NOTICE OF
PROPOSED CHANGES IN THE REGULATIONS
OF THE DEPARTMENT OF REVENUE

BRIEF DESCRIPTION:  The Department of Revenue proposes regulations to implement conforming changes to statutes and legislation enacted in §66 ch. 14 SLA 2014 (SB 138) affecting the oil and gas properties tax.  The proposed regulations relate to appeal procedures, percentage limitations to be applied to assessed value by the department, and conforming and clarifying changes related to recent legislation affecting the oil and gas properties tax.

The Department of Revenue proposes to adopt regulation changes in Title 15, Chapter 56 of the Alaska Administrative Code, dealing with the administration of revenue laws and the oil and gas properties tax, including the following:

1. 15 AAC 05.010. Notice of assessment, is proposed to be amended to conform to the repeal of certain sections of the regulations.
2. 15 AAC 56.015. Appeal procedures, is proposed to be repealed to conform to recent court decisions regarding appeal procedures.
3. 15 AAC 56.020. Appeal to the department, is proposed to be amended to clarify that an appeal must be timely to be considered by the department.
4. 15 AAC 56.030. Appeal to the state assessment review board, is proposed to be amended to clarify that an appeal must be timely to be considered by the department.
5. 15 AAC 56.050. Credit and refund, is proposed to be amended to conform to changes in statute.
6. 15 AAC 56.070. Average per capita assessed full and true value of property in the state, is proposed to be amended to account for the change in the limitation of assessed value from the former 225 percent under AS 29.45.080(c) to the stair-stepped rates in AS 29.45.080(f).
7. 15 AAC 56.100. Production property, is proposed to be amended to delete a provision relating to the establishment of proven reserves.

You may comment on the proposed regulation changes, including the potential costs to private persons of complying with the proposed changes, by submitting written comments to: John Larsen, Audit Master, Alaska Department of Revenue,         550 W. 7th Ave., Ste. 500, Anchorage, AK 99501.

Additionally, the Department of Revenue will accept comments by electronic mail to john.larsen@alaska.gov, or by facsimile at (907) 269-6644.  Written comments must be received no later than 4:30 p.m., on Thursday, October 20, 2016.

If you are a person with a disability who needs a special accommodation in order to participate in this process, please contact John Larsen at (907) 269-8436 no later than October 17, 2016 to ensure that any necessary accommodations can be provided.

For a copy of the proposed regulation changes, contact John Larsen at (907) 269-8436 or go to the Division's Internet website at http://www.tax.alaska.gov.

After the public comment period ends on Thursday, October 20, 2016, the Department of Revenue will either adopt these or other provisions dealing with the same subject, without further notice, or decide to take no action on them.  The language of the final regulations may be different from that of the proposed regulations.  You should comment during the time allowed if your interests could be affected.  Written comments received are public records and are subject to public inspection.

Statutory Authority:  AS 43.05.080.
Statutes Being Implemented, Interpreted, or Made Specific: AS 29.45.080; AS 29.45.090; AS 43.56.010; AS 43.56.060; AS 43.56.110; AS 43.56.10.

Fiscal Information: The proposed regulation changes are not expected to require an increased appropriation.

DATE: September 16, 2016                                                   /s/ Ken Alper
Juneau, Alaska                                                                       Ken Alper     
                                                                                              Director, Tax Division|
                                                                                              (907) 269-6620

ADDITIONAL REGULATIONS NOTICE INFORMATION
[AS 44.62.190(d)]

1. Adopting Agency:  Department of Revenue, Tax Division
2. General subject of regulation:  Alaska Oil and Gas Exploration, Production, and Pipeline Transportation Property Taxes: Appeal procedures, limitations on assessed property values, establishment of proven reserves, and other conforming changes.
3. Citation of regulations:  15 AAC 05 amend section 010; 15 AAC 56 sections to be amended or repealed: 015, 020, 030, 050, 070, and 100
4. Department of Law file number:  JU2015200857
5. Reason for the proposed action:
             (  )  compliance with federal law               
             (x)   compliance with new or changed state statutes
             (x)  compliance with court order
             (x)   development of program standards
             (  )   other:  (please list)
6. Appropriation/Allocation: Tax Division, Revenue Operations
7. Cost of implementation to the state agency and available funding (in thousands of dollars):  No costs are expected in FY 2017 or subsequent years.
   
   

                                                                           Initial Year                  Subsequent
                                                                           FY 2017                      Years
                           Operating Cost                        $___0____                  $___0____
                           Capital Cost                             $___0____                  $___0____
                           1002 Federal receipts              $___0____                  $___0____
                           1003 General fund match        $___0____                  $___0____
                           1004 General fund                  $___0____                   $___0____  
                           1005 General fund/
                               Program                              $___0____                   $___0____
                           1037 General fund/
                                mental health                     $___0____                  $___0____
                            Other                                     $___0____                   $___0____

8. The name of the contact person for the regulations:

Name:              John Larsen
Title:                Audit Master
Address:          550 W. 7^th Ave., Ste. 500, Anchorage, AK 99501
Telephone:       (907) 269-8436
FAX:               (907) 269-6644
E-mail:             john.larsen@alaska.gov

           The origin of the proposed action:
                        __x___ staff of state agency
                        ______ Federal government
                        ______ General public
                        ______ petition for regulation change
                        ______ other (please list)

            Date:  September 16, 2016                 Prepared by:  /s/  John M. Larsen
                                                                                             John M. Larsen
                                                                                             Audit Master, Tax Division
                                                                                             (907) 269-8436

PLEASE SEE THE ATTACHED DOCUMENTS FOR ADDITIONAL INFORMATION.