State of Alaska
Fiscal Note
Bill Version: HB 398
2018 Legislative Session
Fiscal Note Number: 1
(H) Publish Date: 4/5/2018
Identifier: HB 398-DOR-TAX-3-30-2018 Department: Department of Revenue
Title: CORP TAX:PUBLIC UTILITY INCOME Appropriation: Taxation and Treasury
ALLOCATION Allocation: Tax Division
Sponsor: FINANCE OMB Component Number: 2476
Requester: (H) Finance
Expenditures/Revenues
Note: Amounts do not include inflation unless otherwise noted below. (Thousands of Dollars)
Included in
FY2019 Governor's
Appropriation FY2019 Out-Year Cost Estimates
Requested Request
OPERATING EXPENDITURES FY 2019 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024
Personal Services
Travel
Services
Commodities
Capital Outlay
Grants & Benefits
Miscellaneous
Total Operating 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Fund Source (Operating Only)
None
Total 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Positions
Full-time
Part-time
Temporary
Change in Revenues
None *** *** *** *** *** ***
Total 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Estimated SUPPLEMENTAL (FY2018) cost: 0.0 (separate supplemental appropriation required)
(discuss reasons and fund source(s) in analysis section)
Estimated CAPITAL (FY2019) cost: 0.0 (separate capital appropriation required)
(discuss reasons and fund source(s) in analysis section)
ASSOCIATED REGULATIONS
Does the bill direct, or will the bill result in, regulation changes adopted by your agency? Yes
If yes, by what date are the regulations to be adopted, amended or repealed? 01/01/19
Why this fiscal note differs from previous version/comments:
Initial Version
Prepared By: Brandon Spanos Phone: (907)269-6736
Division: Tax Date: 03/30/2018 01:00 PM
Approved By: Mike Barnhill Date:
OUT OF 03/31/18
Agency: DOR REPORTED
Printed 4/5/2018 Page 1 of 2 HFC 04/04/2 018
Control Code: KhfWp
 HB 398 - Fiscal Note 1
FISCAL NOTE ANALYSIS
STATE OF ALASKA BILL NO. HB 398
2018 LEGISLATIVE SESSION
Analysis
This bill would require public utilities to apportion income using the same three-factor formula of property, payroll, and
sales that is used by all other non-oil and gas corporate income taxpayers in Alaska. Under current statutes public utilities
aren't required to file using the three-factor formula, but there is also no other method specified. Within the last 10 years
some public utilities have started using their own methods of allocating and apportioning income to Alaska. These
methods are less than favorable to Alaska.
Currently there are a small number of public utilities utilizing a method other than the standard three-factor
apportionment formula to apportion or allocate income to Alaska. Because of the limited number of impacted taxpayers,
including one taxpayer who could generate over 80% of potential revenue, we are unable to provide an estimate of the
additional potential revenue due to confidentiality concerns. However, we estimate that there will be a material amount
of additional revenue collected, between $100,000 and $5,000,000, if this legislation were to pass.
This legislation would not require the Department of Revenue to update its Tax Revenue Management System (TRMS).
There would also be no needed changes to forms. The only anticipated change would be to draft transition regulations.
We would be able to draft transition language with current resources.
(Revised 9/26/17 OMB/LFD) Page 2 of 2
HB 398-DOR-TAX-3-30-2018 Page 2 of 2 Control Code: KhfWp


Statutes affected:
HB0398A, AM HB 398, introduced 02/23/2018, passed House 04/11/2018: 43.20.143, 43.20.145, 43.20.146
HB0398B, AM SCS HB 398(FIN), introduced 05/04/2018, passed House 05/11/2018, passed Senate 05/10/2018: 43.20.143, 43.20.145, 43.20.146
HB0398Z, AM Enrolled HB 398, introduced 05/11/2018: 43.20.143, 43.20.145, 43.20.146