00                             HOUSE BILL NO. 234                                                                          
01 "An Act relating to the due date for the payment of oil and gas royalty and net profit                                  
02 shares and amending the rate of interest payable on royalties or net profit shares."                                    
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1.  AS 38.05.135(c) is amended to read:                                                                  
05            (c)  Payment of a royalty or a net profit share payment to the state under a lease                           
06       issued under AS 38.05.135 - 38.05.181 becomes due on the date and in the manner                                   
07       specified in the lease or in a regulation adopted by the commissioner.  However, if, as                       
08       a result of an inspection of records or an audit, the commissioner determines that                            
09       there is an error in the oil or gas royalty or net profit share payment due the                               
10       state, the commissioner shall redetermine and recalculate the royalty or net                                  
11       profit and notify the lessee of the redetermination and recalculation, and, if                                
12       under that recalculation, the lessee has underpaid the amount due, the payment                                
13       of the redetermined oil or gas royalty or net profit share payment becomes due                                
14       and payable 60 days after the date of the commissioner's transmittal of the                                   
01       notification of the redetermination.                                                                          
02    * Sec. 2.  AS 38.05.135(d) is amended to read:                                                                     
03            (d)  If a royalty or net profit share payment to which the state is entitled under                           
04       AS 38.05.135 - 38.05.181 is not paid or is underpaid when it becomes due under (c) of                             
05       this section, the unpaid amount of the royalty or net profit share payment bears interest                         
06       in a calendar quarter at the rate of two [FIVE] percentage points above the annual rate                       
07       charged member banks for advances by the 12th Federal Reserve District as of the                                  
08       first day of that calendar quarter [, OR AT THE ANNUAL RATE OF 11 PERCENT,                                        
09       WHICHEVER IS GREATER, COMPOUNDED QUARTERLY AS OF THE LAST                                                         
10       DAY OF THAT QUARTER].