2018-02-05                     Senate Journal                      Page 1930
certain corporate income tax credits for gas storage facilities and in-                                                         
state oil refineries. The lower discount rate will be based on the State's                                                      
true interest cost plus 1.5 percent, which we currently estimate will be                                                        
about 5.5 percent. The corporation would not issue bonds unless it                                                              
found that the discount rate applied in the Department of Revenue's                                                             
purchase of the tax credits would exceed the State's true interest cost                                                         
on the bonds by at least 1.5 percent per year.                                                                                  
                                                                                                                                
The Department of Natural Resources would handle the agreements                                                                 
for overriding royalty interests and waivers of confidentiality for early                                                       
release of seismic data. The bill would have an immediate effective                                                             
date. The immediate effective date would allow the new Alaska Tax                                                               
Credit Certificate Bond Corporation, the Department of Revenue, the                                                             
Department of Natural Resources, and those requesting purchase from                                                             
the oil and gas tax credit fund the ability to start work right away to                                                         
address these tax credits.                                                                                                      
                                                                                                                                
I am proposing this bill to achieve a fair resolution to the oil and gas                                                        
tax credit purchase program, and to free up capital for the small                                                               
companies impacted by the program to resume investing in future oil                                                             
production. Passage of this bill would allow the state to move past the                                                         
uncertainty on these tax credits and focus on growing Alaska.                                                                   
                                                                                                                                
I urge your prompt and favorable action on this measure.                                                                        
                                                                                                                                
Sincerely,                                                                                                                      
/s/                                                                                                                             
Bill Walker                                                                                                                     
Governor                                                                                                                        
                                                                                                                                
SB 177                                                                                                                        
SENATE BILL NO. 177 BY SENATOR MACKINNON, entitled:                                                                             
                                                                                                                                
          "An Act relating to the mental health trust fund and                                                                  
          the Alaska Mental Health Trust Authority; relating to                                                                 
          the Alaska Mental Health Trust Authority's authority                                                                  
          to acquire, invest in, make capital improvements to,                                                                  
          or undertake other activities on real properties;                                                                     
          relating to management of mental health trust land;                                                                   
          establishing the Alaska Mental Health Trust