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SB 135: "An Act relating to the sharing of tax revenue from the fisheries business tax and fishery resource landing tax with municipalities; relating to municipal reports on the shared tax revenue; and providing for an effective date."

00 SENATE BILL NO. 135 01 "An Act relating to the sharing of tax revenue from the fisheries business tax and 02 fishery resource landing tax with municipalities; relating to municipal reports on the 03 shared tax revenue; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 06 to read: 07 LEGISLATIVE INTENT. It is the intent of the legislature that a municipality use the 08 additional revenue distributed under this Act to help maintain and improve the municipality's 09 harbor facilities. 10 * Sec. 2. AS 43.75.130(a) is amended to read: 11 (a) Subject to appropriation by the legislature, and except [EXCEPT] as 12 provided in (d) of this section, the commissioner shall pay 13 (1) to each unified municipality and to each city located in the 14 unorganized borough, 60 [50] percent of the amount of tax revenue collected in the

01 municipality from taxes levied under this chapter; 02 (2) to each city located within a borough, 35 [25] percent of the 03 amount of tax revenue collected in the city from taxes levied under this chapter; and 04 (3) to each borough 05 (A) 60 [50] percent of the amount of tax revenue collected in 06 the area of the borough outside cities from taxes levied under this chapter; and 07 (B) 35 [25] percent of the amount of tax revenue collected in 08 cities located within the borough from taxes levied under this chapter. 09 * Sec. 3. AS 43.75.130(a), as amended by sec. 2 of this Act, is amended to read: 10 (a) Subject to appropriation by the legislature, and except as provided in (d) of 11 this section, the commissioner shall pay 12 (1) to each unified municipality and to each city located in the 13 unorganized borough, 50 [60] percent of the amount of tax revenue collected in the 14 municipality from taxes levied under this chapter; 15 (2) to each city located within a borough, 25 [35] percent of the 16 amount of tax revenue collected in the city from taxes levied under this chapter; and 17 (3) to each borough 18 (A) 50 [60] percent of the amount of tax revenue collected in 19 the area of the borough outside cities from taxes levied under this chapter; and 20 (B) 25 [35] percent of the amount of tax revenue collected in 21 cities located within the borough from taxes levied under this chapter. 22 * Sec. 4. AS 43.75.130(d) is amended to read: 23 (d) Notwithstanding the provisions of (a)(2) and (a)(3)(B) of this section, and 24 subject to appropriation by the legislature, the commissioner shall pay 25 (1) to each city that is located in a borough incorporated after June 16, 26 1987, the following percentages of the tax revenue collected in the city from taxes 27 levied under this chapter: 28 (A) 55 [45] percent of the taxes collected during the calendar 29 year in which the borough is incorporated; 30 (B) 50 [40] percent of the taxes collected during the first 31 calendar year after the calendar year in which the borough is incorporated;

01 (C) 45 [35] percent of the taxes collected during the second 02 calendar year after the calendar year in which the borough is incorporated; and 03 (D) 40 [30] percent of the taxes collected during the third 04 calendar year after the calendar year in which the borough is incorporated; and 05 (2) to each borough that is incorporated after June 16, 1987, the 06 following percentages of the tax revenue collected in the cities located within the 07 borough from taxes levied under this chapter: 08 (A) 7.5 [5] percent of the taxes collected during the calendar 09 year in which the borough is incorporated; 10 (B) 15 [10] percent of the taxes collected during the first 11 calendar year after the calendar year in which the borough is incorporated; 12 (C) 25 [15] percent of the taxes collected during the second 13 calendar year after the calendar year in which the borough is incorporated; and 14 (D) 30 [20] percent of the taxes collected during the third 15 calendar year after the calendar year in which the borough is incorporated. 16 * Sec. 5. AS 43.75.130(d), as amended by sec. 4 of this Act, is amended to read: 17 (d) Notwithstanding the provisions of (a)(2) and (a)(3)(B) of this section, and 18 subject to appropriation by the legislature, the commissioner shall pay 19 (1) to each city that is located in a borough incorporated after June 16, 20 1987, the following percentages of the tax revenue collected in the city from taxes 21 levied under this chapter: 22 (A) 45 [55] percent of the taxes collected during the calendar 23 year in which the borough is incorporated; 24 (B) 40 [50] percent of the taxes collected during the first 25 calendar year after the calendar year in which the borough is incorporated; 26 (C) 35 [45] percent of the taxes collected during the second 27 calendar year after the calendar year in which the borough is incorporated; and 28 (D) 30 [40] percent of the taxes collected during the third 29 calendar year after the calendar year in which the borough is incorporated; and 30 (2) to each borough that is incorporated after June 16, 1987, the 31 following percentages of the tax revenue collected in the cities located within the

01 borough from taxes levied under this chapter: 02 (A) five [7.5] percent of the taxes collected during the calendar 03 year in which the borough is incorporated; 04 (B) 10 [15] percent of the taxes collected during the first 05 calendar year after the calendar year in which the borough is incorporated; 06 (C) 15 [25] percent of the taxes collected during the second 07 calendar year after the calendar year in which the borough is incorporated; and 08 (D) 20 [30] percent of the taxes collected during the third 09 calendar year after the calendar year in which the borough is incorporated. 10 * Sec. 6. AS 43.75.137 is amended to read: 11 Sec. 43.75.137. Additional refund. Subject to appropriation by the 12 legislature [TO THE EXTENT THAT APPROPRIATIONS ARE AVAILABLE FOR 13 THE PURPOSE, AND NOTWITHSTANDING THE REQUIREMENT OF 14 AS 37.07.080(e) THAT APPROVAL OF THE OFFICE OF MANAGEMENT AND 15 BUDGET IS REQUIRED], an amount equal to 75 [50] percent of the tax revenue that 16 is collected under this chapter from fisheries businesses and that is not subject to 17 division with a municipality under AS 43.75.130 shall be paid by [TRANSMITTED 18 EACH FISCAL YEAR, WITHOUT THE APPROVAL OF THE OFFICE OF 19 MANAGEMENT AND BUDGET, BY THE DEPARTMENT TO] the Department of 20 Commerce, Community, and Economic Development [FOR DISBURSAL] to eligible 21 municipalities under AS 29.60.450. 22 * Sec. 7. AS 43.75.137, as amended by sec. 6 of this Act, is amended to read: 23 Sec. 43.75.137. Additional refund. Subject to appropriation by the legislature, 24 an amount equal to 50 [75] percent of the tax revenue that is collected under this 25 chapter from fisheries businesses and that is not subject to division with a municipality 26 under AS 43.75.130 shall be paid by the Department of Commerce, Community, and 27 Economic Development to eligible municipalities under AS 29.60.450. 28 * Sec. 8. AS 43.75 is amended by adding a new section to article 3 to read: 29 Sec. 43.75.150. Municipal reports to the legislature. (a) Not more than 30 30 days after the convening of each regular legislative session, a municipality that 31 receives tax revenue under AS 43.75.130 - 43.75.137 shall prepare and submit to the

01 legislature a report that describes 02 (1) how those funds were used by the municipality in the previous 03 fiscal year; and 04 (2) any harbor maintenance or improvement projects that were funded 05 in whole or in part by the tax revenue collected under AS 43.75.130 - 43.75.137. 06 (b) The report required under (a) of this section may be made jointly with the 07 report required under AS 43.77.060(f). 08 * Sec. 9. AS 43.77.060(a) is amended to read: 09 (a) Subject to appropriation by the legislature and except as provided in (b) of 10 this section, the commissioner shall pay to each 11 (1) unified municipality and to each city located in the unorganized 12 borough 75 [, 50] percent of the amount of tax revenue collected from taxes levied 13 under this chapter on the fishery resource landed in the municipality and accounted for 14 under AS 43.77.050(b); 15 (2) city located within a borough 35 [, 25] percent of the amount of the 16 tax revenue collected from taxes levied under this chapter on fishery resources landed 17 in the city and accounted for under AS 43.77.050(b); and 18 (3) borough 19 (A) 75 [50] percent of the amount of the tax revenue collected 20 from taxes levied under this chapter on fishery resources landed in the area of 21 the borough outside cities and accounted for under AS 43.77.050(b); and 22 (B) 35 [25] percent of the amount of the tax revenue collected 23 from taxes levied under this chapter on fishery resources landed in cities 24 located within the borough and accounted for under AS 43.77.050(b). 25 * Sec. 10. AS 43.77.060(a), as amended by sec. 9 of this Act, is amended to read: 26 (a) Subject to appropriation by the legislature and except as provided in (b) of 27 this section, the commissioner shall pay to each 28 (1) unified municipality and to each city located in the unorganized 29 borough 50 [75] percent of the amount of tax revenue collected from taxes levied 30 under this chapter on the fishery resource landed in the municipality and accounted for 31 under AS 43.77.050(b);

01 (2) city located within a borough 25 [35] percent of the amount of the 02 tax revenue collected from taxes levied under this chapter on fishery resources landed 03 in the city and accounted for under AS 43.77.050(b); and 04 (3) borough 05 (A) 50 [75] percent of the amount of the tax revenue collected 06 from taxes levied under this chapter on fishery resources landed in the area of 07 the borough outside cities and accounted for under AS 43.77.050(b); and 08 (B) 25 [35] percent of the amount of the tax revenue collected 09 from taxes levied under this chapter on fishery resources landed in cities 10 located within the borough and accounted for under AS 43.77.050(b). 11 * Sec. 11. AS 43.77.060(b) is amended to read: 12 (b) Notwithstanding the provisions of (a)(2) and (a)(3)(B) of this section, and 13 subject to appropriation by the legislature, the commissioner shall pay to each 14 (1) city that is located in a borough incorporated after January 1, 1994, 15 the following percentages of the tax revenue collected from taxes levied under this 16 chapter on fishery resources landed in the city and accounted for under 17 AS 43.77.050(b): 18 (A) 50 [45] percent of the tax revenue collected during the 19 calendar year in which the borough is incorporated; 20 (B) 50 [40] percent of the tax revenue collected during the first 21 calendar year after the calendar year in which the borough is incorporated; 22 (C) 50 [35] percent of the tax revenue collected during the 23 second calendar year after the calendar year in which the borough is 24 incorporated; and 25 (D) 50 [30] percent of the tax revenue collected during the third 26 calendar year after the calendar year in which the borough is incorporated; and 27 (2) borough that is incorporated after January 1, 1994, the following 28 percentages of the tax revenue collected from taxes levied under this chapter on 29 fishery resources landed in the cities located within the borough and accounted for 30 under AS 43.77.050(b): 31 (A) 10 [FIVE] percent of the tax revenue collected during the

01 calendar year in which the borough is incorporated; 02 (B) 20 [10] percent of the tax revenue collected during the first 03 calendar year after the calendar year in which the borough is incorporated; 04 (C) 25 [15] percent of the tax revenue collected during the 05 second calendar year after the calendar year in which the borough is 06 incorporated; and 07 (D) 35 [20] percent of the tax revenue collected during the third 08 calendar year after the calendar year in which the borough is incorporated. 09 * Sec. 12. AS 43.77.060(b), as amended by sec. 11 of this Act, is amended to read: 10 (b) Notwithstanding the provisions of (a)(2) and (a)(3)(B) of this section, and 11 subject to appropriation by the legislature, the commissioner shall pay to each 12 (1) city that is located in a borough incorporated after January 1, 1994, 13 the following percentages of the tax revenue collected from taxes levied under this 14 chapter on fishery resources landed in the city and accounted for under 15 AS 43.77.050(b): 16 (A) 45 [50] percent of the tax revenue collected during the 17 calendar year in which the borough is incorporated; 18 (B) 40 [50] percent of the tax revenue collected during the first 19 calendar year after the calendar year in which the borough is incorporated; 20 (C) 35 [50] percent of the tax revenue collected during the 21 second calendar year after the calendar year in which the borough is 22 incorporated; and 23 (D) 30 [50] percent of the tax revenue collected during the third 24 calendar year after the calendar year in which the borough is incorporated; and 25 (2) borough that is incorporated after January 1, 1994, the following 26 percentages of the tax revenue collected from taxes levied under this chapter on 27 fishery resources landed in the cities located within the borough and accounted for 28 under AS 43.77.050(b): 29 (A) five [10] percent of the tax revenue collected during the 30 calendar year in which the borough is incorporated; 31 (B) 10 [20] percent of the tax revenue collected during the first

01 calendar year after the calendar year in which the borough is incorporated; 02 (C) 15 [25] percent of the tax revenue collected during the 03 second calendar year after the calendar year in which the borough is 04 incorporated; and 05 (D) 20 [35] percent of the tax revenue collected during the third 06 calendar year after the calendar year in which the borough is incorporated. 07 * Sec. 13. AS 43.77.060(d) is amended to read: 08 (d) Subject to appropriation by the legislature [TO THE EXTENT THAT 09 APPROPRIATIONS ARE AVAILABLE FOR THE PURPOSE, AND 10 NOTWITHSTANDING THE REQUIREMENT OF AS 37.07.080(e) THAT 11 APPROVAL OF THE OFFICE OF MANAGEMENT AND BUDGET IS 12 REQUIRED], an amount equal to 75 [50] percent of the tax revenue that is collected 13 under this chapter and that is not subject to division with a municipality under (a) - (c) 14 of this section shall be paid by [TRANSMITTED EACH FISCAL YEAR, 15 WITHOUT THE APPROVAL OF THE OFFICE OF MANAGEMENT AND 16 BUDGET, BY THE DEPARTMENT TO] the Department of Commerce, Community, 17 and Economic Development [FOR DISBURSAL] to eligible municipalities under 18 AS 29.60.450. 19 * Sec. 14. AS 43.77.060(d), as amended by sec. 13 of this Act, is amended to read: 20 (d) Subject to appropriation by the legislature, an amount equal to 50 [75] 21 percent of the tax revenue that is collected under this chapter and that is not subject to 22 division with a municipality under (a) - (c) of this section shall be paid by the 23 Department of Commerce, Community, and Economic Development to eligible 24 municipalities under AS 29.60.450. 25 * Sec. 15. AS 43.77.060 is amended by adding a new subsection to read: 26 (f) Not more than 30 days after the convening of each regular legislative 27 session, a municipality that receives tax revenue under this section shall prepare and 28 submit to the legislature a report that describes how those funds were used by the 29 municipality in the previous fiscal year and that details any harbor maintenance or 30 improvement projects that were funded in whole or in part by that tax revenue. The 31 report may be made jointly with the report required under AS 43.75.150.

01 * Sec. 16. The uncodified law of the State of Alaska is amended by adding a new section to 02 read: 03 APPLICABILITY. This Act applies to tax revenue collected by the Department of 04 Revenue under AS 43.75 and AS 43.77 for the 2025 tax year and later tax years. 05 * Sec. 17. Sections 8 and 15 of this Act take effect February 1, 2026. 06 * Sec. 18. Sections 3, 5, 7, 10, 12, and 14 of this Act take effect July 1, 2035. 07 * Sec. 19. Except as provided in secs. 17 and 18 of this Act, this Act takes effect January 1, 08 2026.