likelihood of a successful North
09 Slope natural gas project;
10 (2) a North Slope natural gas project has sufficient
11 (A) financial commitment for a work plan and budget
12 necessary to support major permits and regulatory filings required by state and
13 federal agencies; and
14 (B) commitment of gas by lessees;
15 (3) the lease will produce hydrocarbons that will be transported on a
16 North Slope natural gas project during the initial project term; and
17 (4) the lessee or an affiliate of the lessee has offered to purchase,
18 dispose of, or market the state's royalty gas taken in kind and gas delivered to the state
19 under AS 43.55.014 on the same or substantially similar terms as the lessee or an
20 affiliate of the lessee sells, disposes of, or markets the lessee's gas.
21 * Sec. 29. AS 38.05.183(a) is amended to read:
22 (a) The sale, exchange, or other disposal of a mineral obtained by the state as a
23 royalty under AS 38.05.182, [OR] the sale, exchange, or other disposal in whole or in
24 part of a right to receive future mineral production under a state lease under this
25 chapter, or the sale, exchange, or other disposal of gas delivered to the state under
26 AS 43.55.014(b) shall be by competitive bid and the sale, exchange, or other disposal
27 made to the highest responsible bidder, except that competitive bidding is not required
28 when the commissioner, after prior written notice to the Alaska Royalty Oil and Gas
29 Development Advisory Board under AS 38.06.050, determines that the best interest of
30 the state does not require it or that no competition exists.
31 * Sec. 30. AS 38.05.183(c) is amended to read:
01 (c) If the commissioner determines that a sale, exchange, or other disposal of a
02 mineral obtained by the state as a royalty under AS 38.05.182, [OR] of a right to
03 receive future mineral production under a state lease under this chapter, or of gas
04 delivered to the state under AS 43.55.014(b) shall be made otherwise than by
05 competitive bid, and the Alaska Royalty Oil and Gas Development Advisory Board
06 has been notified in writing of that determination, the commissioner shall make public
07 in writing the specific findings and conclusions on [UPON] which that determination
08 is based.
09 * Sec. 31. AS 38.05.183(d) is amended to read:
10 (d) Oil or gas taken in kind by the state as its royalty share or gas delivered to
11 the state under AS 43.55.014(b) may not be sold or otherwise disposed of for export
12 from the state until the commissioner determines that the [ROYALTY-IN-KIND] oil
13 or gas is surplus to the present and projected intrastate domestic and industrial needs.
14 The commissioner shall make public, in writing, the specific findings and reasons on
15 which the determination is based.
16 * Sec. 32. AS 38.05.183(e) is amended to read:
17 (e) When a sale, exchange, or other disposal of oil or gas taken in kind by the
18 state as its royalty share, or a sale, exchange, or other disposal in whole or in part of a
19 right to receive future royalty oil or gas, under a state lease under this chapter is made
20 other than by competitive bid, or when a sale, exchange, or other disposal of gas
21 delivered to the state under AS 43.55.014(b) is made other than by competitive
22 bid, the sale, exchange, or other disposal shall be awarded by the commissioner to the
23 prospective buyer whose proposal offers the maximum benefits to citizens of the state.
24 The commissioner shall consider
25 (1) the cash value offered;
26 (2) the projected effects of the sale, exchange, or other disposal on the
27 economy of the state;
28 (3) the projected benefits of refining or processing the oil or gas in the
29 state;
30 (4) the ability of the prospective buyer to provide refined products or
31 by-products for distribution and sale in the state with price or supply benefits to the
01 citizens of the state; and
02 (5) the criteria listed in AS 38.06.070(a).
03 * Sec. 33. AS 38.05.965 is amended by adding new paragraphs to read:
04 (26) "initial project term" means the duration sufficient to support an
05 investment decision by the sponsors of a North Slope natural gas project to permit
06 realization of a competitive economic return, to enable necessary financing, and to
07 support agreements for the sale of hydrocarbons transported on a North Slope natural
08 gas project;
09 (27) "North Slope natural gas project" means a project to produce or
10 transport natural gas from state oil and gas and gas only leases that include land north
11 of 68 degrees North latitude for transport in a gaseous state from the North Slope;
12 (28) "project services" means services provided by a gas treatment
13 plant, pipeline, liquefaction facility, or marine terminal, marine transportation
14 services, or other services necessary to transport natural gas to market.
15 * Sec. 34. AS 38.34.020(a) is amended to read:
16 (a) A state agency or entity conducting a review or taking action relating to a
17 project under AS 31.25 (Alaska Gasline Development Corporation) [THE IN-
18 STATE NATURAL GAS PIPELINE PROJECT UNDER THIS CHAPTER] shall
19 expedite the review or action in a manner consistent with the timely completion of the
20 project.
21 * Sec. 35. AS 38.34.020(b) is amended to read:
22 (b) Notwithstanding any contrary provision of law, a state agency or entity
23 may not include in any project certificate, right-of-way, permit, or other authorization
24 a term or condition that is not required by law if the in-state gasline project
25 coordinator determines that the term or condition would prevent or impair, in any
26 significant respect, the expeditious construction and operation or expansion of a
27 project under AS 31.25 (Alaska Gasline Development Corporation) [THE IN-
28 STATE NATURAL GAS PIPELINE PROJECT].
29 * Sec. 36. AS 38.34.020(c) is amended to read:
30 (c) Unless required by law, a state agency or entity may not add to, amend, or
31 abrogate any certificate, right-of-way, permit, or other authorization if the in-state
01 gasline project coordinator determines that the action would prevent or impair, in any
02 significant respect, the expeditious construction, operation, or expansion of a project
03 under AS 31.25 (Alaska Gasline Development Corporation) [THE IN-STATE
04 NATURAL GAS PIPELINE PROJECT].
05 * Sec. 37. AS 40.25.100(a) is amended to read:
06 (a) Information in the possession of the Department of Revenue that discloses
07 the particulars of the business or affairs of a taxpayer or other person, including
08 information under AS 38.05.020(b)(11) that is subject to a confidentiality
09 agreement under AS 38.05.020(b)(12), is not a matter of public record, except as
10 provided in AS 43.05.230(i) or for purposes of investigation and law enforcement. The
11 information shall be kept confidential except when its production is required in an
12 official investigation, administrative adjudication under AS 43.05.405 - 43.05.499, or
13 court proceeding. These restrictions do not prohibit the publication of statistics
14 presented in a manner that prevents the identification of particular reports and items,
15 prohibit the publication of tax lists showing the names of taxpayers who are delinquent
16 and relevant information that may assist in the collection of delinquent taxes, or
17 prohibit the publication of records, proceedings, and decisions under AS 43.05.405 -
18 43.05.499.
19 * Sec. 38. AS 40.25.100(a), as amended by sec. 37 of this Act, is amended to read:
20 (a) Information in the possession of the Department of Revenue that discloses
21 the particulars of the business or affairs of a taxpayer or other person, including
22 information under AS 38.05.020(b)(11) that is subject to a confidentiality agreement
23 under AS 38.05.020(b)(12), is not a matter of public record, except as provided in
24 AS 43.05.230(i) or (k) or for purposes of investigation and law enforcement. The
25 information shall be kept confidential except when its production is required in an
26 official investigation, administrative adjudication under AS 43.05.405 - 43.05.499, or
27 court proceeding. These restrictions do not prohibit the publication of statistics
28 presented in a manner that prevents the identification of particular reports and items,
29 prohibit the publication of tax lists showing the names of taxpayers who are delinquent
30 and relevant information that may assist in the collection of delinquent taxes, or
31 prohibit the publication of records, proceedings, and decisions under AS 43.05.405 -
01 43.05.499.
02 * Sec. 39. AS 40.25.120(a) is amended to read:
03 (a) Every person has a right to inspect a public record in the state, including
04 public records in recorders' offices, except
05 (1) records of vital statistics and adoption proceedings, which shall be
06 treated in the manner required by AS 18.50;
07 (2) records pertaining to juveniles unless disclosure is authorized by
08 law;
09 (3) medical and related public health records;
10 (4) records required to be kept confidential by a federal law or
11 regulation or by state law;
12 (5) to the extent the records are required to be kept confidential under
13 20 U.S.C. 1232g and the regulations adopted under 20 U.S.C. 1232g in order to secure
14 or retain federal assistance;
15 (6) records or information compiled for law enforcement purposes, but
16 only to the extent that the production of the law enforcement records or information
17 (A) could reasonably be expected to interfere with enforcement
18 proceedings;
19 (B) would deprive a person of a right to a fair trial or an
20 impartial adjudication;
21 (C) could reasonably be expected to constitute an unwarranted
22 invasion of the personal privacy of a suspect, defendant, victim, or witness;
23 (D) could reasonably be expected to disclose the identity of a
24 confidential source;
25 (E) would disclose confidential techniques and procedures for
26 law enforcement investigations or prosecutions;
27 (F) would disclose guidelines for law enforcement
28 investigations or prosecutions if the disclosure could reasonably be expected to
29 risk circumvention of the law; or
30 (G) could reasonably be expected to endanger the life or
31 physical safety of an individual;
01 (7) names, addresses, and other information identifying a person as a
02 participant in the Alaska Higher Education Savings Trust under AS 14.40.802 or the
03 advance college tuition savings program under AS 14.40.803 - 14.40.817;
04 (8) public records containing information that would disclose or might
05 lead to the disclosure of a component in the process used to execute or adopt an
06 electronic signature if the disclosure would or might cause the electronic signature to
07 cease being under the sole control of the person using it;
08 (9) reports submitted under AS 05.25.030 concerning certain
09 collisions, accidents, or other casualties involving boats;
10 (10) records or information pertaining to a plan, program, or
11 procedures for establishing, maintaining, or restoring security in the state, or to a
12 detailed description or evaluation of systems, facilities, or infrastructure in the state,
13 but only to the extent that the production of the records or information
14 (A) could reasonably be expected to interfere with the
15 implementation or enforcement of the security plan, program, or procedures;
16 (B) would disclose confidential guidelines for investigations or
17 enforcement and the disclosure could reasonably be expected to risk
18 circumvention of the law; or
19 (C) could reasonably be expected to endanger the life or
20 physical safety of an individual or to present a real and substantial risk to the
21 public health and welfare;
22 (11) the written notification regarding a proposed regulation provided
23 under AS 24.20.105 to the Department of Law and the affected state agency and
24 communications between the Legislative Affairs Agency, the Department of Law, and
25 the affected state agency under AS 24.20.105;
26 (12) records that are
27 (A) proprietary, privileged, or a trade secret in accordance with
28 AS 43.90.150 or 43.90.220(e);
29 (B) applications that are received under AS 43.90 until notice is
30 published under AS 43.90.160;
31 (13) information of the Alaska Gasline Development Corporation
01 created under AS 31.25.010 or a subsidiary of the Alaska Gasline Development
02 Corporation that is confidential by law or under a valid confidentiality agreement;
03 (14) information under AS 38.05.020(b)(11) that is subject to a
04 confidentiality agreement under AS 38.05.020(b)(12).
05 * Sec. 40. AS 43.05.010 is amended to read:
06 Sec. 43.05.010. Duties of commissioner. The commissioner of revenue shall
07 (1) exercise general supervision and direct the activities of the
08 Department of Revenue;
09 (2) supervise the fiscal affairs and responsibilities of the department;
10 (3) prescribe uniform rules for investigations and hearings;
11 (4) keep a record of all departmental proceedings, record and file all
12 bonds, and assume custody of returns, reports, papers, and documents of the
13 department;
14 (5) adopt a seal and affix it to each order, process, or certificate issued
15 by the commissioner;
16 (6) keep a record of each order, process, and certificate issued by the
17 commissioner, and keep the record open to public inspection at all reasonable times;
18 (7) hold hearings and investigations necessary for the administration of
19 state tax and revenue laws;
20 (8) except as provided in AS 43.05.405 - 43.05.499 and in
21 AS 44.64.030, hear and determine appeals of a matter within the jurisdiction of the
22 Department of Revenue and enter orders on the appeals that are final unless reversed
23 or modified by the courts;
24 (9) issue subpoenas to require the attendance of witnesses and the
25 production of necessary books, papers, documents, correspondence, and other things;
26 (10) order the taking of depositions before a person competent to
27 administer oaths;
28 (11) administer oaths and take acknowledgments;
29 (12) request the attorney general for rulings on the interpretation of the
30 tax and revenue laws administered by the department;
31 (13) call upon the attorney general to institute actions for recovery of
01 unpaid taxes, fees, excises, additions to tax, penalties, and interest;
02 (14) issue warrants for the collection of unpaid tax penalties and
03 interest and take all steps necessary and proper to enforce full and complete
04 compliance with the tax, license, excise, and other revenue laws of the state;
05 (15) report to the legislature before February 15 of each year the total
06 amount of contributions reported and the total amount of credit claimed during the
07 previous calendar year under AS 43.20.014, AS 43.55.019, AS 43.56.018,
08 AS 43.65.018, AS 43.75.018, and AS 43.77.045;
09 (16) consult with the commissioner of natural resources on
10 negotiation of contracts and development of terms for inclusion in proposed
11 contracts associated with a North Slope natural gas project.
12 * Sec. 41. AS 43.05.010, as amended by sec. 40 of this Act, is amended to read:
13 Sec. 43.05.010. Duties of commissioner. The commissioner of revenue shall
14 (1) exercise general supervision and direct the activities of the
15 Department of Revenue;
16 (2) supervise the fiscal affairs and responsibilities of the department;
17 (3) prescribe uniform rules for investigations and hearings;
18 (4) keep a record of all departmental proceedings, record and file all
19 bonds, and assume custody of returns, reports, papers, and documents of the
20 department;
21 (5) adopt a seal and affix it to each order, process, or certificate issued
22 by the commissioner;
23 (6) keep a record of each order, process, and certificate issued by the
24 commissioner, and keep the record open to public inspection at all reasonable times;
25 (7) hold hearings and investigations necessary for the administration of
26 state tax and revenue laws;
27 (8) except as provided in AS 43.05.405 - 43.05.499 and in
28 AS 44.64.030, hear and determine appeals of a matter within the jurisdiction of the
29 Department of Revenue and enter orders on the appeals that are final unless reversed
30 or modified by the courts;
31 (9) issue subpoenas to require the attendance of witnesses and the
01 production of necessary books, papers, documents, correspondence, and other things;
02 (10) order the taking of depositions before a person competent to
03 administer oaths;
04 (11) administer oaths and take acknowledgments;
05 (12) request the attorney general for rulings on the interpretation of the
06 tax and revenue laws administered by the department;
07 (13) call upon the attorney general to institute actions for recovery of
08 unpaid taxes, fees, excises, additions to tax, penalties, and interest;
09 (14) issue warrants for the collection of unpaid tax penalties and
10 interest and take all steps necessary and proper to enforce full and complete
11 compliance with the tax, license, excise, and other revenue laws of the state;
12 (15) report to the legislature before February 15 of each year the total
13 amount of contributions reported and the total amount of credit claimed during the
14 previous calendar year under AS 43.20.014, AS 43.55.019, AS 43.56.018,
15 AS 43.65.018, AS 43.75.018, and AS 43.77.045;
16 (16) consult with the commissioner of natural resources on negotiation
17 of contracts and development of terms for inclusion in proposed contracts associated
18 with a North Slope natural gas project;
19 (17) direct the disposition of revenue received from gas delivered
20 to the state under AS 43.55.014(b) by entering into agreements with the
21 commissioner of natural resources related to the management of the custody and
22 disposition of gas delivered to the state under AS 43.55.014(b).
23 * Sec. 42. AS 43.05.230 is amended by adding a new subsection to read:
24 (k) The name of each person that the department has allowed to make an
25 election under AS 43.55.014(a) and the amount of gas produced from each lease or
26 property to which an effective election under AS 43.55.014 applies is public
27 information.
28 * Sec. 43. AS 43.20.144(d) is amended to read:
29 (d) The sales factor of a taxpayer subject to this section is a fraction,
30 (1) the numerator of which is the sum of the following for the tax
31 period:
01 (A) the tariffs allowed and received by or for the taxpayer for
02 transporting oil or gas by pipeline in this state, regardless of whether the tariffs
03 are paid by third parties or by entities within the taxpayer's consolidated
04 business; and
05 (B) the total sales of the taxpayer in this state, determined in
06 accordance with AS 43.19 (Multistate Tax Compact), but excluding
07 (i) those sales already included in the tariffs described
08 in (A) of this paragraph;
09 (ii) constructive sales or deemed sales of natural gas
10 delivered to the state as payment of tax under an election made by
11 the taxpayer under AS 43.55.014;
12 (iii) fees, allowed and received, that are paid
13 between entities within the consolidated business of the taxpayer
14 for transporting the taxpayer's natural gas; and
15 (2) the denominator of which is the sum of the following for the tax
16 period:
17 (A) the tariffs allowed and received by or for the taxpayer's
18 consolidated business for transporting oil or gas by pipeline everywhere,
19 regardless of whether the tariffs are paid by third parties or by entities within
20 the taxpayer's consolidated business; and
21 (B) the total sales of the taxpayer's consolidated business
22 everywhere, determined in accordance with AS 43.19 (Multistate Tax
23 Compact), but excluding
24 (i) those sales already included in the tariffs described
25 in (A) of this paragraph;
26 (ii) constructive sales or deemed sales of natural gas
27 delivered to the state as payment of tax under an election made by
28 the taxpayer under AS 43.55.014 or delivered in another tax
29 jurisdiction under a law comparable to AS 43.55.014;
30 (iii) fees, allowed and received, that are paid
31 between entities within the consolidated business of the taxpayer
01 for transporting the taxpayer's natural gas.
02 * Sec. 44. AS 43.20.144(f) is amended to read:
03 (f) The extraction factor of a taxpayer subject to this section is a fraction,
04 (1) the numerator of which is the sum of the following for the tax
05 period:
06 (A) the number of barrels of the taxpayer's oil (net of royalty to
07 an unrelated party) produced from or allocated to leases or properties of the
08 taxpayer in this state; and
09 (B) one-sixth of the number of Mcf of the taxpayer's gas,
10 excluding reinjected gas but including gas subject to an election under
11 AS 43.55.014, (net of royalty to an unrelated party) produced from or allocated
12 to leases or properties of the taxpayer in this state [, EXCLUDING
13 REINJECTED GAS]; and
14 (2) the denominator of which is the sum of the following for the tax
15 period:
16 (A) the number of barrels of oil of the taxpayer's consolidated
17 business (net of royalty to an unrelated party) produced from or allocated to
18 leases or properties of the taxpayer's consolidated business everywhere; and
19 (B) one-sixth of the number of Mcf of gas, excluding
20 reinjected gas but including gas subject to an election under AS 43.55.014,
21 of the taxpayer's consolidated business (net of royalty to an unrelated party)
22 produced from or allocated to leases or properties of the taxpayer's
23 consolidated business everywhere [, EXCLUDING REINJECTED GAS].
24 * Sec. 45. AS 43.55.011(e) is amended to read:
25 (e) There is levied on the producer of oil or gas a tax for all oil and gas
26 produced each calendar year from each lease or property in the state, less any oil and
27 gas the ownership or right to which is exempt from taxation or constitutes a
28 landowner's royalty interest or for which a tax is levied by AS 43.55.014. Except as
29 otherwise provided under (f), (j), (k), (o), and (p) of this section, for oil and gas
30 produced
31 (1) before January 1, 2014, the tax is equal to the sum of
01 (A) the annual production tax value of the taxable oil and gas
02 as calculated under AS 43.55.160(a)(1) multiplied by 25 percent; and
03 (B) the sum, over all months of the calendar year, of the tax
04 amounts determined under (g) of this section;
05 (2) on and after January 1, 2014, and before January 1, 2022, the tax
06 is equal to the annual production tax value of the taxable oil and gas as calculated
07 under AS 43.55.160(a)(1) multiplied by 35 percent;
08 (3) on and after January 1, 2022, the tax for
09 (A) oil is equal to the annual production tax value of the
10 taxable oil as calculated under AS 43.55.160(h) multiplied by 35 percent;
11 (B) gas is equal to 13 percent of the gross value at the point
12 of production of the taxable gas; if the gross value at the point of
13 production of gas produced from a lease or property is less than zero, that
14 gross value at the point of production is considered zero for purposes of
15 this subparagraph.
16 * Sec. 46. AS 43.55.011(f) is amended to read:
17 (f) The levy of tax under (e) of this section for
18 (1) oil and gas produced before January 1, 2022, from leases or
19 properties that include land north of 68 degrees North latitude, other than [OIL
20 AND GAS PRODUCTION SUBJECT TO (i) OF THIS SECTION AND] gas subject
21 to (o) of this section, may not be less than
22 (A) [(1)] four 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 more than $25;
26 (B) [(2)] three 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 $20 but not over $25;
30 (C) [(3)] two 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 over $17.50 but not over $20;
03 (D) [(4)] one percent of the gross value at the point of
04 production when the average price per barrel for Alaska North Slope crude oil
05 for sale on the United States West Coast during the calendar year for which the
06 tax is due is over $15 but not over $17.50; or
07 (E) [(5)] zero percent of the gross value at the point of
08 production when the average price per barrel for Alaska North Slope crude oil
09 for sale on the United States West Coast during the calendar year for which the
10 tax is due is $15 or less; and
11 (2) oil produced on and after January 1, 2022, from leases or
12 properties that include land north of 68 degrees North latitude, may not be less
13 than
14 (A) four percent of the gross value at the point of
15 production when the average price per barrel for Alaska North Slope
16 crude oil for sale on the United States West Coast during the calendar
17 year for which the tax is due is more than $25;
18 (B) three percent of the gross value at the point of
19 production when the average price per barrel for Alaska North Slope
20 crude oil for sale on the United States West Coast during the calendar
21 year for which the tax is due is over $20 but not over $25;
22 (C) two percent of the gross value at the point of production
23 when the average price per barrel for Alaska North Slope crude oil for
24 sale on the United States West Coast during the calendar year for which
25 the tax is due is over $17.50 but not over $20;
26 (D) one percent of the gross value at the point of production
27 when the average price per barrel for Alaska North Slope crude oil for
28 sale on the United States West Coast during the calendar year for which
29 the tax is due is over $15 but not over $17.50; or
30 (E) zero percent of the gross value at the point of
31 production when the average price per barrel for Alaska North Slope
01 crude oil for sale on the United States West Coast during the calendar
02 year for which the tax is due is $15 or less.
03 * Sec. 47. AS 43.55 is amended by adding a new section to read:
04 Sec. 43.55.014. Payment in gas of tax for gas. (a) For gas produced on and
05 after January 1, 2022, other than gas described in (e) of this section, the department
06 shall allow a producer to make an election, under regulations adopted by the
07 department, to pay in gas the production tax levied by this section in lieu of the tax
08 otherwise levied for the gas by AS 43.55.011(e). An election under this subsection
09 applies only to gas produced from oil and gas leases modified under AS 38.05.180(hh)
10 from which the commissioner of natural resources has determined to take royalty gas
11 in kind under AS 38.05.182.
12 (b) A production tax levied by this section is equal to 13 percent of the gas
13 otherwise taxable under AS 43.55.011(e)(3) produced from each oil and gas lease to
14 which an effective election under (a) of this section applies, when and as that gas is
15 produced. The producer shall pay the tax in gas by delivering that 13 percent of the
16 gas to the state at the point of production.
17 (c) The Department of Natural Resources shall manage under
18 AS 38.05.020(b)(14) the custody and disposition of gas delivered to the state under (b)
19 of this section.
20 (d) An assessment under AS 43.05.245 against a producer for an
21 underpayment of a tax levied by this section may be made in terms of an amount of
22 gas or an amount of money, as determined under regulations adopted by the
23 department. If the assessment is made in terms of money, the amount for a month of
24 production for an oil and gas lease subject to an effective election under (a) of this
25 section is the product of the number of units of gas by which the producer's delivery to
26 the state was less than the amount required by (b) of this section, multiplied by the
27 average gross value at the point of production for each unit of the gas produced by the
28 producer from the lease during the month other than gas that was not subject to tax or
29 gas that was delivered to the state under (b) of this section. The department may allow
30 a credit or refund under AS 43.05.275 for an overpayment of a tax levied by this
31 section that may be issued in the form of gas or money, as determined under
01 regulations adopted by the department. If the credit or refund is allowed in terms of
02 money, the amount of the credit or refund for a month of production for an oil and gas
03 lease subject to an effective election under (a) of this section is the product of the
04 number of units of gas by which the producer's delivery to the state was more than the
05 amount required under (b) of this section, multiplied by the average gross value at the
06 point of production for each unit of the gas produced by the producer from the lease
07 during the month other than gas that was not subject to tax or gas that was delivered to
08 the state under (b) of this section. Interest that is determined as a percentage of the
09 amount of a tax underpayment or overpayment and a penalty that is a percentage of
10 the amount of a tax underpayment are calculated as a percentage of the amount of
11 money determined in this subsection. An amount of gas that was less than the amount
12 required to be delivered to the state under (b) of this section or an amount of gas that
13 was more than the amount required to be delivered to the state under (b) of this section
14 that is adjusted as provided by a gas balancing agreement to which the state is a party
15 under AS 38.05.020(b)(11) is not subject to assessment under AS 43.05.245 or a credit
16 or refund under AS 43.05.275. In this subsection, "unit" means a unit of measurement
17 for gas identified by the department under regulations adopted by the department and
18 may be expressed as 1,000 cubic feet, 1,000,000 British thermal units, or another
19 appropriate unit of measurement specified by the department under regulations
20 adopted by the department.
21 (e) This section does not apply to gas that, under AS 43.55.020(e), is
22 considered as gas produced from a lease or property for the purpose of AS 43.55.011 -
23 43.55.180.
24 * Sec. 48. AS 43.55.019(a) is amended to read:
25 (a) A producer of oil or gas is allowed a credit against the tax levied by
26 AS 43.55.011(e) [DUE UNDER THIS CHAPTER] for cash contributions accepted for
27 (1) direct instruction, research, and educational support purposes,
28 including library and museum acquisitions, and contributions to endowment, by an
29 Alaska university foundation or by a nonprofit, public or private, Alaska two-year or
30 four-year college accredited by a regional accreditation association;
31 (2) secondary school level vocational education courses, programs, and
01 facilities by a school district in the state;
02 (3) vocational education courses, programs, equipment, and facilities
03 by a state-operated vocational technical education and training school, a nonprofit
04 regional training center recognized by the Department of Labor and Workforce
05 Development, and an apprenticeship program in the state that is registered with
06 the United States Department of Labor under 29 U.S.C. 50 - 50b (National
07 Apprenticeship Act);
08 (4) a facility or an annual intercollegiate sports tournament by a
09 nonprofit, public or private, Alaska two-year or four-year college accredited by a
10 regional accreditation association;
11 (5) Alaska Native cultural or heritage programs and educational
12 support, including mentoring and tutoring, provided by a nonprofit agency for public
13 school staff and for students who are in grades kindergarten through 12 in the state;
14 (6) education, research, rehabilitation, and facilities by an institution
15 that is located in the state and that qualifies as a coastal ecosystem learning center
16 under the Coastal America Partnership established by the federal government; and
17 (7) the Alaska higher education investment fund under AS 37.14.750.
18 * Sec. 49. AS 43.55.019(a), as amended by sec. 21, ch. 92, SLA 2010, sec. 14, ch. 7,
19 FSSLA 2011, sec. 17, ch. 74, SLA 2012, and sec. 48 of this Act, is amended to read:
20 (a) A producer of oil or gas is allowed a credit against the tax levied by
21 AS 43.55.011(e) for cash contributions accepted
22 (1) for direct instruction, research, and educational support purposes,
23 including library and museum acquisitions, and contributions to endowment, by an
24 Alaska university foundation or by a nonprofit, public or private, Alaska two-year or
25 four-year college accredited by a regional accreditation association;
26 (2) for secondary school level vocational education courses, programs,
27 and facilities by a school district in the state;
28 (3) for vocational education courses, programs, equipment, and
29 facilities by
30 (A) a [STATE-OPERATED] vocational technical education
31 and training school in the state that offers programs approved by the
01 United States Department of Veterans Affairs and the Alaska Commission
02 on Postsecondary Education;
03 (B) a nonprofit regional training center recognized by the
04 Department of Labor and Workforce Development; or
05 (C) an apprenticeship program in the state that is
06 registered with the United States Department of Labor under 29 U.S.C. 50
07 - 50b (National Apprenticeship Act); and
08 (4) for the Alaska higher education investment fund under
09 AS 37.14.750.
10 * Sec. 50. AS 43.55.019(e) is amended to read:
11 (e) The credit under this section may not reduce a person's tax liability under
12 AS 43.55.011(e) [THIS CHAPTER] to below zero for any tax year. An unused credit
13 or portion of a credit not used under this section for a tax year may not be sold, traded,
14 transferred, or applied in a subsequent tax year.
15 * Sec. 51. AS 43.55.020(a) is amended to read:
16 (a) For a calendar year, a producer subject to tax under AS 43.55.011 shall pay
17 the tax as follows:
18 (1) for oil and gas produced before January 1, 2014, an installment
19 payment of the estimated tax levied by AS 43.55.011(e), net of any tax credits applied
20 as allowed by law, is due for each month of the calendar year on the last day of the
21 following month; except as otherwise provided under (2) of this subsection, the
22 amount of the installment payment is the sum of the following amounts, less 1/12 of
23 the tax credits that are allowed by law to be applied against the tax levied by
24 AS 43.55.011(e) for the calendar year, but the amount of the installment payment may
25 not be less than zero:
26 (A) for oil and gas not subject to AS 43.55.011(o) or (p)
27 produced from leases or properties in the state outside the Cook Inlet
28 sedimentary basin, other than leases or properties subject to AS 43.55.011(f),
29 the greater of
30 (i) zero; or
31 (ii) the sum of 25 percent and the tax rate calculated for
01 the month under AS 43.55.011(g) multiplied by the remainder obtained
02 by subtracting 1/12 of the producer's adjusted lease expenditures for the
03 calendar year of production under AS 43.55.165 and 43.55.170 that are
04 deductible for the oil and gas under AS 43.55.160 from the gross value
05 at the point of production of the oil and gas produced from the leases or
06 properties during the month for which the installment payment is
07 calculated;
08 (B) for oil and gas produced from leases or properties subject
09 to AS 43.55.011(f), the greatest of
10 (i) zero;
11 (ii) zero percent, one percent, two percent, three
12 percent, or four percent, as applicable, of the gross value at the point of
13 production of the oil and gas produced from the leases or properties
14 during the month for which the installment payment is calculated; or
15 (iii) the sum of 25 percent and the tax rate calculated for
16 the month under AS 43.55.011(g) multiplied by the remainder obtained
17 by subtracting 1/12 of the producer's adjusted lease expenditures for the
18 calendar year of production under AS 43.55.165 and 43.55.170 that are
19 deductible for the oil and gas under AS 43.55.160 from the gross value
20 at the point of production of the oil and gas produced from those leases
21 or properties during the month for which the installment payment is
22 calculated;
23 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for
24 each lease or property, the greater of
25 (i) zero; or
26 (ii) the sum of 25 percent and the tax rate calculated for
27 the month under AS 43.55.011(g) multiplied by the remainder obtained
28 by subtracting 1/12 of the producer's adjusted lease expenditures for the
29 calendar year of production under AS 43.55.165 and 43.55.170 that are
30 deductible under AS 43.55.160 for the oil or gas, respectively,
31 produced from the lease or property from the gross value at the point of
01 production of the oil or gas, respectively, produced from the lease or
02 property during the month for which the installment payment is
03 calculated;
04 (D) for oil and gas subject to AS 43.55.011(p), the lesser of
05 (i) the sum of 25 percent and the tax rate calculated for
06 the month under AS 43.55.011(g) multiplied by the remainder obtained
07 by subtracting 1/12 of the producer's adjusted lease expenditures for the
08 calendar year of production under AS 43.55.165 and 43.55.170 that are
09 deductible for the oil and gas under AS 43.55.160 from the gross value
10 at the point of production of the oil and gas produced from the leases or
11 properties during the month for which the installment payment is
12 calculated, but not less than zero; or
13 (ii) four percent of the gross value at the point of
14 production of the oil and gas produced from the leases or properties
15 during the month, but not less than zero;
16 (2) an amount calculated under (1)(C) of this subsection for oil or gas
17 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by
18 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as
19 applicable, for gas or set out in AS 43.55.011(k)(1) or (2), as applicable, for oil, but
20 substituting in AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the
21 amount of taxable gas produced during the month for the amount of taxable gas
22 produced during the calendar year and substituting in AS 43.55.011(k)(1)(A) or
23 (2)(A), as applicable, the amount of taxable oil produced during the month for the
24 amount of taxable oil produced during the calendar year;
25 (3) an installment payment of the estimated tax levied by
26 AS 43.55.011(i) for each lease or property is due for each month of the calendar year
27 on the last day of the following month; the amount of the installment payment is the
28 sum of
29 (A) the applicable tax rate for oil provided under
30 AS 43.55.011(i), multiplied by the gross value at the point of production of the
31 oil taxable under AS 43.55.011(i) and produced from the lease or property
01 during the month; and
02 (B) the applicable tax rate for gas provided under
03 AS 43.55.011(i), multiplied by the gross value at the point of production of the
04 gas taxable under AS 43.55.011(i) and produced from the lease or property
05 during the month;
06 (4) any amount of tax levied by AS 43.55.011, net of any credits
07 applied as allowed by law, that exceeds the total of the amounts due as installment
08 payments of estimated tax is due on March 31 of the year following the calendar year
09 of production;
10 (5) for oil and gas produced on and after January 1, 2014, and before
11 January 1, 2022, an installment payment of the estimated tax levied by
12 AS 43.55.011(e), net of any tax credits applied as allowed by law, is due for each
13 month of the calendar year on the last day of the following month; except as otherwise
14 provided under (6) of this subsection, the amount of the installment payment is the
15 sum of the following amounts, less 1/12 of the tax credits that are allowed by law to be
16 applied against the tax levied by AS 43.55.011(e) for the calendar year, but the amount
17 of the installment payment may not be less than zero:
18 (A) for oil and gas not subject to AS 43.55.011(o) or (p)
19 produced from leases or properties in the state outside the Cook Inlet
20 sedimentary basin, other than leases or properties subject to AS 43.55.011(f),
21 the greater of
22 (i) zero; or
23 (ii) 35 percent multiplied by the remainder obtained by
24 subtracting 1/12 of the producer's adjusted lease expenditures for the
25 calendar year of production under AS 43.55.165 and 43.55.170 that are
26 deductible for the oil and gas under AS 43.55.160 from the gross value
27 at the point of production of the oil and gas produced from the leases or
28 properties during the month for which the installment payment is
29 calculated;
30 (B) for oil and gas produced from leases or properties subject
31 to AS 43.55.011(f), the greatest of
01 (i) zero;
02 (ii) zero percent, one percent, two percent, three
03 percent, or four percent, as applicable, of the gross value at the point of
04 production of the oil and gas produced from the leases or properties
05 during the month for which the installment payment is calculated; or
06 (iii) 35 percent multiplied by the remainder obtained by
07 subtracting 1/12 of the producer's adjusted lease expenditures for the
08 calendar year of production under AS 43.55.165 and 43.55.170 that are
09 deductible for the oil and gas under AS 43.55.160 from the gross value
10 at the point of production of the oil and gas produced from those leases
11 or properties during the month for which the installment payment is
12 calculated, except that, for the purposes of this calculation, a reduction
13 from the gross value at the point of production may apply for oil and
14 gas subject to AS 43.55.160(f) or (g);
15 (C) for oil or gas subject to AS 43.55.011(j), (k), or (o), for
16 each lease or property, the greater of
17 (i) zero; or
18 (ii) 35 percent multiplied by the remainder obtained by
19 subtracting 1/12 of the producer's adjusted lease expenditures for the
20 calendar year of production under AS 43.55.165 and 43.55.170 that are
21 deductible under AS 43.55.160 for the oil or gas, respectively,
22 produced from the lease or property from the gross value at the point of
23 production of the oil or gas, respectively, produced from the lease or
24 property during the month for which the installment payment is
25 calculated;
26 (D) for oil and gas subject to AS 43.55.011(p), the lesser of
27 (i) 35 percent multiplied by the remainder obtained by
28 subtracting 1/12 of the producer's adjusted lease expenditures for the
29 calendar year of production under AS 43.55.165 and 43.55.170 that are
30 deductible for the oil and gas under AS 43.55.160 from the gross value
31 at the point of production of the oil and gas produced from the leases or
01 properties during the month for which the installment payment is
02 calculated, but not less than zero; or
03 (ii) four percent of the gross value at the point of
04 production of the oil and gas produced from the leases or properties
05 during the month, but not less than zero;
06 (6) an amount calculated under (5)(C) of this subsection for oil or gas
07 subject to AS 43.55.011(j), (k), or (o) may not exceed the product obtained by
08 carrying out the calculation set out in AS 43.55.011(j)(1) or (2) or 43.55.011(o), as
09 applicable, for gas or set out in AS 43.55.011(k)(1) or (2), as applicable, for oil, but
10 substituting in AS 43.55.011(j)(1)(A) or (2)(A) or 43.55.011(o), as applicable, the
11 amount of taxable gas produced during the month for the amount of taxable gas
12 produced during the calendar year and substituting in AS 43.55.011(k)(1)(A) or
13 (2)(A), as applicable, the amount of taxable oil produced during the month for the
14 amount of taxable oil produced during the calendar year;
15 (7) for oil and gas produced on or after January 1, 2022, an
16 installment payment of the estimated tax levied by AS 43.55.011(e), net of any tax
17 credits applied as allowed by law, is due for each month of the calendar year on
18 the last day of the following month; the amount of the installment payment is the
19 sum of the following amounts, less 1/12 of the tax credits that are allowed by law
20 to be applied against the tax levied by AS 43.55.011(e) for the calendar year, but
21 the amount of the installment payment may not be less than zero:
22 (A) for oil produced from leases or properties that include
23 land north of 68 degrees North latitude, the greatest of
24 (i) zero;
25 (ii) zero percent, one percent, two percent, three
26 percent, or four percent, as applicable, of the gross value at the
27 point of production of the oil produced from the leases or
28 properties during the month for which the installment payment is
29 calculated; or
30 (iii) 35 percent multiplied by the remainder obtained
31 by subtracting 1/12 of the producer's adjusted lease expenditures
01 for the calendar year of production under AS 43.55.165 and
02 43.55.170 that are deductible for the oil under AS 43.55.160(h)(1)
03 from the gross value at the point of production of the oil produced
04 from those leases or properties during the month for which the
05 installment payment is calculated, except that, for the purposes of
06 this calculation, a reduction from the gross value at the point of
07 production may apply for oil subject to AS 43.55.160(f) or
08 43.55.160(f) and (g);
09 (B) for oil produced before or during the last calendar year
10 under AS 43.55.024(b) for which the producer could take a tax credit
11 under AS 43.55.024(a), from leases or properties in the state outside the
12 Cook Inlet sedimentary basin, no part of which is north of 68 degrees
13 North latitude, other than leases or properties subject to AS 43.55.011(p),
14 the greater of
15 (i) zero; or
16 (ii) 35 percent multiplied by the remainder obtained
17 by subtracting 1/12 of the producer's adjusted lease expenditures
18 for the calendar year of production under AS 43.55.165 and
19 43.55.170 that are deductible for the oil under AS 43.55.160(h)(2)
20 from the gross value at the point of production of the oil produced
21 from the leases or properties during the month for which the
22 installment payment is calculated;
23 (C) for oil and gas produced from leases or properties
24 subject to AS 43.55.011(p), except as otherwise provided under (8) of this
25 subsection, the sum of
26 (i) 35 percent multiplied by the remainder obtained
27 by subtracting 1/12 of the producer's adjusted lease expenditures
28 for the calendar year of production under AS 43.55.165 and
29 43.55.170 that are deductible for the oil under AS 43.55.160(h)(3)
30 from the gross value at the point of production of the oil produced
31 from the leases or properties during the month for which the
01 installment payment is calculated, but not less than zero; and
02 (ii) 13 percent of the gross value at the point of
03 production of the gas produced from the leases or properties
04 during the month, but not less than zero;
05 (D) for oil produced from leases or properties in the state,
06 no part of which is north of 68 degrees North latitude, other than leases or
07 properties subject to (B) or (C) of this paragraph, the greater of
08 (i) zero; or
09 (ii) 35 percent multiplied by the remainder obtained
10 by subtracting 1/12 of the producer's adjusted lease expenditures
11 for the calendar year of production under AS 43.55.165 and
12 43.55.170 that are deductible for the oil under AS 43.55.160(h)(4)
13 from the gross value at the point of production of the oil produced
14 from the leases or properties during the month for which the
15 installment payment is calculated;
16 (E) for gas produced from each lease or property in the
17 state, other than a lease or property subject to AS 43.55.011(p), 13 percent
18 of the gross value at the point of production of the gas produced from the
19 lease or property during the month for which the installment payment is
20 calculated, but not less than zero;
21 (8) an amount calculated under (7)(C) of this subsection may not
22 exceed four percent of the gross value at the point of production of the oil and gas
23 produced from leases or properties subject to AS 43.55.011(p) during the month
24 for which the installment payment is calculated;
25 (9) for purposes of the calculation under (1)(B)(ii), (5)(B)(ii), and
26 (7)(A)(ii) of this subsection, the applicable percentage of the gross value at the
27 point of production is determined under AS 43.55.011(f)(1) or (2) but substituting
28 the phrase "month for which the installment payment is calculated" in
29 AS 43.55.011(f)(1) and (2) for the phrase "calendar year for which the tax is
30 due." [.]
31 * Sec. 52. AS 43.55.020(g) is amended to read:
01 (g) Notwithstanding any contrary provision of AS 43.05.225,
02 (1) before January 1, 2014, an unpaid amount of an installment
03 payment required under (a)(1) - (3) of this section that is not paid when due bears
04 interest (A) at the rate provided for an underpayment under 26 U.S.C. 6621 (Internal
05 Revenue Code), as amended, compounded daily, from the date the installment
06 payment is due until March 31 following the calendar year of production, and (B) as
07 provided for a delinquent tax under AS 43.05.225 after that March 31; interest accrued
08 under (A) of this paragraph that remains unpaid after that March 31 is treated as an
09 addition to tax that bears interest under (B) of this paragraph; an unpaid amount of tax
10 due under (a)(4) of this section that is not paid when due bears interest as provided for
11 a delinquent tax under AS 43.05.225;
12 (2) on and after January 1, 2014, an unpaid amount of an installment
13 payment required under (a)(3), (5), [OR] (6), or (7) of this section that is not paid
14 when due bears interest (A) at the rate provided for an underpayment under 26 U.S.C.
15 6621 (Internal Revenue Code), as amended, compounded daily, from the date the
16 installment payment is due until March 31 following the calendar year of production,
17 and (B) as provided for a delinquent tax under AS 43.05.225 after that March 31;
18 interest accrued under (A) of this paragraph that remains unpaid after that March 31 is
19 treated as an addition to tax that bears interest under (B) of this paragraph; an unpaid
20 amount of tax due under (a)(4) of this section that is not paid when due bears interest
21 as provided for a delinquent tax under AS 43.05.225.
22 * Sec. 53. AS 43.55.020(h) is amended to read:
23 (h) Notwithstanding any contrary provision of AS 43.05.280,
24 (1) an overpayment of an installment payment required under (a)(1),
25 (2), (3), (5), (6), or (7) [(a)(1) - (3), (5) OR (6)] of this section bears interest at the rate
26 provided for an overpayment under 26 U.S.C. 6621 (Internal Revenue Code), as
27 amended, compounded daily, from the later of the date the installment payment is due
28 or the date the overpayment is made, until the earlier of
29 (A) the date it is refunded or is applied to an underpayment; or
30 (B) March 31 following the calendar year of production;
31 (2) except as provided under (1) of this subsection, interest with
01 respect to an overpayment is allowed only on any net overpayment of the payments
02 required under (a) of this section that remains after the later of March 31 following the
03 calendar year of production or the date that the statement required under
04 AS 43.55.030(a) is filed;
05 (3) interest is allowed under (2) of this subsection only from a date that
06 is 90 days after the later of March 31 following the calendar year of production or the
07 date that the statement required under AS 43.55.030(a) is filed; interest is not allowed
08 if the overpayment was refunded within the 90-day period;
09 (4) interest under (2) and (3) of this subsection is paid at the rate and in
10 the manner provided in AS 43.05.225(1).
11 * Sec. 54. AS 43.55.020(l) is amended to read:
12 (l) For oil and gas produced on [ON] and after January 1, 2014, and before
13 January 1, 2022, in making settlement with the royalty owner for oil and gas that is
14 taxable under AS 43.55.011, the producer may deduct the amount of the tax paid on
15 taxable royalty oil and gas, or may deduct taxable royalty oil or gas equivalent in
16 value at the time the tax becomes due to the amount of the tax paid. If the total
17 deductions of installment payments of estimated tax for a calendar year exceed the
18 actual tax for that calendar year, the producer shall, before April 1 of the following
19 year, refund the excess to the royalty owner. Unless otherwise agreed between the
20 producer and the royalty owner, the amount of the tax paid under AS 43.55.011(e) on
21 taxable royalty oil and gas for a calendar year, other than oil and gas the ownership or
22 right to which constitutes a landowner's royalty interest, is considered to be the gross
23 value at the point of production of the taxable royalty oil and gas produced during the
24 calendar year multiplied by a figure that is a quotient, in which
25 (1) the numerator is the producer's total tax liability under
26 AS 43.55.011(e)(2) [AS 43.55.011(e)] for the calendar year of production; and
27 (2) the denominator is the total gross value at the point of production
28 of the oil and gas taxable under AS 43.55.011(e) produced by the producer from all
29 leases and properties in the state during the calendar year.
30 * Sec. 55. AS 43.55.020 is amended by adding a new subsection to read:
31 (m) For oil and gas produced on and after January 1, 2022, in making
01 settlement with the royalty owner for oil and gas that is taxable under AS 43.55.011,
02 the producer may deduct the amount of the tax paid on taxable royalty oil and gas, or
03 may deduct taxable royalty oil or gas equivalent in value at the time the tax becomes
04 due to the amount of the tax paid. If the total deductions of installment payments of
05 estimated tax for a calendar year exceed the actual tax for that calendar year, the
06 producer shall, before April 1 of the following year, refund the excess to the royalty
07 owner. In making settlement with the royalty owner for gas that is taxable under
08 AS 43.55.014, the producer may deduct the amount of the gas paid as in-kind tax on
09 taxable royalty gas or may deduct the gross value at the point of production of the gas
10 paid as in-kind tax on taxable royalty gas. Unless otherwise agreed between the
11 producer and the royalty owner, the amount of the tax paid under AS 43.55.011(e) on
12 taxable royalty oil for a calendar year, other than oil the ownership or right to which
13 constitutes a landowner's royalty interest, is considered to be the gross value at the
14 point of production of the taxable royalty oil produced during the calendar year
15 multiplied by a figure that is a quotient, in which
16 (1) the numerator is the producer's total tax liability under
17 AS 43.55.011(e)(3)(A) for the calendar year of production; and
18 (2) the denominator is the total gross value at the point of production
19 of the oil taxable under AS 43.55.011(e) produced by the producer from all leases and
20 properties in the state during the calendar year.
21 * Sec. 56. AS 43.55.030(a) is amended to read:
22 (a) A producer that produces oil or gas from a lease or property in the state
23 during a calendar year, whether or not any tax payment is due under AS 43.55.020(a)
24 for that oil or gas, shall file with the department on March 31 of the following year a
25 statement, under oath, in a form prescribed by the department, giving, with other
26 information required, the following:
27 (1) a description of each lease or property from which oil or gas was
28 produced, by name, legal description, lease number, or accounting codes assigned by
29 the department;
30 (2) the names of the producer and, if different, the person paying the
31 tax, if any;
01 (3) the gross amount of oil and the gross amount of gas produced from
02 each lease or property, separately identifying the gross amount of gas produced
03 from each oil and gas lease to which an effective election under AS 43.55.014(a)
04 applies, the amount of gas delivered to the state under AS 43.55.014(b), and the
05 percentage of the gross amount of oil and gas owned by the producer;
06 (4) the gross value at the point of production of the oil and of the gas
07 produced from each lease or property owned by the producer and the costs of
08 transportation of the oil and gas;
09 (5) the name of the first purchaser and the price received for the oil and
10 for the gas, unless relieved from this requirement in whole or in part by the
11 department;
12 (6) the producer's qualified capital expenditures, as defined in
13 AS 43.55.023, other lease expenditures under AS 43.55.165, and adjustments or other
14 payments or credits under AS 43.55.170;
15 (7) the production tax values of the oil and gas under AS 43.55.160(a)
16 or of the oil under AS 43.55.160(h), as applicable [AS 43.55.160];
17 (8) any claims for tax credits to be applied; and
18 (9) calculations showing the amounts, if any, that were or are due
19 under AS 43.55.020(a) and interest on any underpayment or overpayment.
20 * Sec. 57. AS 43.55.160(a) is amended to read:
21 (a) For oil and gas produced before January 1, 2022, except [EXCEPT] as
22 provided in (b), (f), and (g) of this section, for the purposes of
23 (1) AS 43.55.011(e)(1) and (2) [AS 43.55.011(e)], the annual
24 production tax value of taxable oil, gas, or oil and gas produced during a calendar year
25 in a category for which a separate annual production tax value is required to be
26 calculated under this paragraph is the gross value at the point of production of that oil,
27 gas, or oil and gas taxable under AS 43.55.011(e), less the producer's lease
28 expenditures under AS 43.55.165 for the calendar year applicable to the oil, gas, or oil
29 and gas in that category produced by the producer during the calendar year, as
30 adjusted under AS 43.55.170; a separate annual production tax value shall be
31 calculated for
01 (A) oil and gas produced from leases or properties in the state
02 that include land north of 68 degrees North latitude, other than gas produced
03 before 2022 and used in the state;
04 (B) oil and gas produced from leases or properties in the state
05 outside the Cook Inlet sedimentary basin, no part of which is north of 68
06 degrees North latitude and that qualifies for a tax credit under AS 43.55.024(a)
07 and (b); this subparagraph does not apply to
08 (i) gas produced before 2022 and used in the state; or
09 (ii) oil and gas subject to AS 43.55.011(p);
10 (C) oil produced before 2022 from each lease or property in the
11 Cook Inlet sedimentary basin;
12 (D) gas produced before 2022 from each lease or property in
13 the Cook Inlet sedimentary basin;
14 (E) gas produced before 2022 from each lease or property in
15 the state outside the Cook Inlet sedimentary basin and used in the state, other
16 than gas subject to AS 43.55.011(p);
17 (F) oil and gas subject to AS 43.55.011(p) produced from
18 leases or properties in the state;
19 (G) oil and gas produced from leases or properties in the state
20 no part of which is north of 68 degrees North latitude, other than oil or gas
21 described in (B), (C), (D), (E), or (F) of this paragraph;
22 (2) AS 43.55.011(g), for oil and gas produced before January 1, 2014,
23 the monthly production tax value of the taxable
24 (A) oil and gas produced during a month from leases or
25 properties in the state that include land north of 68 degrees North latitude is the
26 gross value at the point of production of the oil and gas taxable under
27 AS 43.55.011(e) and produced by the producer from those leases or properties,
28 less 1/12 of the producer's lease expenditures under AS 43.55.165 for the
29 calendar year applicable to the oil and gas produced by the producer from
30 those leases or properties, as adjusted under AS 43.55.170; this subparagraph
31 does not apply to gas subject to AS 43.55.011(o);
01 (B) oil and gas produced during a month from leases or
02 properties in the state outside the Cook Inlet sedimentary basin, no part of
03 which is north of 68 degrees North latitude, is the gross value at the point of
04 production of the oil and gas taxable under AS 43.55.011(e) and produced by
05 the producer from those leases or properties, less 1/12 of the producer's lease
06 expenditures under AS 43.55.165 for the calendar year applicable to the oil and
07 gas produced by the producer from those leases or properties, as adjusted under
08 AS 43.55.170; this subparagraph does not apply to gas subject to
09 AS 43.55.011(o);
10 (C) oil produced during a month from a lease or property in the
11 Cook Inlet sedimentary basin is the gross value at the point of production of
12 the oil taxable under AS 43.55.011(e) and produced by the producer from that
13 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 oil produced by the
15 producer from that lease or property, as adjusted under AS 43.55.170;
16 (D) gas produced during a month from a lease or property in
17 the Cook Inlet sedimentary basin is the gross value at the point of production
18 of the gas taxable under AS 43.55.011(e) and produced by the producer from
19 that lease or property, less 1/12 of the producer's lease expenditures under
20 AS 43.55.165 for the calendar year applicable to the gas produced by the
21 producer from that lease or property, as adjusted under AS 43.55.170;
22 (E) gas produced during a month from a lease or property
23 outside the Cook Inlet sedimentary basin and used in the state is the gross
24 value at the point of production of that gas taxable under AS 43.55.011(e) and
25 produced by the producer from that lease or property, less 1/12 of the
26 producer's lease expenditures under AS 43.55.165 for the calendar year
27 applicable to that gas produced by the producer from that lease or property, as
28 adjusted under AS 43.55.170.
29 * Sec. 58. AS 43.55.160(e) is amended to read:
30 (e) Any adjusted lease expenditures under AS 43.55.165 and 43.55.170 that
31 would otherwise be deductible by a producer in a calendar year but whose deduction
01 would cause an annual production tax value calculated under (a)(1) or (h) of this
02 section of taxable oil or gas produced during the calendar year to be less than zero
03 may be used to establish a carried-forward annual loss under AS 43.55.023(b).
04 However, the department shall provide by regulation a method to ensure that, for a
05 period for which a producer's tax liability is limited by AS 43.55.011(j), (k), (o), or
06 (p), any adjusted lease expenditures under AS 43.55.165 and 43.55.170 that would
07 otherwise be deductible by a producer for that period but whose deduction would
08 cause a production tax value calculated under (a)(1)(C), (D), (E), or (F), or (h)(3) of
09 this section to be less than zero are accounted for as though the adjusted lease
10 expenditures had first been used as deductions in calculating the production tax values
11 of oil or gas subject to any of the limitations under AS 43.55.011(j), (k), (o), or (p) that
12 have positive production tax values so as to reduce the tax liability calculated without
13 regard to the limitation to the maximum amount provided for under the applicable
14 provision of AS 43.55.011(j), (k), (o), or (p). Only the amount of those adjusted lease
15 expenditures remaining after the accounting provided for under this subsection may be
16 used to establish a carried-forward annual loss under AS 43.55.023(b). In this
17 subsection, "producer" includes "explorer."
18 * Sec. 59. AS 43.55.160(f) is amended to read:
19 (f) On and after January 1, 2014, in the calculation of an annual production tax
20 value of a producer under (a)(1)(A) or (h)(1) [(a)(1)] of this section, the gross value at
21 the point of production of oil or gas produced from a lease or property north of 68
22 degrees North latitude meeting one or more of the following criteria is reduced by 20
23 percent: (1) the oil or gas is produced from a lease or property that does not contain a
24 lease that was within a unit on January 1, 2003; (2) the oil or gas is produced from a
25 participating area established after December 31, 2011, that is within a unit formed
26 under AS 38.05.180(p) before January 1, 2003, if the participating area does not
27 contain a reservoir that had previously been in a participating area established before
28 December 31, 2011; (3) the oil or gas is produced from acreage that was added to an
29 existing participating area by the Department of Natural Resources on and after
30 January 1, 2014, and the producer demonstrates to the department that the volume of
31 oil or gas produced is from acreage added to an existing participating area. This
01 subsection does not apply to gas produced before 2022 that is used in the state or to
02 gas produced on and after January 1, 2022. A reduction under this subsection may
03 not reduce the gross value at the point of production below zero. In this subsection,
04 "participating area" means a reservoir or portion of a reservoir producing or
05 contributing to production as approved by the Department of Natural Resources.
06 * Sec. 60. AS 43.55.160(g) is amended to read:
07 (g) On and after January 1, 2014, in addition to the reduction under (f) of this
08 section, in the calculation of an annual production tax value of a producer under
09 (a)(1)(A) or (h)(1) [(a)(1)] of this section, the gross value at the point of production of
10 oil or gas produced from a lease or property north of 68 degrees North latitude that
11 does not contain a lease that was within a unit on January 1, 2003, is reduced by 10
12 percent if the oil or gas is produced from a unit made up solely of leases that have a
13 royalty share of more than 12.5 percent in amount or value of the production removed
14 or sold from the lease as determined under AS 38.05.180(f). This subsection does not
15 apply if the royalty obligation for one or more of the leases in the unit has been
16 reduced to 12.5 percent or less under AS 38.05.180(j) for all or part of the calendar
17 year for which the annual production tax value is calculated. This subsection does not
18 apply to gas produced before 2022 that is used in the state or to gas produced on and
19 after January 1, 2022. A reduction under this subsection may not reduce the gross
20 value at the point of production below zero.
21 * Sec. 61. AS 43.55.160 is amended by adding a new subsection to read:
22 (h) For oil produced on and after January 1, 2022, except as provided in (b),
23 (f), and (g) of this section, for the purposes of AS 43.55.011(e)(3), the annual
24 production tax value of oil taxable under AS 43.55.011(e) produced by a producer
25 during a calendar year
26 (1) from leases or properties in the state that include land north of 68
27 degrees North latitude is the gross value at the point of production of that oil, less the
28 producer's lease expenditures under AS 43.55.165 for the calendar year incurred to
29 explore for, develop, or produce oil and gas deposits located in the state north of 68
30 degrees North latitude or located in leases or properties in the state that include land
31 north of 68 degrees North latitude, as adjusted under AS 43.55.170;
01 (2) before or during the last calendar year under AS 43.55.024(b) for
02 which the producer could take a tax credit under AS 43.55.024(a), from leases or
03 properties in the state outside the Cook Inlet sedimentary basin, no part of which is
04 north of 68 degrees North latitude, other than leases or properties subject to
05 AS 43.55.011(p), is the gross value at the point of production of that oil, less the
06 producer's lease expenditures under AS 43.55.165 for the calendar year incurred to
07 explore for, develop, or produce oil and gas deposits located in the state outside the
08 Cook Inlet sedimentary basin and south of 68 degrees North latitude, other than oil
09 and gas deposits located in a lease or property that includes land north of 68 degrees
10 North latitude or that is subject to AS 43.55.011(p) or, before January 1, 2027, from
11 which commercial production has not begun, as adjusted under AS 43.55.170;
12 (3) from leases or properties subject to AS 43.55.011(p) is the gross
13 value at the point of production of that oil, less the producer's lease expenditures under
14 AS 43.55.165 for the calendar year incurred to explore for, develop, or produce oil and
15 gas deposits located in leases or properties subject to AS 43.55.011(p) or, before
16 January 1, 2027, located in leases or properties in the state outside the Cook Inlet
17 sedimentary basin, no part of which is north of 68 degrees North latitude from which
18 commercial production has not begun, as adjusted under AS 43.55.170;
19 (4) from leases or properties in the state no part of which is north of 68
20 degrees North latitude, other than leases or properties subject to (2) or (3) of this
21 subsection, is the gross value at the point of production of that oil less the producer's
22 lease expenditures under AS 43.55.165 for the calendar year incurred to explore for,
23 develop, or produce oil and gas deposits located in the state south of 68 degrees North
24 latitude, other than oil and gas deposits located in a lease or property in the state that
25 includes land north of 68 degrees North latitude, and excluding lease expenditures that
26 are deductible under (2) or (3) of this subsection or would be deductible under (2) or
27 (3) of this subsection if not prohibited by (b) of this section, as adjusted under
28 AS 43.55.170.
29 * Sec. 62. AS 43.55.165(e) is amended to read:
30 (e) For purposes of this section, lease expenditures do not include
31 (1) depreciation, depletion, or amortization;
01 (2) oil or gas royalty payments, production payments, lease profit
02 shares, or other payments or distributions of a share of oil or gas production, profit, or
03 revenue, except that a producer's lease expenditures applicable to oil and gas produced
04 from a lease issued under AS 38.05.180(f)(3)(B), (D), or (E) include the share of net
05 profit paid to the state under that lease;
06 (3) taxes based on or measured by net income;
07 (4) interest or other financing charges or costs of raising equity or debt
08 capital;
09 (5) acquisition costs for a lease or property or exploration license;
10 (6) costs arising from fraud, wilful misconduct, gross negligence,
11 violation of law, or failure to comply with an obligation under a lease, permit, or
12 license issued by the state or federal government;
13 (7) fines or penalties imposed by law;
14 (8) costs of arbitration, litigation, or other dispute resolution activities
15 that involve the state or concern the rights or obligations among owners of interests in,
16 or rights to production from, one or more leases or properties or a unit;
17 (9) costs incurred in organizing a partnership, joint venture, or other
18 business entity or arrangement;
19 (10) amounts paid to indemnify the state; the exclusion provided by
20 this paragraph does not apply to the costs of obtaining insurance or a surety bond from
21 a third-party insurer or surety;
22 (11) surcharges levied under AS 43.55.201 or 43.55.300;
23 (12) an expenditure otherwise deductible under (b) of this section that
24 is a result of an internal transfer, a transaction with an affiliate, or a transaction
25 between related parties, or is otherwise not an arm's length transaction, unless the
26 producer establishes to the satisfaction of the department that the amount of the
27 expenditure does not exceed the fair market value of the expenditure;
28 (13) an expenditure incurred to purchase an interest in any corporation,
29 partnership, limited liability company, business trust, or any other business entity,
30 whether or not the transaction is treated as an asset sale for federal income tax
31 purposes;
01 (14) a tax levied under AS 43.55.011 or 43.55.014;
02 (15) costs incurred for dismantlement, removal, surrender, or
03 abandonment of a facility, pipeline, well pad, platform, or other structure, or for the
04 restoration of a lease, field, unit, area, tract of land, body of water, or right-of-way in
05 conjunction with dismantlement, removal, surrender, or abandonment; a cost is not
06 excluded under this paragraph if the dismantlement, removal, surrender, or
07 abandonment for which the cost is incurred is undertaken for the purpose of replacing,
08 renovating, or improving the facility, pipeline, well pad, platform, or other structure;
09 (16) costs incurred for containment, control, cleanup, or removal in
10 connection with any unpermitted release of oil or a hazardous substance and any
11 liability for damages imposed on the producer or explorer for that unpermitted release;
12 this paragraph does not apply to the cost of developing and maintaining an oil
13 discharge prevention and contingency plan under AS 46.04.030;
14 (17) costs incurred to satisfy a work commitment under an exploration
15 license under AS 38.05.132;
16 (18) that portion of expenditures, that would otherwise be qualified
17 capital expenditures, as defined in AS 43.55.023, incurred during a calendar year that
18 are less than the product of $0.30 multiplied by the total taxable production from each
19 lease or property, in BTU equivalent barrels, during that calendar year, except that,
20 when a portion of a calendar year is subject to this provision, the expenditures and
21 volumes shall be prorated within that calendar year;
22 (19) costs incurred for repair, replacement, or deferred maintenance of
23 a facility, a pipeline, a structure, or equipment, other than a well, that results in or is
24 undertaken in response to a failure, problem, or event that results in an unscheduled
25 interruption of, or reduction in the rate of, oil or gas production; or costs incurred for
26 repair, replacement, or deferred maintenance of a facility, a pipeline, a structure, or
27 equipment, other than a well, that is undertaken in response to, or is otherwise
28 associated with, an unpermitted release of a hazardous substance or of gas; however,
29 costs under this paragraph that would otherwise constitute lease expenditures under (a)
30 and (b) of this section may be treated as lease expenditures if the department
31 determines that the repair or replacement is solely necessitated by an act of war, by an
01 unanticipated grave natural disaster or other natural phenomenon of an exceptional,
02 inevitable, and irresistible character, the effects of which could not have been
03 prevented or avoided by the exercise of due care or foresight, or by an intentional or
04 negligent act or omission of a third party, other than a party or its agents in privity of
05 contract with, or employed by, the producer or an operator acting for the producer, but
06 only if the producer or operator, as applicable, exercised due care in operating and
07 maintaining the facility, pipeline, structure, or equipment, and took reasonable
08 precautions against the act or omission of the third party and against the consequences
09 of the act or omission; in this paragraph,
10 (A) "costs incurred for repair, replacement, or deferred
11 maintenance of a facility, a pipeline, a structure, or equipment" includes costs
12 to dismantle and remove the facility, pipeline, structure, or equipment that is
13 being replaced;
14 (B) "hazardous substance" has the meaning given in
15 AS 46.03.826;
16 (C) "replacement" includes renovation or improvement;
17 (20) costs incurred to construct, acquire, or operate a refinery or crude
18 oil topping plant, regardless of whether the products of the refinery or topping plant
19 are used in oil or gas exploration, development, or production operations; however, if
20 a producer owns a refinery or crude oil topping plant that is located on or near the
21 premises of the producer's lease or property in the state and that processes the
22 producer's oil produced from that lease or property into a product that the producer
23 uses in the operation of the lease or property in drilling for or producing oil or gas, the
24 producer's lease expenditures include the amount calculated by subtracting from the
25 fair market value of the product used the prevailing value, as determined under
26 AS 43.55.020(f), of the oil that is processed;
27 (21) costs of lobbying, public relations, public relations advertising, or
28 policy advocacy.
29 * Sec. 63. AS 43.55.900(10) is amended to read:
30 (10) "gas processing plant" means a facility that
31 (A) extracts and recovers liquid hydrocarbons from a gaseous
01 mixture of hydrocarbons by gas processing; and
02 (B) is located upstream of the inlet of any pipeline
03 transporting gas to a gas treatment plant and upstream of the inlet of any gas
04 pipeline system transporting gas to a market;
05 * Sec. 64. AS 43.55.900(20) is amended to read:
06 (20) "point of production" means
07 (A) for oil, the automatic custody transfer meter or device
08 through which the oil enters into the facilities of a carrier pipeline or other
09 transportation carrier in a condition of pipeline quality; in the absence of an
10 automatic custody transfer meter or device, "point of production" means the
11 mechanism or device to measure the quantity of oil that has been approved by
12 the department for that purpose, through which the oil is tendered and accepted
13 in a condition of pipeline quality into the facilities of a carrier pipeline or other
14 transportation carrier or into a field topping plant;
15 (B) for gas [, OTHER THAN GAS DESCRIBED IN (C) OF
16 THIS PARAGRAPH,] that is
17 (i) not subjected to or recovered by mechanical
18 separation or run through a gas processing plant, the farthest upstream
19 of the following locations: the first point where the gas is accurately
20 metered, the inlet of any pipeline transporting the gas to a gas
21 treatment plant, or the inlet of any gas pipeline system
22 transporting the gas to a market;
23 (ii) subjected to or recovered by mechanical separation
24 but not run through a gas processing plant, the farthest upstream of
25 the following locations: the first point where the gas is accurately
26 metered after completion of mechanical separation, the inlet of any
27 pipeline transporting the gas after completion of mechanical
28 separation to a gas treatment plant, or the inlet of any gas pipeline
29 system transporting the gas after completion of mechanical
30 separation to a market;
31 (iii) run through a gas processing plant, the farthest
01 upstream of the following locations: the first point where the gas is
02 accurately metered downstream of the gas processing plant, the inlet
03 of any pipeline downstream of the gas processing plant
04 transporting the gas to a gas treatment plant, or the inlet of any gas
05 pipeline system downstream of the gas processing plant
06 transporting the gas to a market [;
07 (C) FOR GAS RUN THROUGH AN INTEGRATED GAS
08 PROCESSING PLANT AND GAS TREATMENT FACILITY THAT DOES
09 NOT ACCURATELY METER THE GAS AFTER THE GAS PROCESSING
10 AND BEFORE THE GAS TREATMENT, THE FIRST POINT WHERE GAS
11 PROCESSING IS COMPLETED OR WHERE GAS TREATMENT BEGINS,
12 WHICHEVER IS FURTHER UPSTREAM];
13 * Sec. 65. AS 43.55.900 is amended by adding a new paragraph to read:
14 (25) "gas treatment plant" means a facility that performs gas treatment,
15 regardless of whether the facility also performs gas processing.
16 * Sec. 66. AS 43.56.010(c) is amended to read:
17 (c) If the total value of assessed property of a municipality taxing under
18 AS 29.45.080(c) exceeds the product of the percentage, as determined in
19 AS 29.45.080(f), [225 PERCENT] of the average per capita assessed full and true
20 value of property in the state, to be determined by the department and reported to each
21 municipality by January 15 of each year, multiplied by the number of residents of the
22 taxing municipality, the department shall designate the portion of the tax base against
23 which the local tax may be applied.
24 * Sec. 67. AS 43.90.900(18) is amended to read:
25 (18) "point of production" has the meaning given in AS 43.55.900 as
26 that section read on June 8, 2007;
27 * Sec. 68. AS 43.98.030(c) is amended to read:
28 (c) A taxpayer acquiring a transferable tax credit certificate may use the credit
29 or a portion of the credit to offset taxes imposed under AS 21.09.210, AS 21.66.110,
30 AS 43.20, AS 43.55.011 [AS 43.55], AS 43.56, AS 43.65, AS 43.75, and AS 43.77.
31 Except as provided in (e) of this section, any portion of the credit not used may be
01 used at a later period or transferred under (b) of this section.
02 * Sec. 69. AS 43.98.050 is amended to read:
03 Sec. 43.98.050. Duties. The duties of the board include the following:
04 (1) establish and maintain a salient collection of information related to
05 oil and gas exploration, development, and production in the state and related to tax
06 structures, rates, and credits in other regions with oil and gas resources;
07 (2) review historical, current, and potential levels of investment in the
08 state's oil and gas sector;
09 (3) identify factors that affect investment in oil and gas exploration,
10 development, and production in the state, including tax structure, rates, and credits;
11 royalty requirements; infrastructure; workforce availability; and regulatory
12 requirements;
13 (4) review the competitive position of the state to attract and maintain
14 investment in the oil and gas sector in the state as compared to the competitive
15 position of other regions with oil and gas resources;
16 (5) in order to facilitate the work of the board, establish procedures to
17 accept and keep confidential information that is beneficial to the work of the board,
18 including the creation of a secure data room and confidentiality agreements to be
19 signed by individuals having access to confidential information;
20 (6) make written findings and recommendations to the Alaska State
21 Legislature before
22 (A) January 31, 2015, or as soon thereafter as practicable,
23 regarding
24 (i) changes to the state's regulatory environment and
25 permitting structure that would be conducive to encouraging increased
26 investment while protecting the interests of the people of the state and
27 the environment;
28 (ii) the status of the oil and gas industry labor pool in
29 the state and the effectiveness of workforce development efforts by the
30 state;
31 (iii) the status of the oil-and-gas-related infrastructure
01 of the state, including a description of infrastructure deficiencies; and
02 (iv) the competitiveness of the state's fiscal oil and gas
03 tax regime when compared to other regions of the world;
04 (B) January 15, 2017, regarding
05 (i) the state's tax structure and rates on oil and gas
06 produced south of 68 degrees North latitude;
07 (ii) a tax structure that takes into account the unique
08 economic circumstances for each oil and gas producing area south
09 of 68 degrees North latitude;
10 (iii) a reduction in the gross value at the point of
11 production for oil and gas produced south of 68 degrees North
12 latitude that is similar to the reduction in gross value at the point of
13 production in AS 43.55.160(f) and (g);
14 (iv) other incentives for oil and gas production south
15 of 68 degrees North latitude;
16 (C) January 31, 2021, or as soon thereafter as practicable,
17 regarding
18 (i) changes to the state's fiscal regime that would be
19 conducive to increased and ongoing long-term investment in and
20 development of the state's oil and gas resources;
21 (ii) alternative means for increasing the state's ability to
22 attract and maintain investment in and development of the state's oil
23 and gas resources; and
24 (iii) a review of the current effectiveness and future
25 value of any provisions of the state's oil and gas tax laws that are
26 expiring in the next five years.
27 * Sec. 70. Section 1(b), ch. 11, SLA 2013, is amended to read:
28 (b) It is the intent of the legislature that
29 (1) the Alaska Gasline Development Corporation, in its new placement
30 as an independent public corporation of the state, shall be treated for all purposes as
31 the transfer of a corporation within the state and not as the creation of a new entity by
01 the State of Alaska;
02 (2) the Board of Directors of the Alaska Gasline Development
03 Corporation commit to governing the Alaska Gasline Development Corporation so as
04 to affect positively as many Alaskans as possible, including those in rural and coastal
05 communities, and to extend opportunities for all Alaskans to benefit from the natural
06 gas resources of the state, including propane and associated gas-related hydrocarbons
07 other than oil;
08 (3) to the maximum extent permitted by law, in developing a natural
09 gas pipeline, the Alaska Gasline Development Corporation shall procure services,
10 labor, products, and natural resources from qualified businesses located in the state,
11 including organizations owned by Alaska Natives and municipal organizations directly
12 affected by the project, if those persons are competitive;
13 (4) the Alaska Gasline Development Corporation in its participation
14 in an Alaska liquefied natural gas project as defined in AS 31.25.390 or a natural
15 gas pipeline shall, to the maximum extent permitted by law,
16 (A) hire qualified residents from throughout the state for
17 management, engineering, construction, operations, maintenance, and other
18 positions for a natural gas pipeline project;
19 (B) establish hiring facilities in the state or use existing hiring
20 facilities in the state; and
21 (C) use, as far as practicable, the job centers and associated
22 services operated by the Department of Labor and Workforce Development
23 and an Internet-based labor exchange system operated by the state; and
24 (5) the Alaska Gasline Development Corporation and its subsidiaries
25 shall wind up and dissolve when no bonds, notes, or other obligations are outstanding
26 and the Alaska Gasline Development Corporation or a subsidiary of the Alaska
27 Gasline Development Corporation is no longer engaged in the development, financing,
28 construction, or operation of an in-state natural gas pipeline.
29 * Sec. 71. AS 31.25.080(f) is repealed.
30 * Sec. 72. The uncodified law of the State of Alaska is amended by adding a new section to
31 read:
01 INFRASTRUCTURE. (a) The Department of Transportation and Public Facilities
02 shall, in consultation with the Alaska Gasline Development Corporation, evaluate the design
03 and construction of a new, separate bridge across the Yukon River that would accommodate
04 both vehicular traffic and a gas pipeline resulting from an Alaska liquefied natural gas project.
05 (b) The Department of Transportation and Public Facilities shall, in consultation with
06 the Alaska Gasline Development Corporation and the Department of Natural Resources,
07 evaluate existing bridges and infrastructure and bridges and infrastructure constructed to
08 accommodate a gas pipeline resulting from an Alaska liquefied natural gas project and
09 determine whether the bridge or infrastructure could also be constructed for transportation
10 uses, including vehicular traffic.
11 * Sec. 73. The uncodified law of the State of Alaska is amended by adding a new section to
12 read:
13 REPORT AND RECOMMENDATIONS BY THE COMMISSIONER OF
14 NATURAL RESOURCES ON THE DELIVERY AND AVAILABILITY OF NORTH
15 SLOPE NATURAL GAS IN THE STATE; IDENTIFICATION OF RISKS AND
16 RECOMMENDATIONS FOR MITIGATION. (a) The commissioner of natural resources in
17 consultation with the Alaska Gasline Development Corporation shall prepare and make
18 available to the legislature a report on a plan and alternatives to make North Slope natural gas
19 available for delivery and use in the state. The report must address
20 (1) the means by which North Slope natural gas may be delivered for use in
21 the state;
22 (2) the anticipated benefits, risks, and liabilities to the state associated with the
23 sale by the state to utilities and other customers in the state of natural gas received by the state
24 as royalty in kind or as payment of tax;
25 (3) the effect and consequences, including the fiscal effect and liability to third
26 parties, of the state's transport of a reduced amount of natural gas south of an in-state delivery
27 point or underutilizing capacity in a liquefied natural gas plant;
28 (4) the costs, benefits, and risks associated with building a pipeline with a
29 mainline diameter larger than 42 inches, including the effect of the increased diameter on
30 compression, fuel, and other costs; the anticipated allocation of the cost of an increased
31 diameter among project participants and the options for and effects of the state or participants
01 in the project funding the increased diameter; a quantification of the potential benefits from
02 the increased diameter that may include increased exploration activity by parties and
03 nonparties to the project and increased royalties and taxes from additional production
04 transported in the increased capacity; and whether natural gas transported in the additional
05 capacity is likely to be produced from federal or state land; and
06 (5) other issues the commissioner of natural resources determines are relevant
07 to the delivery and use of North Slope natural gas in the state and should be considered by the
08 legislature.
09 (b) In conjunction with the report in (a) of this section, the commissioner of natural
10 resources shall recommend the means for eliminating or minimizing the risks and liabilities
11 identified in the report.
12 (c) The commissioner of natural resources shall make the report and
13 recommendations required by this section available to the legislature on or before the date a
14 firm transportation services agreement in a North Slope natural gas project to which the state
15 is a party is submitted to the legislature for approval.
16 (d) In this section, "North Slope natural gas project" has the meaning given in
17 AS 38.05.965, as amended by sec. 33 of this Act.
18 * Sec. 74. The uncodified law of the State of Alaska is amended by adding a new section to
19 read:
20 REQUESTING THE GOVERNOR TO ESTABLISH AN ADVISORY PLANNING
21 GROUP. (a) The legislature requests the governor to establish an advisory planning group
22 under AS 44.19.145 to advise the governor on municipal involvement in a North Slope
23 natural gas project. Members of the advisory planning group may include representatives of
24 municipalities, the commissioner of natural resources, the commissioner of revenue,
25 representatives of oil and gas and gas only lessees on the North Slope, and representatives of
26 other persons expected to be directly involved in the development of a North Slope natural
27 gas project.
28 (b) The advisory planning group shall review available information, hold public
29 meetings, and provide annual reports by December 15 of each year to the governor that
30 include
31 (1) the potential impact and benefits of new infrastructure for North Slope
01 natural gas development, whether designed to provide natural gas for in-state sale or for
02 export, or both, on communities in the state, including consideration of tax structure under
03 AS 29.45 and AS 43.56, and consideration of other payments before construction of new
04 infrastructure associated with North Slope natural gas development;
05 (2) recommendations for changes to the oil and gas exploration, production,
06 and pipeline transportation property taxes under AS 43.56 related to infrastructure for
07 commercialization of natural gas that would facilitate development of a major natural gas
08 project and mitigate financial impacts to communities affected by development of a North
09 Slope natural gas project;
10 (3) recommendations for changes to AS 29.45.080 related to the
11 commercialization of natural gas that would facilitate development of a North Slope natural
12 gas project and mitigate financial impacts to communities affected by a North Slope natural
13 gas project;
14 (4) recommendations for legislative or other options to minimize the financial
15 impact to communities in proximity to North Slope natural gas project infrastructure during
16 construction of a natural gas pipeline and associated infrastructure; and
17 (5) recommendations on the impact and benefits to communities not in
18 proximity to a North Slope natural gas project.
19 (c) In this section, "North Slope natural gas project" has the meaning given in
20 AS 38.05.965, as amended by sec. 33 of this Act.
21 * Sec. 75. The uncodified law of the State of Alaska is amended by adding a new section to
22 read:
23 PLAN AND RECOMMENDATIONS TO THE LEGISLATURE ON
24 INFRASTRUCTURE NEEDED TO DELIVER AFFORDABLE ENERGY TO AREAS IN
25 THE STATE THAT DO NOT HAVE DIRECT ACCESS TO A NORTH SLOPE NATURAL
26 GAS PIPELINE. (a) The Alaska Energy Authority, in consultation with the Alaska Gasline
27 Development Corporation, the Alaska Industrial Development and Export Authority, and the
28 Department of Revenue, shall, after considering the state energy policy under AS 44.99.115
29 and sec. 1, ch. 82, SLA 2010, develop a plan for developing infrastructure to deliver more
30 affordable energy to areas of the state that are not expected to have direct access to a North
31 Slope natural gas pipeline. The plan must identify ownership options, different energy
01 sources, including fossil fuels, hydro projects, tidal, and other alternative energy sources, and
02 describe and recommend the means for generating, delivering, receiving, and storing energy
03 in the most cost-efficient manner. For those citizens for whom there is no economically viable
04 infrastructure available, the plan must recommend the means for directly underwriting the
05 energy costs of the citizens to make their energy costs more affordable. The Alaska Energy
06 Authority may consider the development of regional energy systems that can receive and store
07 bulk fuel in quantity and distribute that fuel as needed within the region.
08 (b) The Alaska Energy Authority, in consultation with the Department of Revenue,
09 shall recommend a plan for funding the design, development, and construction of the required
10 infrastructure and may identify a source of rent, royalty, income, or tax received by the state
11 that may be appropriated by the legislature to implement the plan.
12 (c) The Alaska Energy Authority shall provide the plan and suggested legislation for
13 the design, development, construction, and financing of the required infrastructure to the
14 legislature before January 1, 2017.
15 * Sec. 76. The uncodified law of the State of Alaska is amended by adding a new section to
16 read:
17 DEVELOPMENT OF A PLAN FOR MUNICIPALITIES, REGIONAL
18 CORPORATIONS, AND RESIDENTS TO PARTICIPATE IN THE OWNERSHIP OF A
19 NORTH SLOPE NATURAL GAS PIPELINE; IDENTIFICATION OF AND REPORT ON
20 FINANCING OPTIONS FOR STATE OWNERSHIP AND PARTICIPATION IN A
21 NORTH SLOPE NATURAL GAS PROJECT. (a) The commissioner of revenue shall identify
22 and report to the legislature on a range of financing options for state acquisition of an
23 ownership interest and participation in a North Slope natural gas project. The report must
24 include a description of the risk associated with each option and the effect of each option on
25 the bonding capacity and bond rating of the state. In this subsection, "North Slope natural gas
26 project" has the meaning given in AS 38.05.965, as amended by sec. 33 of this Act.
27 (b) The commissioner shall make an interim draft of the report described in (a) of this
28 section available to the legislature on the first day of the First Regular Session of the Twenty-
29 Ninth Alaska State Legislature, and a final report at the time the commissioner of natural
30 resources submits the first agreement or contract to the legislature for approval under
31 AS 38.05.020(b)(11), enacted by sec. 24 of this Act.
01 (c) At the time the commissioner of natural resources submits the first agreement or
02 contract to the legislature for approval under AS 38.05.020(b)(11), enacted by sec. 24 of this
03 Act, the commissioner of revenue shall present a plan and suggested legislation to allow a
04 municipality, regional corporation, or resident of the state to participate as a co-owner in a
05 North Slope natural gas pipeline. The plan must include the recommendations and analysis by
06 the commissioner as to
07 (1) the means by which a municipality, regional corporation, or resident may
08 invest in the North Slope natural gas pipeline; for a resident, the means may include providing
09 an option to designate an amount of a permanent fund dividend to be deducted for the
10 investment;
11 (2) whether the ownership interest in a North Slope natural gas pipeline should
12 be acquired from the portion of a North Slope natural gas pipeline acquired by the state,
13 through the purchase of stock in a publicly traded corporation that invests in a North Slope
14 natural gas pipeline, or some other means;
15 (3) the means for providing notice to a municipality, regional corporation, or
16 resident receiving an ownership interest that explains the type of ownership interest and the
17 rights and obligations related to that ownership interest;
18 (4) whether the ownership interest received by a municipality, regional
19 corporation, or resident may be transferred or assigned to another person and the means for
20 transferring the interest;
21 (5) the means by which the proportional share of a dividend or other income
22 may be distributed to a municipality, regional corporation, resident, or transferee of an interest
23 if the municipality, regional corporation, or resident receives an ownership interest acquired
24 by the state in a North Slope natural gas pipeline and the state receives a dividend or other
25 income from its ownership interest, and whether the payment should be subject to interest if
26 not timely distributed;
27 (6) the means by which the commissioner may identify a publicly traded
28 corporation that has an ownership interest in a North Slope natural gas pipeline that is subject
29 to investment by a municipality, regional corporation, or resident under the proposed plan;
30 (7) the means by which an individual may qualify as a resident for purposes of
31 investing in an ownership interest;
01 (8) whether the ownership interest held by a municipality, regional
02 corporation, or resident would be subject to project assessments;
03 (9) how cash calls for the project and the expansion of the project would be
04 managed;
05 (10) the income tax consequences to the holder of an ownership interest,
06 including the timing and recognition of income related to the ownership interest, including
07 differentiating income related to the ownership interest from the receipt of dividends or other
08 distributions;
09 (11) the risk that the receipt of a benefit from the project by a person other
10 than the state would make income received from the project by the state subject to federal
11 income tax; and
12 (12) constitutional issues that may be implicated by restricting ownership
13 interests under the plan to residents and municipalities in the state.
14 (d) In this section,
15 (1) "municipality" has the meaning given in AS 01.10.060;
16 (2) "North Slope natural gas pipeline" means a natural gas pipeline project that
17 transports natural gas produced in the state north of 68 degrees North latitude to a market in
18 the state or to tidewater for export from the state including a facility in the state for liquefying
19 natural gas for transport;
20 (3) "regional corporation" means a regional corporation organized under 43
21 U.S.C. 1606(a), as amended.
22 * Sec. 77. The uncodified law of the State of Alaska is amended by adding a new section to
23 read:
24 LEGISLATIVE BRIEFINGS. Before the first flow of gas in a North Slope natural gas
25 project developed under the authority of this Act, the parties to the project shall, at least once
26 every four months, provide briefings to interested legislators, legislative staff, and legislative
27 consultants on the progress of a North Slope natural gas project developed under the authority
28 of this Act. A briefing under this section must be accompanied by a written report provided by
29 the Department of Natural Resources of the amount of money the state may be obligated to
30 pay a third party under an agreement or contract under AS 38.05.020(b)(10) or (11) if a North
31 Slope natural gas project is terminated before the first flow of gas in the project.
01 * Sec. 78. The uncodified law of the State of Alaska is amended by adding a new section to
02 read:
03 APPLICABILITY. Sections 1 - 6 and 66 apply to tax years beginning after
04 December 31, 2014.
05 * Sec. 79. The uncodified law of the State of Alaska is amended by adding a new section to
06 read:
07 TRANSITION: REGULATIONS. The Department of Revenue and the Department of
08 Natural Resources may adopt regulations to implement this Act. The regulations take effect
09 under AS 44.62 (Administrative Procedure Act), but not before the effective date of the
10 provisions of this Act being implemented.
11 * Sec. 80. Sections 7 - 24, 27, 33 - 37, 39, 40, 48, 50, 67 - 77, and 79 of this Act take effect
12 immediately under AS 01.10.070(c).
13 * Sec. 81. Sections 1 - 6, 66, and 78 take effect July 1, 2014.
14 * Sec. 82. Section 49 of this Act takes effect January 1, 2021.
15 * Sec. 83. Except as provided in secs. 80 - 82 of this Act, this Act takes effect January 1,
16 2015.