Bill Summary – FastDemocracy

State of Alaska
                                                            Fiscal Note
                                                                                               Bill Version:                    HB 59
 2019 Legislative Session
                                                                                               Fiscal Note Number:              4
                                                                                               (H) Publish Date:                2/20/2019
 Identifier:        2019200085-DOR-TAX-2-12-2019                                 Department:       Department of Revenue
 Title:             REPEAL MUNI LEVY OF O&G TAX/CREDIT                           Appropriation: Taxation and Treasury
 Sponsor:           RLS BY REQUEST OF THE GOVERNOR                               Allocation:       Tax Division
 Requester: Governor                                                             OMB Component Number:              2476
 Expenditures/Revenues
 Note: Amounts do not include inflation unless otherwise noted below.                                                                 (Thousands of Dollars)
                                                 Included in
                                    FY2020       Governor's
                                Appropriation      FY2020                                             Out-Year Cost Estimates
                                  Requested       Request
 OPERATING EXPENDITURES               FY 2020        FY 2020       FY 2021                       FY 2022           FY 2023            FY 2024         FY 2025
 Personal Services                       142.4                        142.4                        142.4             142.4              142.4           142.4
 Travel
 Services
 Commodities
 Capital Outlay
 Grants & Benefits
 Miscellaneous
 Total Operating                         142.4            0.0         142.4                         142.4             142.4             142.4             142.4
 Fund Source (Operating Only)
 1004 Gen Fund (UGF)                           142.4                             142.4              142.4             142.4             142.4             142.4
 Total                                         142.4              0.0            142.4              142.4             142.4             142.4             142.4
 Positions
 Full-time                                        1.0                                  1.0             1.0                1.0              1.0              1.0
 Part-time
 Temporary
 Change in Revenues
 1004 Gen Fund (UGF)                      420,381.9                         421,618.4          429,305.2          437,440.4         440,838.1       442,968.4
 Total                                    420,381.9               0.0       421,618.4          429,305.2          437,440.4         440,838.1       442,968.4
 Estimated SUPPLEMENTAL (FY2019) cost:                                    50.0               (separate supplemental appropriation required)
 Estimated CAPITAL (FY2020) cost:                                         0.0                (separate capital appropriation required)
 Does the bill create or modify a new fund or account?       No
 (Supplemental/Capital/New Fund - 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?                                  12/31/19
 Why this fiscal note differs from previous version/comments:
 Not applicable, initial version based on the 2-13-19 Governor's FY2020 request.
 Prepared By:             Brandon Spanos, Deputy Director                                                            Phone:         (907)269-1033
 Division:                Tax Division                                                                               Date:          02/12/2019 12:00 PM
 Approved By:             Brad Ewing, Administrative Services Director                                               Date:          02/12/19
 Agency:                  Office of Management and Budget
Printed 2/20/2019                                                        Page 1 of 2                                                         Control Code: LNdah
                                                                                                                    HB 59 - Fiscal Note 4
                                                  FISCAL NOTE ANALYSIS
STATE OF ALASKA                                                                   BILL NO. LL0085
2019 LEGISLATIVE SESSION
Analysis
   Background
   This bill would remove the authority for a municipality to levy and collect a tax on oil, gas, and pipeline property. The bill
   would also repeal the credit for those taxes paid to municipalities and claimed against the state levy of tax on oil, gas, and
   pipeline property. Lastly, the bill would remove the entitlement to trial de novo at a superior court.
   Revenue Impact
   The Department of Revenue estimates that this legislation will increase oil and gas property tax revenue by $420 million in
   FY20.
   Implementation Cost
   This legislation would require the Department of Revenue to update its Tax Revenue Management System (TRMS) and
   Revenue Online (ROL) which allows a taxpayer to file a return online. The update would consist of reprogramming both
   systems, updating the return rules in TRMS and testing both systems thoroughly to verify that they function as expected.
   We would also need to update the current tax return forms and make changes to certain regulations. The supplemental
   fiscal note figure of $50.0 in FY19 is to cover the costs of having our contractor update the two systems.
   The Department of Revenue has had a Memorandum of Understanding with the North Slope Borough in the which the
   North Slope Borough has covered the majority of the costs for two contractors to assist the Tax Division with its annual
   property tax roll assessments. If this bill were to pass, the Tax Division would need to cover the full cost of the contractors
   itself. The Division believes it would be a better use of funds to add a position to the property tax group and not use
   contractors. The new position would be devoted to the annual property tax roll assessments between January and June
   of each year and for the rest of the year the position would audit property tax returns and also assist with audits in other
   tax groups if needed. The $142.4 ongoing personal services cost is the all in cost for an Auditor IV in the Tax Division.
(Revised 9/05/18 OMB/LFD)                                                                                            Page 2 of 2
2019200085-DOR-TAX-2-12-2019                                    Page 2 of 2                                               Control Code: LNdah
Statutes affected: 
HB0059A, AM HB 59, introduced 02/20/2019: 14.17.510, 14.17.410, 29.45.110, 29.45.080, 29.45.030, 14.40.380, 14.40.390, 14.40.365, U.S.C, 43.56.020, 29.45.560, 29.45.010, 29.45.050, 29.45.090, 29.45.100, 29.45.250, 29.45.400, 29.45.440, 29.45.460, 29.45.500, 31.25.260, 43.56.010, 43.55.017, 43.56.030, 43.56.110, 43.56.120, 43.56.130, 43.56.060, 43.56.100