15 AAC — Revenue

Chapter 05 Administration of Revenue Laws

Authority: AS 43.05.080; AS 43.05.240; AS 43.10.210
Eff. 5/31/78, Register 66; am 12/26/80, Register 76; am 9/19/2020, Register 235

Authority: AS 43.05.080Sec. 38, ch. 4Sec. 36, ch. 3 SSLA 2016SSLA 2017
Eff. 3/1/2017, Register 221; am 1/1/2018, Register 224

Authority: AS 43.05.080; AS 43.10.160
Eff. 6/21/78, Register 66; am 5/16/81, Register 78; repealed 9/20/2020, Register 235

Chapter 19 Multistate Tax Compact

Article 1 Division of Income

15 AAC 19.011 Business and nonbusiness income defined

(a) In this chapter

(1) "business income" means income arising from transactions and activity in the regular course of the taxpayer's trade or business and includes income from tangible and intangible property if the acquisition, management, and disposition of the property constitute integral parts of the taxpayer's regular trade or business operations; in essence, all income which arises from the conduct of trade or business operations of a taxpayer is business income; the income of the taxpayer is business income unless clearly classifiable as nonbusiness income;

(2) "nonbusiness income" means all income other than business income.

(b) The classification of income by the labels occasionally used, such as manufacturing income, compensation for services, sales income, interest, dividends, rents, royalties, gains, operating income, nonoperating income, etc., is of no aid in determining whether income is business or nonbusiness income. Income of any type or class and from any source is business income if it arises from transactions and activity occurring in the regular course of a trade or business. Accordingly, the critical element in determining whether income is "business income" or "nonbusiness income" is the identification of the transactions and activity which are the elements of a particular trade or business. In general, all transactions and activities of the taxpayer which are dependent upon or contribute to the operations of the taxpayer's economic enterprise as a whole constitute the taxpayer's trade or business and will be transactions and activity arising in the regular course of, and will constitute integral parts of, a trade or business.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.021 Two or more businesses of a single taxpayer

(a) A taxpayer may have more than one "trade or business." In such cases, it is necessary to determine the business income attributable to each separate trade or business. The income of each business is then apportioned by an apportionment formula which takes into consideration the instate and outstate factors which relate to the trade or business the income of which is being apportioned. Accordingly, the amount of business income attributable to the taxpayer's trade or business activities in the state is determined by applying an appropriate apportionment formula to the business income of each business.

(b) The determination of whether the activities of the taxpayer constitute a single trade or business or more than one trade or business will turn on the facts in each case. In general, the activities of the taxpayer will be considered a single business if there is evidence to indicate that the segments under consideration are integrated with, dependent upon or contribute to each other and the operations of the taxpayer as a whole. The following factors are considered to be good indicia of a single trade or business, and the presence of any of these factors creates a strong presumption that the activities of the taxpayer constitute a single trade or business:

(1) Same Type of Business. A taxpayer is generally engaged in a single trade or business when all of its activities are in the same general line.

(2) Steps in a Vertical Process. A taxpayer is almost always engaged in a single trade or business when its various divisions or segments are engaged in different steps in a large, vertically structured enterprise.

(3) Strong Centralized Management. A taxpayer which might otherwise be considered as engaged in more than one trade or business is properly considered as engaged in one trade or business when there is a strong central management, coupled with the existence of centralized departments for such functions as financing, advertising, research, or purchasing. Thus, some conglomerates may properly be considered as engaged in only one trade or business when the central executive officers are normally involved in the operations of the various divisions and there are centralized offices which perform for the divisions the normal matters which a truly independent business would perform for itself, such as accounting, personnel, insurance, legal, purchasing, advertising, or financing.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.031 Business and nonbusiness income - application of definitions

(a) The following subsections in this section are rules for determining whether particular income is business or nonbusiness income.

(b) Rents from Real and Tangible Personal Property. Rental income from real and tangible personal property is business income if the property with respect to which the rental income was received is used in the taxpayer's trade or business or is incidental to it and, therefore, is includable in the property factor under 15 AAC 19.141 and 15 AAC 19.151.

(c) Gains or Losses From Sales of Assets. Gains or losses from the sale, exchange, or other disposition of real or tangible or intangible personal property constitutes business income if the property while owned by the taxpayer was used in the taxpayer's trade or business. However, if that property was used for the production of nonbusiness income or otherwise was removed from the property factor before its sale, exchange or other disposition, the gain or loss will constitute nonbusiness income. See 15 AAC 19.141 and 15 AAC 19.151.

(d) Interest. Interest income is business income where the intangible with respect to which the interest was received arises out of or was created in the regular course of the taxpayer's trade or business operations or where the purpose for acquiring and holding the intangible is related to or incidental to those trade or business operations.

(e) Dividends. Dividends are business income where the stock with respect to which the dividends are received arises out of or was acquired in the regular course of the taxpayer's trade or business operations or where the purpose for acquiring and holding the stock is related to or incidental to those trade or business operations.

(f) Patent and Copyright Royalties. Patent and copyright royalties are business income where the patent or copyright with respect to which the royalties were received arises out of or was created in the regular course of the taxpayer's trade or business operations or where the purpose for acquiring and holding the patent or copyright is related to or incidental to those trade or business operations.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.041 Proration of deductions

(a) In most cases an allowable deduction of a taxpayer will be applicable only to the business income arising from a particular trade or business or to a particular item of nonbusiness income. In some cases, an allowable deduction may be applicable to the business incomes of more than one trade or business or to several items of nonbusiness income. In such cases, the deduction shall be prorated among those trades or businesses and those items of nonbusiness income in a manner which fairly distributes the deduction among the classes of income to which it is applicable.

(b) In filing returns with this state, if the taxpayer departs from or modifies the manner of prorating any such deduction used in returns for prior years, the taxpayer shall disclose in the return for the current year the nature and extent of the modification.

(c) If the returns or reports filed by a taxpayer with all states to which the taxpayer reports under Article IV of the Multistate Tax Compact or the Uniform Division of Income for Tax Purposes Act are not uniform in the application or proration of any deduction, the taxpayer shall disclose in its return to this state the nature and extent of the variance.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.061 Apportionment

If the business activity in respect to any trade or business of a taxpayer occurs both within and outside of this state, and if by reason of that business activity the taxpayer is taxable in another state, the portion of the net income (or net loss) arising from that trade or business which is derived from sources within this state shall be determined by apportionment in accordance with AS 43.19.010, Article IV.9 - IV.17.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.071 Combined report

If a particular trade or business is carried on by a taxpayer and one or more affiliated corporations, nothing in AS 43.19.010, Article IV, or in these regulations precludes the use of a "combined report" by which the entire business income of that trade or business is apportioned in accordance with AS 43.19.010, Article IV.9 - IV.17.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.081 Allocation

Any taxpayer subject to the taxing jurisdiction of this state shall allocate all of its nonbusiness income or loss within or outside of this state in accordance with AS 43.19.010, Article IV.4 - IV.8.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.091 Consistency and uniformity in reporting

(a) In filing returns with this state, if the taxpayer departs from or modifies the manner in which income has been classified as business income or nonbusiness income in returns for prior years, the taxpayer shall disclose in the return for the current year the nature and extent of the modification.

(b) If the return or reports filed by a taxpayer for all states to which the taxpayer reports under Article IV of the Multistate Tax Compact or the Uniform Division of Income for Tax Purposes Act are not uniform in the classification of income as business or nonbusiness income, the taxpayer shall disclose in its return to this state the nature and extent of the variance.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

Article 2 Taxable in Another State

15 AAC 19.101 Taxable in another state; in general

(a) A taxpayer is subject to the allocation and apportionment provisions of this chapter if it has income from business activity that is taxable both within and outside of this state. A taxpayer's income from business activity is taxable outside of this state if the taxpayer, by reason of that business activity (i.e., the transactions and activity occurring in the regular course of a particular trade or business), is taxable in another state within the meaning of AS 43.19.010, Article IV.3. A taxpayer is taxable within another state if it meets either one of two tests

(1) if by reason of business activity in another state the taxpayer is subject to one of the types of taxes specified, namely: a net income tax, a franchise tax measured by net income, a franchise tax for the privilege of doing business, or a corporate stock tax; or

(2) if by reason of that business activity another state has jurisdiction to subject the taxpayer to a net income tax, regardless of whether the state imposes such a tax on the taxpayer.

(b) A taxpayer is not taxable in another state with respect to a particular trade or business merely because the taxpayer conducts activities in that other state pertaining to the production of nonbusiness income or business activities relating to a separate trade or business.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.111 When a taxpayer is "subject to" a tax

(a) A taxpayer is "subject to" one of the taxes specified in 15 AAC 19.101(a) if it carries on business activity in that state and that state imposes such a tax on that activity. Any taxpayer which asserts that it is subject to one of the taxes specified in 15 AAC 19.101(a) in another state shall furnish to the commissioner of revenue of this state upon his request evidence to support the assertion. The commissioner of revenue may request that the evidence include proof that the taxpayer has filed the requisite tax return in the other state and has paid any taxes imposed under the law of that other state; the taxpayer's failure to produce that proof may be taken into account in determining whether the taxpayer in fact is subject to one of the taxes specified in AS 43.19.010, Article IV.3. 1) and 15 AAC 19.101(a) in the other state.

(b) If the taxpayer voluntarily files and pays one or more of those taxes when not required to do so by the laws of that state or pays a minimal fee for qualification, organization or for the privilege of doing business in that state, but (1) does not actually engage in business activity in that state, or (2) does actually engage in some business activity, not sufficient for nexus, and the minimum tax bears no relation to the taxpayer's business activity within such state, the taxpayer is not "subject to" one of the taxes specified in AS 43.19.010, Article IV.3. 1) and 15 AAC 19.101(a).

(c) The concept of taxability in another state is based on the premise that every state in which the taxpayer is engaged in business activity may impose an income tax even though every state does not do so. In states which do not, other types of taxes may be imposed as a substitute for an income tax. Therefore, only those taxes enumerated in AS 43.19.010, Article IV.3. 1) and 15 AAC 19.101(a) which may be considered as basically revenue-raising rather than regulatory measures shall be considered in determining whether the taxpayer is "subject to" one of the taxes specified in AS 43.19.010, Article IV.3. 1) and 15 AAC 19.101(a) in another state.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.121 When a state has jurisdiction to subject a taxpayer to a net income tax

The second test, that of the state having jurisdiction to subject the taxpayer to a net income tax regardless of whether, in fact, the state does or does not, applies if the taxpayer's business activity is sufficient to give the state jurisdiction to impose a net income tax by reason of such business activity under the Constitution and statutes of the United States. Jurisdiction to tax is not present where the state is prohibited from imposing the tax by reason of the provisions of Public Law 86-272, 15 U.S.C.A. Section 381-385. In the case of any "state" as defined in AS 43.19.010, Article IV.1. h), other than a state of the United States or political subdivision of such a state, the determination of whether that "state" has jurisdiction to subject the taxpayer to a net income tax shall be made as though the jurisdictional standards applicable to a state of the United States applied in that "state." If jurisdiction is otherwise present, the "state" is not considered as without jurisdiction by reason of the provisions of a treaty between the state and the United States.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

Article 3 Apportionment Formula

15 AAC 19.131 Apportionment formula

All business income of each trade or business of the taxpayer shall be apportioned to this state by use of the apportionment formula set forth in AS 43.19.010, Article IV.9. The elements of the apportionment formula are the property factor (see 15 AAC 19.141 - 15 AAC 19.202), the payroll factor (see 15 AAC 19.211 - 15 AAC 19.241), and the sales factor (see 15 AAC 19.251 - 15 AAC 19.302), of the trade or business of the taxpayer.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

Article 4 Property Factor

15 AAC 19.141 Property factor in general

(a) The property factor of the apportionment formula for each trade or business of the taxpayer must include all real and tangible personal property owned or rented by the taxpayer and used during the tax period in the regular course of that trade or business. The term "real and tangible personal property" includes land, buildings, machinery, stocks of goods, equipment, and other real and tangible personal property but does not include coin or currency.

(b) Property used in connection with the production of nonbusiness income must be excluded from the property factor. Property used both in the regular course of taxpayer's trade or business and in the production of nonbusiness income must be included in the factor only to the extent the property is used in the regular course of taxpayer's trade or business. The method of determining that portion of the value to be included in the factor will depend upon the facts of each case.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.151 Property used for the production of business income

(a) Property must be included in the property factor if it is actually used or is available for or capable of being used during the tax period in the regular course of the trade or business of the taxpayer. Property held as reserves or standby facilities or property held as a reserve source of materials must be included in the factor. For example, a plant temporarily idle and raw material reserves not currently being processed are includable in the factor.

(b) Property or equipment under construction during the tax period (except inventoriable goods in process) must be excluded from the factor until that property is actually used in the regular course of the trade or business of the taxpayer. If the property is partially used in the regular course of the trade or business of the taxpayer while under construction, the value of the property to the extent used must be included in the property factor.

(c) Property used in the regular course of the trade or business of the taxpayer must remain in the property factor until its permanent withdrawal is established by an identifiable event such as its conversion to the production of nonbusiness income, its sale, or the lapse of an extended period of time (normally, five years) during which the property is held for sale.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.161 Consistency in reporting

(a) In filing returns with this state, if the taxpayer departs from or modifies the manner of valuing property or of excluding or including property in the property factor used in returns for prior years, the taxpayer shall disclose in the return for the current year the nature and extent of the modification.

(b) If the returns or reports filed by the taxpayer with all states to which the taxpayer reports under Article IV of the Multistate Tax Compact or the Uniform Division of Income for Tax Purposes Act are not uniform in the valuation of property and in the exclusion or inclusion of property in the property factor, the taxpayer shall disclose in its return to this state the nature and extent of the variance.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.171 Numerator

(a) The numerator of the property factor must include the average value of the real and tangible personal property owned or rented by the taxpayer and used in this state during the tax period in the regular course of the trade or business of the taxpayer.

(b) Property in transit between locations of the taxpayer to which it belongs must be considered to be at the destination for purposes of the property factor. Property in transit between a buyer and seller which is included by a taxpayer in the denominator of its property factor in accordance with its regular accounting practices must be included in the numerator according to the state of destination.

(c) The value of mobile or movable property such as construction equipment, trucks or leased electronic equipment which is located within and outside of this state during the tax period must be determined for purposes of the numerator of the factor on the basis of total time within the state during the tax period.

(d) An automobile assigned to a traveling employee must be included in the numerator of the factor of the state to which the employee's compensation is assigned under the payroll factor or in the numerator of the state in which the automobile is licensed.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.181 Valuation of owned property

(a) Property owned by the taxpayer must be valued at its original cost. As a general rule, "original cost" is considered to be the basis of the property for federal income tax purposes (before any federal adjustments) at the time of acquisition by the taxpayer and adjusted by subsequent capital additions or improvements to it and partial disposition of it by reason of sale, exchange, abandonment, etc.

(b) If the original cost of property is unascertainable, the property must be included in the factor at its fair market value as of the date of acquisition by the taxpayer.

(c) Inventory of stock of goods must be included in the factor in accordance with the valuation method used for federal income tax purposes.

(d) Property acquired by gift or inheritance must be included in the factor at its basis for determining depreciation for federal income tax purposes.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.191 Valuation of rented property

(a) Property rented by the taxpayer must be valued at eight times its net annual rental rate. The net annual rental rate for any item of rented property is the annual rental rate paid by the taxpayer for that property, less the aggregate annual subrental rates paid by subtenants of the taxpayer. (See 15 AAC 19.202 for special rules where the use of that net annual rental rate produces a negative or clearly inaccurate value or where property is used by the taxpayer at no charge or rented at a nominal rental rate.)

(b) Subrents are not deducted when the subrents constitute business income because the property which produces the subrents is used in the regular course of a trade or business of the taxpayer when it is producing that income. Accordingly, there is no reduction in its value.

(c) "Annual rental rate" is the amount paid as rental for property for a 12-month period (i.e., the amount of the annual rent). Where property is rented for less than a 12-month period, the rent paid for the actual period of rental constitutes the "annual rental rate" for the tax period. However, where a taxpayer has rented property for a term of 12 or more months and the current tax period covers a period of less than 12 months (due, for example, to a reorganization or change of accounting period), the rent paid for the short tax period must be annualized. If the rental term is for less than 12 months, the rent may not be annualized beyond its term. Rent may not be annualized because of the uncertain duration when the rental term is on a month-to-month basis.

(d) "Annual rent" is the actual sum of money or other consideration payable, directly or indirectly, by the taxpayer or for its benefit for use of the property and includes

(1) any amount payable for the use of real or tangible personal property, or any part of it, whether designated as a fixed sum of money or as a percentage of sales, profits, or otherwise;

(2) any amount payable as additional rent or in lieu of rents, such as interest, taxes, insurance, repairs or any other items which are required to be paid by the terms of the lease or other arrangement, not including amounts paid as service charges, such as utilities, janitor services, etc.; if a payment includes rent and other charges unsegregated, the amount of rent shall be determined by consideration of the relative values of the rent and the other items.

(e) "Annual rent" includes lease bonuses which are to be added to both the numerator and denominator of the property factor, but are not to be capitalized at eight times the lease bonus amount. "Lease bonus" means payments made to acquire an interest in a lease or sublease and includes cash bonuses, advance royalties and other lease acquisition payments.

(f) Leasehold improvements must, for the purposes of the property factor, be treated as property owned by the taxpayer regardless of whether the taxpayer is entitled to remove the improvements or the improvements revert to the lessor upon expiration of the lease. Hence, the original cost of leasehold improvements must be included in the factor.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81; am 4/14/82, Register 82

15 AAC 19.201 Averaging property values

As a general rule, the average value of property owned by the taxpayer shall be determined by averaging the values at the beginning and ending of the tax period. However, the commissioner will, in his discretion, require or allow averaging by monthly values if that method of averaging is required to properly reflect the average value of the taxpayer's property for the tax period. Averaging by monthly values will generally be applied if substantial fluctuations in the values of the property exist during the tax period or where property is acquired after the beginning of the tax period or disposed of before the end of the tax period. Averaging with respect to rented property is achieved automatically by the method of determining the net annual rental rate of that property as set out in 15 AAC 19.181 and 15 AAC 19.191.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.202 Special rules

(a) If the subrents taken into account in determining the net annual rental rate under 15 AAC 19.191 produce a negative or clearly inaccurate value for any item of property, another method which will properly reflect the value of rented property may be required by the commissioner of revenue or requested by the taxpayer. In no case, however, may that value be less than an amount which bears the same ratio to the annual rental rate paid by the taxpayer for such property as the fair market value of that portion of the property used by the taxpayer bears to the total fair market value of the rented property.

(b) If property owned by others is used by the taxpayer at no charge or rented by the taxpayer for a nominal rate, the net annual rental rate for that property must be determined on the basis of a reasonable market rental rate for that property.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

Article 5 Payroll Factor

15 AAC 19.211 Payroll factor in general

(a) The payroll factor of the apportionment formula for each trade or business of the taxpayer must include the total amount paid by the taxpayer in the regular course of its trade or business for compensation during the tax period.

(b) The total amount "paid" to employees is determined upon the basis of the taxpayer's accounting method. If the taxpayer has adopted the accrual method of accounting, all compensation properly accrued is considered to have been paid. Notwithstanding the taxpayer's method of accounting, at the election of the taxpayer, compensation paid to employees may be included in the payroll factor by use of the cash method if the taxpayer is required to report that compensation under that method for unemployment compensation purposes.

(c) The compensation of any employee on account of activities which are connected with the production of nonbusiness income must be excluded from the factor.

(d) "Compensation" means wages, salaries, commissions, and any other form of remuneration paid to employees for personal services. Payments made to an independent contractor or any other person not properly classifiable as an employee are excluded. Only amounts paid directly to employees are included in the payroll factor. Amounts considered paid directly include the value of board, rent, housing, lodging, and other benefits or services furnished to employees by the taxpayer in return for personal services if those amounts constitute income to the recipient under the federal Internal Revenue Code. In the case of employees not subject to the federal Internal Revenue Code, e.g., those employed in foreign countries, the determination of whether those benefits or services would constitute income to the employees must be made as though those employees were subject to the federal Internal Revenue Code.

(e) "Employee" means (1) any officer of a corporation; or (2) any individual who, under the usual common-law rules applicable in determining the employer-employee relationship, has the status of an employee. Generally, a person will be considered to be an employee if he is included by the taxpayer as an employee for purposes of the payroll taxes imposed by the Federal Insurance Contributions Act; except that, since certain individuals are included within the term "employees" in the Federal Insurance Contributions Act who would not be employees under the usual common-law rules, it may be established that a person who is included as an employee for purposes of the Federal Insurance Contributions Act is not an employee for purposes of this section.

(f) In filing returns with this state, if the taxpayer departs from or modifies the treatment of compensation paid, used in returns for prior years, the taxpayer shall disclose in the return for the current year the nature and extent of the modification.

(g) If the returns or reports filed by the taxpayer with all states to which the taxpayer reports under the Multistate Tax Compact or the Uniform Division of Income for Tax Purposes Act are not uniform in the treatment of compensation paid, the taxpayer shall disclose in its return to this state the nature and extent of the variance.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.221 Denominator

The denominator of the payroll factor is the total compensation paid everywhere during the tax period. Accordingly, compensation paid to employees whose services are performed entirely in a state where the taxpayer is immune from taxation, for example, by Public Law 86-272, is included in the denominator of the payroll factor.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.231 Numerator

The numerator of the payroll factor is the total amount paid in this state during the tax period by the taxpayer for compensation. The tests in AS 43.19.010, Article IV.14, to be applied in determining whether compensation is paid in this state, are derived from the Model Unemployment Compensation Act. Accordingly, if compensation paid to employees is included in the payroll factor by use of the cash method of accounting or if the taxpayer is required to report such compensation under such method for unemployment compensation purposes, it shall be presumed that the total wages reported by the taxpayer to this state for unemployment compensation purposes constitutes compensation paid in this state except for compensation excluded under 15 AAC 19.211 - 15 AAC 19.241. The presumption may be overcome by satisfactory evidence that an employee's compensation is not properly reportable to this state for unemployment compensation purposes.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.241 Compensation paid in this state

(a) Compensation is paid in this state if any one of the following tests, applied consecutively, is met:

(1) the employee's service is performed entirely within this state;

(2) the employee's service is performed both within and outside of the state, but the service performed outside of the state is incidental to the employee's service within the state; "incidental" means any service which is temporary or transitory in nature, or which is rendered in connection with an isolated transaction;

(3) if the employee's services are performed both within and outside of this state, the employee's compensation will be attributed to this state

(A) if the employee's base of operation is in this state; or

(B) if there is no base of operations in any state in which some part of the service is performed, but the place from which the service is directed or controlled is in this state; or

(C) if the base of operations or the place from which the service is directed or controlled is not in any state in which some part of the service is performed but the employee's residence is in this state.

(b) As used in this section

(1) "base of operations" means the place of more-or-less permanent nature from which the employee starts his work and to which he customarily returns in order to receive instructions from the taxpayer or communications from his customers or other persons or to replenish stock or other materials, repair equipment, or perform any other functions necessary to the exercise of his trade or profession at some other point or points;

(2) "place from which the service is directed or controlled" means the place from which the power to direct or control is exercised by the taxpayer.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

Article 6 Sales Factor

15 AAC 19.251 Sales factor in general

(a) AS 43.19.010, Article IV.1. g), defines the term "sales" to mean all gross receipts of the taxpayer not allocated under AS 43.19.010, Article IV.5 to IV.8. Thus, for the purposes of the sales factor of the apportionment formula for each trade or business of the taxpayer, the term "sales" means all gross receipts derived by the taxpayer from transactions and activity in the regular course of that trade or business. The following are rules for determining "sales" in various situations:

(1) In the case of a taxpayer engaged in manufacturing and selling or purchasing and reselling goods or products, "sales" includes all gross receipts from the sales of those goods or products (or other property of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the tax period) held by the taxpayer primarily for sale to customers in the ordinary course of its trade or business. "Gross receipts," for this purpose, means gross sales, less returns and allowances, and includes all interest income, service charges, carrying charges, or time-price differential charges incidental to those sales. Federal and state excise taxes (including sales taxes) must be included as part of those receipts if those taxes are passed on to the buyer or included as part of the selling price of the product.

(2) In the case of cost-plus-fixed-fee contracts, such as the operation of a government-owned plant for a fee, "sales" includes the entire reimbursed cost, plus the fee.

(3) In the case of a taxpayer engaged in providing services, such as the operation of an advertising agency, or the performance of equipment service contracts, research and development contracts, "sales" includes the gross receipts from the performance of those services including fees, commissions, and similar items.

(4) In the case of a taxpayer engaged in renting real or tangible property, "sales" includes the gross receipts from the rental, lease, or licensing the use of the property.

(5) In the case of a taxpayer engaged in the sale, assignment, or licensing of intangible personal property such as patents and copyrights, "sales" includes the gross receipts from them.

(6) If a taxpayer derives receipts from the sale of equipment used in its business, those receipts constitute "sales." For example, a truck express company owns a fleet of trucks and sells its trucks under a regular replacement program. The gross receipts from the sales of the trucks are included in the sales factor.

(b) In some cases, certain gross receipts should be disregarded in determining the sales factor in order that the apportionment formula will operate fairly to apportion to this state the income of the taxpayer's trade or business. See 15 AAC 19.302.

(c) In filing returns with this state, if the taxpayer departs from or modifies the basis for excluding or including gross receipts in the sales factor used in returns for prior years, the taxpayer shall disclose in the return for the current year the nature and extent of the modification.

(d) If the returns or reports filed by the taxpayer with all states to which the taxpayer reports under Article IV of the Multistate Tax Compact or the Uniform Division of Income for Tax Purposes Act are not uniform in the inclusion or exclusion of gross receipts, the taxpayer shall disclose in its return to this state the nature and extent of the variance.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.261 Denominator

The denominator of the sales factor must include the total gross receipts derived by the taxpayer from transactions and activity in the regular course of its trade or business, except receipts excluded under 15 AAC 19.302.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.271 Numerator

The numerator of the sales factor must include gross receipts attributable to this state and derived by the taxpayer from transactions and activity in the regular course of its trade or business. All interest income, service charges, carrying charges, or time-price differential charges incidental to those gross receipts shall be included regardless of

(1) the place where the accounting records are maintained; or

(2) the location of the contractor or other evidence of indebtedness.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

15 AAC 19.281 Sales of tangible personal property in this state

(a) Gross receipts from sales of tangible personal property (except sales to the United States government as defined in 15 AAC 19.291) are in this state

(1) if the property is delivered or shipped to a purchaser within this state regardless of the f.o.b. point or other conditions of sale; or

(2) if the property is shipped from an office, store, warehouse, factory, or other place of storage in this state and the taxpayer is not taxable in the state of the purchaser.

(b) Property is considered to be delivered or shipped to a purchaser within this state if the recipient is located in this state, even though the property is ordered from outside this state.

(c) Property is delivered or shipped to a purchaser within this state if the shipment terminates in this state, even though the property is subsequently transferred by the purchaser to another state.

(d) The term "purchaser within this state" includes the ultimate recipient of the property if the taxpayer in this state, at the designation of the purchaser, delivers to or has the property shipped to the ultimate recipient within this state.

(e) When property being shipped by a seller from the state of origin to a consignee in another state is diverted while en route to a purchaser in this state, the sales are in this state.

(f) If the taxpayer is not taxable in the state of the purchaser, the sale is attributed to this state if the property is shipped from an office, store, warehouse, factory, or other place of storage in this state.

(g) If a taxpayer whose salesman operates from an office located in this state makes a sale to a purchaser in another state in which the taxpayer is not taxable and the property is shipped directly by a third party to the purchaser, the following rules apply:

(1) if the taxpayer is taxable in the state from which the third party ships the property, then the sale is in that state;

(2) if the taxpayer is not taxable in the state from which the property is shipped, then the sale is in this state.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.291 Sales of tangible personal property to the United States Government in this state

Gross receipts from sales of tangible personal property to the United States government are in this state if the property is shipped from an office, store, warehouse, factory, or other place of storage in this state. For the purpose of this section, only sales for which the United States government makes direct payment to the seller under the terms of a contract constitute sales to the United States government. Thus, as a general rule, sales by a subcontractor to the prime contractor, the party to the contract with the United States government, do not constitute sales to the United States government.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.301 Sales other than sales of tangible personal property in this state

(a) In General. AS 43.19.010, Article IV.17, provides for the inclusion in the numerator of the sales factor, gross receipts from transactions other than sales of tangible personal property (including transactions with the United States government); under this section gross receipts are attributed to this state if the income-producing activity which gave rise to the receipts is performed wholly within this state. Also, gross receipts are attributed to this state if, with respect to a particular item of income, the income-producing activity is performed within and outside of this state but the greater proportion of the income-producing activity is performed in this state, based on costs of performance.

(b) Income-Producing Activity Defined. The term "income-producing activity" applies to each separate item of income and means the transactions and activity directly engaged in by the taxpayer in the regular course of its trade or business for the ultimate purpose of obtaining gains or profit. Such activity does not include transactions and activities performed on behalf of a taxpayer, such as those conducted on its behalf by an independent contractor. Accordingly, income-producing activity includes, but is not limited to, the following:

(1) rendering personal services by employees or the use of tangible and intangible property by the taxpayer in performing a service;

(2) selling, renting, leasing, licensing or other use of real property;

(3) renting, leasing, licensing, or other use of tangible personal property; or

(4) selling, licensing, or other use of intangible personal property; except that merely holding intangible personal property is not, of itself, an income-producing activity.

(c) Costs of Performance Defined. The term "cost of performance" means direct costs determined in a manner consistent with generally accepted accounting principles and in accordance with accepted conditions or practices in the trade or business of the taxpayer.

(d) Application.

(1) In General. Receipts (other than from sales of tangible personal property) in respect to a particular income-producing activity are in this state if

(A) the income-producing activity is performed wholly within the state; or

(B) the income-producing activity is performed both within and outside of this state and the proportion of the income-producing activity performed in this state is greater than in any other state, based on costs of performance.

(2) Special Rules. The following are special rules for determining when receipts from the income-producing activities described below are in this state:

(A) Gross receipts from the sales, lease, rental or licensing of real property are in this state if the real property is located in this state.

(B) Gross receipts from the rental, lease, or licensing of tangible personal property are in this state if the property is located in this state. Renting, leasing, licensing, or other use of tangible personal property in this state is a separate income-producing activity from renting, leasing, licensing, or other use of the same property while located in another state; consequently, if property is within and outside of this state during the rental, lease, or licensing period, gross receipts attributable to this state must be measured by the ratio which the time the property was physically present or was used in this state bears to the total time or use of the property everywhere during that period.

(C) Gross receipts for the performance of personal services are attributable to this state to the extent those services are performed in this state. If services relating to a single item of income are performed partly within and partly outside of this state, the gross receipts for the performance of those services are attributable to this state only if a greater portion of the services was performed in this state, based on costs of performance. Usually, where services are performed partly within and partly outside of this state the services performed in each state will constitute a separate income-producing activity; in such a case, the gross receipts for the performance of services attributable to this state must be measured by the ratio which the time spent in performing those services in this state bears to the total time spent in performing those services everywhere. Time spent in performing services includes the amount of time expended in the performance of a contract or other obligation which gives rise to those gross receipts. Personal service not directly connected with the performance of the contract or other obligation is excluded from the computations.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66; am 3/31/82, Register 81

15 AAC 19.302 Special rule

(a) Where substantial amounts of gross receipts arise from an incidental or occasional sale of a fixed asset used in the regular course of the taxpayer's trade or business, those gross receipts must be excluded from the sales factor. For example, gross receipts from the sale of a factory or plant will be excluded.

(b) Insubstantial amounts of gross receipts arising from incidental or occasional transactions or activities may be excluded from the sales factor unless that exclusion would materially affect the amount of income apportioned to this state. For example, the taxpayer ordinarily may include or exclude from the sales factor gross receipts from such transactions as the sale of office furniture, business automobiles, etc.

(c) Where the income-producing activity in respect to business income from intangible personal property can be readily identified, that income is included in the denominator of the sales factor and, if the income-producing activity occurs in this state, in the numerator of the sales factor as well. For example, usually the income-producing activity can be readily identified in respect to interest income received on deferred payments on sales of tangible property (15 AAC 19.251(a)(1)) and income from the sale, licensing or other use of intangible personal property (15 AAC 19.301(b)(4)).

(d) Where business income from intangible property cannot readily be attributed to any particular income-producing activity of the taxpayer, that income cannot be assigned to the numerator of the sales factor for any state and must be excluded from the denominator of the sales factor. For example, where business income in the form of dividends received on stock, royalties received on patents or copyrights, or interest received on bonds, debentures or government securities results from the mere holding of the intangible personal property by the taxpayer, those dividends and that interest must be excluded from the denominator of the sales factor.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

Article 7 General Provisions

15 AAC 19.900 Definitions

Unless the context otherwise requires, in this chapter

(1) "allocation" refers to the assignment of nonbusiness income to a particular state;

(2) "apportionment" refers to the division of business income between states by the use of a formula containing apportionment factors;

(3) "business activity" refers to the transactions and activity occurring in the regular course of a particular trade or business of a taxpayer;

(4) "taxpayer" means any natural person, corporation, partnership, firm, association, or governmental unit or agency acting as a business entity in this state.

History

Authority: AS 43.05.080; AS 43.19.010
Eff. 5/24/78, Register 66

Article 8 Special Rules: Airlines

15 AAC 19.1100 Airlines in general

If an airline has income from sources both within and outside this state, the amount of business income from sources within this state must be determined in accordance with 15 AAC 19.1100 - 15 AAC 19.1190. In such cases, the first step is to determine which portion of the airline's income constitutes "business" income and which portion constitutes "nonbusiness" income under AS 43.19.010, Article IV.1 and under 15 AAC 19.011 and 15 AAC 19.031. Nonbusiness income is directly allocable to specific states under the provisions of AS 43.19.010, Article IV.5 - .8. Business income is apportioned among the states in which the business is conducted in accordance with the property, payroll and sales apportionment factors set out in this chapter. The sum of (1) the items of nonbusiness income directly allocated to this state, plus (2) the amounts of business income attributable to this state constitutes the amount of the taxpayer's entire net income which is subject to tax by this state.

15 AAC 19.1110 Apportionment of business income

(a) Property Factor.

(1) The property factor includes the value of all owned and rented aircraft. The use of the taxpayer's owned or rented aircraft in an exchange program with another air carrier does not constitute a rental or subrental, whichever the case may be, of that aircraft by the airline to the other participating airline. That aircraft must be accounted for in the property factor of the taxpayer. Engines, parts, and other expendables, including parts for use in contract overhaul work, will be valued at cost. Landing fees do not constitute rentals in the valuation of property used or rented during the income year.

(2) The denominator of the property factor is the average value of all of the taxpayer's real and tangible personal property owned or rented and used during the income year. The numerator of the property factor is the average value of the taxpayer's real and tangible personal property owned or rented and used in the state during the income year. In determining the numerator of the property factor, all property except aircraft ready for flight, including all attached equipment, must be included in the numerator of the property factor in accordance with AS 43.19.010, Article IV.10 - .12, and 15 AAC 19.171. Aircraft ready for flight must be included in the numerator of the property factor in the ratio that ground time (hours) of that aircraft in this state bears to the ground time (hours) of that aircraft everywhere, as defined in 15 AAC 19.1190.

(b) The Payroll Factor. The denominator of the payroll factor is the total compensation paid everywhere by the taxpayer during the income year. (See AS 43.19.010, Article IV.13 - .14 and 15 AAC 19.211 - 15 AAC 19.241. The numerator of the payroll factor is the total amount paid in this state during the income year by the taxpayer for compensation. With respect to nonflight personnel, compensations paid to those employees must be included in the numerator as provided in AS 43.19.010, Article IV.13 - .14, and 15 AAC 19.231 and 15 AAC 19.241. With respect to flight personnel (the air crew aboard an aircraft assisting in the operation of the aircraft or the welfare of passengers while in the air), compensation paid to those employees must be included in the ratio that ground time in this state bears to total ground time as defined in 15 AAC 19.1190.

(c) Sales Factor. All revenue derived from transactions and activities in the regular course of the trade or business of the taxpayer which produces business income is included in the denominator of the sales factor. (See AS 43.19.010, Article IV.1 and 15 AAC 19.011, 15 AAC 19.031, and 15 AAC 19.251. The numerator of the sales factor is the total revenue of the taxpayer in this state during the income year. With respect to nonflight revenue, the revenue is in this state in accordance with the provisions of AS 43.19.010, Article IV.16 and .17, and 15 AAC 19.271, 15 AAC 19.281, 15 AAC 19.291, and 15 AAC 19.301. With respect to flight revenue, the total revenue of the taxpayer in this state during the income year is the ratio that ground time in this state bears to total ground time as defined in 15 AAC 19.1190.

15 AAC 19.1120 Records

The taxpayer must maintain the records necessary to arrive at "ground time" as defined in 15 AAC 19.1190, which records are subject to review by the department.

15 AAC 19.1190 Multistate Tax Compact

15 AAC 19.1190. Definitions for 15 AAC 19.1100 - 15 AAC 19.1190. (a) "Ground time" for air carriers means all time spent on the ground while loading and unloading passengers, freight, mail, or operating supplies, or during refueling operations, and does not include periods when the aircraft is (1) not being loaded or unloaded; (2) not in service; or (3) idle due to strikes, repairs and maintenance, downshifts, or seasonal reduction of service. (b) For the purposes of computing "ground time," it is presumed that there is one hour of ground time for each departure unless the taxpayer provides evidence acceptable to the department which rebuts that presumption. (c) The "value" of owned real and tangible personal property means its initial federal tax basis, plus the cost of capital improvements to that property. (See AS 43.19.010, Article IV.11, and 15 AAC 19.180. (d) "Average value" of property means the amount determined by averaging the values at the beginning and ending of the income year; however, the commissioner will, in his discretion, require the averaging of monthly values during the income year if that averaging is necessary to reflect properly the average value of the airline's property. (See AS 43.19.010, Article IV.12 and 15 AAC 19.201. (e) The "value" of rented real and tangible personal property means the product of eight times the net annual rental rate. (See AS 43.19.010, Article IV.11, and 15 AAC 19.191. (f) "Net annual rental rate" means the annual rental rate paid by the taxpayer less any annual rental rate received by the taxpayer from subrentals. (g) "Property used during the income year" includes property which is available for use in the taxpayer's trade or business during the income year. (h) "Aircraft ready for flight" means aircraft owned or acquired through rental or lease (but not interchange) which are in the possession of the taxpayer and are available for use on the taxpayer's routes.

Article 9 Special Rules: Land Transportation Carriers

15 AAC 19.1200 Multistate Tax Compact

15 AAC 19.1200. Land transportation carriers in general. If a land transportation carrier has income from sources both within and outside this state, the amount of business income from sources within this state must be determined in accordance with 15 AAC 19.1200 - 15 AAC 19.1290. In such cases, the first step is to determine which portion of the land transportation carriers' income constitutes "business" income and which portion constitutes "nonbusiness" income under AS 43.19.010, Article IV.1, and under 15 AAC 19.011 and 15 AAC 19.031. Nonbusiness income is directly allocable to specific states in accordance with the provisions of AS 43.19.010, Article IV.5 - .8. Business income is apportioned among the states in which the business is conducted in accordance with the property, payroll, and sales apportionment factors set out in 15 AAC 19.1210. The sum of (1) the items of nonbusiness income directly allocated to this state, plus (2) the amount of business income attributable to this state constitutes the amount of the taxpayer's entire net income which is subject to tax by this state.

15 AAC 19.1210 Multistate Tax Compact

15 AAC 19.1210. Apportionment of business income. (a) Property Factor. (1) The denominator of the property factor is the average value of all of the taxpayer's real and tangible personal property owned or rented and used during the income year. (2) The numerator of the property factor is the average value of the taxpayer's real and tangible personal property owned or rented and used in this state during the income year. In determining the numerator of the property factor, all property except interstate mobile transportation equipment must be included in the numerator of the property factor in accordance with AS 43.19.010, Article IV.10 - .12, and 15 AAC 19.171. (3) The Alaska portion of interstate mobile transportation equipment for inclusion in the numerator must be determined by multiplying the total interstate mobile transportation equipment by the terminal days ratio. (b) Payroll Factor. (1) The denominator of the payroll factor is the total compensation paid everywhere by the taxpayer during the income year. (See AS 43.19.010, Article IV.13 - .14 and 15 AAC 19.211 - 15 AAC 19.241. (2) The numerator of the payroll factor is the total amount paid in this state during the income year by the taxpayer for compensation. With respect to employees assigned to fixed locations, compensation paid to those employees must be included in the numerator as provided in AS 43.19.010, Article IV.13 - .14, and 15 AAC 19.231 and 15 AAC 19.241. With respect to the wages of personnel assigned to interstate mobile transportation equipment, the Alaska portion of those wages must be determined by multiplying the total wages of interstate personnel by the terminal days ratio. (c) Sales Factor. (1) The denominator of the sales factor equals all revenue derived from transactions and activities in the regular course of the trade or business of the taxpayer which produces business income. (See AS 43.19.010, Article IV.1, and 15 AAC 19.011, 15 AAC 19.031, and 15 AAC 19.251. (2) The numerator of the revenue factor is the total revenue of the taxpayer in this state during the income year. The total revenue of the taxpayer in this state during the income year is the sum of the intrastate revenues and the Alaska portion of interstate revenues, determined by multiplying the total interstate revenues by the terminal days ratio.

15 AAC 19.1220 Multistate Tax Compact

15 AAC 19.1220. Records. The taxpayer must maintain the records necessary to arrive at "days spent in terminals" as defined in 15 AAC 19.1290, which records are subject to review by the department.

15 AAC 19.1290 Multistate Tax Compact

15 AAC 19.1290. Definitions for 15 AAC 19.1200 - 15 AAC 19.1290. In 15 AAC 19.1200 - 15 AAC 19.1290 (1) "terminal" means any location where goods transported are loaded on or unloaded from interstate mobile transportation equipment; (2) "days spent in terminals" refers to hours spent in terminals by mobile transportation equipment, and is computed by dividing the total number of hours by 24; time spent in terminals does not include periods when the interstate mobile transportation equipment is (A) not being loaded or unloaded; (B) not in service; or (C) idle due to strikes, repairs and maintenance, downshifts, or seasonal reduction of service; for purposes of computing "days spent in terminals," it is presumed that equal time is spent loading and unloading unless the taxpayer provides acceptable evidence to the department which rebuts that presumption; (3) "terminal days ratio" is the number of days spent in Alaska terminals divided by the total number of days spent in terminals everywhere; (4) property valuations: owned transportation equipment must be valued at its average original cost, and rented transportation equipment must be valued at eight times the net annual rental rate in accordance with AS 43.19.010, Article IV.11, and 15 AAC 19.181 and 15 AAC 19.191; (5) the "value" of owned real and tangible personal property means its original cost (see AS 43.19.010, Article IV.11, and 15 AAC 19.181); (6) "original cost" means the federal tax base of the property plus the value of capital improvements to such property (see 15 AAC 19.181) (7) "average value" of property means the amount determined by averaging the values at the beginning and end of the income year, but the commissioner will, in his discretion, require the averaging of monthly values during the income year if that averaging is necessary to reflect properly the average value of the land transportation company's property (see AS 43.19.010, Article IV.12, and 15 AAC 19.201); (8) the "value" of rented real and tangible personal property means the product of eight times the net annual rental rate (see AS 43.19.010, Article IV.11, and 15 AAC 19.191); (9) "net annual rental rate" means the annual rental rate paid by the taxpayer less an annual rental rate received by the taxpayer from subrentals; (10) "property used during the income year" includes property which is available for use in the taxpayer's trade or business during the income year; (11) "interstate mobile transportation equipment" means any automobile, truck, or tractor trailer engaged in interstate commerce over an Alaska surface highway system or any railroad equipment engaged in interstate commerce over or on an Alaska rail line.

Article 10 Special Rules: Construction Contractors

15 AAC 19.1300 Multistate Tax Compact

15 AAC 19.1300. Construction contractors in general. If a construction contractor is performing long-term contracts and is engaged in business both within and outside this state, the amount of income from sources within this state, including income from those long-term contracts, must be determined in accordance with 15 AAC 19.1300 - 15 AAC 19.1390.

15 AAC 19.1310 Multistate Tax Compact

15 AAC 19.1310. Apportionment of business income. A construction contractor's business income must be apportioned to this state by either the apportionment formula described in 15 AAC 19.1320 or the formula described in 15 AAC 19.1330.

15 AAC 19.1320 Multistate Tax Compact

15 AAC 19.1320. Apportionment formula; percentage of completion method. The apportionment formula for a taxpayer reporting income under the percentage of completion method is a fraction (1) the numerator of which is the sum of (A) the property factor as defined in AS 43.19.010, Article IV.10 - .12, and 15 AAC 19.141 - 15 AAC 19.202; (B) the payroll factor as defined in AS 43.19.010, Article IV.13 - .14 and 15 AAC 19.211 - 15 AAC 19.241, except that compensation paid to an employee who performs construction contractor services is attributable to this state if the compensation is actually earned in the state, without regard to base of operations, residence of the employee, or place from which the service is controlled; and (C) the sales factor as defined in AS 43.19.010, Article IV.15 - .17, and 15 AAC 19.251 - 15 AAC 19.302, except that gross revenues derived from the performance of contracts are attributable to this state if the construction projects are located in this state; and (2) the denominator of which is three.

15 AAC 19.1330 Multistate Tax Compact

15 AAC 19.1330. Apportionment formula; completed contract method. (a) The apportionment formula for a taxpayer reporting income under the completed contract method is a fraction (1) the numerator of which is the sum of (A) the property factor as defined in AS 43.19.010, Article IV.10 - .12, and 15 AAC 19.141 - 15 AAC 19.202, and modified under (b)(1) and (b)(2) of this section; (B) the payroll factor as defined in AS 43.19.010, Article IV.13 - .14, and 15 AAC 19.211 - 15 AAC 19.241, and modified under (b)(3) and (b)(4) of this section, except that compensation paid an employee who performs construction contractor services is attributable to this state if the compensation is actually earned in the state, without regard to base of operations, residence of the employee, or place from which the service is controlled; and (C) the sales factor as defined in AS 43.19.010, Article IV.15 - .17, and 15 AAC 19.251 - 15 AAC 19.302, and modified under (b)(5) and (b)(6) of this section, except that gross revenues derived from the performance of contracts are attributable to this state if the construction projects are located in this state; and (2) the denominator of which is three. (b) For purposes of this section, the property, payroll, and sales factors must be modified as follows: (1) the total rent expense attributable to contracts completed during the tax year and paid over the life of the completed contracts is included in the property factor; (2) rents paid during the year attributable to incomplete contracts are not included in the property factor until the year of completion; (3) the total payroll expense attributable to contracts completed during the tax year and paid over the life of the completed contracts is included in the payroll factor; (4) payroll expense paid during the tax year which is attributable to incomplete contracts is not included in the payroll factor until the year of completion; (5) the total gross revenues derived from contracts completed during the tax year are included in the sales factor; and (6) gross revenues attributable to incomplete contracts are not included in the sales factor until the year of completion.

15 AAC 19.1390 Multistate Tax Compact

15 AAC 19.1390. Definitions for 15 AAC 19.1300 - 15 AAC 19.1390. In 15 AAC 19.1300 - 15 AAC 19.1390 (1) "construction contractor" means a person who undertakes or offers to perform to construct, alter, repair, move, or demolish, including excavation and site development, a highway, building, road, railroad, or any type of fixed structures; (2) "long-term contract" means a contract performed by a construction contractor and which is not completed within the taxable year in which it is entered into.

Article 11 Special Rules: Water Transportation Carriers

15 AAC 19.1410 Multistate Tax Compact

15 AAC 19.1410. Days-spent-in-port ratio. (a) A water transportation carrier shall use a days-spent-in-port ratio computed under this section to attribute to the numerators calculated under 15 AAC 19.1420 - 15 AAC 19.1440 a portion of the total property, payroll, and sales of each ship that the taxpayer uses in Alaska mobile property operations during the tax year. (b) The taxpayer shall calculate a days-spent-in-port ratio for each ship engaged in Alaska mobile property operations during the tax year. The days-spent-in-port ratio is the number of days that the ship spends in port in the state during the tax year, divided by the total number of days that the ship spends in all ports during the tax year. The taxpayer shall compute days spent in port by dividing hours spent in port by 24. (c) Hours spent in port are the total hours during the tax year that a ship is docked or anchored within a jurisdiction. The taxpayer may compute hours spent in port by using either the entries in the ship's logs or the ship's published schedule, adjusted as necessary for the hours described in (d) of this section. (d) Hours spent in port do not include the hours that a ship is docked or anchored solely due to strikes or repairs, or is not in service as described in AS 43.20.143(a)(4).

15 AAC 19.1420 Multistate Tax Compact

15 AAC 19.1420. Property factor. (a) For a water transportation carrier, the numerator of the property factor is the sum of (1) the value, determined under AS 43.19 as modified by AS 43.20.144(e) where applicable, of in-state property other than property used in Alaska mobile property operations described in (2) of this subsection; and (2) the value, determined under AS 43.19, of each ship and property used on, or in conjunction with each ship, that is used in Alaska mobile property operations during the tax year, multiplied by that ship's days-spent-in-port ratio determined under 15 AAC 19.1410 for the tax year. (b) For a barge or other property that is used on or in conjunction with more than one ship during the tax year, the taxpayer shall calculate a separate days-spent-in-port ratio for that property and shall allocate that property between jurisdictions as if the property were a separate ship. (c) A container owned by a water transportation carrier is property described in (a)(1) of this section and is not property used on or in conjunction with a ship. The taxpayer shall allocate the value of the container between jurisdictions using the terminal days ratio under 15 AAC 19.1200 - 15 AAC 19.1290. (d) The taxpayer shall determine the denominator of the property factor under AS 43.19 as modified by AS 43.20.144(e) where applicable, and shall include the property of all corporations combined under AS 43.20.144 or 43.20.145.

15 AAC 19.1430 Multistate Tax Compact

15 AAC 19.1430. Payroll factor. (a) For a water transportation carrier, the numerator of the payroll factor is the sum of (1) the compensation paid to employees assigned to locations within the state determined under AS 43.19; and (2) the total year's compensation paid to the crew, master, and officers of each ship that is used in Alaska mobile property operations during the tax year, multiplied by that ship's days-spent-in-port ratio determined under 15 AAC 19.1410 for the tax year. (b) The taxpayer shall determine the denominator of the payroll factor under AS 43.19, and shall include the compensation paid by all corporations combined under AS 43.20.145.

15 AAC 19.1440 Multistate Tax Compact

15 AAC 19.1440. Sales factor. (a) For a water transportation carrier, the numerator of the sales factor is the sum of (1) the in-state gross receipts, determined under AS 43.19 as modified by AS 43.20.144(d) where applicable, that are not from Alaska mobile property operations; and (2) the tax year's gross receipts from mobile property operations everywhere for each ship that is used in Alaska mobile property operations during the tax year, multiplied by that ship's days-spent-in-port ratio determined under 15 AAC 19.1410 for the tax year. (b) For purposes of (a)(2) of this section, gross receipts include the tax year's receipts from (1) loading, transporting, and unloading cargo; (2) passenger fares; (3) all other goods and services provided on the ship during operations, including gambling and concession arrangements; and (4) operating lease and charter payments received for each ship. (c) The taxpayer shall determine the denominator of the sales factor under AS 43.19 as modified by AS 43.20.144(d) where applicable, and shall include the gross receipts of all corporations combined under AS 43.20.144 or 43.20.145.

15 AAC 19.1450 Multistate Tax Compact

15 AAC 19.1450. Oil and gas taxpayers. A water transportation carrier that is subject to 15 AAC 20.300(c) shall use 15 AAC 19.1410 - 15 AAC 19.1490 to calculate the portion of its property and sales numerators attributable to Alaska mobile property operations.

15 AAC 19.1460 Multistate Tax Compact

15 AAC 19.1460. Water's edge combination. (a) This section applies to determine (1) which of the taxpayer's affiliates, that are engaged in international mobile property operations, meet the 20 percent United States factor test under AS 43.20.145(a)(1)(A) and (4) and must be included in the taxpayer's water's edge combined report; and (2) whether a taxpayer, that is engaged in international mobile property operations, meets the 20 percent United States factor test under AS 43.20.145(a)(1)(A) and (4) and must be included in the water's edge combined report of another affiliated taxpayer corporation. (b) When making the determination in (a)(1) of this section, the taxpayer shall use a days-spent-in-port ratio computed under (d) of this section, to attribute to the United States numerators a portion of each affiliate's property, payroll, and sales from international mobile property operations. (c) When making the determination in (a)(2) of this section, the taxpayer shall use a days-spent-in-port ratio computed under (d) of this section, to attribute to the United States numerators a portion of the taxpayer's property, payroll, and sales from international mobile property operations. (d) The taxpayer shall calculate the days-spent-in-port ratio on a ship-by-ship basis. The days-spent-in-port ratio is the number of days that each ship spends in United States ports during the tax year, divided by the total number of days that the ship spends in all ports during the tax year. Days spent in port are the hours spent in port, measured under 15 AAC 19.1410(c) - (d), divided by 24. (e) The United States property numerator includes the value, determined under AS 43.19, of each ship and any property used on, or in conjunction with that ship, that is used in international mobile property operations during the tax year, multiplied by that ship's days-spent-in-port ratio determined under (d) of this section for the tax year. When determining the total value of each ship and its related property, 15 AAC 19.1420(b) and (c) apply. (f) The United States payroll numerator includes the compensation paid to the crew, master, and officers of each ship that is used in international mobile property operations during the tax year, multiplied by that ship's days-spent-in-port ratio determined under (d) of this section for the tax year. (g) The United States sales numerator includes the tax year's gross receipts from mobile property operations everywhere for each ship that is used in international mobile property operations during the tax year, multiplied by that ship's days-spent-in-port ratio determined under (d) of this section for the tax year. The tax year's gross receipts from mobile property operations everywhere include the gross receipts described in 15 AAC 19.1440(b).

15 AAC 19.1470 Multistate Tax Compact

15 AAC 19.1470. Recordkeeping. (a) A taxpayer engaged in Alaska mobile property operations that are subject to AS 43.20.145 shall prepare, maintain, and provide to the department upon request documents necessary to verify the taxpayer's numerators calculated under 15 AAC 19.1420 - 15 AAC 19.1440, and documents necessary to verify the 20 percent United States factor test under AS 43.20.145(a)(1)(A) and (4) and 15 AAC 19.1460, including (1) calculations and supporting documents for the property, payroll, and sales attributable to each ship owned or operated by the taxpayer or any affiliate of the taxpayer and used in Alaska mobile property operations or international mobile property operations; (2) the calculation of hours spent in port for each ship owned or operated by the taxpayer or any affiliate of the taxpayer and used in Alaska mobile property operations or international mobile property operations; that calculation shall be prepared in sufficient detail to permit audit verification of the calculation by comparison to entries in the ship's log, and if applicable, to published schedules; and (3) copies of each ship's log, and if applicable, each ship's published schedule, supporting the calculation of hours spent in port. (b) An oil and gas taxpayer subject to worldwide apportionment under AS 43.20.144 shall prepare, maintain, and provide to the department upon request documents necessary to verify the taxpayer's numerators calculated under 15 AAC 19.1420 - 15 AAC 19.1440, including (1) calculations and supporting documents for the property and sales allocations to the taxpayer's Alaska mobile property operations; (2) the calculation of hours spent in port for each ship engaged in Alaska mobile property operations; that calculation shall be prepared in sufficient detail to permit audit verification of the calculation by comparison to entries in the ship's log; and (3) copies of each ship's log, supporting the calculation of hours spent in port.

15 AAC 19.1490 Multistate Tax Compact

15 AAC 19.1490. Definitions for 15 AAC 19.1410 - 15 AAC 19.1490. In 15 AAC 19.1410 - 15 AAC 19.1490, unless the context requires otherwise, (1) "Alaska mobile property operations" means (A) transporting goods or persons by ship or barge between a port outside the state and a port within the state; or (B) leasing out or chartering out ships, or property used on or in conjunction with ships, used for transportation described in (A) of this paragraph; (2) "international mobile property operations" means (A) transporting goods or persons by ship or barge between a port outside the United States and a port within the United States; or (B) leasing out or chartering out ships, or property used on or in conjunction with ships, used for transportation described in (A) of this paragraph; (3) "ship" means a floating vessel that is self-propelled and capable of (A) carrying cargo or passengers; or (B) pushing or towing barges; (4) "water transportation carrier" means a taxpayer that engages in Alaska mobile property operations during the tax year.

Chapter 20 Alaska Net Income Tax

Eff. 10/9/80, Register 76; am 2/1/81, Register 77; am 6/2/82, Register 82; repealed 3/6/98, Register 145

15 AAC 20.050 Allocation and apportionment of income

Relocated 4/14/82.

15 AAC 20.060 Deposit and payment requirements by employers in connection with income and school tax withholding

Repealed.

History

Eff. 7/2/77, Register 62; repealed 3/6/98, Register 145

15 AAC 20.070 Timeliness of monthly deposit

Repealed.

History

Eff. 7/2/77, Register 62; repealed 3/6/98, Register 145

15 AAC 20.080 Alaska Net Income Tax

15 AAC 20.080. - 15 AAC 20.090. Deleted.

Article 2 Corporate Net Income Tax; Administration and Credits

15 AAC 20.100 Alaska Net Income Tax

15 AAC 20.100. Returns. (a) Each taxpayer shall file a return except that two or more taxpayers that engage in a unitary business and that join in filing a consolidated federal return shall file a consolidated Alaska return. (b) Two or more taxpayers that do not join in a consolidated federal return may file a consolidated Alaska return if they are engaged in a unitary business and are eligible to file a consolidated federal return. For purposes of this subsection, the provisions of subsections (b)(3), (b)(4), or (b)(7) of Internal Revenue Code section 1504 (26 U.S.C 1504(b)(3), (b)(4), or (b)(7)) that disqualify a corporation from the definition of "includible corporation" in Internal Revenue Code section 1504(b) (26 U.S.C. 1504(b)) for the purpose of filing a consolidated federal tax return do not apply to disqualify a corporation from joining in filing a consolidated Alaska return under AS 43.20 and this chapter. (c) If, under this section, two or more taxpayers file a consolidated Alaska return, all includible taxpayers engaged in the unitary business shall join in the consolidated Alaska return. (d) Taxpayers that join in filing a consolidated Alaska return under this section shall apply Internal Revenue Code sections 1502 - 1552 (26 U.S.C. 1502 - 26 U.S.C. 1552) to consolidate taxable income and determine tax payable. In a consolidated Alaska return the separate taxable income of each taxpayer shall be combined and the consolidated group's net operating loss, net capital gain, section 1231 loss, charitable contribution, and dividends received deduction shall be determined on a consolidated basis. (e) For the purpose of illustrating the making of a consolidated Alaska return under (d) of this section, the following example is offered: EXAMPLE Taxpayer A and Taxpayer B join in the filing of a consolidated Alaska return. The unitary business realized a business net capital gain of $100, made charitable contributions of $40, and generated apportionable business income (excluding capital gains and charitable contributions) of $200. Taxpayer A realized a $25 non-business capital loss allocable to Alaska. The apportionment factors of Taxpayers A and B are 10 percent and 15 percent respectively. The individual apportioned and allocated income or loss of Taxpayer A and Taxpayer B under the combined reporting method are as follows: Ordinary Income2030Capital Gain or (Loss)(15)15Excess Capital Loss150Charitable Contributions46Contribution Deduction25Taxable Income1840 In the consolidated return of Taxpayer A and Taxpayer B, the net capital gain or loss and charitable contribution deduction are consolidated items determined on a consolidated basis: ABCom- binedAdjust- mentsConsoli- datedSeparate Taxable Income20305050Capital Gain or (Loss)(15)1500Contributions4610(5)5Taxable Income40545Contributions Carryforward5Excess Capital Loss0 (f) A taxpayer shall determine its charitable contribution limitation by applying Internal Revenue Code section 170 (26 U.S.C. 170) based upon its Alaska taxable income. The charitable contributions subject to limitation for a taxpayer required to use the combined method of reporting are the current charitable contributions of the unitary business before the federal Internal Revenue Code section 170(b) (26 U.S.C. 170(b)) limitation, multiplied by its apportionment factor plus the Alaska charitable contribution carryforward of the taxpayer, if any. For purposes of determining the education credit under AS 43.20.014, qualified contributions are limited to charitable contributions as defined in Internal Revenue Code section 170(c) (26 U.S.C. 170(c)) that also meet the requirements of AS 43.20.014. A taxpayer may not deduct any part of qualified contributions upon which a credit claimed under AS 43.20.014 is based. (g) For purposes of illustrating the determination of the taxpayer's Alaska charitable contribution limitation and deduction under (f) of this section, the following example is offered: EXAMPLE Taxpayer A made a $100 contribution that qualified for the Alaska education credit under AS 43.20.014 and generated a $50 education credit. Taxpayer A made $500 of other charitable contributions during the tax year. The $600 of contributions may not be deducted in the determination of apportionable income. None of Taxpayer A's contributions were currently deductible in its federal return as a result of the limitation imposed by Internal Revenue Code section 170 (26 U.S.C. 170). Taxpayer A has an Alaska apportionment factor of 15 percent and its apportioned and allocated Alaska income measured under Internal Revenue Code section 170(b) (26 U.S.C. 170(b)) is $900. Taxpayer A's charitable contribution limitation is $90 ($900 X 10 percent) and its entire $75 ($500 X 15 percent) of apportioned charitable contributions may be deducted in determining its taxable income. No part of taxpayer A's $100 contribution applied to generate its education credit under AS 43.20.014 may be deducted. (h) A taxpayer shall determine its dividends received deduction by applying Internal Revenue Code sections 243, 244, 246, 246A, and 247 (26 U.S.C. 243, 244, 246, 246A, and 247) to dividends included in its taxable income as if the dividend payor and payee were domestic corporations. A taxpayer shall apply the limitation imposed by Internal Revenue Code section 246(b) (26 U.S.C 246(b)) by reference to its Alaska taxable income. A taxpayer using the combined reporting method shall apply this subsection only to its dividend income as apportioned and allocated to Alaska. A dividends received deduction shall not be allowed with respect to a dividend eliminated or excluded from income under 15 AAC 20.300(n) or AS 43.20.145(b), or gain treated as a dividend for federal tax purposes under Internal Revenue Code section 1248 (26 U.S.C. 1248). (i) The sum of a taxpayer's apportioned and allocated income or loss, if a net loss, is the taxpayer's net operating loss. A taxpayer shall carry forward or carry back its net operating loss in accordance with the Internal Revenue Code. (j) A taxpayer that is required to file a federal return shall submit a copy of its complete federal return with the return required under AS 43.20; the Alaska return is not complete unless the complete federal return is submitted. A taxpayer that joins in the filing of a consolidated federal return shall submit a copy of the consolidated federal return; a pro forma separate company return does not establish a complete return. A taxpayer may comply with this subsection by submitting, in lieu of the complete federal return, only the portions of the federal return that are specified by the department in the written instructions for the return required under AS 43.20.

History

Authority: AS 43.05.080; AS 43.20.031; AS 43.20.145 AS 43.20.030; AS 43.20.144
Eff. 4/14/82, Register 82; am 7/9/93, Register 127; am 3/6/98, Register 145

15 AAC 20.110 Alaska Net Income Tax

15 AAC 20.110. Investment tax credit. (a) For tax years beginning after June 30, 1980, a taxpayer may apply as a credit against his tax liability computed under AS 43.20 18 percent of the investment credit allowed under Internal Revenue Code section 38 upon only the first $20,000,000 of qualified investment put into use in the state for each taxable year. (b) For calendar year 1980 and for any fiscal tax year which includes July 1, 1980, expenditures made before July 1, 1980 shall be used in calculating the credit upon only the first $500,000 of qualified investment put into use. Expenditures made after June 30, 1980 must be used in calculating the credit upon only the first $20,000,000 of qualified investment put into use in the state. For tax years which include July 1, 1980, the total qualified investment upon which credit may be claimed may not exceed $20,000,000 under any circumstances. (c) Expenditures qualifying for the investment credit and subject to the $20,000,000 limitation must (1) qualify for federal investment credit under section 38 of the Internal Revenue Code; (2) be cash expenditures or binding payment agreements entered into after June 30, 1980; and (3) be made for assets placed in service in the state. (d) For purposes of this section, "placed in service in the state" means that the first use of the qualified investment is in this state. If the property is used elsewhere in the taxable year of acquisition and brought to this state during that same year, that property is considered used property and is subject to the limitations as provided in the Internal Revenue Code. If the property is to be used elsewhere during the taxable year of acquisition and brought to this state in another taxable year, the property does not qualify for the investment credit. Transportation equipment used within and outside of this state whose use commences in this state is considered new property. The qualified expenditure for interstate transportation equipment must be based on a prorated formula of days used in this state compared to days used elsewhere. (e) The recapture of any credit taken must be done under Internal Revenue Code section 47 and must apply when the property is sold, transferred, abandoned, or removed from the state. Transportation equipment used in interstate transportation in this state on a regular basis which originally qualified for investment credit but which is subsequently not used in this state on a regular basis is subject to the recapture provisions of Internal Revenue Code section 47 at that subsequent time.

History

Authority: AS 43.05.080; AS 43.20.036SLA 1981 AS 43.20.021Sec. 24, ch. 117,
Eff. 6/2/82, Register 82

15 AAC 20.120 Alaska Net Income Tax

15 AAC 20.120. Alternative energy expenditure credit; eligibility. Repealed.

History

Eff. 3/28/82, Register 81; repealed 3/6/98, Register 145

15 AAC 20.122 Alaska Net Income Tax

15 AAC 20.122. Alternative energy system substantiation. Repealed.

History

Eff. 3/28/82, Register 81; repealed 3/6/98, Register 145

15 AAC 20.124 Alaska Net Income Tax

15 AAC 20.124. Energy conservation improvement substantiation. Repealed.

History

Eff. 3/28/82, Register 81; repealed 3/6/98, Register 145

15 AAC 20.130 Alaska Net Income Tax

15 AAC 20.130. Rates of tax. If a provision of the Internal Revenue Code that is adopted by reference under AS 43.20.021(a) refers to the highest rate of tax under Internal Revenue Code section 11 (26 U.S.C. 11), a taxpayer shall use the highest rate of tax specified under AS 43.20.011(e).

History

Authority: AS 43.05.080; AS 43.20.011; AS 43.20.021
Eff. 3/6/98, Register 145

15 AAC 20.135 Alaska Net Income Tax

15 AAC 20.135. Alternative minimum tax and credit for prior year minimum tax. (a) The Alaska alternative minimum tax is 18 percent of the applicable alternative minimum federal tax determined under (b) and (c) of this section and is in addition to, and independent of, the income tax imposed at the rates set out by AS 43.20.011(e). (b) The applicable alternative minimum federal tax is the taxpayer's actual federal alternative minimum tax or, if the taxpayer is taxable both inside and outside Alaska, the applicable alternative minimum federal tax is the actual federal alternative minimum tax of the taxpayer's unitary business multiplied by the taxpayer's apportionment factor. (c) If a corporation included in the taxpayer's combined report is a member of a federal consolidated group that incurs the federal alternative minimum tax and that federal consolidated group includes one or more corporations that are not included in the combined report, the federal alternative minimum tax of the federal consolidated group must be allocated between members inside and outside the taxpayer's combined group. The allocation shall be made by multiplying the actual federal alternative minimum tax of the federal consolidated group by a fraction, the numerator of which is the pro forma alternative minimum tax of the corporations included in the taxpayer's combined group that are also members of the federal consolidated group, and the denominator of which is the sum of the pro forma alternative minimum tax for the corporations included in the taxpayer's combined group that are also members of the federal consolidated group plus the pro forma alternative minimum tax for the remaining corporations included in the consolidated federal return. For purposes of allocating the federal consolidated alternative minimum tax under this subsection, the pro forma alternative minimum tax of the corporations inside the taxpayer's combined group and of the corporations outside the taxpayer's combined group shall be computed on a consolidated basis for each group and may not be less than zero. (d) For purposes of illustrating the method of determining the amount of a federal consolidated alternative minimum tax that is allocable to a unitary business under (c) of this section, the following example is offered: EXAMPLE Taxpayer A joins in the filing of a federal consolidated return with corporations B, C, and D. The federal alternative minimum tax of the consolidated group is $1,000. Corporation B is part of Taxpayer A's unitary business and is included in the combined report of Taxpayer A. Corporations C and D are not part of the unitary business conducted in this state and are not included in the combined report of Taxpayer A. The pro forma federal alternative minimum tax of Taxpayer A and corporation B is $480. The pro forma federal alternative minimum tax of corporations C and D is $720. Taxpayer A's apportionment factor is 50 percent. The applicable federal alternative minimum tax allocable to the unitary business of Taxpayer A is $1,000 X ($480/($480+$720)) or $400. Taxpayer A's Alaska alternative minimum tax is $36 ($400 X 50 percent X 18 percent). (e) Except as provided in (g) of this section, a taxpayer's Alaska credit for prior year minimum tax is 18 percent of the taxpayer's actual federal credit for prior year minimum tax or, if the taxpayer is taxable both inside and outside Alaska, the credit is 18 percent of the actual federal credit of the taxpayer's unitary business multiplied by the taxpayer's Alaska apportionment factor. (f) If a corporation included in the taxpayer's combined group is a member of a federal consolidated group that applied a federal credit for prior year minimum tax against consolidated federal income tax payable and the federal consolidated group also includes one or more corporations that are not included in the combined report of the taxpayer, the federal credit for prior year minimum tax of the federal consolidated group shall be allocated between the members inside and outside the taxpayer's combined group. The allocation shall be made by multiplying the federal credit for prior year minimum tax of the federal consolidated group by a fraction, the numerator of which is the pro forma credit for prior year minimum tax for the corporations included in the taxpayer's combined group that are also members of the federal consolidated group, and the denominator of which is the sum of the pro forma credit for prior year minimum tax for the corporations included in the taxpayer's combined group that are also members of the federal consolidated group plus the pro forma credit for prior year minimum tax for the remaining corporations included in the federal consolidated group. For the purpose of making a determination required by this subsection, a group's pro forma credit for prior year minimum tax is the credit allowable to that group determined on a consolidated basis and limited by Internal Revenue Code section 53(c) (26 U.S.C. 53(c)). The Alaska credit for prior year minimum tax is the resulting amount multiplied by the taxpayer's apportionment factor and then by 18 percent. (g) The Alaska credit for prior year minimum tax is limited to the cumulative Alaska alternative minimum tax paid by the taxpayer for tax years after 1986 less the Alaska prior year minimum tax credits allowed in prior years.

History

Authority: AS 43.05.080; AS 43.20.021
Eff. 3/6/98, Register 145

15 AAC 20.140 Alaska Net Income Tax

15 AAC 20.140. Determination of net capital gain or loss. (a) A taxpayer's net capital gain may be taxed at the alternative tax rate as provided in AS 43.20.021(c). A taxpayer may not deduct its net capital loss in determining taxable income. A taxpayer shall carry back or carry forward its net capital loss in accordance with Internal Revenue Code section 1212 (26 U.S.C. 1212). (b) A taxpayer shall determine its net capital gain and net capital loss by applying Internal Revenue Code sections 1201 - 1259 (26 U.S.C. 1201 - 26 U.S.C. 1259) to its gains and losses as apportioned and allocated to Alaska. (c) For purposes of illustrating the method of determining the taxpayer's net capital gain and loss under (b) of this section, the following example is offered: EXAMPLE Taxpayer A realized $100 of business capital gain and $200 of non-business capital loss, which is allocable to another state. Taxpayer A's Alaska apportionment factor is 15 percent. Taxpayer A has no federal or Alaska capital loss carryforward from prior years. Taxpayer A has a federal net capital gain of zero, and a federal excess capital loss of $100. Taxpayer A's apportioned business capital gain is $15 ($100 X 15 percent). Its Alaska net capital gain is $15, the sum of its Alaska allocated capital gain or loss of zero and its apportioned business capital gain of $15. (d) For purposes of determining net capital gain or loss, the department will, in its discretion, exclude from the determination the gains and losses realized by all foreign corporations, as defined in Internal Revenue Code section 7701(a) (26 U.S.C. 7701(a)), that are included in the combined report if a taxpayer cannot substantiate with reasonable certainty a full and accurate accounting for gains and losses of each foreign corporation sufficient to determine the taxpayer's net capital gain or loss under this section. A taxpayer may elect to treat the capital gains and losses of all foreign corporations that are included in its combined report as ordinary gains and losses. An election to treat the capital gains and losses of all foreign corporations as ordinary gains and losses shall be deemed to have been made by the taxpayer if the taxpayer fails to maintain records sufficient for the department to determine with reasonable certainty that there has been a full and accurate accounting for the gains and losses of each foreign corporation. An election under this subsection is irrevocable for the current and subsequent tax years without the consent of the department.

History

Authority: AS 43.05.080; AS 43.20.021
Eff. 3/6/98, Register 145

15 AAC 20.145 Alaska Net Income Tax

15 AAC 20.145. Credits adopted by reference. (a) A credit may be attributed to Alaska only if the credit is claimed on a federal return. For purposes of this section, a federal credit is generated in the year it is originally claimed on a federal return. A federal credit need not be applied to reduce federal tax in the year generated for the credit to be attributed to Alaska. A federal credit claimed and disallowed, such as a credit disallowed by the Internal Revenue Service at audit, is not attributable to Alaska. (b) For purposes of illustrating the attribution of a federal credit to Alaska under AS 43.20.021(d) and (a) of this section, the following example is offered: EXAMPLE Taxpayer A does business in Alaska and does not conduct business in any other state. Taxpayer A's business activities in 1998 generated a federal research credit of $100. In 1998, Taxpayer A is subject to the federal alternative minimum tax and cannot claim its federal credit of $100 against federal income tax in 1998. The federal research credit is attributable to Alaska under AS 43.20.021(d) and (a) of this section. Taxpayer A's 1998 Alaska credit is $18, 18 percent of the federal credit generated during 1998. (c) The credit attributable to Alaska is the taxpayer's actual federal credit generated in the current year or, if the taxpayer is taxable both inside and outside Alaska, is the credit calculated by apportioning the actual federal credits generated in the current year by the taxpayer's unitary business using the apportionment factor applicable to the taxpayer under AS 43.20. (d) For purposes of illustrating the attribution of federal credits of a unitary business in a combined report under (c) of this section, the following example is offered: EXAMPLE Taxpayer B is engaged in a unitary business, part of which is conducted inside Alaska. Corporation C is part of the unitary business of Taxpayer B and is included in the combined report of Taxpayer B. Corporation C's business activities generated a federal research credit of $100. No other federal credits were generated by the unitary business of Taxpayer B. Taxpayer B has an Alaska apportionment factor of 50 percent. Taxpayer B's federal credit attributable to Alaska is the $100 federal credit generated by its unitary business multiplied by its apportionment factor of 50 percent, or $50. Taxpayer B's Alaska research credit is $9, which is 18 percent of the $50 federal credit attributed to Alaska. (e) A taxpayer shall apply credits attributable to Alaska against the income tax set out in AS 43.20.011(e) before any other credits. A taxpayer may not apply credits attributable to Alaska against Alaska alternative minimum tax or other taxes. A taxpayer shall carry back or carry forward unused credits attributable to Alaska as provided under the Internal Revenue Code. (f) Federal credits allowed under the Internal Revenue Code that represent, in whole or in part, a refund of federal taxes are not attributable to Alaska. The part of a federal credit not subject to carryforward under the Internal Revenue Code that increases net minimum tax under Internal Revenue Code section 53 (26 U.S.C. 53) may not be attributed to Alaska as a credit under AS 43.20.021(d).

History

Authority: AS 43.05.080; AS 43.20.021
Eff. 3/6/98, Register 145

15 AAC 20.150 Alaska Net Income Tax

15 AAC 20.150. Requirement to file returns electronically. Repealed.

History

Eff. 10/25/2015, Register 216; repealed 9/20/2020, Register 235

15 AAC 20.155 Alaska Net Income Tax

15 AAC 20.155. Electronic filing waivers. (a) A waiver of the electronic filing requirement granted by the United States Internal Revenue Service will be accepted by the department as a waiver to the requirement to electronically file a return under this chapter. The corporation or partnership must notify the department in writing when a waiver from the United States Internal Revenue Service is granted, in accordance with the department's instructions. (b) The department may grant a waiver of the requirement to file a return electronically if (1) the entity submits a written waiver request not later than 30 days before the filing due date including extensions; and (2) the entity's facts and circumstances demonstrate to the department's satisfaction that complying with the requirement would cause an undue financial hardship; the entity's refusal to purchase or use the requisite software or computer equipment does not, in and of itself, satisfy the conditions for a waiver under this subsection. (c) If circumstances warrant, the department may issue an administrative waiver of the requirement to file electronically under this chapter if the department determines it is necessary to promote the effective and efficient administration of the tax system. (d) If an electronic tax return cannot be accepted for processing electronically, the entity must contact the department for assistance in correcting the rejected return errors. If the rejected return errors cannot be corrected, the entity must receive written authorization from the department before filing a paper return.

History

Authority: AS 43.05.080; AS 43.20.160 AS 43.20.030; AS 43.20.300
Eff. 10/25/2015, Register 216

15 AAC 20.200 Alaska Net Income Tax

15 AAC 20.200. Definitions. Relocated.

15 AAC 20.260 Alaska Net Income Tax

15 AAC 20.260. Film production tax credit. (a) Upon notification from the film office of the award, under AS 44.33.231 - 44.33.239 and 3 AAC 188, of a film production tax credit to a producer, and as provided under AS 43.98.030, the department will issue the producer a film production tax credit certificate. (b) To use a film production tax credit provided under AS 43.98.030 to offset taxes imposed under AS 43.20 (Alaska Net Income Tax Act), the current holder of the film production tax credit certificate must use the credit no later than three years after the date on which the department initially issued the certificate. On the certificate, the department will identify the date of initial issuance, transfer date, if applicable, and the expiration date. If the current holder is the first person to whom the certificate was issued, the credit may be taken on one or more of the returns required under AS 43.20 for a tax period that occurred, in whole or in part, no earlier than the date on which the department initially issued the certificate and no later than the date on which the certificate expires. If the current holder acquired the certificate through a transfer, the credit may be taken on one or more of the returns required under AS 43.20 for a tax period that occurred, in whole or in part, no earlier than the date on which the department transferred the certificate to the current holder and no later than the date on which the certificate expires. The current holder must attach the original certificate to the tax return on which the credit is claimed. If the original certificate is lost, stolen, or misplaced, an affidavit signed under penalty of perjury stating that the original certificate was lost, stolen, or misplaced must be attached to the tax return on which the credit is claimed. (c) Transfer under AS 43.98.030(b) of a film production tax credit is subject to department approval under this subsection and (d) of this section. To request approval, the transferor must (1) make a request for transfer on a form or in a format prescribed by the department, and must include on the request (A) the number assigned by the department of the film production tax credit certificate being transferred; (B) the transferor's name, address, and federal tax identification number; (C) the transferor's name, address, and federal tax identification number; (D) the date of the transfer; and (E) the amount of the credit being transferred; (2) include with the request the original film production tax credit certificate or, if the original certificate is lost, stolen, or misplaced, an affidavit signed under penalty of perjury stating that the original certificate was lost, stolen, or misplaced; and (3) include with the request, if the transferor is the producer, a sworn certification that neither the producer nor the production is the subject of an investigation or administrative proceeding concerning alleged violations by the producer or the production of the laws or regulations of this state, and that neither the producer nor the production is involved in a legal action filed in a federal court or a court in this state concerning alleged violations by the producer or the production of the laws or regulations of this state. (d) The department will approve a request for transfer if (1) the transferor provides the information and items required under (c) of this section; and (2) in the case of a transferor that is a producer, there is not (A) a filed, but unresolved, legal action in the state involving the producer or production; or (B) an outstanding liability due to the state or a political subdivision of the state as a result of damages caused by an act or omission of the producer or production. (e) Upon approval of the request for transfer, the department will issue a film production tax credit certificate to the transferee. The department will also issue a certificate to the transferor to the extent that the transferor retains a portion of the film production tax credit. The transfer of the credit in whole or in part does not extend the three-year period during which the credit may be used. (f) A film production tax credit is subject to reduction, withholding, or recovery under AS 44.33.235(f) - (h) and 44.33.237. However, the department will not reduce the amount of a credit transferred in a transaction in which the transferor and transferee act independently and do not have a relationship to each other. (g) In this section, (1) "film office" has the meaning given in AS 44.33.239; (2) "producer" has the meaning given in AS 44.33.239.

History

Authority: AS 43.05.080; AS 43.98.030
Eff. 12/22/2010, Register 196; am 3/4/2011, Register 197

Authority: AS 43.05.080; AS 43.20.145
Eff. 7/9/93, Register 127; am 3/6/98, Register 145

Authority: AS 43.05.080; AS 43.20.144 AS 43.19.010; AS 43.20.145
Eff. 7/1/2004, Register 170

15 AAC 20.550 Alaska Net Income Tax

15 AAC 20.550. Reserved.

Article 5 Corporate Net Income Tax; Transition Rules

15 AAC 20.560 Alaska Net Income Tax

15 AAC 20.560. General rule. Repealed.

History

Eff. 4/14/82, Register 82; repealed 3/6/98, Register 145

15 AAC 20.570 Alaska Net Income Tax

15 AAC 20.570. Expenses; amortization and depreciation. Repealed.

History

Eff. 4/14/82, Register 82; am 3/17/85, Register 93; repealed 3/6/98, Register 145

15 AAC 20.580 Alaska Net Income Tax

15 AAC 20.580. Net operating losses under AS 43.20 and net losses under AS 43.21. Repealed.

History

Eff. 4/14/82, Register 82; repealed 3/6/98, Register 145

15 AAC 20.590 Alaska Net Income Tax

15 AAC 20.590. Short-year return rule. Repealed.

History

Eff. 4/14/82, Register 82; repealed 3/6/98, Register 145

Authority: AS 43.05.080; AS 43.20.030; AS 43.20.031
Eff. 2/17/85, Register 93

Authority: AS 43.05.080Ak Const.AS 43.20.160 AS 43.19.010; AS 43.20.031 Art. IV, $ 18,AS 43.20.142
Eff. 2/17/85, Register 93

Chapter 21 Oil and Gas Corporate Income Tax

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.080 Oil and Gas Corporate Income Tax

15 AAC 21.080 - 15 AAC 21.090. Reserved.

Article 2 Taxable Income from Oil and Gas Production

15 AAC 21.100 Oil and Gas Corporate Income Tax

15 AAC 21.100. Taxable production income. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.110 Oil and Gas Corporate Income Tax

15 AAC 21.110. Gross production revenue. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.120 Oil and Gas Corporate Income Tax

15 AAC 21.120. Value at the point of production. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.122 Oil and Gas Corporate Income Tax

15 AAC 21.122. Sales price. Repealed.

History

Eff. 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.124 Oil and Gas Corporate Income Tax

15 AAC 21.124. Prevailing value for oil. Repealed.

History

Eff. 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.125 Oil and Gas Corporate Income Tax

15 AAC 21.125. Prevailing value for gas. Repealed.

History

Eff. 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.128 Oil and Gas Corporate Income Tax

15 AAC 21.128. Choice of methods for determining reasonable cost of transportation. Repealed.

History

Eff. 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.130 Oil and Gas Corporate Income Tax

15 AAC 21.130. Calculation of reasonable costs of transportation. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.140 Oil and Gas Corporate Income Tax

15 AAC 21.140. Extraordinary production revenue (or loss). Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.150 Oil and Gas Corporate Income Tax

15 AAC 21.150 - 15 AAC 21.190. Reserved.

15 AAC 21.200 Oil and Gas Corporate Income Tax

15 AAC 21.200. Deductions from gross production revenue - In general. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.210 Oil and Gas Corporate Income Tax

15 AAC 21.210. Deduction for royalty. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.215 Oil and Gas Corporate Income Tax

15 AAC 21.215. Deduction for Native corporation revenue sharing. Repealed.

History

Eff. 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.220 Oil and Gas Corporate Income Tax

15 AAC 21.220. Deduction for production taxes. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.230 Oil and Gas Corporate Income Tax

15 AAC 21.230. Deduction for ad valorem taxes. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.235 Oil and Gas Corporate Income Tax

15 AAC 21.235. Deduction for crude oil windfall profit tax. Repealed.

History

Eff. 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.240 Oil and Gas Corporate Income Tax

15 AAC 21.240. Deduction for direct operating costs. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.250 Oil and Gas Corporate Income Tax

15 AAC 21.250. Deduction for acquisition costs. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.260 Oil and Gas Corporate Income Tax

15 AAC 21.260. Deduction for development costs. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.270 Oil and Gas Corporate Income Tax

15 AAC 21.270. Deduction for exploration costs. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.280 Oil and Gas Corporate Income Tax

15 AAC 21.280. Deduction for uncapitalized interest. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.290 Oil and Gas Corporate Income Tax

15 AAC 21.290. Deduction for general overhead and administrative expense. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.330 Oil and Gas Corporate Income Tax

15 AAC 21.330 - 15 AAC 21.340. Reserved.

15 AAC 21.350 Oil and Gas Corporate Income Tax

15 AAC 21.350. Operating expenses (oil pipeline). Repealed.

History

Eff. 2/22/79, Register 69; am 8/29/85, Register 95; repealed 9/20/2020, Register 235

15 AAC 21.360 Oil and Gas Corporate Income Tax

15 AAC 21.360 - 15 AAC 21.390. Reserved.

15 AAC 21.400 Oil and Gas Corporate Income Tax

15 AAC 21.400. Taxable gas pipeline income. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.410 Oil and Gas Corporate Income Tax

15 AAC 21.410. Operating revenues (gas pipelines). Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.420 Oil and Gas Corporate Income Tax

15 AAC 21.420. Extraordinary operating revenues and losses (gas pipelines). Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.430 Oil and Gas Corporate Income Tax

15 AAC 21.430 - 15 AAC 21.440. Reserved.

15 AAC 21.450 Oil and Gas Corporate Income Tax

15 AAC 21.450. Operating expenses (gas pipelines). Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.460 Oil and Gas Corporate Income Tax

15 AAC 21.460 - 15 AAC 21.490. Reserved.

Article 4 Taxable Income Apportioned to Alaska

15 AAC 21.500 Oil and Gas Corporate Income Tax

15 AAC 21.500. Taxable apportioned income. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.510 Oil and Gas Corporate Income Tax

15 AAC 21.510. Apportionable income. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.520 Oil and Gas Corporate Income Tax

15 AAC 21.520. Three-factor formula for apportionment. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.530 Oil and Gas Corporate Income Tax

15 AAC 21.530. Property factor. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.540 Oil and Gas Corporate Income Tax

15 AAC 21.540. Payroll factor. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.550 Oil and Gas Corporate Income Tax

15 AAC 21.550. Sales factor. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.560 Oil and Gas Corporate Income Tax

15 AAC 21.560 - 15 AAC 21.590. Reserved.

Eff. 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.670 Oil and Gas Corporate Income Tax

15 AAC 21.670 - 15 AAC 21.690. Reserved.

Article 6 Administration

15 AAC 21.700 Oil and Gas Corporate Income Tax

15 AAC 21.700. Returns and assessments. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.710 Oil and Gas Corporate Income Tax

15 AAC 21.710. Payments; installments. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; am 9/15/82, Register 83; repealed 9/20/2020, Register 235

15 AAC 21.720 Oil and Gas Corporate Income Tax

15 AAC 21.720. Refunds. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.730 Oil and Gas Corporate Income Tax

15 AAC 21.730. Computation of interest. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.740 Oil and Gas Corporate Income Tax

15 AAC 21.740. Civil penalties. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; repealed 9/20/2020, Register 235

15 AAC 21.750 Oil and Gas Corporate Income Tax

15 AAC 21.750. Relief. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.800 Oil and Gas Corporate Income Tax

15 AAC 21.800. Application to the 1978 tax year. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.810 Oil and Gas Corporate Income Tax

15 AAC 21.810. Statute of limitations. Repealed.

History

Eff. 2/22/79, Register 69; am 3/26/82, Register 81; repealed 9/20/2020, Register 235

15 AAC 21.820 Oil and Gas Corporate Income Tax

15 AAC 21.820. Fiscal-year taxpayers. Repealed.

History

Eff. 2/22/79, Register 69; repealed 9/20/2020, Register 235

15 AAC 21.830 Oil and Gas Corporate Income Tax

15 AAC 21.830 - 15 AAC 21.890. Reserved.

Article 7 General Provisions

15 AAC 21.900 Oil and Gas Corporate Income Tax

15 AAC 21.900. Definitions. Repealed.

History

Eff. 2/22/79, Register 69; am 5/21/81, Register 78; am 4/14/82, Register 82; repealed 9/20/2020, Register 235

(A) after the 180-day period of time in the qualifying year as specified in AS 43.23.005(h); in order to be eligible for purposes of 43.23.005(h) and this subparagraph, the death certificate for the individual who has died must reflect the 181st calendar day or later of the qualifying year as announced by the department; or

(B) during the period of time specified in AS 43.23.011; or

(2) application was signed by the individual or the individual's authorized representative before the individual's death.

(c) An individual applying for a dividend must provide a current mailing and physical address with the application. If a corrected address for the individual is provided to the department by the United States Postal Service or foreign postal service, the department may use that address. If the individual's mailing or physical address changes before the dividend is paid or during the appeal or collection process, the individual must notify the department in writing of the change in address. Except in the case of a minor parent filing on behalf of that parent's own minor child under 15 AAC 23.113(b)(1)(C), the department will not implement a change of address requested by an individual who is a minor unless the individual submits proof satisfactory to the department of emancipation with the request.

(d) An individual born outside Alaska who is filing for a dividend for the first time must submit a certified copy of the individual's birth certificate issued by the official agency of the other state or country responsible for recording births, or must submit an original passport or an original United States naturalization certificate. An individual born in Alaska who is filing for a dividend for the first time need not submit a certified copy of the individual's birth certificate. However, if the individual was born in Alaska and the department is unable to confirm the birth with Alaska's division of public health, vital statistics, the individual must submit a certified copy of the individual's Alaska birth certificate.

(e) Absences that total more than 90 days during the qualifying year must be disclosed on the application. Any absence since January 1 of the qualifying year must be disclosed upon request of the department.

(f) Except as provided in AS 43.23.015(d), 15 AAC 23.113, and 15 AAC 23.123, an individual applying for a dividend must personally sign the certification of residency and eligibility contained on the application form. The department will deny an application if the certification is altered, unless the alteration does not substantially change the content of the certification.

(g) It is an individual's responsibility to ensure that an application is timely delivered to the department. A paper application must be timely delivered to the department during normal business hours or delivered to the post office in sufficient time to be postmarked before the end of the application period. The department will deny a paper application postmarked after the application period, unless the individual provides the department with an official statement from the United States Postal Service or a foreign postal service that describes the specific circumstances under which the postal service incorrectly posted the individual's application or caused a delay in posting. An online application must be received electronically by the department by midnight Alaska Daylight Time on the last day of the application period. An applicant's proof of timely filing an online application is a copy of the computer-generated page containing the permanent fund dividend confirmation number received by the applicant after completing the online filing process that shows that the online application was timely delivered to the department.

(h) If an individual has timely filed an application but the department does not have that application on file, the individual may submit a request to reapply on or before December 31 of the dividend year. A request to reapply must be accompanied by one of the following forms of evidence that an application was timely filed with the department:

(1) a mailing receipt;

(2) a mailing return receipt documenting delivery to the department, or a receipt issued by the department;

(3) a copy of the computer-generated page containing the permanent fund dividend confirmation number received by the applicant after completing the online filing process;

(4) if the previous application was filed on or after January 1, 2009, a notarized affidavit in which the individual attests that the individual mailed or submitted the previous application timely, or a sponsor applying on behalf of the individual attests that the sponsor mailed or submitted the previous application timely; an individual may request to reapply under this paragraph only once during the individual's lifetime.

(i) Unless the department has initiated a criminal investigation involving the individual or the application, an individual may withdraw an application at any time before payment by notifying the department in writing. An individual may retract the withdrawal only during the application period by filing a new application before the end of the application period. After the application period closes, the department will not honor a retraction of the withdrawn application.

(j) The department will deny an application if the department determines that an individual intentionally, recklessly, or negligently provided false information or omitted material facts, including failure to disclose a reportable absence to the department.

(k) An electronic signature satisfies the personal signature requirements of (f) of this section if the electronic signature is

(1) executed or adopted by the individual with the intent to attest to a statement concerning the applicant's residency and eligibility;

(2) verified by the electronic signature verification system designated by the department; and

(3) is securely linked to the application form and stored together with the application as one document.

(l) repealed 5/22/2016.

(m) The application must include the names, addresses, and telephone numbers of adult Alaska residents who can attest to facts relating to the individual's length of residence and physical presence in Alaska.

(n) In this section,

(1) "electronic signature" has the meaning given in AS 09.80.190;

(2) "statement" has the meaning given in AS 11.56.240.

History

Authority: AS 09.80.150; AS 43.05.290; AS 43.23.015 AS 09.80.160; AS 43.23.005; AS 43.23.055 AS 09.80.190; AS 43.23.011; AS 43.23.270
Eff. 1/1/93, Register 124; am 10/8/94, Register 131; am 3/30/95, Register 133; am 8/24/95, Register 135; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; add'l am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2006, Register 176; am 1/1/2007, Register 180; am 1/1/2008, Register 184; am 1/1/2009, Register 188; am 1/1/2010, Register 192; am 6/5/2011, Register 198; am 5/22/2016, Register 218; am 12/23/2022, Register 244

15 AAC 23.105 Applicability of certain provisions

Repealed 1/1/93.

15 AAC 23.110 Eligibility

Repealed 1/1/93.

15 AAC 23.111 Eligibility for a 1982 permanent fund dividend

Repealed 1/1/93.

15 AAC 23.113 Application on behalf of a child

(a) An application for a dividend filed on behalf of a child must comply with the requirements of 15 AAC 23.103.

(b) A child who otherwise qualifies is eligible to receive a dividend if the child is

(1) in the lawful and physical custody of an individual who meets the requirements of a sponsor under (c)(1) of this section and who

(A) is eligible for the dividend or would have been eligible for the dividend had the sponsor filed timely;

(B) was ineligible for the dividend due to AS 43.23.005(d) or due to having forfeited the dividend under AS 43.23.270(a) or (c); or

(2) in the custody of an agency of the state;

(3) released into the child's own custody by the Department of Family and Community Services under a court order; or

(4) in the custody of a tribal court of an Alaska Native entity within this state and on the list issued under 25 U.S.C. 479a-1 (Federally Recognized Indian Tribe List Act) of federally recognized Indian entities.

(1) a sponsor who is

(A) a natural or adoptive parent of the child;

(B) the legal guardian of the child;

(D) except as provided in (2) of this subsection or (e) of this section, an authorized representative, if the authorized representative demonstrates to the satisfaction of the department that a need exists to sponsor the child, and the child does not have a sponsor under (A) - (C) of this paragraph; an authorized representative applying on behalf of a child must have had lawful and physical custody of the child at the time of application and for the majority of the qualifying year, or must be applying in accordance with a court order; or

(2) a representative of the Department of Family and Community Services for a child who is in that department's custody during the application period.

(d) If the department accepts an application filed on behalf of a child by a sponsor under (c)(1) of this section, the department will not determine the child's eligibility until the time when the sponsor's eligibility has been determined.

(e) A child whose adoption is pending during the qualifying year and who otherwise qualifies is eligible for a dividend regardless of the child's alienage or length of residency if

(1) the child's sponsor is a resident and was a resident during the entire qualifying year;

(2) the sponsor has physical custody of the child before the end of the qualifying year; and

(3) the adoption is ultimately finalized according to state law.

(f) The department will not determine the eligibility of a child being adopted until the sponsor provides documentation, satisfactory to the department, that the adoption has been finalized according to state law.

(g) The department may require an individual applying on behalf of a child to provide evidence of the individual's authority to apply on behalf of the child, including

(1) the child's birth certificate issued under AS 18.50 or under other similar provisions of law of another jurisdiction, showing the name of the individual making application as a parent of the child;

(2) a certified copy of a decree of divorce or dissolution of marriage issued under AS 25.24 or under other similar provision of law of another jurisdiction, showing the name of the individual making application as having sole or joint custody of the child;

(3) a certified copy of an adoption order or post-adoption birth certificate issued under AS 25.23 or under other similar provisions of law of another jurisdiction, showing the name of the individual making application as an adoptive parent of the child; or

(4) other information demonstrating the individual's qualification to apply for a dividend on behalf of the child.

(h) The department will accept another eligible individual as a substitute sponsor of a child if the child meets all eligibility requirements but does not have an eligible sponsor on file with the department, so long as the substitute sponsor meets the requirements of a sponsor. The department will not approve the child's application for payment until the time when the substitute sponsor has been determined to be eligible by the department.

(i) The department will reverse a denial of a child's permanent fund dividend application if the child was denied only due to the ineligibility of the child's original sponsor and the child's original sponsor is subsequently determined during processing, at review, at informal conference, at formal hearing, or by a court to be eligible for a dividend.

History

Authority: AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124; am 6/26/93, Register 126; am 12/24/93, Register 128; am 10/8/94, Register 131; am 3/30/95, Register 133; am 11/20/96, Register 140; am 1/1/99, Register 148; am 1/1/2006, Register 176; am 1/1/2011, Register 196; am 5/22/2016, Register 218

15 AAC 23.115 Eligibility of a child for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.120 Eligibility for a prior year dividend

Repealed 1/1/93.

15 AAC 23.123 Application on behalf of a disabled, incompetent, or other adult

(a) An application for a dividend filed on behalf of another adult must comply with the requirements of 15 AAC 23.103.

(b) An application for a dividend may be filed on behalf of a disabled adult only by the disabled adult's spouse, parent, legal guardian, or other authorized representative. Medical documentation regarding the disability must be provided with the disabled individual's application.

(c) An application for a dividend may be filed on behalf of an incompetent adult only by the incompetent adult's parent, guardian, or conservator appointed under AS 13.26 or under other similar provision of law of this state or of another jurisdiction.

(d) An individual, to whom a power of attorney has been granted, may file an application for a dividend on behalf of an adult, if the power of attorney is a general power of attorney or the power of attorney specifically authorizes the individual to file a dividend application on the adult's behalf.

(e) Evidence of the authority of the individual applying on behalf of an adult under (b), (c), or (d) of this section must be attached to the application, and the circumstances requiring the signature by someone other than the applicant must be clearly set out and explained. The individual making application on behalf of another adult must certify to the facts underlying the adult's eligibility for a dividend and must sign the application on behalf of the adult.

History

Authority: AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124; am 1/1/2006, Register 176; am 1/1/2008, Register 184

15 AAC 23.125 Eligibility of aliens for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.130 Adult state resident

Repealed 1/1/93.

15 AAC 23.133 Application for a prior year dividend

(a) Except as provided in (b) - (e) of this section, application for a prior year dividend will be denied by the department.

(b) An individual who has reached majority, or who is an emancipated minor, may apply to the department for a prior year dividend if

(1) the individual had not reached majority by the end of the application period for the dividend year for which the individual is applying;

(2) a complete application was not filed by an eligible sponsor on the individual's behalf, was not timely filed, or, solely as a result of competing applications being filed, was not paid; and

(3) the individual would have qualified for a dividend had an eligible sponsor applied on the individual's behalf during the pertinent dividend year.

(c) An individual who qualifies under (b) of this section must file, before the individual reaches 20 years of age, an application prescribed by the department.

(d) If an individual was disabled, as defined in AS 43.23.295, during the application period of the prior year and, as a result of the disability, did not timely file an application, that individual or an authorized representative may submit an application for the prior year dividend. A certification from a licensed health care provider must be provided with the disabled individual's application. The certification from a licensed health care provider must include

(1) confirmation that the individual was disabled on March 31 of the dividend year for which the individual is applying; and

(2) a statement explaining why the disability prevented the applicant from timely filing an application during the application period of the dividend year for which the individual is applying.

(e) Except for extraordinary circumstances as determined by the department, an application for an individual who qualifies under (d) of this section must be filed within one year after the end of the application period pertaining to the dividend for which the individual is applying.

(f) Repealed 5/22/2016.

(g) A representative of the Department of Family and Community Services may file an application for a child who was in that department's custody when the prior year's application was due, but on whose behalf an application was not filed. The application must be filed within one year from the end of the prior year's dividend application period.

(h) If a representative of the Department of Administration, office of public advocacy failed to apply for a dividend for an individual who was a ward of the agency on December 31 of the prior qualifying year, and the department does not have a timely filed application on file for the individual, a representative of the office of public advocacy may submit an application on the individual's behalf for the prior year's dividend.

(i) Except for extraordinary circumstances as determined by the department, an application for an individual who qualifies under (h) of this section for the prior year's dividend may be filed only by a Department of Administration, office of public advocacy representative and must be filed within one year after the end of the prior year's dividend application period.

(j) For the purposes of this section, "licensed health care provider" means a person licensed in this state or another state of the United States to provide health care services.

History

Authority: AS 43.23.005; AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2005, Register 172; am 1/1/2008, Register 184; am 5/22/2016, Register 218

15 AAC 23.135 Eligibility for a prior year dividend for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.140 Child state resident

Repealed 1/1/93.

15 AAC 23.143 Establishing and maintaining Alaska residency

(a) An individual's intent to establish residency, remain indefinitely in Alaska, or to return to Alaska and remain indefinitely is demonstrated through the establishment and maintenance of customary ties indicative of Alaska residency and the absence of those ties elsewhere. Acts that are required by law or contract or are routinely performed by temporary residents of Alaska are not by themselves evidence of residency. In evaluating whether an individual claiming Alaska residency has demonstrated an intent to remain indefinitely in Alaska, the department will consider whether or not an individual has:

(1) taken steps to establish Alaska residency and sever residency in a previous state or country;

(2) ties to another state or country that indicate continued residency in the other state or country; and

(3) taken other action during the qualifying year, through the date of application, that is inconsistent with an intent to remain in Alaska indefinitely.

(b) An individual may not become a resident while absent from Alaska.

(c) Physical presence in Alaska is not, by itself, sufficient to establish residency. Before January 1 of the qualifying year, an individual must have taken at least one step beyond physical presence in Alaska to establish residency. The department will not consider external indicators, including those listed in 15 AAC 23.173(g), established less than six months before December 31 of the qualifying year as evidence of the establishment of Alaska residency in time to qualify for the current year dividend.

(d) An individual is not eligible for a dividend if, at any time from January 1 of the qualifying year through the date of application, the individual has

(1) maintained the individual's principal home in another state or country, regardless of whether the individual spent a majority of time at that home, except while absent for a reason listed

(A) in AS 43.23.008(a)(1) - (3), (9) - (11), or (16); or

(B) in AS 43.23.008(a)(13), if the eligible resident whom the individual accompanies is absent for a reason listed in (A) of this paragraph;

(2) claimed or maintained a claim of residency in another state or country in the individual's employment personnel records; if the individual claims an error or a delay was made in processing by the personnel office, the individual must submit

(A) from the personnel office, a certified copy of the individual's request to change the individual's state of legal residence; or

(B) a sworn statement from the personnel officer who has specific knowledge that the personnel office made an error, or caused a delay, in processing the individual's personnel records; the personnel officer must state the exact date the records show the original request was received and why the request was not processed timely;

(3) claimed a non-resident motor vehicle tax exemption in Alaska;

(4) accepted full-time, permanent employment in another state or country except while on an absence listed

(A) in AS 43.23.008(a)(1) - (3), (9) - (11), or (16); or

(B) in AS 43.23.008(a)(13), if the eligible resident whom the individual accompanies is absent for a reason listed in (A) of this paragraph;

(5) filed a resident or part-year resident income tax return in another state or country and the claim of residency on the return is for any period of time beginning January 1 of the qualifying year through the date of application, unless the individual

(A) was required by the other state or country to file a return claiming resident tax status in that state or country even though the individual was a state resident as defined in AS 43.23.295; or

(B) files in the other state or country an amended return claiming nonresident tax status and provides proof to the department that the amended return was actually filed in the other state or country;

(6) claimed or maintained a claim of a homestead or homeowner's property tax exemption in another state or country, that required the individual to be a resident of that state or country, unless the individual

(A) files an amended homestead or homeowner's property tax exemption claim deleting the claim of residency; and

(B) provides evidence from the other state or country that the individual filed an amended homestead or homeowner's property tax exemption claim deleting the claim of residency;

(7) applied for or received an education loan from another state or country that required an individual to be a resident of that state or country;

(8) disclosed in a court proceeding or affidavit that the individual is a resident of another state or country;

(9) executed a will that described residency in another state or country;

(10) moved from Alaska,

(A) for a reason other than one listed

(i) in AS 43.23.008(a)(1) - (3), (9) - (11), or (16); or

(ii) in AS 43.23.008(a)(13), if the eligible resident whom the individual accompanies is absent for a reason listed in (i) of this subparagraph; and

(B) claiming moving expenses as a deduction on the individual's federal income tax return, unless the individual

(i) files an amended federal income tax return deleting the claimed moving expenses as a deduction; and

(ii) provides proof from the Internal Revenue Service that the individual filed an amended return;

(11) accepted admission under resident tuition provisions to a college or university in another state or country, unless

(A) there was no difference between resident and nonresident tuition;

(B) nonresident tuition was waived as part of an interstate exchange agreement such as the Western Interstate Commission for Higher Education (WICHE) student exchange program or the Washington Wyoming Alaska Montana Idaho (WWAMI) medical education program; or

(C) the individual was granted admission under resident tuition provisions for any other reason that did not require the individual to be a resident of the state or country in which the college or university is located;

(12) registered to vote in another state or country, except if the individual

(A) registered to vote in another state no more than 60 days before a presidential election solely for the purpose of voting in that election and did not vote in any other election in another state other than for president of the United States; or

(B) registered to vote in another country for which the individual was not required to claim residency of the country in order to register to vote;

(13) voted in another state's or country's state, country, or local election, except if the individual voted in an election described in this paragraph and the individual was not required to claim residency in order to vote;

(14) obtained a resident hunting, fishing, or trapping license from another state or country;

(15) filed for divorce, dissolution, or legal separation in another state or country that required the individual to be a resident of that state or country in order to file the action;

(16) repealed 1/1/2010;

(17) obtained any other benefit or benefits as a result of establishing or maintaining any claim of residency in another state or country or by disclaiming Alaska residency, except that the department will not deny a dividend to an individual solely because the individual received Medicaid benefits from another state if the individual's application for Medicaid was consistent with the intent to maintain residency in Alaska.

(e) Regardless of alienage, a child born outside Alaska to an eligible resident on an allowable absence, adopted by an eligible resident, or whose adoption by an eligible resident is pending during the qualifying year, establishes Alaska residency in the child's own right immediately upon the child's arrival in Alaska if the child's custodial parent or guardian is an eligible resident at the time of the child's arrival in Alaska.

(f) An individual absent from Alaska as a dependent of an eligible resident who as soon as reasonably possible, as determined by the department, after emancipation does not return to Alaska and establish Alaska residency as an adult is not eligible for a dividend. A newly emancipated individual who was absent from Alaska as a dependent of an eligible resident who returns to Alaska as soon as reasonably possible, as determined by the department, after emancipation and who establishes external indicators of Alaska residency as an individual is not subject to the six month physical presence requirements of 15 AAC 23.163(b).

(g) A resident who marries a nonresident while physically present in Alaska is considered to have the intent to remain indefinitely in Alaska until the resident takes steps or actions to depart Alaska.

(h) An individual who on the date of application knows the individual will be moving from Alaska at a specific time to a specific destination for a reason other than one allowed by AS 43.23.008(a) does not have the intent to remain indefinitely in Alaska and is not eligible for a dividend.

(i) The eligibility of a resident who marries a nonresident while absent from Alaska is not changed by the marriage, so long as the resident is absent for the resident's own allowable reason.

(j) The fact that an individual's spouse has not declared Alaska residency does not establish a presumption that an individual is not a resident.

(k) Repealed 1/1/2000.

History

Authority: AS 01.10.055; AS 43.23.008; AS 43.23.055 AS 43.23.005; AS 43.23.015
Eff. 1/1/93, Register 124; am 6/26/93, Register 126; am 12/24/93, Register 128; am 10/8/94, Register 131; am 11/20/96, Register 140; am 4/18/97, Register 142; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2008, Register 184; am 1/1/2009, Register 188; am 1/1/2010, Register 192; am 1/1/2011, Register 196; am 1/1/2013, Register 204

15 AAC 23.145 Applications generally for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.150 Allowable absences

Repealed 1/1/93.

15 AAC 23.153 Eligibility of aliens

Repealed.

History

Eff. 1/1/93, Register 124; am 11/20/96, Register 140; am 4/18/97, Register 142; em am 6/4/99 - 10/1/99, Register 151; repealed 1/1/2000, Register 152

15 AAC 23.154 Eligibility of aliens

(a) The department will consider an alien to be lawfully admitted for permanent residence if the alien provides verification that the alien has been assigned a status under 8 U.S.C. 1101 - 1189 (Immigration and Nationality Act) that allows the alien to adopt the United States as the alien's domicile, including the following statuses:

(1) status as an immigrant within the meaning of 8 U.S.C. 1101(a)(15), as verified by the USCIS;

(2) status as a nonimmigrant within the meaning of 8 U.S.C. 1101(a)(15), as verified by the USCIS, if that status does not require the alien to declare that the alien has a residence in a country other than the United States;

(3) indefinite parole into the United States under 8 U.S.C. 1182(d)(5), as verified by the USCIS;

(4) a status described in 8 U.S.C. 1186a (Conditional Permanent Resident Status for Certain Alien Spouses and Sons and Daughters) or 8 U.S.C. 1186b (Conditional Permanent Resident Status for Certain Alien Entrepreneurs, Spouses, and Children), as verified by the USCIS.

(b) The department will not consider an alien to be lawfully admitted for permanent residence if the USCIS assigns the alien a status that requires the alien to declare that the alien has a residence in a country other than the United States.

(c) The department will consider an alien to be a state resident for purposes of AS 43.23.005(a)(3) on the date that the alien can demonstrate, to the satisfaction of the department, that the alien has formed the intent to remain indefinitely under the requirements of AS 43.23 and this chapter. The qualifying year for dividend eligibility for an alien who is a state resident begins on January 1 of the calendar year after the date the alien is lawfully admitted for permanent residence in the United States under this chapter, granted asylum under 8 U.S.C. 1158, or granted refugee status under 8 U.S.C. 1157 or 8 U.S.C. 1159.

(d) If an alien may adopt the United States as the alien's domicile, but has been assigned, under 8 U.S.C. 1101 - 1189 (Immigration and Nationality Act), a nonimmigrant status allowing only a limited stay in the United States, the department will not consider the alien to be a resident under AS 43.23.005(a)(3) and this section, unless the department finds that the alien has taken a significant step to convert or adjust to a permanent or indefinite status. A significant step includes the filing of a petition or application with the USCIS.

(e) An alien seeking eligibility under this section has the burden of proving that on the date of the dividend application the alien was lawfully admitted for permanent residence as described in (a) of this section, granted asylum under 8 U.S.C. 1158, or granted refugee status under 8 U.S.C. 1157 or 8 U.S.C. 1159.

(f) A foreign-born child adopted by an eligible resident is not subject to this section.

(g) For purposes of this section,

(1) "alien" has the meaning given in 8 U.S.C. 1101(a)(3), as revised as of September 1, 2001 and adopted by reference;

(2) "USCIS" means the United States Citizenship and Immigration Service.

History

Authority: AS 43.23.005; AS 43.23.015; AS 43.23.055
Eff. 10/17/2001, Register 160; am 1/1/2005, Register 172

15 AAC 23.155 Child's application for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.160 Applications generally

Repealed 1/1/93.

15 AAC 23.163 Allowable absences

(a) Except as provided in AS 43.23.005(c), an individual who has never been physically present in Alaska may not claim an allowable absence under AS 43.23.008.

(b) An individual who was absent from Alaska for more than 180 days is not eligible for a dividend if the individual

(1) was not a state resident for at least 180 days immediately before departure from Alaska;

(2) repealed 1/1/2000.

(1) AS 43.23.008(a)(1), receiving secondary or postsecondary education on a full-time basis means enrollment and attendance in good standing as a full-time student where participation requires absence from this state

(A) at an academic institution for any of the 7th - 12th grades consistent with (d) of this section;

(B) for the purpose of pursuing a vocational certificate, associate, baccalaureate, or graduate degree, as a full-time student at a college, university, junior or community college, or postsecondary vocational institution accredited by an accrediting agency that the United States Secretary of Education recognizes under 34 C.F.R. Part 602, or full-time participation in an internship program if the internship is required by the college or university as part of the student's academic program; for the purposes of this subparagraph, an individual in the last academic year before graduation who was carrying enough credits to graduate, but fewer than full-time credits for any one term, semester, or quarter, is considered to have been a full-time student at that time; or

(C) for the purpose of pursuing a vocational certificate, associate, baccalaureate, or graduate degree, as a full-time student

(i) at a Title IV institution recognized under 20 U.S.C. 1001 - 1155 (The Higher Education Act of 1965) and 34 C.F.R., Part 600; or

(ii) at a non-accredited college or university if students attending the college or university may qualify as eligible to receive a student loan from Nellie Mae, or if the college or university's credits or degrees are accepted by at least three Title IV institutions recognized under 20 U.S.C. 1001 - 1155 (the Higher Education Act of 1965) and 34 C.F.R., Part 600;

(D) for the purposes of completing an internship or residency program at a hospital or medical clinic;

(2) AS 43.23.008(a)(2), receiving vocational, professional, or other specific education on a full-time basis means attending a program for which, as determined by the Alaska Commission on Postsecondary Education, a comparable program is not reasonably available in the state; the out-of-state program must be at an educational institution eligible to participate in financial aid programs administered by the Alaska Commission on Postsecondary Education.

(d) An individual clearly demonstrates that the primary reason for the individual's absence is to obtain a secondary education by living at a boarding school while attending grades 7 - 12 at an out-of-state institution. An individual who lives with an ineligible parent or ineligible permanent legal guardian while attending an out-of-state institution has not demonstrated that the primary reason for the individual's absence is to obtain a secondary education.

(e) Repealed 10/8/94.

(f) Repealed 1/1/2014.

(g) Repealed 1/1/2014.

(h) Repealed 1/1/2014.

(i) Repealed 1/1/2000.

(j) The department will count whole days when determining the number of days an individual was absent from Alaska. The department will count the day an individual arrives or returns to Alaska as a day absent unless the individual previously left Alaska that same day. The department will count the day an individual leaves Alaska as a day an individual was in Alaska, unless the individual previously arrived or returned to Alaska that same day.

(k) Repealed 1/1/2014.

(l) For the purposes of AS 43.23.008(a)(15), the department will consider an individual to be allowably absent only for periods of time during which the absent individual is verifiably training or competing as a member of the United States Olympic Team or a United States national team. The sport must be recognized and approved by the International Olympic Committee.

History

Authority: AS 43.23.005; AS 43.23.015; AS 43.23.295 AS 43.23.008; AS 43.23.055
Eff. 1/1/93, Register 124; am 6/26/93, Register 126; am 12/24/93, Register 128; am 10/8/94, Register 131; am 11/20/96, Register 140; am 4/18/97, Register 142; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 5/9/2003, Register 166; am 1/1/2005, Register 172; am 1/1/2008, Register 184; am 1/1/2010, Register 192; am 1/1/2011, Register 196; am 1/1/2014, Register 208; am 5/22/2016, Register 218

15 AAC 23.165 Disabled, incompetent, or other adult application for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.170 Child's application

Repealed 1/1/93.

15 AAC 23.173 Proof of eligibility

(a) An individual must indicate, on forms prescribed by the department, information required by the department that will support the claim of residency and physical presence in Alaska as required by AS 43.23.005.

(b) The department will, in its discretion, require an individual to provide other information to accompany the individual's application. If the department notifies an individual that the information included on, or provided with, the application form is insufficient for any reason, the individual must provide the additional information as requested by the department. If the other information requested by the department is not available at the time of application or the request, the individual must specify why the information is not available, and the date by which the information will be submitted to the department.

(c) An individual must provide all information requested by the department for processing within 30 days after the date of the request. Information delivered to the department or postmarked within 30 days after the date of the request is considered timely. An individual may request, for good cause, an extension of the 30 days to respond to a department request for information. If the department determines that good cause exists and grants an extension, the department will determine the time period of the extension on a case-by-case basis. Information not timely received will not be considered in the initial eligibility determination; however, it may be considered on subsequent appeal.

(d) If an individual has not provided all information for processing requested by the department within 30 days after the date of the request or the time period granted in an extension under (c) of this section, the application will be denied.

(e) An individual whose spouse is not a resident eligible for a dividend must provide documentation that demonstrates an intent to remain indefinitely in Alaska despite the nonresidency of the individual's spouse. The department will, in its discretion, require additional proof of the individual's intent to remain in Alaska.

(f) An individual described in this subsection may be eligible to receive a dividend if, with the application, the individual provides documentation that demonstrates to the department's satisfaction an intent to remain indefinitely in Alaska despite the nature of the individual's employment in Alaska. The department may require additional proof of the individual's intent to remain in Alaska. This subsection applies to

(1) an individual transferred to Alaska on temporary assignment by the individual's employer for a definite period of time;

(2) an individual who is employed in Alaska on a seasonal basis;

(3) an individual who is working in Alaska under a contract that requires the employer to return the individual to a place outside of Alaska at the end of the contract; or

(4) an individual who is employed in Alaska but who maintains a home or other abode outside Alaska to which the individual regularly travels.

(g) Proof bearing on an individual's intent to remain indefinitely in Alaska might be any proof acceptable to the department, including

(1) a contract to move household goods to Alaska, except when there is a contract to move household goods from Alaska at the end of the individual's employment;

(2) proof of home ownership, a home purchase contract, rent receipts, or other proof that the individual maintains a principal place of abode in Alaska, except when housing is provided as a part of an employment contract;

(3) employment and unemployment records, including a copy of the leave and earnings statement of a military member for

(A) December of the year before the qualifying year; and

(B) the most recent month;

(4) tax records;

(5) school records;

(6) voter registration and voting records;

(7) motor vehicle registration records;

(8) licensing records; or

(9) court or other government agency records; or

(10) repealed 5/22/2016.

(h) Proof of physical presence in Alaska might be any proof acceptable to the department, including

(1) records or receipts of completed travel from airlines, the Alaska Marine Highway system, or other carriers;

(2) hotel receipts;

(3) traffic citations;

(4) repealed 1/1/2002;

(5) affidavits or certifications by adult residents acquainted with or related to the applicant who have personal knowledge of the applicant's physical presence in Alaska;

(6) other documentation of completed travel that displays this state as the point of origin or destination.

(i) The burden of proof rests on an individual claiming an allowable absence to prove that the individual has maintained, at all times during the absence, the intent to return and remain indefinitely in Alaska.

(j) If an individual is denied under (d) of this section, the department will reverse the denial if the

(1) only reason the individual was denied was because the individual failed to provide requested information for processing timely;

(2) individual timely requests an informal conference under 15 AAC 05.020; and

(3) requested information is provided by the time of the individual's informal conference;

(4) repealed 8/24/95;

(5) repealed 8/24/95.

History

Authority: AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124; am 12/28/93, Register 128; am 10/8/94, Register 131; am 8/24/95, Register 135; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2005, Register 172; am 1/1/2014, Register 208; am 5/22/2016, Register 218

15 AAC 23.175 Allowable absence for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.180 Disabled, incompetent, or other adult application

Repealed 1/1/93.

15 AAC 23.183 Individuals identified as incarcerated for certain offenses

(a) If the Department of Corrections or the Department of Public Safety advises the department in writing that the Department of Corrections or the Department of Public Safety incorrectly identified an individual as being incarcerated or sentenced as the result of a conviction for an offense as described in AS 43.23.005(d), the department will reverse a denial issued as a result of the Department of Corrections or the Department of Public Safety error even if the individual does not have an appeal of the denial pending before the department or the court.

(b) An individual who was correctly identified as incarcerated or sentenced for an offense as described in AS 43.23.005(d), and consequently was denied a dividend, may appeal a denial of a dividend issued under AS 43.23.005(d) within 60 days of the reversal or vacating of the disqualifying convictions for which the individual was incarcerated or sentenced. The department will overturn any denial of an individual who

(1) has a valid appeal of the individual's dividend denial pending before the department or a court;

(2) can demonstrate to the department's satisfaction that all disqualifying convictions for which the individual was incarcerated or sentenced during the qualifying year for that dividend have been vacated or reversed; and

(3) is otherwise eligible for the dividend.

History

Authority: AS 43.23.005; AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124; am 11/20/96, Register 140; am 4/18/97, Register 142

15 AAC 23.185 Proof of eligibility for 1990 and subsequent years

Repealed 1/1/93.

15 AAC 23.190 Proof of eligibility

Repealed 1/1/93.

15 AAC 23.193 Payment of dividends to individuals identified as non-compliant sex offenders

(a) On or before September 25 of each year, the department will mail, to the address provided on the dividend application, a written notice to applicants whose dividend payment will be delayed under AS 43.23.021(a).

(b) The department will not pay a dividend to an applicant that has been sent a written notice under (a) of this section, unless the applicant provides the department with an original, signed letter from Department of Public Safety verifying that the applicant has registered and is in compliance with the verification and notices required under AS 12.63. The letter from the Department of Public Safety must be dated after the date of the written notice under (a) of this section and must be received by the department within one year after the date of the written notice under (a) of this section.

History

Authority: AS 43.23.015; AS 43.23.021
Eff. 4/24/2009, Register 190

15 AAC 23.200 Determinations of amount of dividend and method of making payment

Repealed 1/1/93.

15 AAC 23.203 Assignments

(a) The department will not implement an assignment, or a transaction, of whatever nature, that the department determines to be an assignment, of a dividend unless the assignee named is an agency authorized to receive an assignment under AS 43.23.200.

(b) An assignment of a dividend may not be made if application for the dividend was made on behalf of a child or made on behalf of an incompetent or disabled adult, except that the dividend of a child may be assigned to satisfy restitution agreed to, or required under AS 47.12.120 or to satisfy a court-ordered fine or judgment for court-appointed attorney fees.

(c) Once an assignment is made and submitted to the department, a retraction of that assignment by the assignor will not be honored by the department.

(d) An assignment must be made in writing on a form provided by the department, signed by the assignor, and properly executed in the presence of two disinterested witnesses or a notary public, and filed with the department before the final processing of the assignor's dividend application. However, assignments made on behalf of a child must be executed by the sponsor of the original application or by an official appointed by the state court system.

(e) Repealed 1/1/2002.

(f) Upon receipt of a written request from an applicant, the department will change an applicant's University of Alaska College Savings Plan check-off response. The department will not guarantee processing of a request received after August 1 of the dividend year.

(g) If, for purposes of AS 43.23.140(d), April 1 falls on a Saturday, Sunday, or state holiday, the date becomes the next working day.

History

Authority: AS 43.23.015; AS 43.23.140 AS 43.23.055; AS 43.23.200
Eff. 1/1/93, Register 124; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2013, Register 204

15 AAC 23.210 Attachments

Repealed 1/1/93.

15 AAC 23.213 Attachments

(a) Notwithstanding the provisions of AS 43.23.140, 100 percent of a dividend payable to an individual under AS 43.23.005 - 43.23.295 is available for attachment in the collection of money owed to the United States if the notice of levy served on the department by an agency of the United States under federal law preempts state law.

(b) Except as provided in (h) of this section, a writ of execution issued to enforce a judgment of the court must be served in the manner set out in Rule 4(c)(1) of the Alaska Rules of Civil Procedure. A service by certified mail, return receipt requested, may only include one Notice of Levy/Writ of Execution. Service may be made in writing upon the department on the department's website, or in person only at locations designated by the department during the hours the location is open to the public.

(c) As required by AS 09.35.110, a notice of levy must accompany a writ of execution. If the notice of levy is made electronically, a CD-ROM containing the image of the writ of execution must be received by the department no later than 10 days after successful submission of the levy file. If the notice of levy is made in person, the writ of execution must be submitted with the levy file. A notice of levy that is submitted without the required writ of execution will be rejected.

(d) In order to establish a positive identification between the attachment and an individual's dividend file, the department will require a three-point match. All matches between the attachment and the dividend file must be exact. The matches will be made against any three of the following:

(1) first name;

(2) date of birth;

(3) social security number; or

(4) last name.

(e) The individual whose dividend was attached may not maintain a claim against the department for honoring the attachment.

(f) A levy under a writ of execution or an equivalent document will be placed only against an individual's current year dividend. However, the limitation of this subsection does not apply if the equivalent document is an administrative withholding order issued by the department's child support services agency for the collection of child support.

(g) Notwithstanding the requirements of AS 43.23.140(c), if the department is served with an order of a bankruptcy court related to an individual eligible for a dividend at least 10 days before payment of the dividend, the department will issue the individual's dividend to the bankruptcy court or trustee.

(h) A government agency that has administrative levy power may perform service through its own agent or by electronic media. All services by electronic media must be accompanied by

(1) repealed 1/1/2008;

(2) a completed form provided by the department on which the agency certifies that

(A) the information on the electronic media is correct and complete;

(B) the agency has identified the individuals on the electronic media file in accordance with the criteria of (d) of this section; and

(i) Attachments, garnishments, or levies served on the department must be received not later than August 31 to be processed for the first payment of the dividend year. Services received on the same date and at the same time at any of the following locations will be processed by the department in the following order:

(1) those submitted electronically on the department's website, which will be made available at 7:00 a.m. Alaska Daylight Time on April 1 as described in (j) of this section; for purposes of this paragraph, the date and time of service are the date and time the submitter initiated upload of a successful submission of a levy file on the department's website; successfully submitted levy files will receive a confirmation number;

(2) those personally delivered to the department in Juneau;

(3) those personally delivered to the department in Anchorage;

(4) those personally delivered to the department in Fairbanks;

(5) those delivered by certified mail to the department in Juneau.

(j) For the purposes of AS 43.23.140(d) and this section, if April 1 falls on a Saturday, Sunday, or state holiday, the date becomes the next working day.

History

Authority: AS 09.35.330; AS 43.23.055 AS 09.40.030; AS 43.23.140
Eff. 1/1/93, Register 124; am 3/30/95, Register 133; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2007, Register 180; am 1/1/2008, Register 184; am 1/1/2011, Register 196; am 1/1/2013, Register 204; em am 4/1/2013 - 7/29/2013, Register 206; am 5/22/2016, Register 218

15 AAC 23.220 Assignments

Repealed 1/1/93.

15 AAC 23.223 Payment of dividends

(a) Repealed 1/1/2005.

(b) An eligible individual, including a child, may qualify to have the department directly deposit the individual's dividend into the individual's financial institution account, if the

(1) individual or the individual's sponsor specifically requests in writing direct deposit of the dividend;

(2) individual or the individual's sponsor provides in writing a valid account number for a financial institution that has entered into agreement with the department to participate in direct deposit of dividends;

(3) individual or the individual's sponsor provides the department a valid social security number;

(4) participating financial institution communicates

(A) that the institution has an open account exactly matching the account number provided by the individual or the individual's sponsor; or

(B) repealed 8/22/97;

(C) that, if the institution records do not exactly match the information in (A) of this paragraph, the institution has enough corroborating information regarding the account to ensure the deposit will be made to the individual's or the individual's sponsor's account and the institution indemnifies the department against deposit errors resulting from that institution's inability to exactly match the information in (A) of this paragraph; and

(5) individual's application is not missing information or still subject to an eligibility determination when direct deposit payments are made by the department.

(c) Upon the request of the sponsor of an eligible child, the department will deposit the child's dividend into the sponsor's account provided the requirements of (b) of this section are met.

(d) The department will electronically deposit the dividends of all individuals who qualify for direct deposit under (b) and (c) of this section as the first payments issued each year.

(e) An individual who does not qualify for direct deposit or who does qualify, but for whom the department does not make a direct deposit of the individual's dividend to the individual's account, may not maintain a claim against the department. A child whose dividend has been directly deposited into the child's sponsor's account under the provision of (c) of this section may not maintain a claim against the department for honoring the request of the sponsor.

(f) The department will make payment of an assigned or attached dividend in accordance with AS 43.23.140, 15 AAC 23.203, and 15 AAC 23.213.

(g) The department will pay a dividend to a public agency trust account established in accordance with AS 43.23.015(e) if the

(1) public agency claims a dividend on behalf of an individual;

(2) public agency timely provides the department with a court order showing the agency has been granted guardianship or conservatorship of the individual; and

(3) individual is otherwise eligible for the dividend.

(h) If competing applications are timely filed on behalf of an eligible child, the department will not pay any dividend for the child unless

(1) all adults who have timely filed for that child have consented in a signed statement to payment on only one of the timely filed applications;

(2) all but one adult have submitted signed statements withdrawing all timely filed competing applications filed on behalf of the child;

(3) the department receives a court order directing the department to send the child's dividend to the court or to one of the adults who filed timely on behalf of the child;

(4) one of the timely filed competing applications was filed by the Department of Family and Community Services under 15 AAC 23.113(c)(2); or

(5) the child applies and qualifies for the dividend under the provisions of 15 AAC 23.133(b).

(i) An application timely filed by the Department of Family and Community Services for an eligible child under 15 AAC 23.113(c)(2) will be paid over all timely filed competing applications in accordance with (g) of this section. If the Department of Family and Community Services obtains legal custody of an eligible child before the department has paid an application filed by any other sponsor of the child, the department will pay the child's dividend in accordance with (g) of this section if the Department of Family and Community Services furnishes the department

(1) evidence of the change in legal custody; and

(2) a timely request for a change of address.

(j) If competing applications are timely filed on behalf of an eligible disabled or incompetent adult, the department will not pay any dividend for the adult unless

(1) all individuals or agencies who have timely filed for the adult have consented in writing to payment of only one of the timely filed applications;

(2) all but one individual or agency have withdrawn all timely filed competing applications filed on behalf of the adult;

(3) the department receives a court order directing the department to pay one of the individuals or agencies who timely filed on behalf of the adult; or

(4) one of the competing timely filed applications was filed by the Department of Administration, office of public advocacy.

(k) An application timely filed by the Department of Administration, office of public advocacy, for an eligible adult under 15 AAC 23.123 will be paid over all timely filed competing applications in accordance with (g) of this section. If the Department of Administration obtains legal custody of an eligible adult before the department has paid an application filed by any other sponsor of the adult, the department will pay the adult's dividend in accordance with (g) of this section if the office of public advocacy furnishes the department

(1) evidence of the change in legal custody; and

(2) a timely request for a change of address before the dividend is issued.

(l) An individual who does not redeem a dividend because the warrant was returned to the department as undeliverable, or because the individual failed to redeem the warrant within six months, may apply to the department for the dividend to be reissued.

(m) Repealed 1/1/99.

(n) The department will calculate the amount of dividends that would have been paid to individuals who were ineligible to receive dividends under AS 43.23.005(d) if they had otherwise been eligible, by applying the percentage of individuals on the lists provided annually to the department under AS 43.23.055(5) who apply for a dividend and are determined to be otherwise eligible had that person not been declared ineligible for a dividend under AS 43.23.005(d), to the total number of individuals on the lists provided annually.

History

Authority: AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124; am 6/16/93, Register 126; am 12/24/93, Register 128; am 12/28/93, Register 128; am 8/24/95, Register 135; am 8/22/97, Register 143; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2006, Register 176; am 1/1/2008, Register 184; am 5/22/2016, Register 218

15 AAC 23.233 Disallowance of claims and recovery of assessments

(a) The department will, in its discretion, recover a dividend payment from the individual who received a payment or from the individual who applied on behalf of another individual, and, in the case of multiple payments made to another individual, from any individual who applied for and received one of the multiple payments if the department determines that

(1) an individual was not qualified to apply on behalf of another individual;

(2) the other individual was not eligible for the dividend; or

(3) more than one payment was made on behalf of the other individual.

(b) If an individual who applies for a dividend on behalf of another becomes subject to the forfeiture provision of AS 43.23.270, that individual forfeits not only the dividend payment that was wrongfully claimed on behalf of another, but also forfeits all dividends that the individual has received in the past and all dividends for which the individual would otherwise be eligible in the future.

(c) The department will not assess a previously paid ineligible individual if the individual's application or the individual's sponsor's application was either previously reviewed by the department's review unit and approved for payment, or was paid upon appeal, as long as

(1) the individual did not attempt to defraud the state;

(2) no significant previously undisclosed facts come to light;

(3) the application was complete with no relevant questions unanswered; and

(4) the only reason the sponsored individual was ineligible was due to the ineligibility of the sponsor.

(d) The department will withhold payment of a dividend of an individual if the department is holding a valid unpaid prior year assessment against that individual and the individual has not exhausted all appeal rights.

(e) The department will offset an assessment against a dividend of an individual if the individual has exhausted all appeal rights. A late appeal from an individual does not stay collection.

(f) A payment on an assessment for a disallowed dividend will be applied first to the unpaid balance of the assessment for the disallowed dividend and next to any accumulated interest.

History

Authority: AS 43.23.055; AS 43.23.140; AS 43.23.270
Eff. 1/1/93, Register 124; am 1/1/2000, Register 152; am 1/1/2002, Register 160

15 AAC 23.240 Disallowance of claims and recovery

Repealed 1/1/93.

15 AAC 23.243 Interest

(a) Dividends held in trust by a public agency in accordance with AS 43.23.015(e) will be invested by the department together with other money under AS 37.10.070. No separate investment accounts for individual applicants will be maintained. Monies held in trust and invested will be paid interest at the average rate earned by all money invested in accordance with AS 37.10.070 from the date the application is approved and processed for payment by the department to the date the claim for payment of the money is filed by or on behalf of the individual on whose behalf the public agency filed.

(b) Except as provided in (c) of this section, interest accrues on assessments of disallowed dividend payments at the rate established in AS 45.45.010 on the balance of the dividend owing.

(c) Interest does not accumulate on an assessment of a disallowed dividend if the dividend is repaid within 60 days after the determination of disallowance becomes final.

History

Authority: AS 43.23.015; AS 43.23.055
Eff. 1/1/93, Register 124

15 AAC 23.250 Disclosure

Repealed 1/1/93.

15 AAC 23.253 Disclosure

(a) Except to the extent required under AS 24.20.271, AS 24.55.160 - 24.55.170, AS 43.23.015, and 43.23.110 for the administration of the dividend program, and as provided in this section, information provided regarding an individual's application is confidential. Except as provided in (e) of this section, the department will release information provided regarding an individual's application to that individual or to an authorized representative of the individual.

(b) The following information is subject to release by the department under the following conditions:

(1) to an individual, including a representative of an agency, who has filed an application on behalf of another individual, information regarding the eligibility status of that other individual;

(2) to any of two or more competing sponsors of an applicant, information regarding the status of the applicant's eligibility;

(3) repealed 1/1/2011;

(4) to a process server or plaintiff identified on a writ of execution by case number or court of origin, information related to payments made by the department to the process server or court and the status of a payment due the process server or court;

(5) to a financial institution with a specific dividend warrant number, whether a stop payment has been placed on that warrant;

(6) to a person who makes a written request and pays the fee under 15 AAC 23.263(a), if applicable, the names of applicants in an electronic medium and format specified by the department;

(7) repealed 1/1/2003;

(8) repealed 1/1/2003;

(9) repealed 1/1/2003;

(10) repealed 1/1/2003;

(11) repealed 1/1/2003;

(12) repealed 1/1/2003;

(13) repealed 1/1/2003;

(14) repealed 1/1/2003;

(15) repealed 1/1/2003;

(16) repealed 1/1/2003;

(17) repealed 1/1/2003;

(18) repealed 1/1/2003;

(19) repealed 1/1/2003;

(20) repealed 1/1/2003;

(21) repealed 1/1/2003;

(22) repealed 1/1/2003;

(23) repealed 1/1/2003;

(24) repealed 1/1/2003;

(25) repealed 1/1/2024;

(26) upon written request and approval from the department, to governmental agencies, information for use in administering programs, collecting debts, and for use in official investigations.

(c) Notwithstanding (b) of this section, the department will only release bank, credit union, or savings and loan account information provided by an individual under 15 AAC 23.223(b)(2) if the department

(1) receives authorization from the individual to release the information;

(2) receives a court order directing the release;

(3) receives a request as part of a criminal investigation; or

(4) makes use of the information to recover an assessment under 15 AAC 23.233.

(d) Repealed 1/1/2003.

(e) A request for information that is denied may be appealed to the director of the department's permanent fund dividend division as provided in 2 AAC 96.335 - 2 AAC 96.350.

(f) If an informant contacts the department with information that might potentially disqualify another individual from receiving a dividend, the informant's name and identity is confidential and will not be disclosed to the extent permitted by law.

(g) The department will provide a paper list of the names of permanent fund dividend applicants, if the person

(1) makes a written request; and

(2) pays the required fee under 15 AAC 23.263, if the request is for more than 500 names.

(h) If a governmental agency wants disclosure of information other than names available under (b)(26) and (g) of this section, the governmental agency must make a written request and sign a written agreement on a form or in a format prescribed by the department. The agreement must contain

(1) an acknowledgement by the requester that the requester understands that the information is confidential;

(2) a list of uses that may be made of the information;

(3) a statement by the requester agreeing to

(A) use the information only for those items listed in this subsection;

(B) ensure each subordinate employee given access to the information is required to sign an acknowledgement containing the provisions of this subsection;

(D) store the information in a secure place; and

(4) an acknowledgement by the requester that the requester understands the applicable provisions of AS 11.56.860 or 5 U.S.C. 552a (Privacy Act of 1974) regarding the misuse of confidential information.

(i) After entering all timely applications into its database, the department will

(1) create an electronic file containing the

(A) name of each individual who has voluntarily indicated on the application form that the individual is a veteran;

(B) individual's mailing address;

(D) dates of service; and

(2) provide the electronic file to the Department of Military and Veterans' Affairs.

History

Authority: Art. 1, sec. 22,AS 43.23.015; AS 43.23.055 Ak Const.AS 43.23.021; AS 43.23.110
Eff. 1/1/93, Register 124; am 10/8/94, Register 131; am 3/30/95, Register 133; am 11/20/96, Register 140; am 4/18/97, Register 142; am 8/22/97, Register 143; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2007, Register 180; am 1/1/2008, Register 184; am 1/1/2009, Register 188; am 1/1/2010, Register 192; am 1/1/2011, Register 196; am 1/1/2024, Register 248

15 AAC 23.263 Fees and fines

(a) The department will provide information requested under 15 AAC 23.253(b)(6) for a fee of $25. All payments required under this subsection must be made by check or money order and must be received by the department before the request will be processed.

(b) The department will deduct from each dividend assigned or attached $2 for each assignment, attachment, garnishment, or levy not released at the time the dividend is paid.

(c) If a person requests a paper list of information under 15 AAC 23.253(g), the department will charge the fees in accordance with AS 40.25.100 - 40.25.220 and 2 AAC 96 for the inspection and copying of public records.

(d) The amount of a civil fine imposed for a violation found under AS 43.23.270(c) will be based on the cost incurred by the department for investigating and processing the violation. Costs incurred by the department may include personal services, travel, and research fees.

(e) Each application for inclusion on the list of beneficiary organizations to be included within the online permanent fund dividend application must be accompanied by a nonrefundable fee of $250. A payment required under this subsection must be made by check or money order.

History

Authority: AS 40.25.110; AS 43.23.130; AS 43.23.270 AS 40.25.115; AS 43.23.210
Eff. 10/8/94, Register 131; am 11/20/96, Register 140; am 12/19/96, Register 141; am 4/18/97, Register 142; am 1/1/99, Register 148; am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2006, Register 176; am 4/24/2009, Register 190; am 6/5/2011, Register 198

15 AAC 23.300 Definitions

Repealed 4/1/89.

15 AAC 23.310 Application for beneficiary organization

(a) Repealed 6/5/2011.

(b) As part of the online permanent fund dividend application, the department will provide a search tool to allow selection of a specific beneficiary organization. The beneficiary organization must provide a physical address for the organization's place of business in a geographic location in order for the organization to be listed in the online search tool to provide services or aid in the geographic location.

(c) For the purposes of AS 43.23.130(d)(1), the department will consider an educational organization, community foundation, or charitable organization to have filed an application only if that application is complete and timely. For the purposes of this subsection, an application is

(1) timely if it is postmarked on or before March 31 of the qualifying year; and

(2) complete if, when considered along with documents submitted with an application that established eligibility for a prior dividend year, it contains all the information required for the department to make the determinations required by AS 43.23.130(d)(2) - (9), including copies of documents necessary to determine eligibility.

(d) For the purposes of AS 43.23.130(d)(2) and (3), the department will verify the tax-exempt status of an educational organization, community foundation, or charitable organization when the organization provides a copy of the tax-exempt determination letter issued by the Internal Revenue Service.

(e) For the department to verify compliance with AS 43.23.130(d)(4), an educational organization, community foundation, or charitable organization must provide a copy of the beneficiary organization's current Internal Revenue Service Form 990 on file with the Internal Revenue Service for the most recently completed fiscal year. If a filing extension has been submitted for that fiscal year, the beneficiary organization's application must contain a copy of the request for an extension and a copy of the Internal Revenue Service Form 990 for the next most recently completed fiscal year. A beneficiary organization may meet the requirements of this subsection by providing a copy of

(1) the online filing confirmation, if the organization files an Internal Revenue Service Form 990N;

(2) the entire form, if the organization files an Internal Revenue Service Form 990EZ; or

(3) page 1, if the organization files an Internal Revenue Service Form 990.

(f) For the department to verify compliance with AS 43.23.130(d)(5), an educational organization, community foundation, or charitable organization must certify in the beneficiary organization's application that

(1) the majority of the members of the organization's board of directors or local advisory board who are holding office during the qualifying year are residents of the state; and

(2) all members of the organization's board of directors or local advisory board serve without monetary compensation.

(g) For the department to verify compliance with AS 43.23.130(d)(6), an educational organization, community foundation, or charitable organization must certify in the application that it provided aid or services in the state during the two calendar years that immediately precede the year the application is filed, and an organization other than a community foundation must declare in the application the charitable purpose for which it provides aid or services in the state. In addition to considering the certification and any declaration required by this subsection, the department will consider the date the Internal Revenue Service granted the organization tax-exempt status.

(h) For the department to verify compliance with AS 43.23.130(d)(7), an educational organization, community foundation, or charitable organization must certify in the beneficiary organization's application that the organization receives at least $100,000 or five percent of the organization's total annual receipts, whichever is less, from contributions. The annual receipts figure must be the same as that reflected in part III of the Internal Revenue Service Form 990 for the most recently completed fiscal year if filing is required by law.

(i) For the purposes of AS 43.23.130(d)(8), an educational organization, community foundation, or charitable organization must provide in its application either

(1) a copy of the audited financial statement, including the auditor's opinion letter, covering the fiscal year for the Internal Revenue Service Form 990 submitted under (e) of this section; or

(2) a certification that the organization's budget for that period was $250,000 or less.

(j) Repealed 6/5/2011.

(k) Repealed 6/5/2011.

History

Authority: AS 43.23.130
Eff. 1/1/2009, Register 188; am 6/5/2011, Register 198

15 AAC 23.320 Withdrawal or change of contribution

An individual may withdraw or change an election to contribute to a beneficiary organization made on the online application only as provided in this section. In order to be effective, an individual must complete the online process to change or withdraw an election through the department's website on or before August 31 of the dividend year.

History

Authority: AS 43.23.130
Eff. 1/1/2009, Register 188; am 6/5/2011, Register 198; am 5/22/2016, Register 218

15 AAC 23.330 Authorized notification of contributions

(a) The department will provide a place on the online application form where an individual filing for a permanent fund dividend may authorize a limited release of information gathered in the form to the beneficiary organizations selected to receive a contribution from the individual's dividend. On the online application form, the department will include a question asking whether an individual consents to a release of the name and mailing address of the individual making the contribution to the beneficiary organization and the amount of the contribution. The release of information will be permitted to allow the beneficiary organization to acknowledge the contribution and to explain how the contribution will be expended. On the online application form, the department will include a disclosure that a beneficiary organization receiving information released under this section is not required to keep the information confidential.

(b) On the online application form, the department will include a means by which the individual may answer "yes" or "no" to the authorization question. Failure to answer the authorization question will be considered to be a refusal of authorization to release information, other than information specifically authorized for release by law.

(c) A parent or legal guardian may consent to the release of information authorized in this section on behalf of a minor child. A person authorized by 15 AAC 23.123 to file for a dividend on behalf of an adult may consent to the release of information authorized in this section on behalf of the adult.

History

Authority: AS 43.23.110; AS 43.23.130
Eff. 1/1/2009, Register 188

15 AAC 23.340 Contribution list appeals

(a) No later than August 1 of the qualifying year, the department will issue written notice of the department's decision relating to an application of an educational organization, community foundation, or charitable organization to appear in the contribution list of beneficiary organizations authorized by AS 43.23.130 as a part of the online permanent fund dividend application form. The department will send the decision by electronic mail or facsimile transmission to the organization. To appeal from that decision, the organization must submit its appeal in writing, and the department must receive the appeal within 15 days after the date of the notice of the department's decision. The organization's authorized representative must sign the appeal.

(b) The appeal must contain a complete explanation for the basis of the appeal, including a detailed statement of the factual and legal basis of the issues, copies of the documents on which the appellant intends to rely, and a statement of the remedy requested. The appeal must provide the address of the organization or the organization's representative to whom any notice or decision concerning the appeal is to be mailed or delivered. The appeal must indicate whether an evidentiary hearing is requested. If an evidentiary hearing is requested, the appeal must include a statement of the facts alleged to be in dispute.

(c) In accordance with AS 44.64.060, the department will refer an appeal for which an administrative hearing is requested to the Office of Administrative Hearings. The department will request a fast-track hearing under 2 AAC 64.210 and expedited proceedings for proposals for action under AS 44.64.060(e) so that a proposed decision will be ready for final action by the department within 45 days after receiving the appeal, or by October 1 of the qualifying year, whichever is earlier.

(d) The decision on the appeal is a final administrative decision of the department that may be appealed to the superior court under the Alaska Rules of Appellate Procedure.

History

Authority: AS 43.23.060; AS 43.23.130
Eff. 1/1/2009, Register 188

15 AAC 23.350 Payment of contributions

(a) The department will directly deposit contributions made to beneficiary organizations into the financial institution account of the agent organization. At the same time that it issues electronic deposits to individuals applying for the permanent fund dividend each year, the department will electronically deposit the contributions made to all eligible beneficiary organizations receiving contributions.

(b) The department will prepare a report for the agent organization that sets out for each beneficiary organization the amount contributed, the applicant locater number assigned by the department to each individual making a contribution to the beneficiary organization, and the information, if any, authorized to be released by that individual.

(c) If a dividend remains unpaid for any reason after December 31 of the dividend year, contributions elected with the application for the dividend expire December 31 of the year for which the contribution is associated.

History

Authority: AS 43.23.130
Eff. 1/1/2009, Register 188; am 1/1/2011, Register 196

15 AAC 23.360 Permanent fund dividend donations for educational purposes and the dividend raffle; eligibility

(a) As part of the online permanent fund dividend application, the department will provide an option for an applicant who is 18 years of age or older to direct that all or a portion of the applicant's dividend payment be donated for educational purposes and to enter the permanent fund dividend raffle.

(b) An applicant may make a donation under this section in increments of $100, up to the total amount of the permanent fund dividend that the applicant is entitled to receive, rounded down to the nearest $100. Each $100 donation is equal to one entry into the raffle under AS 43.23.230. An applicant may not withdraw or exchange a donation after the applicant submits the original application.

(c) Regardless of the amount of a donation for educational purposes an applicant intends to make under this section and AS 43.23.230, if an applicant makes both a charitable contribution under AS 43.23.130 and a donation for educational purposes as described in AS 43.23.230, and the combined total of required deductions, charitable contributions, and donations results in an amount greater than an applicant would otherwise be entitled to receive as a permanent fund dividend the order of subtraction shall be as follows:

(1) first, the full amount of any required deductions;

(2) second, the full amount, to the extent of any remaining balance, of charitable contribution made under AS 43.23.130; and

(3) last, donations for educational purposes as provided for in this section and AS 43.23.230.

(d) If the department determines that an applicant is not eligible for a permanent fund dividend by December 31 of the dividend year, then the department will void a donation made by the applicant. If the department determines that an applicant is eligible for a permanent fund dividend after December 31 of the dividend year, the department will void a donation made by the applicant and pay to the applicant the amount available after any required deductions. The department will deposit a donation from an eligible applicant not later than December 31 of the dividend year for appropriation under AS 43.23.230 and will pay the applicant the amount available, if any, after payment of any required deductions or contributions under AS 43.23.130.

(e) If the department finds the recipient of a dividend raffle prize ineligible for a permanent fund dividend under AS 43.23.270 for the dividend year of the prize-winning donation and entry, the prize is forfeit in accordance with the procedures set out under AS 43.23.270. The department will re-deposit the forfeited prize in the dividend raffle fund. The department has six years after the date of an improperly paid prize to send the recipient notice of the improperly paid prize. If the department finds that the recipient is ineligible and that the prize is forfeit, the department will make funds collected and returned to the dividend raffle fund available for determination of future prizes. The department will not use the collected and returned funds to revise prizes from previous dividend years. The department will not revise a prize or draw an additional prize winner for a dividend year for the sole reason that a recipient is subsequently found ineligible.

(f) An applicant may make a donation under this section, but is ineligible to receive a prize from the dividend raffle fund if the applicant is

(1) employed by the Department of Revenue commissioner's office during

(A) the application period for the dividend year immediately before a dividend raffle fund drawing; or

(B) the 30-day period immediately preceding and including the date of the dividend raffle fund drawing;

(2) a raffle drawing auditor appointed by the commissioner of revenue under 15 AAC 23.370;

(3) a member of the team securing and transporting the drawing container containing raffle tickets;

(4) an employee within the department that actively assisted in generating dividend raffle tickets; or

(5) a person who draws one or more winning tickets at the dividend raffle fund drawing.

(g) In this section, "required deductions" means attachments, garnishments or levies, including assignments under AS 43.23.200, issued against an applicant's Permanent Fund Dividend payment, on behalf of an agency, in order to collect funds.

History

Authority: AS 43.23.055; AS 43.23.220; AS 43.23.270 AS 43.23.200; AS 43.23.230
Eff. 12/25/2020, Register 236; am 12/24/2021, Register 240; am 1/1/2024, Register 248

15 AAC 23.370 Permanent fund dividend raffle procedures

(a) The commissioner will conduct the permanent fund dividend raffle not later than January 31 each year. The department will provide public notice of the date, time, and location of the drawing on the Alaska Online Public Notice System (AS 44.62.175) at least 15 days before the drawing is scheduled to occur.

(b) The commissioner will appoint a certified public accountant to serve as the auditor for the dividend raffle. The auditor shall witness the raffle drawing and certify in writing, within a reasonable time after the raffle is completed, the department's compliance with the procedures set out under this section. As the witness to the raffle drawing, the auditor shall

(1) watch as printed tickets are placed in the dividend raffle drawing container;

(2) accompany the printed tickets to the location of the dividend raffle draw;

(3) watch the drawing occur; and

(4) accompany the printed tickets being returned to the department.

(c) After all appropriated donations are deposited into the dividend raffle fund, at least two department employees shall together generate a consecutively numbered table of dividend raffle tickets, representing one ticket for each entry into the raffle. The table must include the name of each entrant, a ticket number, and the permanent fund dividend applicant locator number. The completed table must be used to print dividend raffle tickets for each entry. A raffle ticket must contain on its face the same information contained in the table. The auditor appointed under this section shall inspect and compare the table with the printed tickets and confirm that

(1) the dividend raffle tickets are numbered consecutively;

(2) the number of entries in the completed table is equal to the number of printed tickets; and

(3) a random comparison of information on a ticket and in the table corresponds.

(d) In the presence of the auditor, the department employees who generated the table shall place the printed raffle tickets into a container designated for the permanent fund raffle drawing. The auditor shall accompany the container to the location of the dividend raffle drawing.

(e) At the time and location of the drawing, the commissioner or a designee will announce to the public the amount of each prize and make available the calculation for each amount. After sharing this information, a person who is not an employee of the department or the auditor appointed under this section may draw the winning raffle tickets. Tickets must be shown to the raffle auditor before the names are read aloud.

(f) After the winning tickets are drawn, the container must be secured and returned to the department. Remaining tickets must be stored and retained as a public record. Winning tickets must be stored separately and also retained as a public record. Within a reasonable time after the drawing occurs, the department will post on the department's website

(1) the amount of each prize and the calculation for each amount;

(2) the names on the winning tickets;

(3) the procedure followed under this section; and

(4) the auditor's certification of compliance with these procedures.

(g) The department will provide the prize amount awarded to the winners of the raffle drawing within a reasonable time after the drawing occurs.

History

Authority: AS 43.23.055; AS 43.23.220; AS 43.23.230
Eff. 12/25/2020, Register 236

Article 4 General Provisions

15 AAC 23.990 Definitions

Repealed 1/1/93.

15 AAC 23.993 Definitions

(a) In this chapter, unless otherwise indicated,

(1) "abode" means one's home or place of dwelling;

(2) "adult" means an individual who has reached 18 years of age, which is the age of majority under AS 25.20.010, or who is under 18 years of age but because of marriage has reached the age of majority under AS 25.20.020;

(3) "authorized representative"

(A) means an adult who has a sufficiently significant personal relationship with a child or another adult whom the department is satisfied that the person is applying for the dividend payment for the benefit of the child or the adult;

(B) includes an official of a public agency or a private institution;

(C) does not include an individual who receives compensation, including all or a portion of the dividend, to sponsor a child or adult to receive the dividend under 15 AAC 23.113(c)(1)(D);

(4) "child" means an individual who has not reached the age of majority under AS 25.20.010 or 25.20.020;

(5) "department" means the Department of Revenue;

(6) "dividend" means a permanent fund dividend;

(7) "dividend year" means the calendar year in which the dividend is declared;

(8) "emancipated minor" means an individual under the age of 18 years who has been declared emancipated by the superior court of this state under AS 09.55.590, or by a court of another jurisdiction under procedures granting the individual the equivalent status;

(9) "legal guardian" means a guardian or conservator appointed by the court under AS 13.26.035, 13.26.045, 13.26.095, 13.26.112, 13.26.116, 13.26.210, or similar provisions of law of Alaska or another jurisdiction;

(10) "month" means a calendar month;

(11) "qualifying year" means the calendar year immediately preceding the dividend year;

(12) "resident" means a state resident as defined by AS 43.23.295(7);

(13) repealed 1/1/99;

(14) "serving as an employee of the state of Alaska" means active compensated employment in the executive, legislative, or judicial branch of state government or the University of Alaska; the phrase does not include employment by a political subdivision of the state of Alaska;

(15) "incarcerated" means confined in a facility or setting under a court order for a conviction to restrain an individual's movement and freedom, including a prison, jail, other penal institution, half-way house, hospital, medical facility, treatment facility, or a furlough to a non-penal setting monitored by an electronic device for the purpose of monitoring the individual's movements;

(16) "financial institution" means a bank, savings bank, savings and loan association, credit union, securities broker-dealer, or other institution determined by the department to be an eligible depository;

(17) "process" means the procedure of collecting information and documents in order to ensure that an application is complete and upon which a non-discretionary decision to pay or deny can be based according to statutory criteria;

(18) "review" means the procedure subsequent to processing in which an otherwise complete application is required to undergo further inquiry and examination to determine whether an applicant, in fact, meets all applicable eligibility criteria;

(19) "life-threatening" means any condition that the attending physician indicates in writing is life-threatening in the physician's opinion;

(20) "sibling" means one of two or more individuals having at least one parent in common, and includes step-relationships;

(21) "terminally ill" means any condition that the attending physician indicates in writing is a terminally ill condition in the physician's opinion;

(22) "personal information" has the meaning given that term in AS 44.99.350;

(23) "governmental agencies" means entities of the

(A) federal government; or

(B) state or of a political subdivision of the state, including

(i) an agency, a board or commission, the University of Alaska, a public authority or corporation, a municipality, a school district, and other governmental units of the state or a political subdivision of the state; and

(ii) entities of the court system or the legislative branch of state government;

(24) "postmarked" means that an official cancellation stamp has been placed by the United States Postal Service, or the postal service of a foreign country, that records the date and place of mailing;

(25) "signed" means either to sign by hand or by using an electronic signature function;

(26) "in writing" means on paper or electronically;

(27) "agent organization" means the entity that the department selects under AS 43.23.130(g) to implement and operate the contribution program for beneficiary organizations;

(28) "beneficiary organization" means

(A) each campus of the University of Alaska;

(B) each other educational organization, community foundation, or charitable organization that the department determines to be eligible under AS 43.23.130(c) and (d) to receive a contribution deducted from a dividend payable to an individual;

(29) "educational organization" does not include the campuses of the University of Alaska.

(30) "minor parent" means a parent who

(A) has not reached the age of majority under AS 25.20.010 or 25.20.020; and

(B) is not an emancipated minor;

(31) "substitute sponsor" means a person or agency otherwise qualifying as a sponsor under 15 AAC 23.113(c)(1), and who replaces the child's original sponsor due to the original sponsor's ineligibility as a sponsor.

(b) For the purposes of AS 43.23.005(a) and this chapter, "date of application" means the date on which an application for a dividend is

(1) timely filed under 15 AAC 23.103(a); or

(2) timely delivered under 15 AAC 23.103(g).

(c) For the purposes of AS 43.23.008(a), "disabled dependent" means an individual who is claimed as a dependent for Internal Revenue Service purposes by an eligible resident, and whose physical or mental impairment prevents the individual from living independently, if a written statement to that effect is submitted to the department by a licensed physician or medical practitioner.

(d) For the purposes of AS 43.23.015(b), "furnish an application form" means to provide the prescribed application form

(1) on the department's website;

(2) by mail to an individual who requests it; and

(3) at public locations to be described on the department's website.

(e) In AS 43.23.130(b) and this chapter, "geographic location" means the city or cities in this state in which a beneficiary organization has a physical address from where the organization operates and provides services.

(f) In AS 43.23.130(d)(8), "annual budget" means the amount listed as total revenue by a beneficiary organization that is

(1) required by law to file an Internal Revenue Service (IRS) Form 990, if the organization files an

(A) IRS Form 990 on Part 1, line 12; or

(B) IRS Form 990EZ, on Part 1, line 9;

(2) not required by law to file an IRS Form 990, on the organization's

(A) internal, unaudited financial statement if the organization does not conduct an audit; or

(B) audited financial statement.

(g) For purposes of AS 43.23.130 and this chapter, "provide services" means an activity or system of activities, other than solely providing funding or financial support, conducted by an educational organization or charitable organization.

(h) For purposes of AS 43.23.130(d)(7) and this chapter, "annual receipts" means net revenue, excluding in-kind and non-cash donations.

History

Authority: AS 43.23.015; AS 43.23.130 AS 43.23.055; AS 43.23.295
Eff. 1/1/93, Register 124; am 12/24/93, Register 128; am 10/8/94, Register 131; am 8/24/95, Register 135; em am 11/20/96 - 3/19/97, Register 140; am 4/18/97, Register 142; am 1/1/99, Register 148; am 1/1/2000, Register 152; am 1/1/2003, Register 164; am 1/1/2005, Register 172; am 1/1/2007, Register 180; am 1/1/2008, Register 184; am 1/1/2009, Register 188; am 4/24/2009, Register 190; am 6/5/2011, Register 198; am 1/1/2013, Register 204; am 5/22/2016, Register 218

Chapter 35 Coin-Operated Devices and Punchboards

Eff. 5/28/83, Register 86; repealed 1/1/2002, Register 160

15 AAC 35.060 Coin-Operated Devices and Punchboards

15 AAC 35.060 - 15 AAC 35.090. Reserved.

Article 2 Punchboards

15 AAC 35.100 Coin-Operated Devices and Punchboards

15 AAC 35.100. Punchboards. Repealed.

History

Eff. 5/28/83, Register 86; repealed 1/1/2002, Register 160

Chapter 40 Motor Fuel Tax

Eff. 7/19/82, Register 83; am 11/14/82, Register 84; repealed 4/1/2001, Register 157

Article 2 (Repealed)

15 AAC 40.100 Refunds and credits on certain sales or transfers of motor fuel

Repealed.

History

Eff. 4/8/82, Register 82; am 8/1/82, Register 83; am 7/19/82, Register 83; am 11/14/82, Register 84; am 8/12/84, Register 91; am 1/19/86, Register 97; repealed 4/1/2001, Register 157

15 AAC 40.110 Additional tax due for sales of diesel fuel not used for heating purposes

History

Eff. 7/19/82, Register 83; am 11/14/82, Register 84; am 1/19/86, Register 97; repealed 4/1/2001, Register 157

Article 4 Collection of Tax

15 AAC 40.300 Fuel subject to tax; incidence of tax

(a) The motor fuel tax is imposed under AS 43.40 at the earlier of

(1) the sale or transfer of motor fuel in the state; or

(2) the use of motor fuel in the state.

(b) A sale or transfer of fuel is a taxable event, unless

(1) to a person who uses fuel that is exempt under 15 AAC 40.310;

(2) the fuel being sold or transferred is excluded from being "motor fuel" under AS 43.40.100(2); or

(3) between qualified dealers.

(c) If a sale or transfer of fuel was exempt from tax under (b) of this section, but the fuel is later sold, transferred, or used in a manner that does not meet the requirements for the exemption from tax under (b) of this section, the applicable tax is imposed at the time of the first taxable sale, transfer, or use. The person who sells, transfers, or uses the fuel that is taxable under AS 43.40 shall file a tax return under 15 AAC 40.400 and pay the applicable tax to the department. If a subsequent sale or transfer is subject to a higher tax rate under AS 43.40 than the tax rate imposed on the first sale, the higher rate applies.

(d) A sale or transfer of fuel to a person eligible for a refund for non-highway use under AS 43.40.030(a) is taxed at the rate under AS 43.40.010(a). The person who uses the fuel may file a claim with the department for any available refund.

(e) The following examples illustrate the application of this section:

EXAMPLE 1

Cannery A is not licensed as a qualified dealer. Cannery A purchases diesel at a tax rate of five cents per gallon. Cannery A sells its excess diesel to Dealer X who picks up the diesel and sells it to a person who uses it for heating. Cannery A must collect tax at the general tax rate of eight cents per gallon on all sales of diesel to Dealer X because Dealer X is not a person exempt under AS 43.40. Cannery A must file a tax return to report the sale of diesel to Dealer X and pay the applicable tax to the department. Dealer X may file a claim for refund for any sales exempt under AS 43.40, including sales to customers who use the diesel for heating purposes.

EXAMPLE 2

Taxpayer A purchases diesel without paying the tax, with the intention of using the diesel for heating purposes. Taxpayer A later uses the diesel for a purpose that is not exempt, such as use in a licensed motor vehicle. Taxpayer A must file a tax return to report the taxable use of the diesel and pay the applicable tax.

EXAMPLE 3

Municipality A purchases diesel without paying tax, in accordance with 15 AAC 40.320(c), intending to use a portion of the diesel, and to sell the remainder to residents of the community for heating purposes. Municipality A later sells some of the diesel to a contractor for use in non-highway equipment. Municipality A must collect tax of eight cents per gallon on the diesel sold to the contractor and file a tax return to report those sales. The contractor may file a claim for a partial refund on the diesel used in non-highway equipment under AS 43.40.030(a).

History

Authority: AS 43.05.080; AS 43.40.010; AS 43.40.100
Eff. 4/1/2001, Register 157

15 AAC 40.310 Exempt sales, transfers, or uses

(a) Except as provided in (b) of this section, fuel meeting the following requirements is exempt from tax under AS 43.40:

(1) fuel that is specifically excluded under AS 43.40.100(2)(A) - (L);

(2) fuel withdrawn from a foreign trade zone or bonded warehouse to the extent that an exemption is required by 19 U.S.C. 81a-81u and 19 U.S.C. 1309(a) and (d);

(3) fuel that is exported;

(4) fuel used exclusively for a domestic purpose in single or multiple unit private dwellings, including mobile homes, but not including watercraft;

(5) losses of volume of fuel that occur during handling, transportation, and storage, including losses of volume due to temperature changes of the fuel.

(b) The exemption available under 43.40.100(2)(I) for fuel used to heat private or commercial buildings or facilities does not apply to fuel used in or on watercraft.

History

Authority: AS 43.05.080; AS 43.40.010; AS 43.40.100
Eff. 4/1/2001, Register 157

15 AAC 40.320 Sales or transfers for mixed uses

(a) Except as provided in (b) of this section, fuel transferred to a common storage tank is taxable at the time of sale or transfer at the highest rate that applies to any of the fuel transferred into the tank.

(b) A person operating jet propulsion aircraft in both foreign and domestic flights may elect to defer the payment of the tax under AS 43.40 on the transfer of the fuel to a common storage tank. A person makes the election annually on a form or in a format prescribed by the department. A person making the election must file a tax return and remit the amount of tax due no later than the last day of the month following the month in which the person withdrew the fuel from the common storage tank. The withdrawal from the common storage tank of fuel subject to tax under AS 43.40 is a taxable transfer under AS 43.40.

(c) A municipality or a federally recognized tribe may elect to defer the payment of tax on diesel purchased for its own official use and for resale to residents of the municipality or tribal members if

(1) the municipality is incorporated under AS 29.05.011 and is not connected to more than 200 miles of publicly maintained roads; or

(2) the federally recognized tribe stores the fuel in a location that is not connected to more than 200 miles of publicly maintained roads.

(d) A municipality or federally recognized tribe that elects under (c) of this section to defer the payment of tax must file this election with the department on a form or in a format prescribed by the department. The department will notify the municipality or tribe that its election is accepted and the election remains effective until the municipality or tribe revokes it in writing. The municipality or tribe making the election must file a tax return if the municipality or tribe sells fuel for which taxes were deferred under this subsection if the fuel is sold for a use that is taxable.

(e) The following examples illustrate the application of (a) of this section:

EXAMPLE 1

If the tax is eight cents per gallon and fuel used for heating purposes is exempt, a transfer of fuel to a common storage tank providing fuel for both on-road and heating uses is taxable at eight cents per gallon.

EXAMPLE 2

If fuel for marine use is taxable at five cents per gallon, a transfer of fuel to a common storage tank providing fuel for both on-road and marine uses is taxable at eight cents per gallon.

EXAMPLE 3

Assuming the same rates listed in examples 1 and 2 of this subsection, a transfer of fuel to a common storage tank providing fuel for both marine and heating uses is taxable at five cents per gallon.

History

Authority: AS 43.05.080; AS 43.40.010; AS 43.40.100
Eff. 4/1/2001, Register 157

15 AAC 40.330 Certificate of use

(a) A dealer or reseller must obtain a certificate of use in each calendar year from the person intending to use the fuel at the time of the first sale or transfer of fuel that is exempt from taxation under AS 43.40. A certificate of use must be a form prescribed by the department. That form may be obtained from the dealer, reseller, or department.

(b) A person engaged in mining or construction activity who purchases fuel for heating purposes must include an attachment to the certificate of use that identifies and diagrams the location of each storage tank that stores fuel used exclusively for heating.

(c) The person who intends to use the fuel must sign the certificate of use. The certificate of use is not valid if signed by a dealer or reseller.

(d) A person obtaining fuel with a certificate of use who later uses the fuel for a purpose that is taxable under AS 43.40 shall file a tax return on a form or in a format prescribed by the department and pay the tax by the last day of the month following the month in which the taxable use occurred.

(e) If the department publishes a list of qualified dealers or other persons to whom fuel may be transferred without collecting tax under AS 43.40, a dealer may rely on the most recent list in place of a certificate of use obtained under this section.

(f) In determining whether a certificate of use is not required under AS 43.40.015(d)(2), the department will consider fuel to be exempted under AS 43.40.100(2)(I) as fuel used to heat private or commercial buildings or facilities only if the fuel is delivered to a tank

(1) providing a direct and dedicated supply to the building or facility being heated; or

(2) that is

(A) clearly and conspicuously marked as being intended for use or resale as heating fuel only; and

(B) equipped, modified or monitored to a degree sufficient to cause a reasonable person to believe that the tank's contents will be dispensed or resold as heating fuel only.

History

Authority: AS 43.05.080; AS 43.40.050; AS 43.40.100 AS 43.40.015; AS 43.40.085
Eff. 4/1/2001, Register 157; am 10/16/2013, Register 208

15 AAC 40.340 Gasohol control period

The lower tax rate provided for in AS 43.40.010(a)(4)(A) or (b)(4)(A) on gasohol applies during the

(1) control period specified in 18 AAC 53.010, except that the lower tax rate does not apply on March 1; and

(2) five days before the first day of the control period, as specified in 18 AAC 53.020.

History

Authority: AS 43.05.080; AS 43.40.010
Eff. 4/1/2001, Register 157

Article 5 Tax Return Filing Requirements; Filing Credits

15 AAC 40.400 Tax return filing requirements

(a) Each person subject to AS 43.40.010(c) shall file the tax return, under penalty of unsworn falsification, on a form or in a format prescribed by the department. Each person shall file a separate tax return for gasoline, diesel, aviation fuel, and gasohol.

(b) Each person filing a tax return under (a) of this section may deduct and retain one percent of the total monthly tax due per tax return, up to $100, if the tax return is complete and timely filed, and the tax is timely paid. The department will not consider the tax return complete unless the tax return includes information on the sales, transfers, or purchases of all fuel held as inventory in this state, regardless of whether the fuel is classified as motor fuel under AS 43.40.100.

History

Authority: AS 43.05.080; AS 43.40.010
Eff. 4/1/2001, Register 157

Article 6 Refunds

15 AAC 40.500 Refunds and credits on sales or transfers by resellers

A claim by a reseller for refund or credit on sales or transfers under AS 43.40.035 must be made on a form prescribed by the department, and must include original invoices issued to the reseller, copies of invoices issued by the reseller, and copies of each certificate of use required under AS 43.40.015(b). The invoices must show the type of fuel transferred, the number of gallons transferred, and the amount of tax billed. The claim for refund or credit of taxes paid must be filed within one year after the date of the sale or transfer as shown on the invoice issued by the reseller.

History

Authority: AS 43.05.080; AS 43.40.050 AS 43.40.035; AS 43.40.060
Eff. 4/1/2001, Register 157

15 AAC 40.510 Other refunds

(a) If a person obtains motor fuel on which the tax levied by AS 43.40.010 has been paid and uses the fuel in a manner that would have made the fuel subject to a lower tax than was paid, or exempt from tax under AS 43.40.100(2), the person may apply to the department for a refund of the difference within the time period provided in AS 43.40.050(b). The refund claim must be made on a form prescribed by the department.

(b) Except as provided in (d) of this section, the claim must include original invoices of each purchase of fuel for which a refund is being claimed. The invoices must show the type of fuel purchased, the number of gallons of fuel purchased, and the amount of tax paid under AS 43.40.

(c) A person making a claim for refund for fuel used from a common storage tank must provide documentation to show the use of all fuel from that tank. The department will accept as documentation fuel use logs or other records that clearly show the use of fuel from that tank.

(d) An agency of the United States government whose employees make purchases of fuel exclusively for official use and use a credit card issued to that agency may submit a claim for refund containing a schedule of invoices of purchases of fuel instead of the original invoices for the fuel. Charges on the card must be billed directly to the federal governmental agency. A person may submit a claim for refund of more than $100 under this subsection at any time within the period provided in AS 43.40.050(b). A person may submit only one claim of less than $100 in any six-month period. The schedule of invoices must be subject to generally accepted internal accounting controls, be capable of verification by audit, and detail the following information for each purchase of fuel:

(1) the transaction date;

(2) the invoice number;

(3) the type of fuel purchased;

(4) the name of the seller and physical location of the pump;

(5) the name of the United States governmental agency purchasing the fuel;

(6) the price per gallon of fuel paid;

(7) the number of gallons of fuel purchased;

(8) the tax paid on each gallon of fuel purchased;

(9) other information required by the department in order to evaluate if the claim for refund meets the requirements of AS 43.40 and this subsection.

History

Authority: AS 43.05.080; AS 43.40.050 AS 43.40.030; AS 43.40.100
Eff. 4/1/2001, Register 157

Article 7 Qualified Dealer License and Bonding Requirements

15 AAC 40.600 Qualified dealer license

Repealed.

History

Eff. 4/1/2001, Register 157; am 10/16/2013, Register 208; repealed 7/8/2020, Register 235

15 AAC 40.610 Bonding requirement

(a) A person applying for a qualified dealer license must file a bond with the department in an amount equal to twice the estimated average monthly tax or $5,000, whichever is greater. A person applying to renew a qualified dealer license must file either a new bond or a bond continuation certificate on a form or in a format prescribed by the department. The bond may not be cancelled and must remain in effect until the department determines that the assessment or collection of the motor fuel tax is satisfied or prohibited by the applicable statute of limitations. The department may accept other security in the amount required by this section instead of a bond, including a certificate of deposit, a cash deposit, or bank letter of credit.

(b) If at any time the qualified dealer learns information that would lead a reasonable person to believe that the estimate required in 15 AAC 40.610(a) is understated, the qualified dealer shall file a corrected estimate with the department, recalculate the amount of bond due under (a) of this section, and file an additional bond with the department. The qualified dealer shall file the corrected estimate and provide the additional bond within 30 days after the date on which the qualified dealer learned the information that would have resulted in a higher original estimate.

(d) The department may require an additional bond if the qualified dealer's average tax liability over the last 12 months exceeds the estimated tax liability upon which the bond is based.

(e) A qualified dealer that has shown a consistent history of timely filing of monthly tax returns and payment of monthly tax to the department over the last three years is not required to maintain a bond if the qualified dealer continues to remain in compliance with AS 43.40. The department will notify the qualified dealer of any noncompliance that would require the qualified dealer to file a bond under this subsection. The qualified dealer must file with the department the bond required by this subsection within thirty days of the date of issuance of the notice.

History

Authority: AS 43.05.080; AS 43.40.100
Eff. 4/1/2001, Register 157; am 10/16/2013, Register 208; am 7/8/2020, Register 235

15 AAC 40.615 Demand on bond or other security

Except if under appeal, the department will make demand on a bond or other security if a licensee fails to pay an amount due under AS 43.05, AS 43.40, or this chapter to the department, including taxes, interest, or penalties, within the time required by law.

History

Authority: AS 43.05.080; AS 43.05.150; AS 43.40.100
Eff. 10/16/2013, Register 208

15 AAC 40.620 Revocation of qualified dealer license

(a) The department may revoke a qualified dealer license if

(1) the licensee fails to comply with a requirement of AS 43.40 or this chapter;

(2) the licensee is not currently engaged in the activities specified in AS 43.40.100(3);

(3) the licensee, or a responsible person of a licensee that is a business organization, has been convicted within the last 10 years, in this state or any other taxing jurisdiction, of crimes involving fuel tax under AS 43.05.290 or similar provisions in other taxing jurisdictions; or

(4) except if under appeal, the licensee has failed to pay in full the taxes, interest, and penalties levied under AS 43.05 and AS 43.40.

(b) If the department determines a qualified dealer license should be revoked, the department will mail a notice of proposed revocation at least 30 days before the revocation is to take effect. If the person has not cured the cause for revocation by the thirtieth day from the date of issuance of notice, or timely filed a notice of appeal under (d) of this section, the license is revoked by default on the thirtieth day from the date of issuance of notice. The department will mail a notice of revocation to the person.

(c) If the department revokes a qualified dealer license for failing to comply with AS 43.40, the person is not eligible for a new license until 60 days after the date of revocation. The person must apply for a new qualified dealer license.

(d) A person may appeal a notice of proposed revocation under this section to the department. The appeal must be filed within 10 days after the date of the issuance of the notice of proposed revocation. The department will follow the appeal procedures of 15 AAC 05. The department may stay a revocation proceeding if the qualified dealer is in the process of contesting in court or with the department the amount of tax assessed under AS 43.40.

(e) If the department revokes a license under this section, the licensee shall, after all appeals have been exhausted, immediately surrender the license to the department.

History

Authority: AS 43.05.080; AS 43.40.100
Eff. 4/1/2001, Register 157; am 10/16/2013, Register 208; am 7/8/2020, Register 235

Article 9 General Provisions

15 AAC 40.800 Recordkeeping requirements

Each dealer, reseller, and user must keep records to make a complete accounting for the information required on the tax return or claim for a refund under AS 43.40, including fuel purchases, transfers, and use. The records must include an accounting for inventories of fuel on the first and last days of the month, or in the case of a claim for a refund, inventories on the first and last days of the claim period. The failure to maintain records required by AS 43.40.085 and this chapter will result in the denial of the refund.

History

Authority: AS 43.05.080; AS 43.40.085
Eff. 4/1/2001, Register 157

15 AAC 40.900 Definitions

As used in AS 43.40 and this chapter, unless the context requires otherwise,

(1) "aviation fuel" means fuel used in an aircraft;

(2) "charitable institution" means a person described in 26 U.S.C. 501(c)(3) (Internal Revenue Code sec. 501(c)(3)) and exempt from income taxation under 26 U.S.C. 501(a) (Internal Revenue Code sec. 501(a));

(3) "common storage tank" means a storage tank serving both taxable and exempt uses, or multiple taxable uses to which various tax rates apply;

(4) "dealer" has the meaning given in AS 43.40.100;

(5) "department" means the Department of Revenue;

(6) "domestic purposes" means use in and around a private residence, except that it does not include use on public highways, in or on watercraft, or in conjunction with any commercial activity;

(7) "exported" means transported as cargo out of this state by or for the seller or purchaser and intended for use outside of this state;

(8) "federally recognized tribe" means a tribal entity that the United States Department of the Interior, Bureau of Indian Affairs, has recognized in this state and listed in 65 Fed. Reg. 13, 298 (Mar. 13, 2000); that list is adopted by reference;

(9) "flight" includes the continuing segment of a flight with a stopover in this state where the flight number and aircraft are not changed between flight segments;

(10) "fuel" has the meaning given to "motor fuel" in AS 43.40.100(2), except that "fuel" includes fuel and residual fuel oil listed in AS 43.40.100(2)(A)-(L);

(11) "gasohol" means motor fuel that is blended with alcohol as described in AS 43.40.010;

(12) "import" means to deliver fuel as cargo into this state;

(13) "motor fuel" has the meaning given in AS 43.40.100;

(14) "official use" does not include the following:

(A) consumption by a contractor who purchases motor fuel either for its own account or as the agent of a government agency for use in the performance of a contract with that agency;

(B) use in a private vehicle, unless transporting students;

(15) "person" means an individual, firm, partnership, joint venture, government, association, corporation, estate, trust, or receiver;

(16) "purchases" includes the manufacture of fuel;

(17) "qualified dealer" has the meaning given in AS 43.40.100;

(18) "qualified municipality" means a municipality incorporated under AS 29.05.011 that is not connected to more than 200 miles of publicly maintained roads;

(19) "reseller" means a person who sells or otherwise transfers in this state fuel upon which the taxes imposed by AS 43.40 have been paid;

(20) "responsible person" means

(A) a general partner in a partnership, limited partnership, or limited liability partnership;

(B) the manager or any managing member of a limited liability company; or

(D) any employee or contractor that has direct financial or physical control of fuel as part of that person's job duties;

(21) "stationary power plant" means a generator that is permanently attached to real property or is otherwise a fixture;

(22) "tax" means the motor fuel tax established under AS 43.40;

(23) "tax rate" means the motor fuel tax rate established under AS 43.40;

(24) "timely filed" means received by the department or postmarked on or before the last day of the month following the month motor fuel is sold, transferred, or used;

(25) "unrelated person" means a person other than one listed in 26 U.S.C. 267(b) (Internal Revenue Code sec. 267(b)); for purposes of this paragraph, 26 U.S.C. 267(b), as amended as of December 17, 1999, is adopted by reference;

(26) "user" has the meaning given in AS 43.40.100;

(27) "watercraft" means a ship, boat, vessel, or other structure that is capable of being moved in or on water either under its own propulsion or propelled by another watercraft; "watercraft" includes a floating fish processor, a barge, a drilling ship, and a semi-submersible drilling rig;

(28) "foreign country" means any location that is not the 50 United States, the District of Columbia, or Puerto Rico.

History

Authority: AS 43.05.080; AS 43.40.035; AS 43.40.085 AS 43.40.010; AS 43.40.050; AS 43.40.100 AS 43.40.030; AS 43.40.080
Eff. 4/8/82, Register 82; am 8/1/82, Register 83; am 7/19/82, Register 83; am 11/14/82, Register 84; am 8/12/84, Register 91; am 4/1/2001, Register 157; am 11/10/2005, Register 176; am 10/16/2013, Register 208

Chapter 50 Cigarette Tax

Article 1 Licensing

15 AAC 50.010 Application for license

(a) A person engaged in a cigarette business in the state shall file an application for a license on a form provided by the department, pay the license fee as required under 15 AAC 50.030, and, in the case of a distributor, file a surety bond as required under 15 AAC 50.040.

(b) The application must include the following information:

(1) the applicant's name and address;

(2) the name under which the cigarette business will be conducted;

(3) the applicant's cigarette business category as a manufacturer, distributor, direct-buying retailer, vending machine operator, or buyer;

(4) in the case of vending machine operator, the number of vending machines which will be operated; and

(5) other information required on the department's application form.

(c) A person engaged in more than one cigarette business shall file a separate application for each category of cigarette business. A person conducting a cigarette business shall file a separate application for each place of business. A vending machine operator who operates a cigarette business from one place of business but who has cigarette vending machines in more than one location on the premises of others is required to file only one application.

(d) Licenses expire at the end of the license year and must be renewed by filing an application under this section no later than June 30 of the current license year. A person who moves a place of business to a new location must first file an application to transfer the license to the new place of business and pay the fee specified under 15 AAC 50.030(b). A person whose license is lost, stolen, or defaced, shall immediately file an application for a duplicate license and pay the fee specified under 15 AAC 50.030(c).

(e) The license required under this chapter is in addition to all other licenses required by law.

History

Authority: AS 43.05.080; AS 43.50.020; AS 43.50.040 AS 43.50.010; AS 43.50.035; AS 43.50.150
Eff. 2/27/83, Register 85

15 AAC 50.020 Display and surrender of license

(a) A license must be prominently displayed at the licensee's place of business. A vending machine operator shall also display a stamp provided by the department on each vending machine operated by the licensee.

(b) A licensee shall surrender a license within 30 days after

(1) a revocation of a license;

(2) a cessation of a cigarette business;

(3) a change of ownership of a cigarette business; or

(4) a change of a place of business.

History

Authority: AS 43.05.080; AS 43.50.020; AS 43.50.150 AS 43.50.010; AS 43.50.040
Eff. 2/27/83, Register 85

15 AAC 50.030 License fees

(a) Repealed 7/8/2020.

(b) The license fee for a transfer of a license to a new place of business is 50 cents.

History

Authority: AS 43.05.080; AS 43.50.040; AS 43.50.150 AS 43.50.030; AS 43.50.060
Eff. 2/27/83, Register 85; am 7/8/2020, Register 235

15 AAC 50.040 Distributor bond

An application for a distributor license must be accompanied by a surety bond on a form provided by the department which has been approved by the Department of Law. The surety on the bond must be licensed by the State of Alaska to write surety bonds in the state. The amount of the surety bond must be in an amount equal to twice the estimated average monthly amount of tax due during the license year for which the application is being filed, or $5,000, whichever is higher.

History

Authority: AS 43.05.080; AS 43.50.035; AS 43.50.150
Eff. 2/27/83, Register 85

15 AAC 50.050 License transfer

(a) Repealed 7/8/2020.

(b) Repealed 7/8/2020.

(c) Upon application and payment of the fee provided for in 15 AAC 50.030(b), a license will be transferred to a new place of business for the remainder of the license year.

History

Authority: AS 43.05.080; AS 43.50.050 AS 43.50.040; AS 43.50.150
Eff. 2/27/83, Register 85; am 7/8/2020, Register 235

15 AAC 50.060 License refunds

Repealed.

History

Eff. 2/27/83, Register 85; repealed 7/8/2020, Register 235

15 AAC 50.070 License revocation and suspension

Repealed.

History

Eff. 2/27/83, Register 85; repealed 7/8/2020, Register 235

Article 2 Taxation

15 AAC 50.090 Cigarette tax

Repealed.

History

Eff. 2/27/83, Register 85; am 3/28/86, Register 97; repealed 7/8/2020, Register 235

15 AAC 50.100 Exemptions for military and Indian reservation sales

(a) Cigarettes imported or acquired by a military exchange, commissary, or ship store are exempt from tax under this chapter if the cigarettes are sold to and for the sole use of authorized personnel according to current military regulations. Cigarettes imported or acquired by a military exchange, commissary, or ship store and sold to or for the use of unauthorized personnel are not exempt from the tax under this chapter. Cigarettes imported or acquired by independent contractors and sold to consumers within military installations are not exempt from tax under this chapter.

(b) A person claiming an exemption under (a) of this section for the sale of cigarettes directly to a military exchange, commissary, or ship store shall file, with a return under 15 AAC 50.120, an exemption certificate for each exempt sale claimed under this section. The certificate must be in the form of an affidavit, signed by an authorized agent of the military exchange, commissary, or ship store, and contain a statement that the cigarettes purchased will be sold solely to and for the use of authorized personnel in accordance with military regulations. Accompanying the exemption certificate must be the invoice supporting the sale to the military exchange, commissary, or ship store.

(c) If the department determines that cigarettes sold under exemption of this section were sold to or for the use of unauthorized personnel, the department will assess the tax under this chapter to the person or entity making the sale.

(d) Cigarettes imported or acquired by an Indian operating a cigarette business within an Indian reservation are exempt from tax under this chapter if the cigarettes are sold to and for the sole use of Indians. Cigarettes imported or acquired by an Indian operating a cigarette business within an Indian reservation are not exempt from the tax under this chapter if sold to a non-Indian, and the tax from those nonexempt sales must be collected, reported, and remitted as required in (f) of this section.

(e) A person claiming an exemption under (d) of this section for the sale of cigarettes directly to an Indian operating a cigarette business within an Indian reservation shall file with a return under 15 AAC 50.120, an exemption certificate for each exempt sale claimed under this section. The certificate must be in the form of an affidavit signed by the Indian operating the cigarette business within the Indian reservation, and it must contain a statement that tax-free cigarettes will be sold solely to and for the use of Indians. Accompanying the exemption certificate must be the invoice supporting the sale to the Indian operating the cigarette business within the Indian reservation.

(f) An Indian operating a cigarette business on an Indian reservation and making sales to non-Indians shall collect the tax due on sale of cigarettes from the non-Indian and remit the tax with a withholding report to the department. The withholding report must be on a form prepared by the department and must state the number of cigarettes sold to non-Indians and the amount of tax due on the sales to the non-Indians. The tax collected and the withholding report must be filed with the department no later than the end of the month following the month in which the cigarettes were sold.

(g) If the department determines that cigarettes sold under exemption of this section were sold to or for the use of non-Indians without collection, remitting, and reporting the tax due, the department will assess the tax under this chapter to the person or entity making the sale.

History

Authority: AS 43.05.080; AS 43.50.090; AS 43.50.150
Eff. 2/27/83, Register 85

15 AAC 50.110 Tax credits and refunds

(a) A person paying tax on cigarettes which are destroyed, or which are returned unsalable to the manufacturer, before sale, may claim a credit on a return of the tax paid on the destroyed or unsalable cigarettes.

(b) If a claim for credit is made for cigarettes returned unsalable, the claim for credit must be supported by a credit invoice issued by the manufacturer.

(c) If a person is entitled to a credit under this section after having filed a final return under 15 AAC 50.120(e), the person may claim a refund of the tax. A claim for refund must be filed on a form provided by the department and must include the number and circumstances of the cigarettes destroyed or returned unsalable.

History

Authority: AS 43.05.080; AS 43.50.090; AS 43.50.150
Eff. 2/27/83, Register 85; am 7/8/2020, Register 235

15 AAC 50.120 Returns

(a) A person who during the preceding month first manufactures, imports, or acquires cigarettes in this state or who during the preceding month acquired cigarettes in this state upon which the tax has not been paid shall file a return at the end of the month, as required by this section, and pay the tax.

(b) The return must be signed under penalty of perjury by the person filing the return. The return must be on a form provided by the department and must include

(1) the name and address of the person filing the return;

(2) the name under which the cigarette business is being conducted;

(3) the number of cigarettes manufactured, imported, or acquired in the state during the preceding month;

(4) the names of persons from whom the cigarettes were imported or acquired during the preceding month;

(5) the number of cigarettes imported or acquired from each person named in (b)(4) of this section;

(6) the amount of tax due on the cigarettes manufactured, imported, or acquired in the state during the preceding month;

(7) the amount of cigarettes for which exemption is claimed;

(8) the amount of the one-percent commission deduction allowed under AS 43.50.090;

(9) the amount of tax credit claimed under 15 AAC 50.110; and

(10) other information required on the department's form.

(c) Purchase invoices must be attached to the return supporting the purchase of cigarettes during the previous calendar month. Exemption certificates and supporting invoices required by 15 AAC 50.100 must be attached to the return. Credit forms and invoices required by 15 AAC 50.110 must also be attached to the return.

(d) A separate return must be filed for each cigarette business category for which a separate license is required under 15 AAC 50.010. A single return may be filed for a cigarette business conducted in several locations but within one cigarette business category.

(e) After the cessation of a cigarette business, a person shall file a final return in the manner required by this section with the department covering the period from the date of the last return to the date of cessation of business.

History

Authority: AS 43.05.080; AS 43.50.150
Eff. 2/27/83, Register 85; am 7/8/2020, Register 235

15 AAC 50.130 Joint administration of state and municipal tobacco taxes

(a) A municipality participating in the joint administration of cigarette and other tobacco product taxes must either amend an existing written agreement or enter into an initial written agreement with the department to memorialize the responsibilities of each party to the agreement. An agreement must include

(1) a detailed statement of the purpose and scope of the agreement between the parties;

(2) limitations of the parties;

(3) identification of representatives of each party; and

(4) all pertinent appendices or other information that the department determines necessary.

(b) If the department administers municipal cigarette taxes under an agreement authorized under AS 43.50.150, the department may agree to

(1) collect municipal taxes consistent with department practices, using department forms, timelines, and requirements;

(2) jointly audit returns according to the department's practices and procedures; and

(3) jointly investigate taxpayer activity.

(c) Reimbursement of costs to the department must include normal operating expenses associated with the administration of cigarette taxes within the department to include wages, benefits, litigation costs, and administration and overhead costs and be allocated in a manner prescribed by a written agreement between the department and the participating municipality.

(d) A municipality engaged with the department in the sharing of taxpayer information pertaining to cigarette and other tobacco product taxes must enter into a written agreement with the department. The agreement must include the purpose, scope, limitations, and identification of parties authorized to share confidential information.

(e) A municipality must require employees that will have access to department records to

(1) read and become familiar with department confidentiality policies;

(2) agree to comply with all state confidentiality requirements;

(3) attend any department training sessions on confidentiality at the request of the department; and

(4) annually sign the department's confidentiality agreement and return the signed agreement to the department.

(f) If the department shares confidential information with a municipality, the municipality may not share the information with other agencies, officials, or contractors working on behalf of the municipality unless the department grants authorization.

(g) A municipality is responsible for immediately notifying the department of any breach of confidentiality, mitigating any confidentiality breach as required under the agreement with the department, and bearing all relevant costs.

(h) The department may cease joint administration of cigarette and other tobacco product taxes if a municipality or its employees violate department confidentiality policies and requirements.

History

Authority: AS 43.05.080; AS 43.50.035; AS 43.50.150
Eff. 8/8/2015, Register 215

15 AAC 50.140 Cigarette Tax

Reserved.

Article 3 General Provisions

15 AAC 50.150 Manufacturer's report

Repealed.

History

Eff. 2/27/83, Register 85; repealed 7/8/2020, Register 235

15 AAC 50.160 Invoices

An invoice for the sale of cigarettes must contain a statement in bold letters stating whether the tax under this chapter has been paid on the cigarettes sold.

History

Authority: AS 43.05.080; AS 43.50.130; AS 43.50.150
Eff. 2/27/83, Register 85

15 AAC 50.170 Appeal

Except in the case of a suspension or revocation of a license under AS 43.50, a person aggrieved by an action of the department may file an appeal under AS 43.05.240.

History

Authority: AS 43.05.080; AS 43.05.240; AS 43.50.150
Eff. 2/27/83, Register 85; am 7/8/2020, Register 235

15 AAC 50.180 Penalties and interest

Repealed.

History

Eff. 2/27/83, Register 85; repealed 7/8/2020, Register 235

15 AAC 50.190 Definitions

In addition to the definitions contained in AS 43.50.170, in this chapter

(1) "cigarette business" means a category of activity in the state as a manufacturer, distributor, direct-buying retailer, vending machine operator, retailer, or buyer of cigarettes;

(2) "department" means the Department of Revenue;

(3) "import or acquire" includes all manners, ways, and modes of bringing or obtaining cigarettes in the state and, in the case of a manufacturer, includes bringing cigarettes into the state for samples or storage;

(4) "Indian" means a person registered on the tribal rolls of the Indian tribe occupying an Indian reservation;

(5) "Indian reservation" means all land set aside by the United States for the exclusive use and occupancy of Indian tribes, which are recognized as Indian reservations under federal law and, as of February 27, 1983, includes only the Annette Islands Reserve set aside by the United States for the exclusive use and occupancy of Metlakatla Indian Community; and

(6) "license year" means the 12 months commencing July 1 of one calendar year and ending June 30 of the following calendar year.

History

Authority: AS 43.05.080; AS 43.50.150; AS 43.50.170
Eff. 2/27/83, Register 85

Chapter 52 Transportation Taxes

Article 1 Vehicle Rental Tax

15 AAC 52.010 Collection of vehicle rental tax and filing of returns

(a) A person required under AS 43.52.050 to collect from the renter and remit to the department a vehicle rental tax imposed by AS 43.52.010 - AS 43.52.099 shall

(1) collect the tax from the renter at the completion or close of the lease or rental contract, regardless of billing practices, installment agreements, credit procedures, or bad debts; and

(2) file one return for each calendar quarter for all leases and rentals that occurred during that calendar quarter and that are

(A) subject to the tax; or

(B) exempt under AS 43.52.090 or 15 AAC 52.020 from the tax.

(b) The taxes imposed in AS 43.52.010 - AS 43.52.099 apply to a lease or rental to a related person.

(c) A person shall file the return required under AS 43.52.050 on a form prescribed by the department, and on that form shall provide identification of the person filing the return, computation of the tax to be remitted, and the person's signature, made under penalty of perjury. For purposes of this subsection, "person" has the meaning given in AS 43.05.290.

(d) Subject to 15 AAC 05.310(h), the filing of the return and the remittance of the total taxes must be made not later than April 30, July 31, October 31, and January 31, for the calendar quarters ending March 31, June 30, September 30, and December 31, respectively.

History

Authority: AS 43.05.080; AS 43.52.040; AS 43.52.080 AS 43.05.290; AS 43.52.050
Eff. 1/8/2004, Register 169

15 AAC 52.020 Exemptions from vehicle rental tax

(a) For an exemption to be claimed under AS 43.52.090, and at the time that the rental contract is executed, the lessor must

(1) complete a government use exemption certificate

(A) on a form prescribed by the department; or

(B) incorporated, directly or as an addendum, into the lessor's form contract, if the incorporated material is substantially the same as the contents of the form described in (A) of this paragraph;

(2) obtain, from the individual taking possession of the leased or rented vehicle,

(A) a signed declaration, made under penalty of perjury, that the individual has reviewed the certificate and that, to the best of the individual's knowledge, the certificate is true, correct, and complete; and

(B) proof of that individual's employment or official status, through the presentation of one or more of the following for examination by the lessor, except as provided in (c)(2)(B) of this section:

(i) a valid photo identification card issued by or on behalf of a government agency or of a federal instrumentality described in (c)(1) of this section;

(ii) the individual's business card, embossed with the seal of the government agency or federal instrumentality;

(iii) a document directly billing the lease or rental to the government agency or federal instrumentality, or to a credit card issued to the government agency or federal instrumentality;

(iv) a travel or purchase order issued by a government agency or federal instrumentality.

(b) The completed government use exemption certificate must identify the renter, identify the government agency, federal instrumentality, or foreign government, and identify the item presented under (a)(2)(B) of this section as proof of exempt status.

(c) The department will not apply the vehicle rental tax requirements of AS 43.52.010 - 43.52.099 and 15 AAC 52.010 - 15 AAC 52.099 to a lease or rental

(A) a government use exemption certificate is completed as required under (a) and (b) of this section; and

(B) the individual taking possession of the leased or rented vehicle presents proof of employment or official status as described in (a)(2)(B) of this section; or

(2) to a foreign government, if

(A) a government use exemption certificate is completed as required under (a) and (b) of this section; and

(B) the individual taking possession of the leased or rented vehicle presents a valid tax exemption card issued under 22 U.S.C. 4301 - 4316 by the United States Department of State; a renter who presents that card is not required to present the proof described in (a)(2)(B) of this section.

(d) If an individual executes a government use exemption certificate under (a) or (c)(1) of this section, and subsequently uses the vehicle for a period of time that is not authorized by the government agency or federal instrumentality for official use, the individual shall

(1) inform the lessor upon return of the vehicle; and

(2) pay any tax that is due on the difference between the total fees and costs for the lease or rental and the fees and costs authorized by the government agency or federal instrumentality.

(e) If an individual executes a government use exemption certificate for a lease or rental that is not exempt, and if the individual fails to inform the lessor upon the return of the vehicle and pay the tax, the individual shall file a return and remit the tax to the department.

History

Authority: AS 43.05.080; AS 43.52.040; AS 43.52.080 AS 43.05.290; AS 43.52.050
Eff. 1/8/2004, Register 169

15 AAC 52.030 Effect of extensions, renewals, or new or supplemental contracts

In determining whether a lease or rental exceeds a period of 90 consecutive days and is not subject to the tax imposed in AS 43.52.010 and 43.52.030,

(1) the initial lease or rental contract must contain a written term exceeding 90 consecutive days;

(2) an extension or renewal of, or a new or supplemental contract to, an initial lease or rental contract described in (1) of this section for a period of 90 days or less may be combined with the initial lease or contract if there is not a break in total consecutive days; and

(3) a lease or rental contract that contains a term exceeding 90 consecutive days is subject to the tax if that lease or rental contract is closed or completed on or before the 90th day.

History

Authority: AS 43.05.080; AS 43.52.030; AS 43.52.080 AS 43.52.010; AS 43.52.050
Eff. 1/8/2004, Register 169; am 6/27/2014, Register 210

15 AAC 52.091 Applicability to contracts executed before January 1, 2004

Repealed.

History

Eff. 1/8/2004, Register 169; repealed 7/8/2020, Register 235

15 AAC 52.099 Definitions

In AS 43.52.010 - 43.52.099 and 15 AAC 52.010 - 15 AAC 52.099, unless the context requires otherwise,

(1) "calendar quarter" means the period of three months of the calendar year, each beginning January 1, April 1, July 1, and October 1;

(2) "day" means 24 consecutive hours;

(3) "department" means the Department of Revenue;

(4) "fees and costs" has the meaning given in AS 43.52.099; "fees and costs"

(A) includes amounts paid to, or retained by, travel and other agents as a commission or fee for services related to a lease or rental; and

(B) does not include

(i) cancellation fees;

(ii) adjustments made at the end of a contract for fuel, damages, towing fees, and overdue penalties; or

(iii) separately itemized charges for pots, pans, linens, cellular telephones, child car seats, global positioning systems, and other personal property included in the lease or rental of a passenger or recreational vehicle;

(5) "official use" does not include a lease or rental by a contractor either for the contractor's own account, as the agent of a government agency, or as the agent of an organization described in 15 AAC 52.020(c)(1), for use in the performance of a contract with that agency or organization;

(6) "person" means an individual, firm, partnership, joint venture, government, association, corporation, estate, trust, receiver, or other group or combination acting as a unit;

(7) "related person" means a person listed in 26 U.S.C. 267(b) (Internal Revenue Code); for purposes of this paragraph, 26 U.S.C. 267(b), as amended as of December 17, 1999, is adopted by reference;

(8) "renter" means the person subject to the lease or rental contract with the lessor.

History

Authority: AS 43.05.080; AS 43.52.050; AS 43.52.080
Eff. 1/8/2004, Register 169

Article 2 Excise Tax on Travel Aboard Commercial Passenger Vessels

15 AAC 52.210 Collection and payment of commercial passenger vessel tax

(a) A person required under AS 43.52.220 to collect from a passenger and remit to the department a tax imposed by AS 43.52.200 - 43.52.295 shall

(1) collect the tax from the passenger on or before completion of the voyage, regardless of billing practices, installment agreements, credit procedures, or bad debts; and

(2) pay the tax to the department on or before the end of the month following the month in which the voyage ended.

(b) The tax imposed by AS 43.52.200 - 43.52.295 applies to a passenger provided a voyage under a promotion, contest, or other agreement for which the passenger did not compensate the person who provided travel aboard the commercial vessel.

History

Authority: AS 43.05.080; AS 43.52.220; AS 43.52.240
Eff. 5/3/2007, Register 182

15 AAC 52.220 Exemptions

The tax imposed by AS 43.52.200 - 43.52.295 does not apply to passengers on board a commercial passenger vessel that does not anchor or moor in state marine waters with the intent to allow passengers to disembark.

History

Authority: AS 43.05.080; AS 43.52.220; AS 43.52.240
Eff. 5/3/2007, Register 182

15 AAC 52.240 Returns

(a) A person required to collect and pay the tax imposed by AS 43.52.200 - 43.52.295 shall file with the department a separate return for each commercial passenger vessel providing overnight accommodations that anchors or moors on the state's marine water with the intent to allow passengers to embark or disembark, for each calendar month for all passengers whose voyage ended during that calendar month.

(b) The return must be signed under penalty of perjury by the person filing the return. The return must be on a form or in a format prescribed by the department and must include

(1) the name, federal taxpayer identification number, address, telephone number, and other contact information of the person filing the return;

(2) the name and call sign of the commercial passenger vessel providing the voyage; and

(3) a schedule of all voyages that the commercial passenger vessel completed during the month; the schedule must include, by voyage,

(A) the beginning and ending date of the voyage;

(B) the total number of passengers subject to the excise tax;

(D) the names and port codes designated by the department of the first seven ports of call in the state;

(E) the number of passengers on board the vessel at each port of call identified in (D) of this paragraph;

(F) the name of the port where the voyage ended; and

(G) for each tax imposed and collected by a home rule or general law municipality on a passenger traveling on a commercial passenger vessel,

(i) the name of the home rule or general law municipality;

(ii) the amount of tax imposed; and

(iii) the number of passengers upon which the tax was imposed and collected.

(c) Subject to 15 AAC 05.310(h), the filing of the return and the remittance of the total taxes must be made not later than the end of the month following the month in which the voyage ended.

History

Authority: AS 43.05.080; AS 43.52.230 AS 43.52.220; AS 43.52.240
Eff. 5/3/2007, Register 182; am 7/1/2011, Register 198

15 AAC 52.250 Records retention and inspection

(a) A person required to file the return under 15 AAC 52.240 shall preserve in hard copy or electronic format for three years all books, records, and any other data utilized to complete the return, including

(1) passenger manifests;

(2) passenger names, addresses, and telephone numbers; and

(3) the amount of levies imposed and collected by home rule or general law municipalities.

(b) A book, record, or other piece of data required to be preserved under this section must be available for inspection and copying at any time upon oral or written demand by the department or its authorized agent.

History

Authority: AS 43.05.080; AS 43.52.230 AS 43.52.220; AS 43.52.240
Eff. 5/3/2007, Register 182; am 7/1/2011, Register 198

15 AAC 52.255 Tax reduction for local levies

The rates for the tax reduction under AS 43.52.255 for local levies are

(1) for the City and Borough of Juneau, $8;

(2) for the City of Ketchikan for docking at a city-owned or city-leased facility, $7;

(3) for the City of Ketchikan for docking at a privately-owned facility, $4;

(4) for the City of Ketchikan for lightering passengers to facilities, $4.

History

Authority: AS 43.05.080; AS 43.52.240; AS 43.52.255
Eff. 5/21/2021, Register 238

15 AAC 52.295 Definitions

(a) In 15 AAC 52.210 - 15 AAC 52.295, "passenger manifest" means a document stating the total number of passengers aboard the commercial passenger vessel at the time the vessel enters the boundaries of a port of call within the state.

(b) In AS 43.52.295, "itinerary" means a trip or journey

(1) commencing in a port within or outside of the state; and

(2) having at least one port of call within the state.

(1) "municipality" has the meaning given in AS 29.71.800;

(2) "port of call" means a municipality at which a commercial passenger vessel commences or ends a voyage or stops during a voyage, and

(A) at which the commercial passenger vessel embarks or disembarks passengers; or

(B) to which a commercial passenger vessel lighters passengers.

History

Authority: AS 43.05.080; AS 43.52.230 AS 43.52.220; AS 43.52.240
Eff. 5/3/2007, Register 182

Article 3 General Provisions

15 AAC 52.910 Applicability to contracts executed before January 1, 2004

Relocated.

History

Eff. 1/8/2004, Register 169

15 AAC 52.990 Definitions

Relocated.

History

Eff. 1/8/2004, Register 169

Chapter 55 Oil and Gas Production Tax and Oil Surcharge

Article 1 Gross Value at the Point of Production of Oil and Gas

15 AAC 55.010 Monthly production rate at the economic limit for oil or gas produced before 1/1/95

Repealed.

History

Eff. 7/1/77, Register 63; am 3/26/82, Register 81; am 1/1/95, Register 132; repealed 5/3/2007, Register 182

15 AAC 55.011 Determination of applicable tax rate for oil and monthly production rate at the economic limit for oil or gas produced on or after 1/1/95

Repealed.

History

Eff. 1/1/95, Register 132; repealed 5/3/2007, Register 182

15 AAC 55.020 Well days for oil or gas produced before 1/1/95

Repealed.

History

Eff. 7/1/77, Register 63; am 2/23/88, Register 105; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.021 Days of well operation

(a) An operator of a lease or property from which oil or gas is produced during a month before January 1, 2012 shall, no later than the last day of the following month, submit to the department a detailed account of the individual well data showing the number of days and fractions of days that each well operated for the month. If the lease or property is within a unit participating area or includes a unit participating area, the well data must be reported for the unit participating area.

(b) Repealed 5/3/2007.

(c) A well is operating for purposes of this section when the well is yielding oil or gas that is considered to be produced under AS 43.55 and this chapter. An injection well, or a well yielding only gas that is not considered to be produced under 15 AAC 55.151(e), is not operating within the meaning of this section.

(d) Repealed 5/3/2007.

(e) Repealed 5/3/2007.

(f) A hole drilled or bored in the ground to produce oil or gas, or both, is a single well, regardless of how many completions or lateral extensions that hole contains; how many pools, formations, or zones are produced through that hole; or whether that hole produces both oil and gas.

(g) Repealed 5/3/2007.

(h) Repealed 5/3/2007.

(i) Repealed 1/1/2000.

History

Authority: AS 43.05.080; AS 43.55.110 AS 43.55.030; AS 43.55.180
Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 5/3/2007, Register 182; am 10/21/2009, Register 192

15 AAC 55.025 Computation of economic limit factor after 10 years of production for oil produced before January 1, 1989

Repealed.

History

Eff. 6/30/87, Register 103; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.027 Use of common production facilities between leases or properties

Repealed.

History

Eff. 1/1/95, Register 132; repealed 5/3/2007, Register 182

15 AAC 55.030 Economic limit factor for casinghead gas produced before 1/1/95

Repealed.

History

Eff. 7/1/77, Register 63; am 11/25/77, Register 64; am 3/26/82, Register 81; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.040 Interim taxation of gas well gas

Repealed.

History

Eff. 7/1/77, Register 63; repealed 1/1/95, Register 132

15 AAC 55.045 Economic limit factor for distillate or condensate produced before 1/1/95

Repealed.

History

Eff. 3/26/82, Register 81; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.050 Gas run through a gas processing plant

Repealed.

History

Eff. 7/1/77, Register 63; am 11/25/77, Register 64; am 1/1/2000, Register 152; repealed 5/3/2007, Register 182

15 AAC 55.052 Reasonable allowance for processing gas in a gas processing plant and for transporting gas from its point of production to a gas processing plant

Repealed.

History

Eff. 1/1/2000, Register 152; repealed 5/3/2007, Register 182

15 AAC 55.060 Lease identification number

Repealed.

History

Eff. 1/2/71, Register 36; am 1/1/95, Register 132; repealed 5/3/2007, Register 182

15 AAC 55.070 Penalty for gas flared before 1/1/95

Repealed.

History

Eff. 7/1/77, Register 63; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.071 Gas flared

Repealed.

History

Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2003, Register 164; repealed 5/3/2007, Register 182

15 AAC 55.080 Interest

Repealed.

History

Eff. 7/1/77, Register 63; am 1/1/95, Register 132; am 1/1/2000, Register 152; repealed 5/3/2007, Register 182

15 AAC 55.090 Significant digits in economic limit factors

Repealed.

History

Eff. 7/1/77, Register 63; am 11/25/77, Register 64; am 1/1/2002, Register 160; repealed 5/3/2007, Register 182

15 AAC 55.100 Average API gravity

Repealed.

History

Eff. 3/7/74, Register 49; am 6/28/74, Register 50; am 7/1/77, Register 63; repealed 5/3/2007, Register 182

15 AAC 55.110 Application of early development incentive credit against production tax

Repealed.

History

Eff. 12/24/75, Register 56; repealed 1/1/95, Register 132

15 AAC 55.115 Accounting for shrinkage when oil and NGLs are commingled

Repealed.

History

Eff. 1/1/2000, Register 152; repealed 5/3/2007, Register 182

15 AAC 55.120 Payment and reporting procedures

Repealed 9/15/82.

15 AAC 55.122 Supplemental submissions

Repealed.

History

Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; repealed 5/3/2007, Register 182

15 AAC 55.140 Processing cost deduction for a downstream gas plant

(a) For gas processed in a downstream gas plant under an arm's length contract, the processing cost deduction under 15 AAC 55.151(b)(2)(B) is the actual cost incurred by the producer under the contract for processing the taxable gas, except as otherwise provided under (c) of this section.

(b) For gas processed in a downstream gas plant other than under an arm's length contract, except as otherwise provided under (c) of this section, the processing cost deduction under 15 AAC 55.151(b)(2)(B)

(1) will be calculated by the department as a volume-weighted average of processing costs under arm's length contracts for comparable processing in the area where the downstream gas plant is located, if the department determines that sufficient arm's length contracts for comparable processing exist and are available to the department to provide a reliable basis for the processing cost deduction;

(2) otherwise is calculated using the methodology under 15 AAC 55.141.

(1) a cost not directly related to processing of taxable gas;

(2) a cost for processing gas downstream of the point where destination value is determined under 15 AAC 55.151(b)(1);

(3) a cost greater than the consideration transferred, either directly or indirectly, from the producer to the processor, regardless of the cost or fee identified in a processing contract;

(4) a cost incidental to marketing.

(d) On or after January 1 of a calendar year during which a producer produces gas from leases or properties in the state that is processed in a downstream gas plant other than under an arm's length contract, the producer may request in writing the department's determination whether the processing cost deduction for the calendar year for that gas will be calculated under (b)(1) of this section or 15 AAC 55.141. No later than 90 days after receiving the request, the department will notify the producer of the department's determination. If the department determines that the processing cost deduction will be calculated under (b)(1) of this section, the department will provide the department's calculation to the producer no later than the later of July 1 of the calendar year or 150 days after the department receives the producer's request.

(e) If a producer's gas produced from leases or properties in the state is processed during a month in a downstream gas plant in an area where the producer's other gas is also processed during the month,

(1) for each downstream gas plant in that area in which the producer's gas from whatever source is processed, the percentage of the producer's gas processed in that plant during the month that is considered to be gas produced from leases or properties in the state is equal to the percentage that the producer's gas produced from leases or properties in the state constitutes of the producer's total amount of gas processed in downstream gas plants in that area during the month;

(2) if the producer has gas processed during the month under multiple contracts in a given downstream gas plant, the percentage of the producer's gas processed under each of those contracts during the month that is considered to be gas produced from leases or properties in the state is equal to the percentage that the producer's gas produced from leases or properties in the state constitutes of the producer's total amount of gas processed under those contracts during the month.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.900
Eff. 4/30/2010, Register 194

15 AAC 55.141 Methodology for calculating certain gas processing cost deductions

(a) For gas processed in a downstream gas plant for which the processing cost deduction is calculated under this section, the applicable processing cost deduction is based on the downstream gas plant's actual and reasonable, directly allocable and attributable processing costs in the form of operating and maintenance expense, overhead, depreciation, and a return on undepreciated capital investment as provided in (c) of this section. Allowable capital costs are the original costs for depreciable fixed assets, including costs of delivery and installation of capital equipment that is an integral part of the plant.

(b) To compute depreciation for the purposes of this section, the producer shall use straight-line depreciation based on the economic life of the downstream gas plant. A change in ownership of a plant does not alter the depreciation schedule established by the original processor or producer for purposes of calculating a processing cost deduction under this section. Notwithstanding a change in ownership, a downstream gas plant may only be depreciated once. Equipment may not be depreciated below a reasonable, positive salvage value.

(c) Each February, the department will determine and publish the prevailing yield during the preceding January on corporate bonds whose relevant characteristics are comparable to those for which Moody's Investor Services, Inc., published its Moody's Seasoned Baa Corporate Bond Yield - All Industries for January 2010. The prevailing yield published by the department is the rate of return for purposes of calculating the return for that calendar year on undepreciated capital investment under (a) of this section.

(d) For a new downstream gas plant, the producer shall include in its initial processing cost deduction estimates of the directly allocable gas processing costs allowed under (a) of this section for the applicable period. The producer shall base cost estimates upon the most recently available operations data for the plant; if these data are not available, the producer shall base cost estimates upon industry data for similar downstream gas plants. To the extent a processing cost deduction is based on estimates, the deduction must be revised after actual costs are known.

(e) The billing determinant to be used in calculating a processing cost deduction under this section is throughput for the downstream gas plant.

(f) A reasonable share of overhead directly allocable and attributable to the operation and maintenance of a downstream gas plant is an allowable operating expense for purposes of this section.

(g) A producer may not include the following capital costs in determining a processing cost deduction under this section:

(1) a cost for a capital improvement or equipment that is not an integral part of the downstream processing plant;

(2) nondepreciable property, including land and a pipeline right-of-way;

(3) a facility used to store, deliver, or otherwise dispose of residue gas or gas plant products after extraction.

(h) A producer may not include the following non-capital costs in calculating a processing cost deduction under this section:

(1) operating and maintenance cost not directly related to processing;

(2) a cost associated with a capital improvement or equipment if the cost of the capital improvement or equipment is disallowed under (g) of this section;

(3) federal, state, or other income taxes;

(4) production or severance taxes;

(5) royalty payments.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.900
Eff. 4/30/2010, Register 194

15 AAC 55.150 Valuation of oil or gas produced before 1/1/95

Repealed.

History

Eff. 1/6/80, Register 73; am 5/21/81, Register 78; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.151 Gross value of oil or gas at the point of production

(a) Except as otherwise provided in 15 AAC 55.163, this section applies to all oil and gas produced in the state on a lease or property, regardless of whether the oil or gas is removed from the lease or property, less any oil or gas the ownership of or right to which is exempt from state taxation.

(b) The gross value at the point of production for a producer's oil or gas must be calculated as follows:

(1) a destination value must be determined for the oil or gas; the destination value is the sales price under 15 AAC 55.161 unless (c) or (d) of this section applies, in which case the destination value is the prevailing value under 15 AAC 55.171 or 15 AAC 55.173, as applicable;

(2) for oil and gas produced

(A) repealed 9/20/2020;

(B) after June 30, 2007, the producer's costs of transportation under AS 43.55.150 and 15 AAC 55.193 and, if applicable, the producer's processing cost deduction under 15 AAC 55.140 or 15 AAC 55.141 must be subtracted from the destination value determined under (1) of this subsection; costs of transportation are calculated from the point of production of the oil or gas to its sales delivery point or, if the destination value determined under (1) of this subsection is the prevailing value, to the point where prevailing value is determined under 15 AAC 55.171 or 15 AAC 55.173;

(3) if oils of different qualities are commingled, the value calculated under (2) of this subsection must be adjusted for the cash value of the full consideration paid or received for quality differentials, regardless of whether prescribed by a filed tariff;

(4) if gas of different qualities is commingled, the value calculated under (2) of this subsection must be adjusted for the cash value of the full consideration paid or received for quality differentials, regardless of whether prescribed by a filed tariff, and including the value of any volumetric allocations or adjustments made on the basis of the relative BTU content, NGL content, or any other characteristic of the gas.

(c) The prevailing value under 15 AAC 55.171 or 15 AAC 55.173 must be used in determining the gross value at the point of production for a producer's oil or gas if

(1) the producer's oil or gas is refined, used as fuel or petrochemical feedstock, or otherwise consumed at a refinery or plant owned by the producer, or the oil or gas is transferred from the producer in other than an arm's length, third party transaction;

(2) the prevailing value for the producer's gas under 15 AAC 55.173, plus the total of the actual or reasonable costs of transportation, as applicable, incurred to transport the gas from the point where prevailing value is calculated to the sales delivery point and, if the gas has been processed in a downstream gas plant, the gas processing cost deduction under 15 AAC 55.140 or 15 AAC 55.141, exceed the sales price for that gas under 15 AAC 55.161, by more than one percent of the sales price; or

(3) the prevailing value for the producer's oil under 15 AAC 55.171, plus the actual or reasonable costs of transportation, as applicable, incurred to transport the oil from the point where prevailing value is calculated to the sales delivery point, exceed the sales price under 15 AAC 55.161 by more than $.15 per barrel.

(d) The department may apply prevailing value if the circumstances relating to the disposition of the producer's oil or gas show fraud or an intent to evade taxes.

(e) For purposes of AS 43.55 and this chapter, production of oil or gas does not include

(1) oil or gas used in production operations on a lease or property in the state by the producer;

(2) gas flared, released, or allowed to escape in amounts authorized by the Alaska Oil and Gas Conservation Commission;

(3) oil or gas injected by the producer into a reservoir on a lease or property in the state in the course of operations for purposes of repressuring, including enhanced recovery, but not including storage;

(4) oil or gas on which production tax has been previously paid;

(5) oil or gas sold or otherwise transferred by the producer to another producer of oil or gas in the state for use in a manner described in (1) or (3) of this subsection, if

(A) the producer of the oil or gas

(i) obtains an affidavit from the purchaser or transferee certifying under penalty of perjury that the oil or gas was used in the past year for a purpose described in (1) or (3) of this subsection; and

(ii) on March 31 of each year files with the department the affidavit obtained under (i) of this subparagraph together with the producer's statement described in AS 43.55.030(a); and

(B) the oil or gas is actually used in a manner described in (1) or (3) of this subsection.

(f) Oil or gas deemed not to be produced under (e)(3) or (5) of this section is subject to tax on the basis of prevailing conditions at the time, and for the lease or property from which, the oil or gas is ultimately produced.

(g) If a producer transfers oil to a third party for purposes of operational necessity or convenience in what otherwise would be a bona fide, arm's-length exchange but for the fact that at the time of the particular transfer the producer expects to receive a like amount of similar quality oil produced in the state from that third party, the transfer to a third party and the transfer from the third party are disregarded and the oil is treated as if it had remained in the possession of the original transferring producer until final disposition of that oil. If the transfers under that exchange are made at different locations, the location differential paid by a producer is treated as a transportation cost and the location differential received by a producer is treated as a reimbursement of a transportation cost.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.900 AS 43.55.020; AS 43.55.150
Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 5/3/2007, Register 182; am 4/30/2010, Register 194; am 9/20/2020, Register 235

15 AAC 55.160 Sales price for oil or gas produced before 1/1/95

Repealed.

History

Eff. 1/6/80, Register 73; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.161 Sales price for oil or gas

(a) For purposes of this chapter, the sales price for oil or gas is the cash value of the full consideration being given in receipt for oil or gas transferred from a producer in an arm's length, third party transaction. For gas that has been processed in a downstream gas plant, the sales price is the total of the cash value of the full consideration being given in receipt for the residue gas and gas plant products transferred from a producer in an arm's length, third party transaction.

(b) Repealed 1/1/2000.

(1) the average spot price of the crude received that is published during the month that corresponds most closely to the pricing period identified in the contract for the crude received, if the crude received is priced by reference to a crude other than ANS and a pricing period is identified in the contract; or

(2) the average spot price of the crude received that is published during the month of delivery of the crude received, if the crude received is priced by reference to ANS or if a pricing period is not identified in the contract.

(d) If oil or gas is sold under a contract that contains a provision for reimbursing the producer for all or any part of the production taxes paid by the producer for that oil or gas, full consideration for purposes of (a) of this section includes the amount of the tax reimbursement received by the producer.

History

Authority: AS 43.05.080; AS 43.55.110 AS 43.55.020; AS 43.55.150
Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2003, Register 164; am 4/30/2010, Register 194

15 AAC 55.163 Valuation of oil run through a North Slope field topping plant

(a) This section applies to oil run through a field topping plant in the Alaska North Slope area that is not returned and blended back into a production stream upstream of a point of production for oil.

(b) The gross value per barrel at the point of production for the oil is the prevailing value for that month determined under 15 AAC 55.171(g) multiplied by 1.2.

(c) The gross value determined under this section includes and is in place of the value of all pertinent cash receipts and disbursements between the owners of a field topping plant and the working interest owners of the oil run through the field topping plant.

History

Authority: AS 43.05.080; AS 43.55.030; AS 43.55.190 AS 43.55.011; AS 43.55.040 AS 43.55.020; AS 43.55.150
Eff. 1/1/2003, Register 164

15 AAC 55.165 Estimated payment of taxes based on market value for oil produced before 1/1/95

Repealed.

History

Eff. 9/1/84, Register 91; am 10/10/90, Register 116; am 2/14/91, Register 117; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.167 Transition rule for payment of estimated tax for third quarter 1990

Deleted.

History

Eff. 2/14/91, Register 117; deleted as of 1/2000, Register 152

15 AAC 55.170 Prevailing value for oil produced before 1/1/95

Repealed.

History

Eff. 1/6/80, Register 73; am 5/21/81, Register 78; am 9/1/84, Register 91; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.171 Prevailing value for oil

(a) The prevailing value for oil produced in the Alaska North Slope area ("ANS") and delivered to the United States West Coast, including Hawaii, is

(1) for oil transferred by the producer in an arm's-length, third party sale, the average spot price for ANS at the United States West Coast during the month that is referenced in the sales contract pricing provision; if more than one month is referenced in the sales contract pricing provision, the month with more daily spot price reports that fall within the contract price reference period must be used; in the case of an equal number of spot price reports, the month closer to the month of production must be used; if the sales contract has no price reference period, the prevailing value determined under (3) of this subsection must be used;

(2) for oil transferred by the producer in an arm's-length, third party exchange, the average spot price for ANS at the United States West Coast during the same month that is applied under 15 AAC 55.161(c) to the crude received in the exchange; if the department cannot determine the month in which the crude was received, the prevailing value determined under (3) of this subsection must be used; or

(3) for other oil, including oil that is refined, used as fuel or petrochemical feedstock, or otherwise consumed at a refinery or plant owned by the producer, the average spot price for ANS at the United States West Coast during the month of delivery of that oil.

(b) Repealed 1/1/2000.

(d) Repealed 1/1/2000.

(e) Repealed 1/1/2000.

(f) The prevailing value for ANS sold in the state at tidewater or delivered to coastal refineries in the state is the prevailing value determined in (a) of this section minus the volume-weighted average location differential between the Port of Valdez and the United States West Coast provided for under contracts for the sale of ANS delivered in the state during the previous calendar year. The department will calculate the annual volume-weighted average location differential by analyzing contracts entered into during the 18-month period ending November 30 of the previous calendar year for the sale of producers' ANS delivered in the state. The department will use contracts that it has received from producers by January 15 of the current calendar year. The department will calculate the location differential and the number of barrels specified to be delivered under each contract. The differential for each contract will be multiplied by the total number of barrels specified to be delivered under that contract. The resulting totals for all contracts will be added together, and that sum will be divided by the total number of barrels delivered under all of the contracts. If two or fewer contracts are entered into during the 18-month period ending November 30 of the previous calendar year that meet the criteria in this subsection, the department will use the volume-weighted average of marine transportation costs, reported monthly under AS 43.55.030(f)(2), during the prior 12-month period ending June 30 of the previous calendar year, less 25 percent of those reported marine transportation costs. The resulting location differential is a per-barrel amount. The department will provide notice to the producers of the amount of the location differential no later than February 10 each year.

(g) The prevailing value for ANS sold at Trans Alaska Pipeline System ("TAPS") pump station number one or sold at the entrance to a publicly regulated pipeline other than TAPS is the prevailing value determined in (f) of this section minus the carrier ownership-weighted average of all applicable publicly filed pipeline tariffs and the quality bank differentials, not including the TAPS Valdez Marine Terminal Quality Bank, for oil produced from the relevant lease or property and transported between the location of sale and the TAPS terminal in Valdez. If a carrier has more than one applicable publicly filed pipeline tariff, the lowest tariff filed by that carrier must be used in calculating the carrier ownership-weighted average.

(h) The prevailing value for ANS delivered to an inland refinery in the state is the prevailing value as determined in (f) of this section, minus the carrier ownership-weighted average of all applicable TAPS tariffs and the quality bank differentials, not including the TAPS Valdez Marine Terminal Quality Bank, for oil transported between TAPS pump station number one and the TAPS terminal in Valdez, plus the carrier ownership-weighted average of all applicable publicly filed pipeline tariffs and the per-barrel quality bank adjustments for oil transported between TAPS pump station number one and the refinery. If a carrier has more than one applicable publicly filed pipeline tariff, the lowest tariff filed by that carrier must be used in calculating the carrier ownership-weighted average.

(i) Repealed 1/1/2004.

(j) Repealed 1/1/2004.

(k) The prevailing value for oil produced in the state and delivered to a location other than those specified in (a) or (f) - (j) of this section is the value of comparable crudes delivered to the same regional market, as adjusted for quality and location and measured by indices of current market value.

(l) Repealed 1/1/2000.

(m) For purposes of this section, the average spot price for ANS at the United States West Coast during a month is the average of the monthly average assessments for the month as reported by Platt's and Reuters online data providing service, calculated to three decimal places using the automatic convention in the rounding command or function in commercially available software. If Platt's or Reuters online data providing service ceases to report daily assessments for ANS at the United States West Coast, the average spot price for ANS at the United States West Coast is the average of the monthly average assessments by the remaining price reporting service. In this subsection, a monthly average assessment for a month is the average of the midpoints between a reporting service's high and low closing assessments for ANS at the United States West Coast for all days during the month for which closing assessments are reported.

(n) Repealed 1/1/2000.

History

Authority: AS 43.05.080; AS 43.55.020; AS 43.55.110
Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 11/1/2000, Register 156; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 1/1/2004, Register 168; am 5/3/2007, Register 182; am 4/30/2010, Register 194; am 6/4/2010, Register 194; am 3/1/2017, Register 221

15 AAC 55.172 Prevailing value for gas produced before 1/1/95

Repealed.

History

Eff. 5/21/81, Register 78; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.173 Prevailing value for gas

(a) For gas delivered in the Alaska North Slope area, the prevailing value is,

(1) repealed 1/1/2022;

(2) for gas produced on or after October 1, 2008 and before the commencement of commercial operation of a regulated pipeline facility that delivers gas outside of the Alaska North Slope area, the weighted average sales price of sales from producers of gas to regulated utilities in the Alaska North Slope area for the three-month period ending one month before the end of the previous calendar quarter; in the absence of sales from producers to regulated utilities in the Alaska North Slope area, the department will determine the prevailing value on another reasonable basis under AS 43.55.020(f); the department will publish on the 15th day of each calendar quarter the prevailing value for that quarter;

(3) for gas produced after the commencement of commercial operation of a regulated pipeline facility that delivers gas outside of the Alaska North Slope area, the prevailing value determined under (j) of this section, adjusted for differences, if any, in location, quality, or composition between unprocessed gas delivered into the pipeline facility and gas delivered in the Alaska North Slope area.

(b) For gas delivered in the Cook Inlet area during a calendar quarter, the prevailing value is the weighted average price of significant sales of gas from producers of gas to publicly regulated utilities in the Cook Inlet area for the three month period ending one month before the end of the previous calendar quarter. The department will publish on the 15th day of each calendar quarter the prevailing value for that quarter. For purposes of this subsection, "significant sales" means sales of 10,000 Mcf per month or more.

(c) For gas delivered by pipeline to a market in Canada or the Lower 48, the prevailing value for the month of production of that gas is determined as follows:

(1) except as provided in (3) of this subsection, for unprocessed gas delivered in, or downstream of, a first destination market with reasonable liquidity, the prevailing value is the total value of the component residue gas and component gas plant products, based on market price indices for residue gas and gas plant products determined by the department under (n) of this section, as adjusted for quality or location, for the first destination market with reasonable liquidity, after deduction of a downstream gas processing cost allowance;

(2) except as provided in (3) of this subsection, if gas has been processed in a downstream gas plant and delivered in, or downstream of, a first destination market with reasonable liquidity, the prevailing value is the total value of the residue gas and the gas plant products, based on market price indices for residue gas and gas plant products determined by the department under (n) of this section, for the first destination market with reasonable liquidity, after deduction of a downstream gas processing cost allowance;

(3) if unprocessed gas, residue gas, or gas plant products are not delivered in, or downstream of, a first destination market with reasonable liquidity and are not subject to (k) of this section, or if the department determines that a methodology set out in (1) and (2) of this subsection cannot practicably be applied, the department will determine the prevailing value using one of the following methods:

(A) the weighted average sales price of all gas produced in the state and sold in arm's length, third party transactions in the month of delivery in the same destination market;

(B) the weighted average sales price of all gas produced in the state and sold in arm's length, third party transactions in the month of delivery in the same regional market;

(C) the value of comparable gas delivered to the same regional market, as adjusted for quality and location and based on applicable reference prices published by government entities in Canada or the United States, or any other source of market price information identified by the department as reasonably reliable for purposes of determining the value of the gas.

(d) For gas delivered in the United States outside the state or in a foreign market by means of an LNG transportation facility, the prevailing value for the month of production of that gas is determined as follows:

(1) except as provided in (2) of this subsection, for LNG delivered in or downstream of a first destination market with reasonable liquidity, prevailing value is the higher of

(A) the total value of the LNG based on the market price index determined by the department under (n) of this section for LNG of like kind, quality, and condition for that market;

(B) the total value of the LNG based on the market price index determined by the department under (n) of this section for regasified LNG or the market price indices determined by the department under (n) of this section for residue gas and gas plant products, after deduction of a regasification cost allowance and, if applicable, a downstream gas processing cost allowance, and after applying any location or quality differentials determined by the department;

(2) if the LNG or regasified LNG is not delivered in, or downstream of, a first destination market with reasonable liquidity, or if the department determines that the methodology set out in (1) of this subsection cannot practicably be applied, the department will determine the prevailing value using one of the following methods:

(A) the weighted average sales price of all gas produced in the state and sold in arm's length, third party transactions in the month of delivery in the same destination market;

(B) the weighted average sales price of all gas produced in the state and sold in arm's length, third party transactions in the month of delivery in the same regional market;

(C) the value of comparable gas delivered to the same regional market, as adjusted for quality and location, based on applicable reference prices published by government entities in the foreign market or the United States, or any other source of market price information identified by the department as reasonably reliable for purposes of determining the value of LNG, regasified LNG, residue gas, or gas plant products for that same regional market.

(e) Repealed 5/3/2007.

(f) Repealed 5/3/2007.

(g) A producer that sells gas that has been produced from a lease or property in the state shall, as part of its monthly report under AS 43.55.030(f), file with the department a copy of the sales invoice for each sales transaction for the month covered by the report and a copy of any contract to sell gas produced from a lease or property in the state that the producer entered into during the month covered by the report.

(h) Repealed 1/1/2000.

(i) Repealed 9/20/2020.

(j) For gas sold at the inlet to a gas treatment plant or at the inlet to a regulated gas pipeline facility capable of transporting gas to areas of the state outside of the Alaska North Slope area, the prevailing value for the month of production of that gas is the prevailing value determined in (c) of this section for the first destination market with reasonable liquidity for residue gas and gas plant products, or if there is more than one first destination market with reasonable liquidity, the weighted average of the prevailing values determined under (c) of this section, minus the volume-weighted average of all applicable filed pipeline tariff rates for gas produced from the lease or property and transported to the destination market and, if applicable, minus the cost of gas treatment at the gas treatment plant. In calculating a volume-weighted average of pipeline tariff rates under this subsection, the department may use data from an appropriate prior tax period as necessary to allow for a more contemporaneous determination of prevailing value. For purposes of this subsection, the cost of gas treatment is

(1) if the gas treatment plant is regulated, the applicable tariff rate for the gas treatment plant or, if there is more than one applicable filed tariff rate, the weighted average of all of those rates;

(2) if the gas treatment plant is not regulated, the cost determined by the department using the methodology under 15 AAC 55.197 for current or prior tax periods.

(k) For North Slope gas delivered at an offtake point or other point downstream from the inlet to a regulated gas pipeline facility in an area of the state outside of the Alaska North Slope area or in Canada or the Lower 48 but upstream from a first destination market with reasonable liquidity, the prevailing value for the month of production of that gas is the prevailing value determined in (c) of this section for the first destination market with reasonable liquidity for residue gas and gas plant products, or if there is more than one first destination market with reasonable liquidity, the weighted average of the prevailing values determined under (c) of this section, minus the volume-weighted average of all applicable filed pipeline tariff rates for gas transported from that offtake or other point to the first destination market. In calculating a volume-weighted average of pipeline tariff rates under this subsection, the department may use data from an appropriate prior tax period as necessary to allow for a more contemporaneous determination of prevailing value.

(l) For North Slope gas delivered to and sold at the inlet to the liquefaction plant of an LNG transportation facility located in or near Valdez, Alaska, by use of a pipeline facility that does not also deliver gas to Canada or the Lower 48, the prevailing value is the prevailing value determined by the department in (d) of this section for LNG deliveries to the destination market or if there is more than one destination market, the weighted average of the prevailing values determined under (d) of this section, minus the volume-weighted average costs of transportation, determined under 15 AAC 55.193, between the inlet of the liquefaction facility and the destination markets. In calculating a volume-weighted average cost of transportation under this subsection, the department may use data from an appropriate prior tax period as necessary to allow for a more contemporaneous determination of prevailing value.

(m) For gas delivered by pipeline to any location outside of the Alaska North Slope area other than those locations provided for in (c), (d), (k), and (l) of this section, the prevailing value of the gas is the higher of

(1) the prevailing value determined under (k) of this section at the applicable offtake point from the pipeline facility originating in the Alaska North Slope area, plus the volume-weighted average of all applicable filed pipeline tariff rates, if any, between the offtake point and the sales delivery point; or

(2) the weighted average sales price of all gas produced in the state and sold in arm's length, third party transactions in the month of delivery in the same regional market.

(n) For purposes of determining prevailing value under this section,

(1) a first destination market with reasonable liquidity is a destination market that the department determines satisfies the following criteria:

(A) for residue gas,

(i) the average daily volume of residue gas sold in arm's length transactions exceeds 100,000 MMBTUs; and

(ii) there is sufficient market price information reasonably available in that market for the department to establish a market price index under (2) of this subsection and, if applicable, an adjustment under (3) of this subsection for residue gas for that market;

(B) for LNG,

(i) the average daily volume of LNG or regasified LNG sold in arm's length transactions is substantial; and

(i) gas plant products are either extracted or fractionated in the market for purposes of sale;

(ii) the market is designated as a first destination market for residue gas under (A) of this paragraph; and

(iii) there is sufficient market price information reasonably available either in that destination market or in another market for gas plant products connected by pipeline to that destination market for the department to establish a market price index under (2) of this subsection and, if applicable, an adjustment under (3) of this subsection for gas plant products for that market;

(2) for residue gas, LNG, or gas plant products, the department will determine a market price index, if appropriate, based on information published on a regular basis in reliable and widely available industry trade publications, applicable reference prices published by government entities in Canada or the United States, or any other source of market price information identified by the department as reasonably reliable for purposes of determining a value of residue gas, LNG, or gas plant products for that location or area, as adjusted for quality and location differentials and if applicable, any adjustment under (3) of this subsection;

(3) for residue gas, LNG, or gas plant products, the department may determine an appropriate adjustment between component residue gas and component gas plant products, and among actual or potential component gas plant products, based on BTU content, NGL content, or any other characteristic of the producer's gas that is required to determine a prevailing value under this section.

(o) The department will determine a reasonable downstream gas processing cost allowance, or in the case of LNG, a reasonable regasification cost allowance to be used in the calculation of prevailing value under this section, using one of the following methods as applicable:

(1) downstream gas processing costs or regasification costs published by an industry trade journal, a governmental entity, or any other reliable source of this information, adjusted for quality, location, and any service charges embedded in the published cost and not directly related to processing or regasification; for purposes of this paragraph, service charges include marketing allowances;

(2) for a gas processing cost allowance, a weighted average of downstream gas processing cost deductions determined by the department under 15 AAC 55.140(b)(2) and 15 AAC 55.141, for current or prior tax periods, as adjusted for quality or location;

(3) for a regasification cost allowance, a weighted average of actual transportation costs for regasification facilities determined under 15 AAC 55.193(b)(4)(B) and 15 AAC 55.196 for current or prior tax periods, as adjusted for quality or location;

(4) a weighted average of arm's length downstream gas processing costs or regasification costs for current or prior tax periods, as adjusted for quality or location.

(p) In this section,

(1) "Alaska North Slope area" means that part of the state that lies north of 68 degrees North latitude;

(2) "offtake point" means a point of delivery along the length of a long-distance integrated pipeline facility that is capable of providing connections to other lateral pipelines for delivery to markets separate from the mainline or to local gas distribution lines for residential or commercial use, or to both;

(3) "unprocessed gas" means gas that has not been subject to downstream gas processing.

History

Authority: AS 43.05.080; AS 43.55.030; AS 43.55.110 AS 43.55.020; AS 43.55.040
Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2003, Register 164; am 5/3/2007, Register 182; am 10/1/2008, Register 187; am 4/30/2010, Register 194; am 9/20/2020, Register 235; am 1/1/2022, Register 240

15 AAC 55.175 Allocation of value between oil and NGLs

Repealed.

History

Eff. 1/1/2000, Register 152; am 1/1/2003, Register 164; repealed 5/3/2007, Register 182

15 AAC 55.177 Publication of information related to prevailing value determinations for gas

(a) For purposes of determining the prevailing value for gas under 15 AAC 55.173, the department will publish the information described in (b) of this section as follows:

(1) for the period that (A) begins with the date of commencement of commercial operation of a regulated pipeline that delivers gas to Canada, to the Lower 48, or to an LNG transportation facility located in or near Valdez, Alaska; and (B) ends on the last day of the same tax year, the department will publish the information at least 60 days before the date of commencement of commercial operation;

(2) for each tax year later than the tax year described in (1) of this subsection, the department will publish the information on or before December 1 of the immediately preceding year.

(b) The information to be published by the department under (a) of this section is

(1) the identification of each market that the department has determined to be a first destination market with reasonable liquidity for residue gas, for gas plant products, or for LNG;

(2) for each first destination market with reasonable liquidity,

(A) the name of the publication or other source of the market price index for residue gas, for gas plant products, or for LNG;

(B) a description of the specific price information that can be referenced; and

(C) the manner in which that price information must be applied, including a description of any location or quality differential that the department determines to be appropriate to adjust the market price index in a given market;

(3) the method the department has selected to determine a downstream gas processing cost allowance or a regasification cost allowance under 15 AAC 55.173(o) for each first destination market with reasonable liquidity;

(4) to the extent practicable, the destination markets and the alternative prevailing value methods the department may apply under 15 AAC 55.173(c)(3) and (d)(2) in those markets; and

(5) to the extent practicable, any other information relating to the determination of prevailing value under 15 AAC 55.173.

(c) To the extent practicable, for each first destination market with reasonable liquidity identified by the department under (b) of this section, the department will publish on a monthly or other periodic basis the market price index determined by the department under 15 AAC 55.173(n), and any other information the department has determined can be reasonably provided related to the calculation of prevailing value for gas under 15 AAC 55.173.

(d) In this section, "Alaska North Slope area" means that part of the state that lies north of 68° North latitude.

History

Authority: AS 43.05.080; AS 43.55.030; AS 43.55.110 AS 43.55.020; AS 43.55.040
Eff. 4/30/2010, Register 194

15 AAC 55.180 Choice of methods for determining reasonable cost of transportation for oil and gas produced before July 1, 2007

Repealed.

History

Eff. 1/6/80, Register 73; am 1/1/95, Register 132; am 1/1/2000, Register 152; am 4/30/2010, Register 194; repealed 9/20/2020, Register 235

15 AAC 55.181 Comparison of actual and reasonable costs of transportation for oil and gas produced after June 30, 2007

(a) Except as otherwise provided under (b) of this section, for purposes of determining the lower of actual costs of transportation or reasonable costs of transportation under AS 43.55.150(b), if the department finds under AS 43.55.150(b) that a condition in

(1) AS 43.55.150(a)(1) or (2) is present, the actual costs of transporting the producer's oil or gas from the point where the oil or gas is tendered into the transportation facility to the point where the oil or gas is delivered from the facility are compared to the reasonable costs of transporting the producer's oil or gas from the point where the oil or gas is tendered into the transportation facility to the point where the oil or gas is delivered from the facility;

(2) AS 43.55.150(a)(3) is present, the actual costs of transporting the producer's oil or gas by the method or under the terms the department finds to be not reasonable are compared to the reasonable costs of transporting the producer's oil or gas for that portion of the transportation of the oil or gas as to which the department finds the method or terms of the actual transportation used are not reasonable.

(b) If different filed tariff rates for intrastate transportation and for interstate transportation apply to the transportation of oil or gas from a given point where that oil or gas is tendered into a regulated transportation facility to a given point where it is delivered from the facility, the comparison of actual costs of transportation and reasonable costs of transportation under (a) of this section is made separately for the intrastate transportation and the interstate transportation of the oil or gas.

(c) For purposes of determining the lower of actual costs of transportation or reasonable costs of transportation under AS 43.55.150(b) in the case of transportation for which actual costs of transportation are determined under 15 AAC 55.193(b)(1) or (5), if the tariff rate has a materially different rate structure or capital recovery profile than the reasonable costs of transportation determined under 15 AAC 55.193(c)(5), the department may allow or require the comparison of actual costs and reasonable costs to be made using comparable rate structures and capital recovery profiles.

(d) For purposes of AS 43.55.150 and this section, a physical pipeline is a single transportation facility regardless of whether multiple carriers own interests in the pipeline, file separate tariffs for transporting oil or gas in the pipeline, or enter into separate contracts with shippers to transport oil or gas in the pipeline.

(e) On or after January 1 of a calendar year during which a producer expects to produce oil or gas for which the producer may be required under AS 43.55.150(b) to calculate the gross value at the point of production of oil or gas using the lower of the actual costs of transportation or the reasonable costs of transportation of the oil or gas, if the reasonable costs of transportation are determined under 15 AAC 55.193(c)(5) or (e) - (j), the producer may request in writing the department's determination of the reasonable costs of transportation. The department will provide the department's determination to the producer no later than the later of July 1 of the calendar year or 180 days after the department receives the producer's request. Regardless of whether the department receives a request under this subsection, the department may at any time determine the reasonable costs of transportation of oil or gas under AS 43.55.150(b).

(f) This section applies to oil and gas produced after June 30, 2007.

History

Authority: AS 43.05.080; AS 43.55.110 AS 43.55.020; AS 43.55.150
Eff. 4/30/2010, Register 194

15 AAC 55.190 Calculation of reasonable costs of transportation for oil or gas produced before 1/1/95

Repealed.

History

Eff. 1/6/80, Register 73; am 5/21/81, Register 78; am 1/1/95, Register 132; repealed 1/1/2000, Register 152

15 AAC 55.191 Calculation of reasonable costs of transportation for oil or gas produced before July 1, 2007

Repealed.

History

Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 5/3/2007, Register 182; am 4/30/2010, Register 194; am 3/1/2017, Register 221; am 1/1/2020, Register 232; repealed 9/20/2020, Register 235

15 AAC 55.192 Monthly share of annual transportation costs

(a) For purposes of AS 43.55.160(c), a producer shall determine the appropriate monthly share of the producer's costs of transportation for a calendar year using an acceptable method under this section that the producer chooses for this purpose and applying that method consistently for all months of the calendar year. An acceptable method is

(1) a method that the producer used consistently in calculating its tax under AS 43.55 during calendar year 2005;

(2) any of the following methods as applicable:

(A) for transportation described in 15 AAC 55.193(b)(1), (2), (4)(A), or (5),

(i) use of the actual or reasonable costs of transportation, as applicable, of the oil and gas produced or shipped during the month in question and that are allowable under 15 AAC 55.193; or

(ii) use of the per barrel, per Mcf, or per MMBTU annual average of the actual or reasonable costs of transportation, as applicable, for the oil or gas produced or shipped during the calendar year and that are allowable under 15 AAC 55.193;

(B) for transportation described in 15 AAC 55.193(b)(3), (4)(B), or (6), use of the per barrel, per Mcf, or per MMBTU annual average of the actual or reasonable costs of transportation, as applicable, of the oil or gas produced or shipped during the calendar year and that are allowable under 15 AAC 55.193; or

(3) another method that is approved by the department as fairly representing the appropriate monthly share of the producer's transportation costs for a calendar year.

(b) A producer may not shift transportation costs between months for the purpose of reducing a tax levied by AS 43.55.011(g), as that provision read on June 30, 2007, or a tax levied by AS 43.55.011(e).

History

Authority: AS 43.05.080; AS 43.55.150 AS 43.55.110; AS 43.55.160
Eff. 5/3/2007, Register 182; am 4/30/2010, Register 194; am 9/20/2020, Register 235

15 AAC 55.193 Calculation of costs of transportation for oil and gas produced after June 30, 2007

(a) Costs of transportation are the ordinary and necessary costs incurred to transport the oil or gas from the point of production to the sales delivery point.

(b) Actual costs of transportation under AS 43.55.150(a) are

(1) if transportation of oil or gas is by a regulated carrier, the tariff rate that is on file with the Regulatory Commission of Alaska or another regulatory agency having jurisdiction, and that is applicable to and paid for that transportation of the oil or gas, from the point where that oil or gas is tendered into the facility of the carrier to the point where it is delivered from the facility of the carrier; for purposes of this paragraph, "carrier" includes a person providing gas treatment in a regulated gas treatment plant;

(2) if transportation of oil is by a vessel that is not owned or effectively owned, in whole or in part, by the producer of that oil

(A) for a single voyage charter, the total costs under the charter for that vessel, plus any voyage and port costs as provided in (d) of this section if those voyage and port costs are incurred for that transportation during the term of the charter, are not included in the charter fee, and are borne by the producer, plus the positioning costs, if any, borne by the producer for that vessel;

(B) for a consecutive voyage charter or a time charter, the total costs under the charter for that vessel, plus any voyage and port costs as provided in (d) of this section if those voyage and port costs are incurred for that transportation during the term of the charter, are not included in the charter fee, and are borne by the producer, plus the positioning cost, if any, borne by the producer for that vessel; the positioning cost must be amortized over the lesser of 36 months or the term of the charter in the case of a time charter, and amortized on the basis of the number of voyages in the case of a consecutive voyage charter; or

(C) for a contract of affreightment, the total costs under the contract, plus any voyage and port costs as provided in (d) of this section if those voyage and port costs are incurred for that transportation during the contract of affreightment, are not included in the charter fee, and are borne by the producer, plus any positioning costs not included in that fee that are incurred with respect to that transportation during the contract of affreightment and that are borne by the producer;

(3) if transportation of oil is by a vessel that is owned or effectively owned, in whole or in part, by the producer of that oil, the sum of

(A) voyage and port costs incurred with respect to that transportation, as provided in (d) of this section;

(B) the positioning cost, amortized over 36 months, for that vessel; and

(D) repealed 1/1/2020;

(4) in the case of transportation of gas as liquefied natural gas (LNG) by an LNG transportation facility not subject to tariff regulations of the Federal Energy Regulatory Commission or another federal agency, a state, territory, or possession of the United States, or a foreign nation,

(A) if the producer does not own or effectively own, in whole or in part, the LNG transportation facility, the amount charged to the producer for that LNG transportation;

(B) if the producer owns or effectively owns, in whole or in part, the LNG transportation facility, the sum of

(i) the direct operating costs of the LNG transportation facility incurred with respect to the producer's gas; for an LNG tanker, direct operating costs consist of the tanker's voyage and port costs as provided in (d) of this section;

(ii) the positioning cost, amortized over 36 months, in the case of an LNG tanker; and

(iii) depreciation of the LNG transportation facility and cost of capital allowance calculated under 15 AAC 55.196(d);

(iv) repealed 1/1/2020;

(5) if transportation of oil or gas is by a nonregulated pipeline facility or gas treatment plant that is not owned or effectively owned, in whole or in part, by the producer of that oil or gas, the transportation fee specified in the contract;

(6) if transportation of oil or gas is by a nonregulated pipeline facility or gas treatment plant that is owned or effectively owned, in whole or in part, by the producer of that oil or gas, the costs calculated using the methodology under 15 AAC 55.197.

(1) for transportation whose actual costs are calculated under (b)(2) or (4)(A) of this section, reasonable costs of transportation are fair market value; the department will determine the fair market value of the transportation

(A) for shipments of oil, on the basis of third-party charters (that is, time charters in which the producer does not own or effectively own the vessel in whole or in part) of one year or more for like vessels; two vessels will be considered like vessels if the difference between them in tonnage is less than 10,000 dead-weight tons and if they are both

(i) Jones Act vessels (46 U.S.C. 55102 and 57109);

(ii) Construction-Differential Subsidy (CDS) vessels (46 U.S.C. 53101 - 53312);

(iii) Operating-Differential Subsidy (ODS) vessels (46 U.S.C. 53101 - 53517);

(iv) CDS and ODS vessels; or

(v) vessels that do not meet the qualifications of (i) - (iv) of this subparagraph;

(B) for shipments of gas as LNG, on the basis of third party charters or leases (that is, time charters or leases in which the producer does not own or effectively own, in whole or in part, the LNG transportation facility in question) of three years or more for like LNG transportation facilities;

(2) for transportation whose actual costs are calculated under (b)(3) of this section, reasonable costs are the actual costs;

(3) for transportation whose actual costs are calculated under (b)(4)(B) of this section, reasonable costs are the actual costs;

(4) for transportation of gas as LNG by a regulated LNG transportation facility whose actual costs of transportation are calculated under (b)(1) of this section, reasonable costs are determined using the applicable methodology under (b)(4)(B) of this section for calculating actual costs as if the LNG transportation facility were not regulated;

(5) for transportation by a pipeline facility or gas treatment plant, except as otherwise provided under (e) - (j) of this section, reasonable costs are 103 percent of the costs of transportation calculated by the department using the methodology under 15 AAC 55.197.

(d) For purposes of this section, allowable voyage and port costs for a vessel do not include losses, damages, or expenses incurred in connection with an oil discharge except as provided in this subsection, and do not include taxes or fees on the receipt of oil or LNG at a marine terminal from a vessel. Allowable voyage and port costs for a vessel or LNG tanker are costs actually incurred for the following purposes:

(1) fuel for the vessel or LNG tanker while in port and at sea not to exceed the actual cost if purchased from a third party, or if the fuel is not purchased from a third party, the spot market price of comparable fuel as reported by Platt's at the time of the fuel purchase for the market nearest the point of refueling, plus related allowable fuel taxes and handling charges;

(2) stores and provisions for the vessel or LNG tanker and its captain and crew;

(3) wages and benefits of the vessel's or LNG tanker's captain and crew;

(4) routine maintenance;

(5) drydocking costs, expensed in the year paid;

(6) port and dock fees;

(7) demurrage;

(8) tug and pilotage fees;

(9) marine agents' fees in port;

(10) lightering;

(11) transshipment charges;

(12) customs fees and duties;

(13) taxes incurred due to the ownership and operation of the vessel or LNG tanker, except for income taxes and other taxes (including certain franchise taxes) measured by income;

(14) regular and customary gratuities that are also legal;

(15) insurance premiums actually paid to third-party insurers;

(16) minor cargo losses or measuring differentials not to exceed .0025 of the oil transported, determined on an annual basis for each vessel;

(17) loading and unloading inspection fees;

(18) Panama Canal transit fees;

(19) a reasonable management fee for operating vessels or LNG tankers; this fee is set at six percent of the allowable costs set out in (1) - (3) of this subsection; this set fee covers all general and administrative costs related to vessel operations, including all costs for accounting services, clerical services, administrative services, secretarial services, data processing services, legal services, corporate and operations management, overhead pass-throughs, facility costs and depreciation, corporate planning, risk management, environmental planning and risk evaluation, public affairs, governmental affairs, political affairs, dues and subscriptions other than dues allowable under (21) of this subsection, long-range scheduling, and long-range planning; additional deductions will not be allowed for these costs;

(20) other costs directly associated with the operation or maintenance of the vessel or LNG tanker, including costs for port services and operations, cargo scheduling and planning, fleet staffing, fleet scheduling, fleet staff training, fleet safety, engineering for repair, engineering for maintenance, engineering for drydocking, quality assurance for vessel operations, communication systems, navigation systems, United States Coast Guard certifications, and utility services; these costs include costs for personnel performing the functions listed and the first level of supervision of these personnel;

(21) costs incurred in transportation of oil to comply with 33 U.S.C. 2701 - 2762 (Oil Pollution Act of 1990), AS 46.04, and applicable laws of this or any other state or political subdivision requiring equipment and personnel to be in place for spill prevention and response to spills from vessels; those costs must have not been incorporated into a pipeline tariff, but must have been incurred as an actual cost in the transportation of oil produced in the state; and

(22) costs of containing and cleaning up cargo lost in a discharge, unless the discharge is a catastrophic oil discharge under AS 46.04.900.

(e) Except as otherwise provided in this subsection and in (i) of this section, if a tariff rate for pipeline transportation of oil or gas or gas treatment has been adjudicated as just and reasonable by the Regulatory Commission of Alaska or another regulatory agency having jurisdiction, the tariff rate establishes the reasonable costs of the pipeline transportation or gas treatment to which the tariff rate applies, for periods for which the tariff rate is in effect, including periods for which the tariff rate is given retroactive effect. However, the tariff rate does not establish those reasonable costs for any period later than five years after the end of the test period on which the tariff rate is based. If a complaint challenging the tariff rate has been filed with and accepted for investigation by the Regulatory Commission of Alaska or other regulatory agency, the reasonable costs of the pipeline transportation or gas treatment are 103 percent of the costs of transportation calculated by the department using the methodology under 15 AAC 55.197, for the period

(1) that begins on the date the complaint is accepted for investigation and ends the day before the date, if any, that the complaint proceeding is resolved by

(A) the adjudication of an applicable tariff rate as just and reasonable; or

(B) the acceptance by the Regulatory Commission of Alaska or other regulatory agency of a settlement to which the state is a party and that provides for a tariff rate that the department determines uses a cost-based tariff settlement methodology; and

(2) for which a tariff rate described in (1)(A) or (B) of this subsection is not given retroactive effect.

(f) Except as otherwise provided in this subsection and in (i) of this section, if a tariff rate for pipeline transportation of gas or gas treatment has been approved by the Federal Energy Regulatory Commission in connection with issuance of a certificate of public convenience and necessity for the pipeline facility or gas treatment plant, respectively, the tariff rate establishes the reasonable costs of the pipeline transportation or gas treatment to which the tariff rate applies, for periods for which the tariff rate is in effect. However, the tariff rate does not establish those reasonable costs for any period later than three years after the later of the date the tariff rate is approved or the date commercial operation commences. For purposes of this subsection, the date a tariff rate is approved is the date when the Federal Energy Regulatory Commission's final order issuing the certificate of public convenience and necessity becomes effective, regardless of whether the order is subject to judicial review. If a complaint challenging the tariff rate has been filed with and accepted for investigation by the Federal Energy Regulatory Commission, the reasonable costs of the pipeline transportation or gas treatment are 103 percent of the costs of transportation calculated by the department using the methodology under 15 AAC 55.197, for the period

(1) that begins on the date the complaint is accepted for investigation and ends the day before the date, if any, that the complaint proceeding is resolved by

(A) the adjudication of an applicable tariff rate as just and reasonable; or

(B) the Federal Energy Regulatory Commission's acceptance of a settlement to which the state is a party and that provides for a tariff rate that the department determines uses a cost-based tariff settlement methodology; and

(2) for which no rate referred to in (1)(A) or (B) of this subsection is given retroactive effect.

(g) Except as otherwise provided in this subsection and in (h) and (i) of this section, if the department determines that a tariff rate for pipeline transportation of oil or gas or gas treatment on file with the Regulatory Commission of Alaska or another regulatory agency having jurisdiction uses a cost-based tariff settlement methodology, and if the tariff rate is the result of a settlement that is accepted by the Regulatory Commission of Alaska or other regulatory agency and to which the state is a party, the tariff rate establishes the reasonable costs of the pipeline transportation or gas treatment to which the tariff rate applies, for periods for which the tariff rate is in effect, including periods for which the tariff rate is given retroactive effect. However, the tariff rate does not establish those reasonable costs for any period later than the latest of the following dates:

(1) December 31, 2013;

(2) five years after the date the settlement is accepted by the regulatory agency;

(3) three years after the last date that under the settlement the state has the right, beginning no later than five years after the date the settlement is accepted by the regulatory agency and recurring at least once every three years, to require renegotiation or arbitration of material terms of the settlement in response to a material change in rate determination methodologies approved by the regulatory agency, in the economic life of the pipeline facility or gas treatment plant, in capital structure, or in the cost of capital.

(h) Except as otherwise provided in (i) of this section, if a protest or complaint has been filed with and accepted for investigation by the Regulatory Commission of Alaska or another regulatory agency challenging a tariff rate that would otherwise establish the reasonable costs of pipeline transportation or gas treatment under (g) of this section, the reasonable costs of the pipeline transportation or gas treatment are 103 percent of the costs of transportation calculated by the department using the methodology under 15 AAC 55.197, for the period

(1) that begins on the date the protest or complaint is accepted for investigation and ends the day before the date, if any, that the protest or complaint proceeding is resolved by

(A) the adjudication of an applicable tariff rate as just and reasonable; or

(2) for which a tariff rate described in (1)(A) or (B) of this subsection is not given retroactive effect.

(i) If two or more tariff rates for the same category of service for pipeline transportation of oil or gas from a given point of receipt to a given point of delivery are in effect for a calendar year or portion of a calendar year for which each rate would otherwise establish the reasonable costs of the pipeline transportation under (e) - (h) of this section, the reasonable costs of the pipeline transportation for that category of service are equal to the average of all those tariff rates, weighted according to the respective amounts of throughput or, in the case of tariff rates for firm transportation on a gas pipeline facility, the respective amounts of contracted pipeline capacity subject to each of those tariff rates during the calendar year or portion of the calendar year, as applicable.

(j) In the case of an oil or gas pipeline facility as to which the difference between the tariff rate and the reasonable costs of transportation if determined under (c)(5) of this section would not be expected to have a material effect on the production tax liability of producers shipping oil or gas in the pipeline, due to the low volume of oil or gas transported in the pipeline or the low tariff rate, the department may determine that the reasonable costs of transportation equal the tariff rate.

(k) A payment for unused pipeline capacity under a contractual obligation to pay for pipeline capacity whether or not used does not constitute a cost of transportation of oil or gas.

(l) If a producer sells its oil or gas to a third party in what would otherwise be a bona fide, arm's length sale but at the time of the sale expects to repurchase that oil or gas at a subsequent time and place, that sale to the third party and the repurchase from the third party, when it occurs, must be disregarded and the oil or gas subject to that sale must be regarded as if it had remained the producer's own oil or gas throughout the time between that sale and repurchase. In determining the value at the point of production of the oil or gas, the cost of transportation between the point of sale for that sale and the point of repurchase must be determined as if the producer were the shipper. This subsection does not apply if the producer's expected repurchase does not in fact occur.

(m) The producer's actual or reasonable marine transportation cost, as otherwise determined under this section, for a producer that transports oil or gas produced in the state through a charter, contract of affreightment, sublease, or other arrangement on behalf of a person not affiliated with the producer, in addition to the producer's own oil or gas produced in the state, includes the cost of transporting that non-affiliated person's oil or gas produced in the state and is reduced by the revenue received for providing that transportation.

(n) Costs that are reimbursed or otherwise offset by payments or credits are not allowable as actual or reasonable costs of transportation. Gas pipeline facility revenues for interruptible transportation, authorized overrun service, or park-and-loan service that the facility does not credit to shippers are considered as credited to the shippers that are affiliated with a person that owns an interest in the facility and that have made firm transportation commitments for the facility; the revenues considered as credited are allocated to these shippers in proportion to the amounts of contracted pipeline capacity under their respective firm transportation commitments. A producer shall report to the department any reimbursements or other payments or credits that offset transportation costs.

(o) The following are not allowable costs of transportation:

(1) a fee or other cost incurred for storage, except for storage

(A) for no more than 30 days if the storage is required under the applicable transportation services agreement with a pipeline facility and is necessary for pipeline operations;

(B) as part of LNG transportation, if the fee or cost is allowed under (b)(4)(B) of this section;

(2) an intra-hub transfer fee paid to a gas pipeline hub operator for administrative services, including accounting for the sale of gas within a hub and title transfer tracking;

(3) a fee paid to a scheduling service provider;

(4) internal costs to schedule, nominate, and account for the sale or movement of oil or gas, if incurred by an entity other than the provider of the transportation services; those costs include salaries and related costs, rent and space costs, office equipment costs, and legal fees;

(5) an aggregator or marketer fee, including a fee a producer pays its affiliate or another person to market, purchase, or resell oil or gas, or find or maintain a market for oil or gas;

(6) a fee paid to a broker, including a fee paid to a person that arranges marketing or transportation;

(7) a penalty incurred as a shipper, including

(A) an over-delivery cash-out penalty, including the difference between the price a pipeline pays for over-delivered volumes outside the tolerances and the price received for over-delivered volumes within the tolerances;

(B) a scheduling penalty, including a penalty incurred for differences between daily volumes delivered into a pipeline and volumes scheduled or nominated at a receipt or delivery point;

(C) an imbalance penalty, including a penalty incurred for differences between volumes delivered into a pipeline and volumes scheduled or nominated at a receipt or delivery point;

(D) an operational penalty, including a fee incurred for violation of a pipeline's curtailment or operational orders issued to protect the operational integrity of the pipeline;

(8) a transportation factor listed as reducing the sales price or posted price for a component of gas;

(9) costs of arbitration, litigation, or other dispute resolution activity that involves the state or concerns the rights or obligations

(A) among carriers or owners of a transportation facility; or

(B) between a carrier or owner of a transportation facility and a shipper;

(10) if the producer is affiliated with the carrier or owner of the transportation facility or if the transportation contract otherwise is not at arm's length,

(A) a payment, either volumetric or in value, for actual or theoretical losses of oil or gas;

(B) costs of a surety.

(p) Only costs incurred in the transportation of taxable oil or gas produced from a lease or property in the state are allowable costs. Costs incurred in connection with the transportation of any other oil or gas are not allowable costs.

(q) A producer for which the gross value at the point of production of oil or gas is calculated using the lower of actual costs of transportation or reasonable costs of transportation under AS 43.55.150 shall provide to the department, upon request, information available to the producer that the department considers as necessary to determine the reasonable costs of transportation under this section.

(r) For purposes of AS 43.55.150(b) and this section, a tariff rate has been adjudicated when the regulatory agency has issued its final order in the adjudication and that order has become effective, regardless of whether the order is subject to judicial review.

(s) For purposes of this section,

(1) a settlement has been accepted by a regulatory agency when the regulatory agency has issued its final order accepting the settlement and that order has become effective, regardless of whether the order is subject to judicial review;

(2) a tariff rate is given retroactive effect for a period beginning on a past date if the regulatory agency having jurisdiction provides that the tariff rate is effective beginning on that date, regardless of the extent, if any, to which the agency orders refunds with respect to transportation charges paid by shippers during the period;

(3) a cost-based tariff settlement methodology is a methodology

(A) for determining the charge for pipeline transportation of oil or gas or for gas treatment;

(B) that is substantially similar to an adjudicatory methodology used by the Regulatory Commission of Alaska or another regulatory agency having jurisdiction over one or more pipeline tariffs for an oil or gas pipeline in the state;

(D) that provides for a charge per unit of oil or gas transported or gas treated based solely on recovery of the sum of no more than the following elements of cost:

(i) a return on capital investment calculated by multiplying a specified percentage rate times the amount of capital investment in the transportation facility net of prior accumulated depreciation;

(ii) depreciation of the capital investment in the transportation facility;

(iii) identified elements of operating and maintenance costs and ad valorem taxes incurred, or identified elements of operating and maintenance costs and ad valorem taxes forecast to be incurred;

(iv) income taxes;

(v) an allowance for the cost of dismantlement and removal of the pipeline facility and of restoration after removal of the pipeline facility, if the tariff specifically identifies and provides for the allowance to be included in the applicable recourse rate, in the case of a regulated gas pipeline facility, or the applicable rate, in the case of a regulated oil pipeline facility;

(4) a producer effectively owns a vessel, LNG transportation facility, nonregulated gas treatment plant, or nonregulated pipeline facility if the vessel, LNG transportation facility, nonregulated gas treatment plant, or nonregulated pipeline facility

(A) is owned by another person comprising part of a consolidated business in which the producer is also a part;

(B) is the subject of a lease that qualifies as a capital lease under generally accepted accounting principles, in which the producer or another person comprising part of a consolidated business in which the producer is also a part, is the lessee;

(C) was built to the account of the producer, or of another person comprising part of a consolidated business in which the producer is also a part, was sold and was chartered or leased back by the producer, or by another person comprising part of a consolidated business in which the producer is also a part, all in a simultaneous transaction, and is on a term charter or lease for a period of 15 years or longer to the producer, or to another person comprising part of a consolidated business in which the producer is also a part; or

(D) in the case of a vessel or LNG transportation facility for which a cost of capital allowance is allowed under 15 AAC 55.196, is treated as owned by the producer, or by another person comprising part of a consolidated business in which the producer is also a part, in a federal income tax return filed by or on behalf of the producer, or by or on behalf of another person comprising part of a consolidated business in which the producer is also a part;

(5) "expected useful life" means the period of time used to calculate depreciation under (b)(3)(C) or (4)(B)(iii) of this section;

(6) "positioning cost" for a vessel or LNG tanker includes the costs borne by the producer for placing that vessel or LNG tanker into position before the vessel's or LNG tanker's first voyage in service for that producer;

(7) transportation of gas includes gas treatment.

(t) This section applies to oil and gas produced after June 30, 2007.

History

Authority: AS 43.05.080; AS 43.55.040; AS 43.55.900 AS 43.55.020; AS 43.55.110 AS 43.55.030; AS 43.55.150
Eff. 4/30/2010, Register 194; am 3/1/2017, Register 221; am 1/1/2020, Register 232; am 9/20/2020, Register 235

15 AAC 55.195 Return on investment or cost of capital allowance to be used in calculation of costs of transportation for oil or gas, other than certain LNG or vessel transportation costs for oil or gas produced on or after January 1, 2003

Repealed.

History

Eff. 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 5/3/2007, Register 182; am 4/30/2010, Register 194; am 3/1/2017, Register 221; repealed 1/1/2020, Register 232

15 AAC 55.196 Cost of capital allowance to be used in calculation of costs of vessel transportation for oil or gas, and in calculation of transportation costs for gas by an LNG transportation facility

(a) For oil or gas produced on or after January 1, 2003, a cost of capital allowance that consists of depreciation and a return on invested capital will be allowed under this section, as provided in 15 AAC 55.193 for a (1) vessel, or an improvement completed on or after January 1, 2002 to a vessel, owned or effectively owned by the producer; or (2) LNG transportation facility owned or effectively owned by the producer and placed in service after December 31, 2010, or an improvement to that facility. However, a producer may elect to expense the first $2,000,000 in costs incurred with respect to improvements during a calendar year.

(b) A cost of capital allowance under this section for a vessel will be allowed only for days when the vessel is in allowable service, in allowable lay up, or in allowable dry dock.

(1) a vessel changing from operation in allowable service to lay up or operation in alterative service begins lay up or operation in alternative service on the day after the last day of cargo discharge in allowable service;

(2) a vessel changing from operation in alternative service to lay up or operation in allowable service begins lay up or operation in allowable service on the day after the last day of cargo discharge in alternative service;

(3) a vessel changing from lay up to operation in allowable service or operation in alternative service begins operation in allowable service or operation in alternative service on the day after the vessel departs from the location where the vessel was laid up;

(4) a vessel going into dry dock begins dry dock status on the day after the last day of cargo discharge or, if going into dry dock from lay up, on the day after the vessel departs from the location where the vessel was laid up;

(5) a vessel finishing dry dock changes from dry dock status to the immediately subsequent status on the day after the vessel departs the dry dock facility;

(6) a vessel begins operation in allowable service on the day that its useful life begins or, in the case of a used vessel newly acquired by a producer, on the day that its remaining useful life for that producer begins, if the vessel proceeds directly to enter operation in allowable service; otherwise, the vessel begins operation in alternative service on the day specified in this paragraph; for purposes of this paragraph, the beginning of a vessel's useful life or remaining useful life is determined in accordance with generally accepted accounting principles.

(d) A cost of capital allowance under this section must be calculated using the methodology set out in the department's publication Computation of a Cost-of-Capital Allowance under 15 AAC 55.196, Incorporating Depreciation and Return on Invested Capital for Marine Vessels and Improvements, Edition 4.0, dated November 19, 2019 and adopted by reference.

(e) For purposes of this section,

(1) a vessel is in allowable service if the vessel is

(A) in service within the meaning given in 15 AAC 55.900, except when the vessel is in dry dock; or

(B) idle for a period of fewer than 90 consecutive days immediately before operation in allowable service under (A) of this paragraph; for purposes of this subparagraph, a vessel is not idle if it is in dry dock;

(2) a vessel is laid up if it is idle for a period of 90 or more consecutive days; for purposes of this paragraph, a vessel is not idle if it is in dry dock;

(3) a vessel is in allowable lay up if the vessel is laid up during a calendar year, but only to the extent that the total number of days it is or has been laid up while owned or effectively owned by the producer through the end of that calendar year does not exceed the total number of days it is or has been in allowable service while owned or effectively owned by the producer through the end of that calendar year;

(4) a vessel is in allowable dry dock if the vessel is in dry dock during a calendar year, but only for that fraction of the total days in dry dock that equals the sum of the number of days during the year that the vessel is in allowable service and the number of days during the year that the vessel is in allowable lay up, divided by the sum of the number of days during the year that the vessel is in allowable service, the number of days during the year that the vessel is laid up, and the number of days during the year that the vessel is in alternative service;

(5) a vessel is in alternative service if it is not in lay up, dry dock, or allowable service; and

(6) if necessary to determine a vessel's status during a month, the vessel's status at later times will be considered.

(f) In (b), (c), and (e) of this section, "vessel" includes LNG tanker.

History

Authority: AS 43.05.080; AS 43.55.030; AS 43.55.110 AS 43.55.020; AS 43.55.040; AS 43.55.150
Eff. 1/1/2003, Register 164; am 1/1/2004, Register 168; am 4/30/2010, Register 194; am 12/28/2018, Register 228; am 1/1/2020, Register 232; am 9/20/2020, Register 235

15 AAC 55.197 Methodology to determine certain transportation costs for pipelines and gas treatment plants

(a) For transportation of oil or gas for which costs are determined under this section, the applicable costs of transportation are determined for a calendar year by calculating the total amount for the year for the following items and allocating that total, as provided under this section, to the specific quantity of oil or gas transported:

(1) an allowance for operating and maintenance expenses of the facility;

(2) annual depreciation on capital investment in the facility at original cost; except as otherwise provided under (k) of this section, depreciation is calculated using straight-line depreciation over the allowed economic life of the facility;

(3) a return on capital investment in the facility at original cost net of depreciation accumulated before the year of calculation, with the undepreciated capital investment adjusted to account for accumulated deferred income taxes;

(4) income tax on the equity portion of the return under (3) of this subsection as determined under (e) and (f) of this section;

(5) ad valorem taxes on the facility;

(6) an allowance for the cost of dismantlement and removal of the pipeline facility and of restoration after removal of the pipeline facility, if the tariff specifically identifies and provides for the allowance to be included in the applicable recourse rate, in the case of a regulated gas pipeline facility, or the applicable rate, in the case of a regulated oil pipeline facility.

(b) For purposes of (a)(1) of this section, the allowance for operating and maintenance expenses is the amount of expenses actually incurred that

(1) are direct costs of operating and maintaining the facility or are overhead costs directly related to operation and maintenance of the facility; and

(2) in the case of

(A) a gas pipeline facility, are properly reportable as operation and maintenance expenses on the Federal Energy Regulatory Commission's FERC Financial Report, FERC Form No. 2: Annual Report of Major Natural Gas Companies, as revised as of March 26, 2010 and adopted by reference (FERC Form 2), or, for a gas pipeline facility not subject to FERC regulation, would be properly reportable as operation and maintenance expenses on FERC Form 2 if the facility were subject to FERC regulation;

(B) an oil pipeline facility, are properly reportable as operation and maintenance expenses on the Federal Energy Regulatory Commission's FERC Financial Report, FERC Form No. 6:Annual Report of Oil Pipeline Companies, as revised as of March 26, 2010 and adopted by reference (FERC Form 6), or, for an oil pipeline facility not subject to FERC regulation, would be properly reportable as operation and maintenance expenses on FERC Form 6 if the facility were subject to FERC regulation.

(c) For purposes of (a)(2) and (3) of this section, capital investment in the facility includes an allowance for funds used during construction.

(d) For purposes of calculating annual depreciation under (a)(2) of this section,

(1) the allowed economic life is

(A) in the case of a regulated gas pipeline facility or gas treatment plant, the greater of

(i) the estimated useful life used in calculating the recourse rate in the filed tariff; or

(ii) 25 years;

(B) in the case of a regulated oil pipeline facility, the greater of

(i) the estimated useful life used in calculating the rate in the filed tariff; or

(ii) 25 years;

(i) the estimated useful life used for financial accounting purposes; or

(ii) 25 years;

(2) a change in ownership of an asset does not alter the depreciation schedule established for the original owner;

(3) a capital investment may be depreciated only once, and may not be depreciated below a reasonable salvage value; if specifically identified and provided for in an applicable tariff for a regulated pipeline, the salvage value may be negative, unless the calculation of costs under (a) of this section includes an allowance under (a)(6) of this section for dismantlement and removal of the pipeline facility and restoration after removal of the pipeline facility.

(e) For purposes of calculating the return on capital investment under (a)(3) of this section, the percentage of the capital investment treated as financed with long-term debt is the greater of (1) the percentage actually used by the facility owner to finance the facility; or (2) 70 percent for a gas pipeline facility or gas treatment plant, or 55 percent for an oil pipeline facility. The remainder is treated as financed with equity. The return on the portion of the capital investment treated as financed with long-term debt is the actual cost, if any, of the debt or, in the absence of actual cost, the return computed by the department using the weighted average of the cost of long-term debt for the applicable proxy group designated by the department under (f) of this section.

(f) For purposes of the equity portion of the return on capital investment under (a)(3) of this section, an after-tax rate of return on the percentage of the capital investment treated as financed with equity will be determined by the department for a calendar year using a two-stage discounted cash flow model. In implementing that model, the department will give substantial weight to the Federal Energy Regulatory Commission's Policy Statement in Composition of Proxy Groups for Determining Gas and Oil Pipeline Return on Equity, Docket No. PL07-2-000, dated April 17, 2008 and adopted by reference for that purpose, subject to the following:

(1) the department will designate the group of proxy companies from companies that meet the following criteria:

(A) the company is publicly traded;

(B) the company is

(i) a natural gas pipeline company for purposes of determining the rate of return for a gas pipeline facility or gas treatment plant;

(ii) an oil pipeline company for purposes of determining the rate of return for an oil pipeline facility;

(D) pipeline operations constitute a high proportion of the company's business;

(E) the company or its predecessor in interest has been in operation for at least three years;

(F) there are estimates by Institutional Brokers' Estimate System established by Thomson Reuters, or similar estimates, of five-year earnings growth for the company;

(G) the company has a history of paying dividends or distributions and is currently paying a dividend or distribution;

(H) the company has not eliminated or announced an intention to eliminate its dividend or distribution;

(2) in determining whether a company meeting the criteria under (1) of this subsection should be included in the group of proxy companies, the department may consider the following factors:

(A) the size of the company's market capitalization;

(B) the company's credit rating;

(3) the department will calculate the rate of return for a calendar year based on information about the group of proxy companies for a recent 12-month period selected by the department.

(g) For purposes of (a)(4) of this section, the

(1) combined federal and state income tax rate for the year of calculation must be used for a facility located within the United States;

(2) applicable combined foreign income tax rate for the year of calculation must be used for a facility located in another country.

(h) The amounts described in (a)(1) and (4) - (6) of this section must be calculated for every calendar year on the same basis, which may be either

(1) the amounts incurred during, or applicable to, the calendar year of calculation; or

(2) if the facility was

(A) in operation for at least nine months during the calendar year immediately preceding the calendar year of calculation, the amounts incurred during, or applicable to, that immediately preceding calendar year; the amounts are annualized or prorated if necessary to account, respectively, for the facility's being in operation for less than that entire immediately preceding calendar year or less than the entire calendar year of calculation;

(B) not in operation for at least nine months during the calendar year immediately preceding the calendar year of calculation, good-faith estimates of the amounts that will be incurred during, or will be applicable to, the calendar year of calculation; an overestimate or underestimate is deducted from or added to, respectively, the amounts used for the next calendar year.

(i) In the calculation of costs of transportation under this section,

(1) a management fee may not be included;

(2) working capital may not be included in capital investment on which depreciation or a return is calculated.

(j) In the allocation of the total amount calculated under (a) of this section to a specific quantity of oil or gas,

(1) for a regulated gas pipeline facility or regulated gas treatment plant, per-unit transportation costs are based on 100 percent load factor of certificated capacity;

(2) for an oil pipeline facility or nonregulated gas treatment plant, per-unit transportation costs are based on throughput;

(3) for a nonregulated gas pipeline facility, per-unit transportation costs are based on

(A) 100 percent load factor of contracted capacity, if the pipeline provides firm transportation service or firm and interruptible service;

(B) throughput, if the pipeline does not provide firm transportation service or firm and interruptible service;

(4) the costs of different categories of pipeline transportation services or gas treatment plant services bear the same relationship to one another as under the recourse rates in the applicable tariff, in the case of a regulated gas pipeline facility or regulated gas treatment plant, or as under the rates in the applicable tariff in the case of a regulated oil pipeline facility, unless the department determines that relationship is unreasonable; if the department determines that relationship is unreasonable or for an unregulated pipeline facility or gas treatment plant, the department will reasonably allocate costs among different categories of pipeline transportation services or gas treatment plant services;

(5) the costs of pipeline transportation between different pairs of receipt and delivery points bear the same relationship to one another as under the recourse rates in the applicable tariff, in the case of a regulated gas pipeline facility, or as under the rates in the applicable tariff in the case of a regulated oil pipeline facility, unless the department determines that relationship is unreasonable; if the department determines that relationship is unreasonable or for an unregulated pipeline facility, the department will reasonably allocate costs to pipeline transportation between different pairs of receipt and delivery points.

(k) If the tariff rates of a regulated pipeline facility or gas treatment plant have a levelized rate structure, the reasonable costs otherwise calculated under this section will also be calculated using a comparable levelized rate structure.

(l) For purposes of the department's determination of reasonable costs of transportation under 15 AAC 55.193(c)(5) and this section, to the extent the department is unable to obtain sufficient information to calculate an item in (a)(1) - (6) of this section, the department may make and use a reasonable estimate.

(m) On or after January 1 of a calendar year during which a producer expects to produce oil or gas the actual costs of transportation of which are required by 15 AAC 55.193(b)(6) to be calculated using the methodology under this section, the producer may request in writing the department's determination of the applicable after-tax rate of return under (f) of this section. The department will provide the department's determination to the producer no later than the later of July 1 of the calendar year or 90 days after the department receives the producer's request.

(n) In this section, "facility" means pipeline facility or gas treatment plant, as applicable.

History

Authority: AS 43.05.080; AS 43.55.040; AS 43.55.900 AS 43.55.020; AS 43.55.110 AS 43.55.030; AS 43.55.150
Eff. 4/30/2010, Register 194

Article 2 Production Tax Value of Oil and Gas

15 AAC 55.200 Retroactive adjustments

Repealed.

History

Eff. 1/6/80, Register 73; am 1/1/2000, Register 152; repealed 5/3/2007, Register 182

15 AAC 55.205 Calculation of production tax values for oil and gas produced before July 1, 2007

Repealed.

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; repealed 9/20/2020, Register 235

15 AAC 55.206 Calculation of production tax values for oil and gas produced after June 30, 2007 and before January 1, 2022, and for oil produced after December 31, 2021

(a) A producer or, under AS 43.55.160(d), an explorer shall calculate a single production tax value for a calendar year, under AS 43.55.160(a)(1) or (h), as applicable, for each segment.

(b) The provision of AS 43.55.160(b) that a production tax value may not be less than zero applies to each production tax value calculated for each segment. Subject to the provisions of AS 43.55.023(b)(2), as those provisions read before January 1, 2018, for oil and gas produced before January 1, 2018, or the provisions of AS 43.55.160(e), for oil and gas produced after December 31, 2017, adjusted lease expenditures applicable to a segment that exceed the amount of adjusted lease expenditures that may, under AS 43.55.160(b), be deducted in calculating a production tax value for the segment are considered excess adjusted lease expenditures and, except as otherwise provided under 15 AAC 55.224, may not be reallocated to, or deducted in calculating a production tax value for, a different segment. Excess adjusted lease expenditures relating to the calculation of an annual production tax value, but not a monthly production tax value, may be used to establish a carried-forward annual loss to the extent allowed under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, for oil and gas produced before January 1, 2018, or under AS 43.55.165(a)(3), for oil and gas produced after December 31, 2017, and AS 43.55.160(e).

(1) for oil and gas produced for a calendar year before 2022, and except as otherwise provided under (2) of this subsection, each of the following is a segment for a producer:

(A) all oil and gas, if any, taxable under AS 43.55.011(e), other than gas subject to AS 43.55.011(o), that the producer produces from leases or properties in the state that include land north of 68 degrees North latitude;

(B) all oil and gas, if any, taxable under AS 43.55.011(e), other than gas subject to AS 43.55.011(o) or oil or gas subject to AS 43.55.011(p), that the producer produces from leases or properties in the state outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, for a calendar year before or during the last calendar year under AS 43.55.024(b) for which the producer could take a tax credit under AS 43.55.024(a);

(C) oil, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the Cook Inlet sedimentary basin; for purposes of this paragraph, oil produced from each lease or property constitutes a separate segment;

(D) gas, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the Cook Inlet sedimentary basin; for purposes of this paragraph, gas produced from each lease or property constitutes a separate segment;

(E) gas, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the state outside the Cook Inlet sedimentary basin and that is used in the state, other than gas subject to AS 43.55.011(p); for purposes of this paragraph, gas produced from each lease or property constitutes a separate segment;

(F) all oil and gas, if any, taxable under AS 43.55.011(e) and subject to AS 43.55.011(p) that the producer produces;

(G) all oil and gas, if any, taxable under AS 43.55.011(e) that the producer produces from leases or properties in the state no part of which is north of 68 degrees North latitude, other than oil or gas described in (B), (C), (D), (E), or (F) of this paragraph;

(2) if a producer or explorer for a calendar year before 2022 does not produce any oil or gas from leases or properties in the

(A) state that include land north of 68 degrees North latitude, the area of the state north of 68 degrees North latitude is a segment for the producer or explorer;

(B) state outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, the area of the state outside the Cook Inlet sedimentary basin and not including any land north of 68 degrees North latitude is a segment for the producer or explorer;

(3) for oil and gas produced for a calendar year after 2021, and except as otherwise provided under (4) of this subsection, each of the following is a segment for a producer:

(A) oil, if any, taxable under AS 43.55.011(e) that the producer produces from leases or properties in the state that include land north of 68 degrees North latitude;

(B) oil, if any, taxable under AS 43.55.011(e) other than oil subject to AS 43.55.011(p), that the producer produces from leases or properties in the state outside the Cook Inlet sedimentary basin, no part of which is north of 68 degrees North latitude, for a calendar year before or during the last calendar year under AS 43.55.024(b) for which the producer could take a tax credit under AS 43.55.024(a);

(C) oil, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the Cook Inlet sedimentary basin; for purposes of this subparagraph, oil produced from each lease or property constitutes a separate segment;

(D) oil, if any, taxable under AS 43.55.011(e) and subject to AS 43.55.011(p) that the producer produces;

(E) oil, if any, taxable under AS 43.55.011(e) that the producer produces from leases or properties in the state no part of which is north of 68 degrees North latitude, other than oil described in (B), (C), or (D) of this paragraph;

(4) if a producer or explorer for a calendar year after 2021 does not produce any oil from leases or properties in the state

(A) that include land north of 68 degrees North latitude, the area of the state north of 68 degrees North latitude is a segment for the producer or explorer;

(B) outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, the area of the state outside of the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude is a segment for the producer or explorer.

(d) For leases or properties in the Cook Inlet sedimentary basin that first commenced commercial production of oil or gas before April 1, 2006, unless otherwise approved or required by the department, the producer shall continue to treat as a single lease or property each tract, group of tracts, participating area, or unit that the producer consistently treated, subject to final audit resolution, as a single lease or property for purposes of calculating an economic limit factor under former AS 43.55.013. Production of oil or gas from a lease or property in the Cook Inlet sedimentary basin that first commences commercial production of oil or gas on or after April 1, 2006, and that corresponds to a participating area or unit approved by the Department of Natural Resources under AS 38.05.180, other than a lease or property for which the producer calculated an economic limit factor under former AS 43.55.013, must be treated as production from a distinct lease or property.

(e) Except as otherwise provided under (f) of this section,

(1) for gas used in the state and produced from leases or properties outside the Cook Inlet sedimentary basin that first commenced commercial gas production before April 1, 2006, unless otherwise approved or required by the department, the producer shall continue to treat as a single lease or property each tract, group of tracts, participating area, or unit that the producer consistently treated, subject to final audit resolution, as a single lease or property for purposes of calculating an economic limit factor under former AS 43.55.013;

(2) production of gas used in the state from a lease or property outside the Cook Inlet sedimentary basin that first commences commercial production on or after April 1, 2006, and that corresponds to a participating area or unit approved by the Department of Natural Resources under AS 38.05.180, other than a lease or property for which the producer calculated an economic limit factor under former AS 43.55.013, must be treated as production from a distinct lease or property.

(f) For purposes of this section, 15 AAC 55.215, and 15 AAC 55.217, if a unit, other than a unit within the Cook Inlet sedimentary basin contains multiple participating areas, the participating areas together may be treated as a single lease or property, unless any producer's ownership interests differ by 10 percentage points or more between two or more of the participating areas.

(g) This section applies to oil and gas produced after June 30, 2007.

(h) In the calculation of annual production tax value under AS 43.55.160(a)(1) or (h) for a calendar year, the provisions of AS 43.55.165(n)(2) do not affect the deductibility of adjusted lease expenditures for the calendar year under AS 43.55.165(a) that are described in AS 43.55.165(a)(1) and (2).

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.160 AS 43.55.011; AS 43.55.110; AS 43.55.165
Eff. 10/21/2009, Register 192; am 12/25/2013, Register 208; am 3/1/2017, Register 221; am 12/6/2018, Register 228; am 1/1/2022, Register 240

15 AAC 55.208 Calculation of adjusted lease expenditures and production tax value for a municipal entity

(a) An annual production tax value is not calculated under AS 43.55.160(a)(1) or (h) for oil or gas produced by a municipal entity that it does not sell to another party. The calculation of an annual production tax value under AS 43.55.160(a)(1) or (h) for oil or gas produced by a municipal entity that it sells to another party is subject to the provisions of this section.

(b) For each category of oil, gas, or oil and gas for which the calculation of an annual production tax value is specified under AS 43.55.160(a)(1)(A) - (G) and for each category of oil for which the calculation of an annual production tax value is specified under AS 43.55.160(h)(1) - (4), a municipal entity that produces oil or gas within that category during a calendar year that it sells to another party shall calculate a fraction, the numerator of which is equal to the amount of oil, gas, or oil and gas produced by the municipal entity in that category during the calendar year, in BTU equivalent barrels, that it sells to another party, other than oil or gas in which the federal government or the state has an ownership interest or the ownership or right to which constitutes a landowner's royalty interest, and the denominator of which is equal to the total amount of oil, gas, or oil and gas produced by the municipal entity in that category during the calendar year, in BTU equivalent barrels, other than oil or gas in which the federal government or the state has an ownership interest or the ownership or right to which constitutes a landowner's royalty interest. Subject to AS 43.55.160(b), the amount of adjusted lease expenditures that is deductible from the gross value at the point of production of the oil, gas, or oil and gas in that category that the municipal entity sells to another party equals the product of the amount of adjusted lease expenditures that are described in the applicable provision of AS 43.55.160(a) or (h) for that category, multiplied by the fraction calculated under this subsection for that calendar year for that category.

(c) The only adjusted lease expenditures incurred by a municipal entity that may be used to establish a carried-forward annual loss under AS 43.55.023(b)(1), as the provisions of that paragraph read before January 1, 2018, subject to the provisions of AS 43.55.023(b)(2), as the provisions of that paragraph read before January 1, 2018, for lease expenditures incurred before January 1, 2018, or AS 43.55.165(a)(3), subject to the provisions of AS 43.55.160(e), for lease expenditures incurred after December 31, 2017, are the portion, if any, of the amount of adjusted lease expenditures calculated under (b) of this section that would otherwise be deductible in calculating an annual production tax value but whose deduction would cause the annual production tax value to be less than zero.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.165 AS 43.55.023; AS 43.55.160; AS 43.55.895
Eff. 3/1/2017, Register 221; am 12/6/2018, Register 228

15 AAC 55.210 Definitions

Repealed.

History

Eff. 1/6/80, Register 73; repealed 1/1/95, Register 132

15 AAC 55.211 Gross value reductions

(a) AS 43.55.160(f) and (g) apply only to oil and gas produced from a lease or property after December 31, 2013.

(b) For purposes of AS 43.55.160(f)(1) and (g), a lease that includes land that was within a unit on January 1, 2003 is not considered to be a lease that was within that unit on January 1, 2003, if

(1) the lease was issued following the expiration of a former lease containing the land and the lease at or after the time it was issued was not within that unit; or

(2) the lease was segregated from an existing lease into a separate and distinct lease comprising a portion of the land that was formerly within the existing lease and the lease after segregation was not within that unit.

(c) If a reservoir had been in a participating area before December 31, 2011, oil or gas produced from a participating area established after December 31, 2011 that contains all or part of the reservoir does not meet the criteria in AS 43.55.160(f)(2) for a reduction in the gross value at the point of production.

(d) For purposes of AS 43.55.160(f), the date that

(1) a participating area is established is the effective date specified in the written decision of the commissioner of natural resources approving the establishment of the participating area or, if no effective date is specified, the date of the decision;

(2) acreage is added to an existing participating area is the effective date specified in the written decision of the commissioner of natural resources approving the expansion of the participating area to include that acreage or, if no effective date is specified, the date of the decision.

(e) In AS 43.55.160(f)(3) and 15 AAC 55.212 - 15 AAC 55.213,

(1) oil or gas produced from acreage that was added to an existing participating area is oil or gas

(A) other than oil or gas that is not considered produced within the meaning of AS 43.55.020(e) and 15 AAC 55.151(e); and

(B) the volume of which is from acreage added to an existing participating area;

(2) the volume of oil or gas produced is from acreage added to an existing participating area only if the oil or gas is produced from a well with producing intervals that are all within the acreage added to the existing participating area;

(3) acreage added to an existing participating area is the portion of a reservoir or reservoirs that an existing participating area is expanded to include, unless the portion had previously been excluded from the participating area after having been included in the participating area.

(f) The provisions of AS 43.55.160(g) apply only to oil and gas that qualify for a reduction in gross value at the point of production under AS 43.55.160(f)(1) and that are produced from a unit made up solely of oil and gas leases issued by the Department of Natural Resources. For purposes of AS 43.55.160(g), a royalty share does not include a share of the net profit derived from a lease.

(g) Except as otherwise provided in this subsection, a 20 percent reduction in the gross value at the point of production under AS 43.55.160(f) is calculated separately for the qualifying oil and gas produced from each lease or property subject to AS 43.55.160(f)(1) but not AS 43.55.160(g), each participating area subject to AS 43.55.160(f)(2), and each addition of acreage subject to AS 43.55.160(f)(3). Oil and gas that qualify under more than one provision of AS 43.55.160(f)(1), (2), or (3), but not AS 43.55.160(g), may receive no more than a single 20 percent reduction in the gross value at the point of production. A 30 percent reduction in the gross value at the point of production is calculated separately for the qualifying oil and gas produced from each lease or property subject to both AS 43.55.160(f)(1) and (g). Oil or gas that qualifies under both AS 43.55.160(f)(1) and (g) and that also qualifies under AS 43.55.160(f)(2) or (3) may receive no more than a single 30 percent reduction in the gross value at the point of production. No reduction in the gross value at the point of production is calculated under AS 43.55.160(f) or (g) for oil or gas produced from a lease or property subject to AS 43.55.160(f)(1) or subject to both AS 43.55.160(f)(1) and (g), from a participating area subject to AS 43.55.160(f)(2), or from an addition of acreage subject to AS 43.55.160(f)(3) if the gross value at the point of production is negative.

(h) Except as provided under AS 43.55.160(e) and 15 AAC 55.511(c)(2), the gross value at the point of production of oil or gas is reduced under AS 43.55.160(f) or (g) only for the purpose of calculating an annual production tax value under AS 43.55.160(a)(1)(A) or (h)(1), subject to the provisions of AS 43.55.023(b)(2), as those provisions read before January 1, 2018, for oil and gas produced before January 1, 2018, or under AS 43.55.160(e) for oil and gas produced after December 31, 2017. The gross value at the point of production of oil is not reduced under AS 43.55.160(f) or (g) for the purpose of calculating an average gross value at the point of production of oil for a month under AS 43.55.024(j), or for the purpose of calculating a gross value at the point of production under AS 43.55.011(f) or AS 43.55.020(a)(1)(B)(ii), (5)(B)(ii), or (7)(A)(ii).

(i) Except as provided under 15 AAC 55.212(l), a reduction in the gross value at the point of production provided by AS 43.55.160(f) or (g) is not optional.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.160
Eff. 12/25/2013, Register 208; am 3/1/2017, Register 221; am 12/6/2018, Register 228

15 AAC 55.212 Procedures relating to gross value reductions

(a) At any time

(1) a producer may request in writing the department's determination for purposes of

(A) AS 43.55.160(f)(1), or for purposes of AS 43.55.160(f)(1) and (g), that a specified lease or property from which the producer produces or plans to produce oil or gas does not contain a lease that was within a unit on January 1, 2003;

(B) AS 43.55.160(f)(2), that a specified participating area from which the producer produces or plans to produce oil or gas was established after December 31, 2011, is within a unit formed under AS 38.05.180(p) before January 1, 2003, and does not contain a reservoir or portion of a reservoir that had previously been in a participating area established before December 31, 2011;

(C) AS 43.55.160(g), that a specified unit from which the producer produces or plans to produce oil or gas is made up solely of oil and gas leases issued by the Department of Natural Resources that have a royalty share of more than 12.5 percent in amount or value of the production removed or sold from the lease as determined under AS 38.05.180(f);

(2) on or after the date an application has been submitted to the Department of Natural Resources for approval by the Department of Natural Resources of an expansion of an existing participating area after December 31, 2013, a producer with a working interest in the existing participating area or in the acreage added or proposed to be added to the existing participating area may request in writing the department's determination that the department will accept a specified methodology for purposes of demonstrating to the department under AS 43.55.160(f)(3) the volumes of oil and gas produced that are from the acreage added to the participating area after December 31, 2013.

(b) A producer that makes a written request under (a) of this section shall give written notice to all interested persons, as provided under (c) of this section, other than producers that have already joined in the request. The notice must inform the interested persons that (1) they have the right to be heard by the department on the request, by written submission within 30 days after receipt of the notice or within a longer period if extended by the department in its discretion; and (2) they will be bound by the department's determination, subject to any appeal rights under law, whether or not they choose to be heard. The notice must be accompanied by a copy of the request.

(1) in the case of a request under (a)(1)(A) of this section, producers that have a working interest in the lease or property to which the request applies;

(2) in the case of a request under (a)(1)(B) of this section, producers that have a working interest in the participating area to which the request applies;

(3) in the case of a request under (a)(1)(C) of this section, producers that have a working interest in the unit to which the request applies;

(4) in the case of a request under (a)(2) of this section, producers that have a working interest in the existing participating area or the acreage added to which the request applies and, if not one of those producers, the operator of the unit containing the participating area.

(d) A request under (a) of this section must include written documentation sufficient to support the requested determination and must be accompanied by proof that the notice required under (b) and (c) of this section has been provided. The department may require that a person making or joining in the request submit additional information the department considers necessary to make a determination. The department may consider information in addition to that submitted by persons that have made or joined in a request or that seek to be heard on the request. If a person that makes or joins in a request under (a)(2) of this section or seeks to be heard on the request asks to limit the disclosure to other producers or to the operator of specified information that the person shows to be proprietary to that person, the department will

(1) provide that person a reasonable opportunity to be heard regarding the proposed disclosure and the conditions to be imposed under (2) of this subsection; and

(2) impose appropriate conditions

(A) limiting access to the information to those legal counsel, consultants, employees, officers, and agents of the other producers or the operator who have a need to know that information for the purpose of supporting or being heard on the request; and

(B) providing that the information may be used only for the purpose of supporting or being heard on the request.

(e) If the department receives a request under (a)(1) of this section that meets the requirements of (b) - (d) of this section, the department will issue a written determination in response to the request. In the determination, the department will either (1) confirm that the lease or property, participating area, or unit specified in the request meets the respective criteria under (a)(1)(A), (B), or (C) of this section; or (2) reject the request on the ground that the lease or property, participating area, or unit specified in the request fails to meet the respective criteria under (a)(1)(A), (B), or (C) of this section or on the ground that insufficient information is available to support a determination under (1) of this subsection. A determination applies only to the facts in existence at the time the determination is made and is subject to change if the relevant facts change.

(f) If the department receives a request under (a)(2) of this section that meets the requirements of (b) - (d) of this section, the department will issue a written determination in response to the request, but not before the commissioner of natural resources has issued a written decision approving the expansion of the participating area to include the acreage to which the request applies. In the department's determination the department will either

(1) accept the specified methodology, with or without adding conditions to the acceptance; or

(2) reject the specified methodology

(A) on the ground that it fails to comply with 15 AAC 55.213 or that it is otherwise inadequate to demonstrate the volume of oil or gas produced that is from the added acreage;

(B) on the ground that the demonstration required under (g) of this subsection has not been made; or

(g) The documentation required under (d) of this section for a request under (a)(2) of this section must include a demonstration that the plans for the development and operation of the participating area have not been designed to cause drainage by expansion area wells of oil or gas from the pre-expansion area that could be more efficiently produced by wells with a producing interval in the pre-expansion area. After a methodology has been accepted by the department under (f)(1) of this section, if the plans for the development and operation of the participating area are materially changed, producers that use the methodology to determine the volumes of oil and gas that qualify for a reduction in gross value at the point of production under AS 43.55.160(f)(3) shall submit to the department, not later than 60 days after the changes are made, a demonstration that the changes to the plans have not been designed to cause drainage by expansion area wells of oil or gas from the pre-expansion area that could be more efficiently produced by wells with a producing interval in the pre-expansion area. In this subsection,

(1) "expansion area well" means a well with producing intervals that are all within the acreage added to the existing participating area;

(2) "pre-expansion area" means the portion of the reservoir outside the acreage added to the existing participating area.

(h) A determination under (f)(1) of this section is subject to change or revocation if justified by new information about metering performance or other facts relevant to the adequacy of the methodology accepted to demonstrate the volume of oil or gas produced that is from the added acreage, or if the producers responsible for making a demonstration required under (g) of this section after acceptance of a methodology fail or are unable to make the required demonstration. A change in or revocation of a determination under this subsection will be made prospectively only, unless the determination was made in reliance on a producer's or operator's material misrepresentation or failure to disclose a material fact.

(i) A producer aggrieved by a determination under (e) or (f) of this section or by a change in or revocation of a determination under (h) of this section may appeal under 15 AAC 05.010.

(j) A determination by the department under (e)(1) of this section is not required in order for a producer of oil or gas that otherwise meets the criteria in AS 43.55.160(f)(1), the criteria in AS 43.55.160(f)(2), or the criteria in AS 43.55.160(f)(1) and (g) to reduce the gross value at the point of production of the oil or gas in the calculation of an annual production tax value to the extent allowed under AS 43.55.160(f) and (g). Oil that meets the criteria in AS 43.55.160(f)(1), the criteria in AS 43.55.160(f)(2), or the criteria in AS 43.55.160(f)(1) and (g) and that is produced, if on or after January 1, 2017, during a period for which a gross value reduction is allowed under 15 AAC 55.214, does not qualify for a tax credit under AS 43.55.024(j) regardless of whether the department has issued a determination under (e)(1) of this section and regardless of whether the producer reduces the gross value at the point of production of the oil under AS 43.55.160(f) or under AS 43.55.160(f)(1) and (g) in the calculation of an annual production tax value.

(k) A determination by the department under (f)(1) of this section is required for a producer of oil or gas to demonstrate under AS 43.55.160(f)(3) that the volume of oil or gas produced is from acreage added to an existing participating area. In order to reduce under AS 43.55.160(f)(3) the gross value at the point of production of oil or gas produced from acreage that was added to an existing participating area after December 31, 2013, a producer shall determine the volumes of oil and gas that qualify for the reduction using the methodology applicable to that acreage that is accepted by the department under (f)(1) of this section. For periods earlier than the date the department's determination is issued during which the facilities or equipment necessary to implement the methodology were operational and for which the data necessary to use the methodology to determine the volumes of oil and gas that qualify for the reduction are available, a producer may use the methodology to determine the volumes of oil and gas that qualify for the reduction that were produced before the determination is issued, but not for earlier than January 1 of the calendar year during which the request for determination was made under (a)(2) of this section.

(l) Regardless of whether the department has accepted under (f)(1) of this section a methodology applicable to acreage that was added after December 31, 2013 to an existing participating area north of 68 degrees North latitude, a producer's oil taxable under AS 43.55.011(e) that does not meet the criteria in AS 43.55.160(f)(1) or (2) and that is produced during a month after December 31, 2013 from the participating area qualifies for a tax credit under AS 43.55.024(j) if the producer has not elected to reduce under AS 43.55.160(f)(3) the gross value at the point of production of any of the oil or gas produced from the participating area. However, if a producer elects for any month, as allowed under 15 AAC 55.214, to reduce under AS 43.55.160(f)(3) the gross value at the point of production of any oil or gas produced during the month from the participating area, the producer shall use the methodology accepted by the department under (f)(1) of this section to determine the volumes of oil and gas produced during that month and every succeeding month from the participating area that qualify for a reduction in gross value at the point of production under AS 43.55.160(f)(3), until the period for which a gross value reduction is allowed under 15 AAC 55.214 ends. That volume of oil does not qualify for a tax credit under AS 43.55.024(j). In this subsection, "the participating area" means the existing participating area after expansion to include the acreage added after December 31, 2013.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.160
Eff. 12/25/2013, Register 208; am 3/1/2017, Register 221

15 AAC 55.213 Methodologies under AS 43.55.160(f)(3)

(a) This section sets out requirements that must be met by a methodology to be accepted by the department under 15 AAC 55.212(f)(1).

(b) A methodology must provide for determining the amounts of oil and gas recovered each month from wells with producing intervals that are all within the acreage added to an existing participating area by

(1) continuous metering of the oil and of the gas, before commingling with produced fluids from other wells, by one or more multiphase flow metering systems that are demonstrated with a 90 percent or higher level of confidence to be accurate within plus or minus five percent and that meet standards and requirements relating to operation, procedures, equipment and materials, software, installation, performance, calibration, testing, field verification, monitoring, maintenance, sampling, correction to standard conditions, and reporting that the department determines are appropriate for the purposes of AS 43.55.160(f)(3); in determining what standards and requirements are appropriate, the department will consider the relevant portions of the first edition of chapter 20.3 of the American Petroleum Institute Manual of Petroleum Measurement Standards (January 2013), which is adopted by reference for that purpose; the accuracy standard of plus or minus five percent in this paragraph applies to oil, except that the accuracy standard applies to gas rather than oil during a time period during which the gross value at the point of production of the gas produced from the acreage added to the existing participating area, other than gas produced before 2022 that is used in the state, and gas produced after 2021, exceeds the gross value at the point of production of the oil produced from that acreage;

(2) continuous metering of the oil and of the gas, after mechanical separation and before commingling with produced fluids from other wells, that

(A) uses equipment and procedures that are sufficient for custody transfer purposes; and

(B) is regulated by the Alaska Oil and Gas Conservation Commission under 20 AAC 25.228 as the measurement of oil and gas severed from the property or unit;

(3) continuous metering of the oil and of the gas, after mechanical separation and before commingling with produced fluids from other wells, that

(A) uses equipment and procedures that are sufficient for custody transfer purposes;

(B) is not regulated by the Alaska Oil and Gas Conservation Commission under 20 AAC 25.228 as the measurement of oil and gas severed from the property or unit; and

(C) meets the standards and requirements of 20 AAC 25.228, adopted by reference as amended from time to time, except that for this purpose the term "commission" in 20 AAC 25.228 is replaced with the term "Department of Revenue"; or

(4) another method of continuous metering of the oil and of the gas, before commingling with produced fluids from other wells, that

(A) is demonstrated with a 90 percent or higher level of confidence to meet the accuracy standard of plus or minus five percent set out in (1) of this subsection; and

(B) meets standards and requirements relating to operation, procedures, equipment and materials, software, installation, performance, calibration, testing, field verification, monitoring, maintenance, sampling, correction to standard conditions, and reporting that the department determines are appropriate for the purposes of AS 43.55.160(f)(3).

(c) The metering provisions of (b) of this section do not require separate metering of individual wells. The metering provisions of (b) of this section may be met by metering the combined flow from all of the wells with producing intervals that are all within the acreage added to an existing participating area, by separately metering the combined flows from subsets of the wells with producing intervals that are all within the acreage added to an existing participating area, by separately metering individual wells with producing intervals that are all within the acreage added to an existing participating area, or by a combination of separately metering the combined flows from subsets of the wells with producing intervals that are all within the acreage added to an existing participating area and separately metering individual wells with producing intervals that are all within the acreage added to an existing participating area.

(d) A methodology must provide for excluding any oil or gas that is not considered produced under AS 43.55.020(e) and 15 AAC 55.151(e). The amount excluded may not be less than the pro rata amount of the oil or gas, respectively, recovered from the entire participating area and not considered produced under AS 43.55.020(e) and 15 AAC 55.151(e).

(e) A methodology must provide for excluding any gas produced

(1) before 2022 that is used in the state; the amount excluded may not be less than the pro rata amount of the gas recovered from the entire participating area that is produced before 2022 and used in the state;

(2) after 2021; the amount excluded may not be less than the pro rata amount of the gas recovered from the entire participating area that is produced after 2021.

(f) If gas is run through a gas processing plant after being metered under (b) of this section, the methodology must include an acceptable method to adjust the metered amounts of oil and gas to account for the recovery of liquid hydrocarbons at the gas processing plant.

(g) A methodology that provides for metering under (b)(1) or (4) of this section must provide for subtracting from the metered amount of oil the shrinkage that occurs in the downstream mechanical separation process.

(h) A methodology must provide for a method to calculate an individual producer's share of the total volumes of oil and gas produced that are demonstrated to be from the acreage added to the existing participating area.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.160
Eff. 12/25/2013, Register 208; am 1/1/2022, Register 240

15 AAC 55.214 Duration of gross value reductions

(a) This section implements the time limits established by AS 43.55.160(f) and (g) for reductions under those provisions in the gross value at the point of production of oil and gas.

(b) This subsection applies to (1) oil and gas that meet the criteria for a gross value reduction under AS 43.55.160(f)(1) or under AS 43.55.160(f)(1) and (g) if any oil or gas was produced before January 1, 2017, from the qualifying lease or property; (2) oil and gas that meet the criteria for a gross value reduction under AS 43.55.160(f)(2) if any oil or gas was produced before January 1, 2017, from the qualifying participating area; and (3) oil and gas that meet the criteria for a gross value reduction under AS 43.55.160(f)(3) if any oil or gas was produced before January 1, 2017, from the qualifying acreage added to a participating area. The period for which oil and gas produced from the qualifying lease or property, qualifying participating area, or qualifying acreage added to a participating area, respectively, may receive a gross value reduction ends on the earlier of December 31, 2022, or the alternate expiration date determined under (g) of this section.

(c) This subsection applies to oil and gas that meet the criteria for a gross value reduction under AS 43.55.160(f)(1) or under AS 43.55.160(f)(1) and (g) if no oil or gas was produced before January 1, 2017, from the qualifying lease or property. The period for which oil and gas produced from the qualifying lease or property may receive a gross value reduction begins on the first day that regular production of oil or gas commences from a well producing from the lease or property and ends on the date provided under (f) of this section.

(d) This subsection applies to oil and gas that meet the criteria for a gross value reduction under AS 43.55.160(f)(2) if no oil or gas was produced before January 1, 2017, from the qualifying participating area. The period for which oil and gas produced from the qualifying participating area may receive a gross value reduction begins on the first day that regular production of oil or gas commences from a well producing from the participating area and ends on the date provided under (f) of this section. However, if before establishment of the qualifying participating area, regular production of oil or gas commenced from one or more wells producing from a tract or tracts to be included in the participating area,

(1) the period begins on the date the participating area is established, unless none of those wells is still producing on that date, and ends on the date provided under (f) of this section;

(2) if none of those wells is still producing on the date the participating area is established, the period begins on the earlier of the day any of the wells resumes production after the participating area is established, or the first day on or after the participating area is established that regular production of oil or gas commences from a well producing from the participating area, and ends on the date provided under (f) of this section.

(e) This subsection applies to oil and gas that meet the criteria for a gross value reduction under AS 43.55.160(f)(3) if no oil or gas was produced before January 1, 2017, from the qualifying acreage added to a participating area. The period for which oil and gas produced from qualifying acreage added to a participating area may receive a gross value reduction begins on the first day that oil or gas whose volume the producer determines under 15 AAC 55.212(k) qualifies for a gross value reduction is produced from a well all of whose producing intervals are within that acreage, if the well has commenced regular production of oil or gas, and ends on the date provided under (f) of this section.

(f) A period subject to (c) - (e) of this section ends on the earlier of the following dates:

(1) the last day of the month that

(A) immediately precedes the month that includes the seventh anniversary of the day the period began, if that anniversary occurs before the 16th day of the month;

(B) includes the seventh anniversary of the day the period began, if that anniversary occurs after the 15th day of the month; or

(2) the alternate expiration date determined under (g) of this section.

(g) An alternate expiration date for a period under (b) - (e) of this section for which oil and gas may receive a gross value reduction is determined by (1) identifying the first sequence, if any, of 12 consecutive months over which the average price per barrel of ANS for sale on the United States West Coast exceeds $70, that begins on or after January 1, 2017, for a period under (b) of this section, or that begins on or after the first day of the period, for a period under (c) - (e) of this section; (2) identifying the next sequence, if any, of 12 consecutive months over which the average price per barrel of ANS for sale on the United States West Coast exceeds $70, that begins after the first sequence ends; and (3) identifying the next sequence, if any, of 12 consecutive months over which the average price per barrel of ANS for sale on the United States West Coast exceeds $70, that begins after the second sequence ends. The alternate expiration date is the last day of the third sequence. For purposes of this subsection, the average price per barrel of ANS for sale on the United States West Coast over 12 consecutive months is equal to the simple average of the average spot prices for ANS at the United States West Coast during the 12 months as calculated under 15 AAC 55.171(m).

(h) If a period for which a gross value reduction is allowed under this section has begun for oil and gas produced from certain land that is later combined with other land and the combined land is treated as a lease or property qualifying for a gross value reduction under AS 43.55.160(f)(1), as a participating area qualifying for a gross value reduction under AS 43.55.160(f)(2), or as acreage added to an existing participating area and qualifying for a gross value reduction under AS 43.55.160(f)(3), neither the expiration of the period for oil and gas produced from the former land, nor the expiration of the period, if any, for oil and gas produced from the latter land, is extended beyond what it would be if the combination had not occurred.

(i) The day that a period for which a gross value reduction is allowed under this section ends is included in the period.

(j) The date that regular production of oil or gas commences from a well is determined by the Alaska Oil and Gas Conservation Commission.

(k) In this section, "gross value reduction" means a reduction in the gross value at the point of production of oil or gas under AS 43.55.160(f) or AS 43.55.160(f) and (g).

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.160
Eff. 3/1/2017, Register 221

15 AAC 55.215 Applicability of lease expenditures

(a) For purposes of AS 43.55.160, a lease expenditure for a calendar year that is a cost of

(1) exploring for, developing, or producing oil or gas deposits located within a lease or property is considered a lease expenditure applicable to

(A) oil or gas produced from that lease or property during that calendar year for a calendar year before 2022, irrespective of whether any oil or gas is actually produced from that lease or property during that calendar year;

(B) oil produced from that lease or property during that calendar year for a calendar year after 2021, irrespective of whether any oil or gas is actually produced from that lease or property during that calendar year;

(2) exploring for oil or gas deposits located within land in the state other than a lease or property is considered a lease expenditure applicable to oil or gas produced from leases or properties during that calendar year in the area of the state explored, irrespective of whether any oil or gas is actually produced from leases or properties in that area during that calendar year; for purposes of this paragraph, for a calendar year

(A) to which (B) of this paragraph does not apply, an area of the state is either

(i) land north of 68 degrees North latitude;

(ii) land outside the Cook Inlet sedimentary basin not including any land north of 68 degrees North latitude; or

(iii) the Cook Inlet sedimentary basin;

(B) after the latest of 2021, the last calendar year under AS 43.55.024(b) for which the producer could take a tax credit under AS 43.55.024(a), or the last calendar year for which AS 43.55.011(p) could limit the levy of tax under AS 43.55.011(e) for any of the producer's oil or gas, an area of the state is either

(i) land north of 68 degrees North latitude; or

(ii) land south of 68 degrees North latitude.

(b) A producer's lease expenditure

(1) incurred before 2022 that is a cost of exploring for, developing, or producing oil or gas deposits located within a lease or property in the Cook Inlet sedimentary basin from which both oil and gas are produced by the producer during the calendar year that the lease expenditure is incurred, is allocated between the oil and gas proportionally to the respective amounts of oil and gas in BTU equivalent barrels produced by the producer from the lease or property during the calendar year and taxable under AS 43.55.011(e); a producer's lease expenditure incurred before 2022 that is a cost of exploring for oil or gas deposits located within land in the Cook Inlet sedimentary basin that is not a lease or property is allocated among leases or properties in the Cook Inlet sedimentary basin and between oil and gas produced from each of those leases or properties proportionally to the respective amounts, if any, of oil and gas in BTU equivalent barrels produced by the producer from those leases or properties during the calendar year the lease expenditure is incurred and taxable under AS 43.55.011(e);

(2) incurred after 2021 that is a cost of exploring for, developing, or producing oil or gas deposits is applicable to the calculation of production tax value for oil produced by the producer in that area of the state described in (a)(2)(B)(i) or (ii) of this section, as applicable, during the calendar year that the lease expenditure is incurred or as provided in AS 43.55.160(e) or 43.55.165.

(c) The applicability of a lease expenditure with respect to a geographic location is determined by the location of the oil or gas deposit that is explored for, developed, or produced, and not by the location where the cost in question is incurred.

(d) A producer's lease expenditure that is a cost of exploring for, developing, or producing oil or gas deposits located within a lease or property, other than a lease or property subject to AS 43.55.011(p), outside the Cook Inlet sedimentary basin

(1) incurred before January 1, 2022, from which both gas used in the state and oil or other gas are produced by the producer during the calendar year after June 30, 2007 in which the lease expenditure is incurred, is allocated between gas used in the state and oil or other gas, proportionally to the respective amounts of each, in BTU equivalent barrels, produced by the producer from the lease or property during the calendar year and taxable under AS 43.55.011(e);

(2) incurred on and after January 1, 2022, or as provided in AS 43.55.160(e) for a carried-forward annual loss under AS 43.55.165(a)(3), is attributable to the production tax value of oil for leases or properties outside the Cook Inlet sedimentary basin, other than leases or leases or properties subject to AS 43.55.011(p).

(e) A producer's lease expenditure that is a cost of exploring for oil or gas deposits located within land that is not a lease or property and is in an area of the state described in

(1) (a)(2)(A)(i) or (ii) of this section is allocated among gas used in the state produced from each lease or property in that area, other than gas subject to AS 43.55.011(p), and oil and other gas produced from leases or properties in that area, proportionally to the respective amounts, if any, of gas used in the state and of oil or other gas, in BTU equivalent barrels, produced by the producer from the leases or properties during the calendar year after June 30, 2007 and before 2022 in which the lease expenditure is incurred and taxable under AS 43.55.011(e);

(2) (a)(2)(B) of this section on and after January 1, 2022 is included in calculating the production tax value of oil applicable to the area of the state described in (a)(2)(B)(i) or (ii) of this section and as provided in AS 43.55.160(h).

(f) Repealed 1/1/2022.

(g) A producer's lease expenditure incurred during a calendar year during which the producer produces oil or gas that is subject to AS 43.55.011(p), that is a cost of exploring for oil or gas deposits located within land that is not a lease or property and is in the area of the state described in (a)(2)(A)(ii) of this section is allocated among (1) oil and gas produced from the leases or properties from which oil and gas subject to AS 43.55.011(p) are produced; and (2) oil and gas produced from other leases or properties in that area, proportionally to the respective amounts, if any, of the oil and gas described in (1) of this subsection and of the oil and gas described in (2) of this subsection, in BTU equivalent barrels, produced by the producer during the calendar year in which the lease expenditure is incurred and taxable under AS 43.55.011(e).

(h) Except to the extent provided under 15 AAC 55.217(f), this section does not apply to carried-forward annual losses.

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.160 AS 43.55.011; AS 43.55.110; AS 43.55.165
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 12/25/2013, Register 208; am 12/6/2018, Register 228; am 9/20/2020, Register 235; am 1/1/2022, Register 240

15 AAC 55.217 Carried-forward annual losses after December 31, 2017

(a) This section applies to lease expenditures incurred after December 31, 2017, to explore for, develop, or produce oil or gas deposits located outside the Cook Inlet sedimentary basin.

(b) For carried-forward annual losses for a segment under 15 AAC 55.206(c)(1) and (3), the adjusted lease expenditures that establish each carried-forward annual loss are determined using the following procedure, unless no oil or gas is produced during the calendar year from the segment:

(1) for any oil or gas produced during the calendar year for which the gross value at the point of production is reduced under AS 43.55.160(f) or (f) and (g), the reduction is added back to the gross value at the point of production;

(2) the adjusted lease expenditures incurred by the producer during the calendar year that are applicable to the segment under 15 AAC 55.215 are segregated into the following groups:

(A) the adjusted lease expenditures incurred to explore for, develop, or produce oil or gas deposits located within segment leases or properties from which oil or gas is produced during the calendar year, as allocated under 15 AAC 55.215(d) if applicable;

(B) the adjusted lease expenditures incurred to explore for, develop, or produce oil or gas deposits located within segment leases or properties, if any, from which no oil or gas is produced during the calendar year;

(C) the adjusted lease expenditures incurred to explore for oil or gas deposits located within land in the area under 15 AAC 55.215(a)(2) other than the producer's leases or properties, as allocated under 15 AAC 55.215(e) or (g), as applicable;

(3) if the gross value at the point of production of the taxable oil and gas produced by the producer during the calendar year from all leases or properties in the segment is

(A) less than or equal to the total adjusted lease expenditures described in (2)(A) of this subsection, a quotient Q is calculated as Q = SE / S(PE), where SE = the amount by which the total adjusted lease expenditures described in (2)(A) of this subsection exceed the gross value at the point of production of the taxable oil and gas produced by the producer during the calendar year from all leases or properties subject to (2)(A) of this subsection, and PE = the amount, if greater than zero, by which the adjusted lease expenditures incurred by the producer during the calendar year to explore for, develop, or produce oil or gas deposits located within each of those leases or properties, as allocated to the segment under 15 AAC 55.215(d) if applicable, exceeds the gross value at the point of production of taxable oil and gas produced by the producer during the calendar year from the lease or property; for each of those leases or properties for which PE is calculated, PE is multiplied by the quotient Q; the product of that multiplication is referred to as TE, and for each lease or property for which TE is calculated, a fraction is calculated as F = TE / LE, where LE is the amount of adjusted lease expenditures incurred by the producer during the calendar year to explore for, develop, or produce oil or gas deposits located within the lease or property, as allocated to the segment under 15 AAC 55.215(d) if applicable; carried-forward annual losses for the segment are, subject to 15 AAC 55.224(f) or (g) if applicable, established only by

(i) for each lease or property for which F is calculated, a fraction F of the adjusted lease expenditures incurred by the producer during the calendar year to explore for, develop, or produce oil or gas deposits located within the lease or property, as allocated to the segment under 15 AAC 55.215(d) if applicable; for each lease or property this fraction F is applied uniformly to all of those adjusted lease expenditures; and

(ii) the adjusted lease expenditures, if any, described in (2)(B) and (2)(C) of this subsection;

(B) greater than the adjusted lease expenditures described in (2)(A) of this subsection and less than or equal to the sum of the adjusted lease expenditures described in (2)(A) and (2)(B) of this subsection, a fraction G is calculated as G = XE / AE, where XE = the amount, if any, by which the adjusted lease expenditures described in (2)(B) of this subsection exceed the remainder resulting from subtracting the adjusted lease expenditures described in (2)(A) of this subsection from the gross value at the point of production of the taxable oil and gas produced by the producer during the calendar year from all leases or properties in the segment, and AE = the total adjusted lease expenditures described in (2)(B) of this subsection; carried-forward annual losses for the segment are, subject to 15 AAC 55.224(f) or (g) if applicable, established only by

(i) for each lease or property subject to (2)(B) of this subsection, a fraction G of the adjusted lease expenditures incurred by the producer during the calendar year to explore for, develop, or produce oil or gas deposits located within the lease or property; for each lease or property this fraction G is applied uniformly to all of those adjusted lease expenditures; and

(ii) the adjusted lease expenditures, if any, described in (2)(C) of this subsection;

(C) greater than the sum of the adjusted lease expenditures described in (2)(A) of this subsection and (2)(B) of this subsection and less than the sum of the adjusted lease expenditures described in (2)(A), (2)(B), and (2)(C) of this subsection, a fraction H is calculated as H = YE / QE, where YE = the amount, if any, by which the adjusted lease expenditures described in (2)(C) of this subsection exceed the remainder resulting from subtracting the sum of the adjusted lease expenditures described in (2)(A) and (2)(B) of this subsection from the gross value at the point of production of the taxable oil and gas produced by the producer during the calendar year from all leases or properties in the segment, and QE = the total adjusted lease expenditures described in (2)(C) of this subsection; carried-forward annual losses for the segment are, subject to 15 AAC 55.224(f) or (g) if applicable, established only by a fraction H of the adjusted lease expenditures described in (2)(C) of this subsection; this fraction H is applied uniformly to all of those lease expenditures;

(D) equal to or greater than the sum of the adjusted lease expenditures described in (2)(A), (2)(B), and (2)(C) of this subsection, no carried-forward annual loss is established for the segment;

(4) in the case of a segment described in 15 AAC 55.206(c)(1)(E) or (F), before 2022, the amount initially calculated for each carried-forward annual loss under (3) of this subsection is multiplied by the fraction calculated under 15 AAC 55.224(g)(7); only the product of that multiplication, if greater than zero, establishes the carried-forward annual loss;

(5) in the case of a segment described in 15 AAC 55.206(c)(3)(B) or (D), after 2021, the amount initially calculated for each carried-forward annual loss under (3) of this subsection is multiplied by the fraction calculated under 15 AAC 55.224(g)(7); only the product of that multiplication, if greater than zero, establishes the carried-forward annual loss.

Example 1. In a given calendar year before 2022, a producer has three producing leases or properties on the North Slope and no non-producing leases or properties on the North Slope. The producer also conducts seismic exploration on the North Slope in a location remote from and unrelated to any of the leases or properties.

Ten barrels of taxable oil with a gross value at the point of production of $500, and qualifying for a gross value reduction of 20 percent under AS 43.55.160(f), are produced during the year from Property A. The producer incurs adjusted lease expenditures during the year of $400 to develop and produce oil from Property A.

Twenty barrels of taxable oil with a gross value at the point of production of $1,000, not qualifying for a gross value reduction, and 10 BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $610 are produced during the year from Property B. The producer incurs adjusted lease expenditures during the year of $1,800 to develop and produce oil and gas from Property B.

Thirty barrels of taxable oil with a gross value at the point of production of $1,500, not qualifying for a gross value reduction, are produced during the year from Property C. The producer incurs adjusted lease expenditures during the year of $2,000 to develop and produce oil from Property C.

The producer incurs adjusted lease expenditures during the year of $140 to conduct the off-lease exploration.

An annual production tax value must be calculated for each of two segments in this example: (1) oil and gas, other than gas used in the state, produced from North Slope leases or properties, under 15 AAC 55.206(c)(1)(A); and (2) gas produced from Property B that is used in the state, under 15 AAC 55.206(c)(1)(E).

The gross value at the point of production for the first segment is the sum of $500, less a 20 percent gross value reduction, or $400 from Property A, plus $1,000 from Property B, plus $1,500 from Property C, for a total of $2,900. Adjusted lease expenditures applicable to this segment are the sum of $400 from Property A, plus $1,200 from Property B (because under 15 AAC 55.215(d), the lease expenditures to develop and produce oil and gas from Property B are allocated between the oil and the gas used in the state proportionally to the respective BTU equivalent barrels produced, of which oil accounts for 20/30 = 2/3 of the $1,800 lease expenditures = $1,200), plus $2,000 from Property C, plus $120 from the seismic exploration (because under 15 AAC 55.215(c), those lease expenditures are allocated between the oil produced from both Properties A, B, and C, on one hand, and the gas used in the state produced from Property B, on the other hand, proportionally to the respective BTU equivalent barrels produced, of which oil accounts for 60/70 = 6/7 of the $140 lease expenditures = $120), for a total of $3,720. Since the lease expenditures exceed the gross value at the point of production, the annual production tax value for the segment is zero. Hence, the producer is required to follow the procedure set out in (b) of this section to determine the producer's carried-forward annual losses, if any, for this segment.

The gross value at the point of production for the second segment is $610, for gas used in the state produced from Property B. The lease expenditures applicable to this segment are the sum of $600 from Property B (because under 15 AAC 55.215(d), one-third of the lease expenditures incurred to develop and produce oil and gas from Property B are allocated to gas used in the state produced from Property B), plus $20 from the seismic exploration (because under 15 AAC 55.215(e), 1/7 of those lease expenditures are allocated to the gas used in the state produced from Property B), for a total of $620. Since the lease expenditures exceed the gross value at the point of production, the annual production tax value for the segment is zero. Hence, the producer is required to follow the procedure set out in (b) of this section to determine the producer's carried-forward annual losses, if any, for this segment.

For the first segment:

(1) After adding back the gross value reduction for Property A, the gross value at the point of production for Property A is $500.

(2) The applicable adjusted lease expenditures are grouped as follows:

(A) $3,600 incurred to explore for, develop, or produce oil or gas deposits located within the producer's leases or properties from which oil or gas is produced;

(B) zero incurred to explore for, develop, or produce oil or gas deposits located within the producer's leases or properties from which no oil or gas is produced;

(C) $120 incurred to explore for oil or gas deposits located within North Slope land other than the producer's leases or properties.

(3) The gross value at the point of production of the oil and gas produced from Properties A, B, and C, $3,000, is less than the $3,600 in adjusted lease expenditures in group (2)(A), above. Therefore, carried-forward annual losses for the segment are calculated under (3)(A), as follows:

SE = $3,600 - $3,000 = $600PE for Property B = $200PE for Property C = $500(1) Sum of PEs = $700(2) Q = $600 / $700 = 6/7(A) TE for Property B = $200 * 6/7 = $171.43(B) TE for Property C = $500 * 6/7 = $428.57(C) F for Property B = $171.43 / $1,200 = 14.286%(3) F or Property C = $428.57 / $2,000 = 21.428%

Therefore, under (b)(3)(A)(i) of this section, the producer has a carried-forward annual loss for the segment in the amount of $171.43, established by 14.286 percent of the producer's $1,200 in adjusted lease expenditures incurred to explore for, develop, or produce oil or gas deposits located within Property B and allocated to oil produced from Property B. (That is to say, 14.3 percent of each of those lease expenditures is carried-forward, rather than the producer's identifying a subset of lease expenditures with a total dollar amount of $171.43 to carry forward.) The producer has a second carried-forward annual loss for the segment in the amount of $428.57, established by 21.428 percent of the producer's $2,000 in adjusted lease expenditures incurred to explore for, develop, or produce oil or gas deposits located within Property C. In addition, as provided by (b)(3)(A)(ii) of this section, the producer has a third carried-forward annual loss for the segment in the amount of $120, established by the producer's $120 in adjusted lease expenditures incurred to explore for oil or gas deposits located in North Slope land other than the producer's leases or properties and allocated to oil and gas other than gas used in the state.

For the second segment:

(1) There is no gross value reduction to add back.

(2) The applicable adjusted lease expenditures are grouped as follows:

(A) $600 incurred to explore for, develop, or produce oil or gas deposits located within the lease or property from which gas is produced (Property B);

(B) zero incurred to explore for, develop, or produce oil or gas deposits located within the producer's leases or properties from which no oil or gas is produced (this is necessarily true for a segment under 15 AAC 55.206(c)(1)(E), since by definition this kind of segment is gas produced from a single lease or property, and that single lease or property is the subject of the preceding subparagraph (2)(A));

(C) $20 incurred to explore for oil or gas deposits located within North Slope land other than the producer's leases or properties.

(3) The gross value at the point of production of gas produced from the segment lease or property, $610, is greater than the sum of the adjusted lease expenditures described in (2 )(A) and (2)(B), $600, but is less than the sum of the adjusted lease expenditures described in (2)(A), (2)(B), and (2)(C), $620. Therefore, carried-forward annual losses for the segment are calculated under (3)(C), as follows:

YE = $10

H = $10 / $20 = 50%

Therefore, under (b)(3)(C) of this section, the producer has a carried-forward annual loss for the segment in the amount of $10, established by 50 percent of the producer's $20 in adjusted lease expenditures incurred to explore for oil or gas deposits located within North Slope land other than the producer's leases or properties and allocated to gas used in the state. (It is assumed for purposes of (b)(4) of this section that the production does not have a positive annual production tax value for the segment described in 15 AAC 55.206(c)(1)(F) for the calendar year, so that the fraction calculated under 15 AAC 55.224(f)(7) equals one.)

Example 1. . In a given calendar year after 2021, a producer has three producing leases or properties on the North Slope and no non-producing leases or properties on the North Slope. The producer also conducts seismic exploration on the North Slope in a location remote from and unrelated to any of the leases or properties.

Ten barrels of taxable oil with a gross value at the point of production of $500, and qualifying for a gross value reduction of 20 percent under AS 43.55.160(f) are produced during the year from Property A. The producer incurs adjusted lease expenditures during the year of $400 to develop and produce oil from Property A.

The producer incurs adjusted lease expenditures during the year of $140 to conduct the off-lease exploration.

An annual production tax value must be calculated for oil, produced from North Slope leases or properties, under 15 AAC 55.206(c)(3)(A). No production tax value is calculated for gas, including gas used in the state, since gas, including gas used in the state. is taxed at rate of 13 percent of the gross value at the point of production as provided in AS 43.55.011(e)(3)(B), and the levy of tax for gas used in the state is limited as provided in AS 43.55.011(o). Additionally, beginning January 1, 2022, lease expenditures to produce both oil and gas, including gas used in the state, are all attributable to the production tax value of oil for North Slope leases or properties as provided in AS 43.55.160(h)(l).

The gross value at the point of production for the first segment is the sum of $500, less a 20 percent gross value reduction of $100, for a gross value at the point of production of $400 from Property A, plus $1,000 from Property B, plus $1,500 from Property C, for a total of $2,900. Adjusted lease expenditures applicable to this segment are the sum of $400 from Property A, plus $1,800 from Property B, plus $2,000 from Property C ($400 Property A+ $1,800 Property B + $2,000 Property C = $4,200 from producing leases or properties), plus $140 from the seismic exploration (total adjusted lease expenditures is $4,200 from Properties A, B, and C + $140 seismic exploration= $4,340). Since the lease expenditures exceed the gross value at the point of production for the oil, the annual production tax value for the segment is zero. Hence, the producer is required to follow the procedure set out in (b) of this section to determine the producer's carried-forward annual losses, if any, for this segment.

The gross value at the point of production for gas used in the state produced from Property B is $610. As provided in AS 43.55.160(h)(l) the lease expenditures to produce gas used in the state are attributable to oil produced from the leases or properties.

For the oil segment:

(1) After adding back the gross value reduction for Property A, the gross value at the point of production for Property A is $500.

(2) The adjusted lease expenditures are grouped as follows:

(A) $4,200 incurred to explore for, develop, or produce oil or gas deposits, including gas used in the state, located within the producer's leases or properties from which oil or gas is produced;

(B) zero incurred to explore for, develop, or produce oil or gas deposits located within the producer's leases or properties from which no oil or gas is produced;

(C) $140 incurred to explore for oil or gas deposits located within North Slope land other than the producer's leases or properties.

(3) The gross value at the point of production of the oil and gas, including gas used in the state, produced from Properties A, B, and C, $3,000, is less than the $4,200 in adjusted lease expenditures from producing properties in (2)(A) - (C). above. Therefore, carried-forward annual losses for the segment are calculated under (b)(3)(A) of this section, as follows:

SE = $4,200 - $3,000 = $1,200PE for Property B = $800PE for Property C = $500Sum of PEs = $1,300Q = $1,200 / 1,300 = 92.31 %TE for Property B = $800 * 92.31 % = $738.46TE for Property C = $500 * 92.31 % = $461.54F for Property B = $738.46 / $1,800 = 41.03 %F for Property C = $461.55 / $2,000 = 23.08%

Therefore, under (b)(3)(A)(i) of this section, the producer has a carried-forward annual loss for the segment attributable to Properties B and C in the amount of $1,200, established by 41.03 percent of the producer's $1,800 in adjusted lease expenditures incurred to explore for, develop, or produce oil or gas deposits located within Property B and allocated to oil produced from Property B. (That is to say, 41.03 percent of each of those lease expenditures is carried-forward, rather than the producer's identifying a subset of lease expenditures with a total dollar amount of $738.46 to carry forward.) The producer has a second carried-forward annual loss for the segment in the amount of $461.54, established by 23.08 percent of the producer's $2,000 in adjusted lease expenditures incurred to explore for, develop, or produce oil or gas deposits located within Property C. In addition, as provided by (b)(3)(A)(ii) of this section, the producer has a third carried-forward annual loss for the segment (that is not attributable to any of the producing leases or properties) in the amount of $140, established by the producer's $140 in adjusted lease expenditures incurred to explore for oil or gas deposits located in North Slope land other than the producer's leases or properties and attributable to oil as provided in AS 43.55.160(h)(l) for a total carried-forward annual loss for the segment in the amount of $1,340.

For the gas used in the state there is no carried-forward annual loss because as of January 1, 2022, the lease expenditures to produce gas used in the state are attributable to the production tax value of oil produced from those leases or properties as provided in AS 43.55.160(h).

Example 2. In a given calendar year, a producer has one lease or property on the North Slope, Property D, from which no oil or gas is produced. The producer incurs adjusted lease expenditures of $1,000 to explore for or develop oil and gas deposits located within the lease or property. The producer also incurs adjusted lease expenditures of $200 to conduct seismic exploration on the North Slope in a location remote from and unrelated to the lease or property.

Under 15 AAC 55.206(c)(2)(A), for a calendar year before 2022, or 15 AAC 55.206(c)(4) for a calendar year after 2021, the relevant segment is the area of the state north of 68 degrees North latitude. The production tax value for the segment is zero, but since the segment is not a segment under either 15 AAC 55.206(c)(1), for a calendar year before 2022, or 15 AAC 55.206(c)(3) for a calendar year after 2021, the producer need not use the procedure set out in (b) of this section to determine carried-forward annual losses for the segment. The producer has a carried-forward annual loss for the segment in the amount of $1,000, established by the producer's $1,000 in adjusted lease expenditures incurred to explore for or develop oil or gas deposits located within Property D. The producer also has a carried-forward annual loss for the segment in the amount of $200, established by the producer's $200 in adjusted lease expenditures incurred to explore for oil or gas deposits located within North Slope land other than the producer's leases or properties. The carried-forward annual loss of $1,000 for Property D may not be applied in determining production tax value for the segment until the calendar year in which regular production of oil or gas from the lease or property commences as provided in AS 43.55.165(n)(2). Similarly, the carried-forward annual loss of $200 for the remote seismic exploration may not be included in determining the production tax value for the segment until regular production of oil or gas has commenced from leases or properties that are reasonably related to the remote seismic exploration as provided in AS 43.55.165(n)(2) and (r).

(d) The following examples illustrate (b)(3) of this section and, for calendar years before 2022, 15 AAC 55.224(f):

Example 1. In a given calendar year before 2022, a producer has two producing leases or properties on the North Slope, both of which have commenced regular production (Property A and Property B). The producer also has two non-producing leases or properties on the North Slope, neither of which has commenced regular production (Property C and Property D). Oil and gas other than gas used in the state produced from the four properties make up the first segment of taxable production for the producer. The producer also has taxable production from a second segment on the North Slope for gas used in the state produced from Property A. For purposes of this example it has been assumed that if any of the properties are eligible for a gross value reduction under AS 43.55.160(f) or AS 43.55.160(f) and (g), any gross value reduction has been added back to the gross value at the point of production before determining the amount of any carried-forward annual loss under this section. Additionally, the producer has no lease expenditures or production outside of the North Slope.

In Year 1, the producing leases or properties, Property A and Property B, respectively, produce 30 and 20 barrels of taxable oil with gross values at the point of production of $1,500 and $1,000, and adjusted lease expenditures of $1,800 and $1,200. Property A also produces six BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $200. The non-producing properties, Property C and Property D incur adjusted lease expenditures of $300 and $500, respectively.

In Year 2, the producing leases or properties, Property A and Property B, respectively, produce 50 and 25 barrels of taxable oil with gross values at the point of production of $2,750 and $1,375, and adjusted lease expenditures of $2,400 and $1,200. Property A also produces 10 BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $500. The non-producing properties, Property C and Property D incur adjusted lease expenditures of $400 and $600, respectively.

In Year 3, the producing leases or properties, Property A and Property B, respectively, produce 50 barrels and 30 barrels of taxable oil with gross values at the point of production of $3,000 and $1,800, and adjusted lease expenditures of $2,400 and $1,200. Property A also produces 10 BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $500. In addition, during Year 3, Property C commences regular production and for the North Slope oil and gas, other than gas used in the state segment, produces 20 barrels of taxable oil with a gross value at the point of production of $1,200 and incurs adjusted lease expenditures of $1,300. In addition, Property C produces six BTU equivalent barrels of gas used in the state, with a gross value at the point of production of $150. Non-producing Property D incurs adjusted lease expenditures of $600.

In Year 1, the producer has a loss for the first segment of $1,000. The $1,800 in adjusted lease expenditures for Property A are allocated to the first segment, North Slope oil and gas other than gas used in the state, in the amount of $1,500 ($1,800 * (30/(30 + 6))) and $300 to the second segment, gas used in the state for Property A ($1,800 * (6/(30 + 6))). Part or all of the $200 carried-forward annual loss established by lease expenditures incurred on Property B may be deducted in determining the annual production tax value for the first segment in any following year to the extent that the gross value at the point of production for the segment exceeds the adjusted lease expenditures described in AS 43.55.165(a)(1) or (2) for the segment for the calendar year subject to AS 43.55.165(m). The carried-forward annual losses of $300 established by lease expenditures incurred on Property C, and $500 established by lease expenditures incurred on Property D, may not be applied in determining the annual production tax value for the segment until the respective Property has commenced regular production. For the gas used in the state segment for Property A, the producer has a carried-forward annual loss of $100. Since there are no other North Slope properties from which gas used in the state was produced and it was previously stated that the producer does not have any other lease expenditures or production outside of the North Slope that might result in a positive annual production tax value for the segment described in 15 AAC 55.206(c)(1)(F) for the calendar year, the fraction calculated under 15 AAC 55.224(f)(7) equals one.

In Year 2, the producer has a loss for the first segment, in the amount of $75. The lease expenditures establishing the loss are those incurred on the non-producing properties (Property C and Property D) as provided by (b)(3)(B) of this section. The $2,400 in adjusted lease expenditures from Property A is allocated to the North Slope oil or gas, other than gas used in the state segment, in the amount of $2,000 to Property A ($2,400 * (50/(50 + 10))) and $400 to the gas used in the state segment of Property A ($2,400 * (10/(50 + 10))). Since the amount of lease expenditures for the calendar year for the North Slope oil and gas, other than gas used in the state segment, required to exceed the gross value at the point of production includes costs from producing and non-producing properties, the adjusted lease expenditures incurred on the non-producing properties are used to establish any carried-forward annual losses based on the calculations in (b)(3)(B) of this section, where XE = $75 (amount of the loss for the North Slope oil and gas, other than gas used in the state, segment) and AE = $1,000 (the sum of the adjusted lease expenditures from leases or properties from which no oil or gas is produced), resulting in a fraction G, of .075. Applying the fraction G of .075 to the adjusted lease expenditures of $400 incurred on Property C and $600 incurred on Property D results in carried-forward annual losses in the amounts of $30 established by lease expenditures incurred on Property C and $45 established by lease expenditures incurred on Property D. Those carried-forward annual losses may not be applied to the segment until the respective property commences regular production. For the gas used in the state segment for Property A, the gross value at the point of production (GVPP) of $500 exceeds the adjusted lease expenditures of $400, so there is no carried-forward annual loss. Additionally, the $100 carried-forward annual loss for gas used in the state from Property A from Year 1 may be applied against the $100 production tax value in Year 2 to reduce production tax value to zero. Since there are no excess lease expenditures for the gas used in the state segment for Property A the calculations under 15 AAC 55.224(f) are not relevant.

In Year 3, the producer has a positive production tax value for the North Slope oil and gas, other than gas used in the state segment, before deducting any available carried-forward annual losses, in the amount of $1,200. For the North Slope oil and gas, other than gas used in the state segment, there is no carried-forward annual loss created in Year 3. The adjusted lease expenditures from Property A are allocated to the North Slope oil and other gas, other than gas used in the state segment, in the amount of $2,000 to Property A ($2,400 * (50/(50 + 10))) and $400 to the gas used in the state segment for Property A (2,400 * (10/50 +10))). The adjusted lease expenditures for Property C of $1,300 are allocated to the North Slope oil and other gas, other than gas used in the state segment, in the amount of $1,000 to Property A ($1,300 * (20/20 + 6))) and $300 to the gas used in the state segment, in the amount of $1,000 to Property C ($1,300 * (6/(20 + 6))). For the North Slope oil and gas, other than gas used in the state segment, the amount of tax levied by AS 43.55.011(e) is $420 if no carried-forward annual losses from prior years are deducted (($6,000 GVPP - $4,800 adjusted lease expenditures) * 35%). Since the minimum tax for the North Slope oil and gas, other than gas used in the state segment, as determined under AS 43.55.011(f) is $240 ($6,000 gross value at the point of production * 4%), the producer may use any available carried-forward annual losses from Property B ($200), plus those from Property C ($300) from Year 1, plus an additional $14 from Property C (Year 2) to reduce the producer's production tax liability, before the application of any tax credits, to no less than the $240 minimum tax determined under AS 43.55.011(f).

For the gas used in the state segment for Property A, the amount of production tax calculated under AS 43.55.011(e)(2) is $35 (($500 GVPP - $400 adjusted lease expenditures) * 35%))). However, this amount is limited under AS 43.55.011(o) to $10 (((10 BTU equivalent barrels * (6 MMBTUs/BTU Eq. Bbl./1,037,000 BTUs/Mcf)) = 58 Mcf. (58 Mcf * $.177 = $10)). For the gas used in the state segment for Property C the producer is determined to have incurred excess lease expenditures under 15 AAC 55.206(b) in the amount of $150 ($150 GVPP - adjusted lease expenditures of $300). As previously noted, the producer does not have any other lease expenditures or production outside of the North Slope that might result in a positive annual production tax value for the segment described in 15 AAC 55.206(c)(1)(F). Therefore, the amount of the carried-forward annual loss would be determined under 15 AAC 55.224(f) as follows:

$150 = 15 AAC 55.224(f)(1) - Total amount of excess lease expenditures gas used in state$ 53 = 15 AAC 5.224(f)(2) - ((15 AAC 55.224(f)(1) * 35%))$ 25 = 15 AAC 5.224(f)(3) & (4) - sum of benefit of limitation under AS 43.55.011(o) & (p)$ 28 = 15 AAC 55.224(f)(5) - Difference ((15 AAC 55.224(f)(2) - 15 AAC 55.224(f)(4))$ 79 = 15 AAC 55.224(f)(6) - ((15 AAC 55.224(f)(5)/35%))0.53 = 15 AAC 55.224(f)(7) - ratio to be applied to excess lease expenditures in 15 AAC 55.224(f)(1) ((15 AAC 55.224(f)(6)/15 AAC 55.224(f)(1)))

In accordance with (b)(4) of this section the 53 percent ratio in 15 AAC 55.224(f)(7) is applied to the $150 excess less expenditures from gas used in the state Property C resulting in a carried-forward annual loss of $79 for the segment.

Example 2. In a given calendar year after 2021, a producer has two producing leases or properties on the North Slope, both of which have commenced regular production, Property A and Property B. The producer also has two non-producing leases or properties on the North Slope, neither of which has commenced regular production, Property C and Property D. Oil produced from the four properties make up the first segment of taxable oil production for the producer. The producer also has taxable production on the North Slope for gas used in the state produced from Property A. For purposes of this example it bas been assumed that if any of the properties are eligible for a gross value reduction under AS 43.55.160((f) or AS 43.55.160(f) and (g), any gross value reduction has been added back to the gross value at the point of production before determining the amount of any carried-forward annual loss under this section. Additionally, the producer has no lease expenditures or production outside of the North Slope.

In Year 3, the producing leases or properties, Property A and Property B, respectively, produce 50 barrels and 30 barrels of taxable oil with gross values at the point of production of $3,000 and $1,800, and adjusted lease expenditures of $2,400 and $1,200. Property A also produces 10 BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $500. In addition, during Year 3, Property C commences regular production and for the North Slope oil segment, produces 20 barrels of taxable oil with a gross value at the point of production of $1,200 and incurs adjusted lease expenditures of $1,300. In addition, Property C produces six BTU equivalent barrels of gas used in the state, with a gross value at the point of production of $150. Non-producing Property D incurs adjusted lease expenditures of $600.

In Year 1 the producer has a loss for the oil segment of $1,300. Part or all of the $300 carried-forward annual loss established by lease expenditures incurred on Property A, or $200 carried-forward annual loss established by lease expenditures incurred on Property B, may be deducted in determining the annual production tax value for the oil segment in any following year to the extent that the gross value at the point of production for the segment exceeds the adjusted lease expenditures described in AS 43.55.165(a)(1) or (2) for the segment for the calendar year, subject to AS 43.55.165(m). The carried-forward annual losses of $300 established by lease expenditures incurred on Property C, and $500 established by lease expenditures incurred on Property D, may not be applied in determining the annual production tax value for the oil segment until the respective property has commenced regular production.

For the gas used in the state produced from Property A, there is no carried-forward annual loss as the lease expenditures to produce gas used in the state are attributable to oil produced from the leases or properties, as provided in AS 43.55.160(h)(l). The tax for the gas used in the state is $6 as limited by AS 43.55.011(o) because that is less than the $26 calculated under AS 43.55.011(e)(3)(B).

In Year 2, the producer has a loss for the oil segment, in the amount of $475. The lease expenditures establishing the loss are those incurred on the non-producing properties, Property C and Property D, as provided by (b)(3)(B) of this section. The $2,400 in adjusted lease expenditures from Property A is attributable to the North Slope oil segment. Since the amount of lease expenditures for the calendar year for the North Slope oil segment, required to exceed the gross value at the point of production includes costs from producing and non-producing properties, the adjusted lease expenditures incurred on the non-producing properties are used to establish any carried-forward annual losses based on the calculations in (b)(3)(B) of this section, where XE = $475 (amount of the loss for the North Slope oil segment) and AE = $1,000 (the sum of the adjusted lease expenditures from leases or properties from which no oil or gas is produced), resulting in a fraction G, of .475. Applying the fraction G of .475 to the adjusted lease expenditures of $400 incurred on Property C and $600 incurred on Property D results in carried-forward annual losses in the amounts of $190 established by lease expenditures incurred on Property C and $285 established by lease expenditures incurred on Property D. Those carried-forward annual losses may not be applied to the segment until the respective property commences regular production as provided in AS 43.55.165(n)(2).

For the gas used in the state produced from Property A, the lease expenditures to produce gas used in the state are attributable to the oil segment, so there is no carried-forward annual loss for gas used in the state. The tax for the gas used in the state is $10 as limited by AS 43.55.011(o) because that is less than the $65 calculated under AS 43.55.011(e)(3)(B).

In Year 3, the producer has a positive production tax value for the North Slope oil segment, before deducting any available carried-forward annual losses, in the amount of $500. For the North Slope oil segment, there is no carried-forward annual loss created in Year 3. The adjusted lease expenditures from Property A are attributable to the North Slope oil segment, in the amount of $2,400. The adjusted lease expenditures for Property C of $1,300 are attributable to the North Slope oil segment. For the North Slope oil segment, the amount of tax levied by AS 43.55.011(e) is $175 if no carried-forward annual losses from prior years are deducted (($6.000 GVPP - $5,500 adjusted lease expenditures) * 35%). Since the minimum tax for the North Slope oil segment, as determined under AS 43.55.011(f) is $240 ($6,000 gross value at the point of production * 4%), is greater than the tax under AS 43.55.011(e), the producer must pay the minimum tax under AS 43.55.011(f) and may not apply any carried-forward annual losses from prior years.

For the gas used in the state produced from Property A, the amount of production tax calculated under AS 43.55.011(e)(3) is $65 ($500 GVPP * 13%). However, this amount is limited under AS 43.55.011(o) to $10 (10 BTU equivalent barrels * (6 MMBTUs/BTU Eq. Bbl./1,037,000 BTUs/Mcf)) = 58 Mcf. (58 Mcf * $.177 = $10).

For the gas used in the state produced from Property C the amount of production tax calculated under AS 43.55.011(e)(3)(B) is $20 (150 GVPP * 13%). However, this amount is limited under AS 43.55.011(o) to $6 (6 BTU equivalent barrels* (6 MMBTUs/BTU Eq. Bbl./1,037,000 BTUs/Mcf) = 35 Mcf. (35 Mcf * $.177 = $6).

(e) A producer for which a carried-forward annual loss for a segment under 15 AAC 55.206 is established by adjusted lease expenditures incurred during a calendar year shall file, with or as part of the statement required by AS 43.55.030(a) or (e) for the calendar year, a statement on a form approved or prescribed by the department that contains, for the segment,

(1) the following information:

(A) if applicable, the calculations specified under (b) of this section;

(B) the amount of the carried-forward annual loss, if any, established for each segment lease or property; and

(C) the amount of the carried-forward annual loss, if any, established for exploration described in (b)(2)(C) of this section; or

(2) if the producer wishes to disclaim the right to use in the future any carried-forward annual loss for the segment established for that calendar year, the producer's agreement not to deduct all or any part of any carried-forward annual loss for the segment established for that calendar year in the calculation of an annual production tax value for a future calendar year; that agreement binds any transferee of an interest in a lease or property of the producer and any person that acquires the producer.

(f) This subsection implements AS 43.55.165(n)(1). A carried-forward annual loss established

(1) under (b) of this section may be deducted

(A) only in calculating an annual production tax value for the same segment under 15 AAC 55.206(c)(1) or (3), as applicable, for which the carried-forward annual loss was established; or

(B) in the case of a carried-forward annual loss to produce only gas from leases or properties north of 68 degrees North latitude or from leases or properties outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, from the production tax value of oil for the respective segment under 15 AAC 55.206(c)(3);

(2) before 2022 and for a segment described in 15 AAC 55.206(c)(2)(A)

(A) may be deducted only in calculating annual production tax values for the following segments, if the lease expenditures establishing the carried-forward annual loss were incurred to explore for or develop oil or gas deposits located within a lease or property that includes land north of 68 degrees North latitude, with the carried-forward annual loss allocated between the segments proportionally to the respective amounts of gas used in the state and of oil and other gas produced by the producer from the lease or property during the calendar year regular production of oil or gas commences from the lease or property:

(i) gas used in the state produced by the producer from the lease or property;

(ii) oil and other gas produced by the producer from leases or properties that include land north of 68 degrees North latitude;

(B) may be deducted only in calculating annual production tax values for the following segments, if the lease expenditures establishing the carried-forward annual loss were incurred to explore for or develop oil or gas deposits located within land that is not the producer's lease or property and is located north of 68 degrees North latitude, with the carried-forward annual loss allocated among the segments proportionally to the respective amounts of gas used in the state and of oil and other gas produced by the producer from the producer's leases or properties that include land north of 68 degrees North latitude during the first calendar year that regular production of oil or gas commences from any of the producer's leases or properties that include land north of 68 degrees North latitude:

(i) gas used in the state produced by the producer from each lease or property that includes land north of 68 degrees North latitude;

(ii) oil and other gas produced by the producer from leases or properties that include land north of 68 degrees North latitude;

(3) for a segment described in 15 AAC 55.206(c)(2)(B) may be deducted only in calculating an annual production tax value for oil and gas produced by the producer from leases or properties outside the Cook Inlet sedimentary basin and no part of which is north of 68 degrees North latitude lease or property.

(4) after 2021 and for a segment described in 15 AAC 55.206(c)(4)(A)

(A) may be deducted only in calculating the annual production tax value for oil produced by the producer from leases or properties that include land north of 68 degrees North latitude;

(B) may be deducted only in calculating annual production tax value of oil, if the lease expenditures establishing the carried-forward annual loss were incurred to explore for or develop oil or gas deposits located within land that is not the producer's lease or property and is located north of 68 degrees North latitude, during the first calendar year that regular production of oil or gas commences from any of the producer's leases or properties that include land north of 68 degrees North latitude;

(5) after 2021 and for a segment described in 15 AAC 55.206(c)(4)(B) may be deducted only in calculating an annual production tax value for oil produced by the producer from leases or properties no part of which is north of 68 degrees North latitude.

(g) The following example illustrates (f) of this section and 15 AAC 55.224(f):

Example. In a given calendar year before 2022, a producer has two producing leases or properties on the North Slope, both of which have commenced regular production (Property E and Property F). The producer also has two non-producing leases or properties on the North Slope, neither of which has commenced regular production (Property G and Property H). Oil and other gas produced from the two producing properties plus the adjusted lease expenditures for all four properties make up the first segment of taxable production for the producer. The producer also has taxable production for the second segment on the North Slope for gas used in the state produced from Property E. For purposes of his example, it has been assumed that if any of the properties are eligible for a gross value reduction under AS 43.55.160(f) or AS 43.55.160(f) and (g), any gross value reduction has been added back to the gross value at the point of production before determining the amount of any carried-forward annual loss under this section. Additionally, the producer has no lease expenditures or production outside of the North Slope.

In Year 1, the producing leases or properties, Property E and Property F, respectively, produce 30 and 20 barrels of taxable oil with gross values at the point of production of $1,500 and $1,000, and adjusted lease expenditures of $1,800 and $1,200. Property E also produces six BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $200. The non-producing properties, Property G and Property H incur adjusted lease expenditures of $300 and $500, respectively.

In Year 2, the producing leases or properties, Property E and Property F, respectively, produce 50 and 25 barrels of taxable oil with gross values at the point of production of $2,750 and $1,375, and adjusted lease expenditures of $2,400 and $1,200. Property E also produces 10 BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $500. The non-producing properties, Property G and Property H incur adjusted lease expenditures of $400 and $600, respectively.

In Year 3, the producing leases or properties, Property E and Property F, respectively, produce 50 barrels and 30 barrels of taxable oil with gross values at the point of production of $3,000 and $1,800, and adjusted lease expenditures of $2,400 and $1,200. Property E also produces 10 BTU equivalent barrels of taxable gas used in the state with a gross value at the point of production of $500. In addition, during Year 3, Property G commences regular production of oil and gas for the North Slope segment, producing 20 barrels of taxable oil with a gross value at the point of production of $1,200 and incurs adjusted lease expenditures of $1,300. In addition, Property G produces six BTU equivalent barrels of gas used in the state, with a gross value at the point of production of $150. Non-producing Property H incurs adjusted lease expenditures of $600. The producer wishes to deduct the carried-forward annual losses to the maximum extent possible in calculating annual production tax values for a later calendar year.

In Year 1, the first segment, for which adjusted lease expenditures established the $200, $300, and $500 of carried-forward annual losses, for properties F, G, and H, respectively, is oil and gas, other than gas used in the state, produced from leases or properties that include land north of 68 degrees North latitude, under 15 AAC 55.206(c)(l)(A). Since regular production has already commenced from Property F, and subject to AS 43.55.165(n)(l), the carried-forward annual losses established by those lease expenditures may be deducted in calculating the annual production tax value for oil and gas, other than gas used in the state, produced from leases or properties that include land north of 68 degrees North latitude in any subsequent calendar year.

Since regular production of oil or gas has not yet commenced from either Properties G or H, the $300 and $500 carried-forward annual losses incurred in Year 1 and established by lease expenditures incurred to explore for or develop oil or gas deposits located within Properties G and H may be deducted only after regular production of oil or gas has commenced from those leases or properties, as provided in AS 43.55.165(n)(2) and (p)(2) of this section. In addition, the amounts of any or all of the carried-forward losses are potentially subject to reduction under 43.55.165(o).

The second segment, gas used in the state, for which adjusted lease expenditures established the $100 carried-forward annual loss, is gas used in the state produced from Property E, under 15 AAC 55.206(c)(1)(E). Therefore, subject to AS 43.55.165(o), this carried-forward annual loss may be deducted in calculating the annual production tax value of gas used in the state in any future period before 2022.

In Year 2, there is a loss for the first segment, oil and other gas, in the amount of $75. The $2,400 in adjusted lease expenditures for Property E is allocated on a BTU equivalent basis to oil and other gas ($2,400 * (50/(50 + 10))) = $2,000. $2,000 + $1,200 Property F + $400 Property G + $600 Property H = adjusted lease expenditures for the oil and other gas segment of $4,200 subtracted for the GVPP of Properties E, $2,750 and F, $1,375 = a carried-forward annual loss of $75. This carried-forward annual loss is allocated between Properties G and H as in 15 AAC 55.217(d) as XE= $75 an AE = $1,000 for a Factor G of .075 which is applied to the loss in properties G and H as $400 * .075 = $30 and $600 * .075 = $45 for a total carried forward annual loss for the segment of $75. The carried-forward annual loss for gas used in the state from Property E is calculated as ($2,400 * (10/10(50 + 10))) = $400 allocated to the segment as adjusted lease expenditures, subtracted from the $500 gross value at the point of production to yield a positive production tax value of $100. Applying the carried-forward annual loss from Property E in Year 1 results in a production tax value of zero for gas used in the state produced from Property E in Year 2.

In Year 3, there is a positive production tax value for the first segment, oil and other gas, in the amount of $1,200. The $2,400 in adjusted lease expenditures for Property E is allocated on a BTU / equivalent basis to oil and other gas ($2,400 * (50/(50+ 10)))= $2,000. $2,000 + $1,200 Property F + $1,000 Property G + $600 Property H = adjusted lease expenditures for the oil and other gas segment of $4,800 subtracted from the GVPP of Properties E, $3,000, F, $1,800 plus G, $1,200 (total $6,000) = a positive production tax value of $1,200. In accordance with AS 43.55.165(m) a carried-forward annual loss may not be used to reduce a tax below the amount calculated under AS 43.55.011(f) ($6,000 * 4% = $240). $240 / .35 (tax rate)= $686, the desired production tax value needed to equal the minimum tax under AS 43.55.011(f) $1,200 - $686 = $514. Therefore, a total carried-forward annual loss from Properties F and G (since regular production has commenced from both of those leases or properties) in the amount of $514 may be applied against the production tax value of $1,200 reducing that to $686. $686 * .35 = $240, equivalent to the amount of production calculated under AS 43.55.011(f) for the oil and other gas segment.

Then, finally for the gas used in the state segment for Property E the tax under AS 43.55.011(o) ($10) is less than the tax under AS 43.55.011(e) of $35. For the gas used in the state produced from Property G, the carried-forward annual loss of $150 ($150 gross value at the point of production minus $300 in allocated adjusted lease expenditures) is limited as determined under 15 AAC 55.224(f) as follows:

$150 in excess lease expenditures * tax rate 35% = $53 (15 AAC 55.224(f)(2))

Less $25 (sum of benefits as determined under 15 AAC 55.224(f)(4))

= $28 (15 AAC 55.224(f)(5) / 35% = $79 (15 AAC 55.224(f)(6))

$79 / $150 (excess lease expenditures from 15 AAC 55.224(f)(1))

= .53 (15 AAC 55.224(f)(7)) becomes the ratio applied to the carried-forward annual loss from 15 AAC 55.224(f)(l), so that:

$150 * .53 = $79, the amount of the carried-forward annual loss for Property G, gas used in the state.

(h) For purposes of AS 43.55.165(r) and this section,

(1) a lease expenditure incurred by a producer to conduct

(A) exploration for oil or gas deposits within land that later becomes part or all of a lease or property of the producer is reasonably related to that lease or property, beginning in the calendar year the land becomes part or all of that lease or property;

(B) geological or geophysical exploration, other than a stratigraphic test well under (5) of this subsection, within 25 miles of land that later becomes part or all of a lease or property of the producer, is reasonably related to that lease or property, beginning in the calendar year the land becomes part or all of that lease or property; for purposes of this sub-paragraph, geological or geophysical exploration is conducted within 25 miles of land that later becomes part or all of a lease or property of the producer if

(i) the location of the energy source used in active geophysical exploration is no more than 25 miles from the point within the lease or property that is nearest to that location;

(ii) the location of the sensor used in passive geophysical exploration is no more than 25 miles from the point within the lease or property that is nearest to that location; for an aerial survey, the location of the aerial sensor is the surface location overflown at the time the sensor is in use for geophysical exploration;

(iii) the location where rock or other geologic material is sampled or examined in place in geological exploration is no more than 25 miles from the point within the lease or property that is nearest to that location.

(2) a lease expenditure incurred by a producer to explore a specific potential hydrocarbon accumulation, or to explore by delineating a specific reservoir, is reasonably related to a participating area of the producer established for a reservoir that is discovered or delineated, respectively, by the producer's exploration of that potential hydrocarbon accumulation or reservoir; the first calendar year the lease expenditure is reasonably related to the participating area is the calendar year the participating area is established, except for lease expenditures subject to (3) of this subsection;

(3) a lease expenditure incurred by a producer to explore by further delineating a reservoir for which a participating area was previously established is reasonably related to the participating area as of the calendar year during which the lease expenditure is incurred;

(4) unless (2) or (3) of this subsection applies, a lease expenditure incurred by a producer to explore a specific potential hydrocarbon accumulation outside a unit or within a unit described in 15 AAC 55.815(2), or to explore by delineating a specific reservoir outside a unit or within a unit described in 15 AAC 55.815(2), is reasonably related to a lease or property of the producer that contains all or part of a reservoir that is discovered or delineated, respectively, by the producer's exploration of that potential hydrocarbon accumulation or reservoir; the first calendar year the lease expenditure is reasonably related to the lease or property is the later of the calendar year during which (A) the lease expenditure is incurred, or (B) the lease or property is first shown to contain all or part of the reservoir;

(5) a lease expenditure incurred by a producer to explore for oil or gas deposits by means of a stratigraphic test well is reasonably related to a lease or property acquired by the producer, beginning in the calendar year the lease or property is acquired, if the producer relies on information gained from the well in evaluating that lease or property for acquisition; this paragraph does not apply to a well less than 600 feet deep and for whose drilling the Alaska Oil and Gas Conservation Commission does not require a blowout preventer.

(i) The following example illustrates (h)(1)(B) of this section:

A producer conducts a seismic survey, a type of active geophysical exploration, on the North Slope. The energy source is provided by a vehicle-mounted plate vibration generator (vibroseis). Vibrations for the purpose of the survey are generated at 1,000 locations over the course of the survey. The producer subsequently acquires an oil and gas lease that is within 25 miles of 345 of those locations, as measured from the nearest point in the lease. The other 655 locations are more than 25 miles from the lease. The lease expenditures incurred to conduct the seismic survey at the 345 locations within 25 miles of the lease are reasonably related to the lease. The amount of lease expenditures that are reasonably related to the lease may be calculated as 34.5 percent of the total lease expenditures incurred to conduct the seismic survey.

(j) The following example illustrates (h)(2) of this section:

A unit composed of state oil and gas leases has been formed to encompass a specific potential hydrocarbon accumulation. A producer drills three wells to explore the potential hydrocarbon accumulation. The first well is a dry hole. The second well discovers a reservoir in the potential hydrocarbon accumulation. The third well penetrates the same reservoir. A participating area in which the producer owns an interest is established for the reservoir by the department of natural resources. The lease expenditures incurred to drill all three wells are reasonably related to the participating area, because all the wells were drilled to explore the potential hydrocarbon accumulation in question.

(k) This subsection implements AS 43.55.165(m). In the calculation of an annual production tax value for a producer's segment described in 15 AAC 55.206(c)(1)(A), carried-forward annual losses may be deducted only to the extent that 35 percent of the resulting annual production tax value is equal to or greater than the amount calculated for the producer for the calendar year under AS 43.55.011(f).

(l) The following example illustrates (k) of this section:

A producer produces oil from North Slope leases or properties for which the amount of tax calculated under AS 43.55.011(e)(2) for the calendar year is $150 after the deduction of adjusted lease expenditures under AS 43.55.165(a)(1) and (2). The minimum tax for the oil as determined under AS 43.55.011(f) for the calendar year is $100. Regardless of the amount of carried-forward annual losses under AS 43.55.165(a)(3) that the producer has available, carried-forward annual losses under AS 43.55.165(a)(3) may not be used to reduce the amount of tax calculated under AS 43.55.011(e) to less than $100. The producer deducts carried-forward annual losses under AS 43.55.165(a)(3) from a prior year to reduce the producer's tax liability to an amount equal to the amount of tax determined under AS 43.55.011(f) ($100). The producer has available $75 of credits earned in the current year under AS 43.55.024(i) and a tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, for oil and gas produced before January 1, 2018, in the amount of $50. The entire amount of the tax credit under AS 43.55.024(i) of $75 may be applied to reduce the producer's tax liability to $25, and $25 dollars of the tax credit under AS 43.55.023(b) may be applied to further reduce the producer's tax liability down to zero. The remaining $25 of the tax credit under AS 43.55.023(b) may not he used to apply for a refund, but may be carried-forward to be used in a future period.

(m) Subject to the following conditions and limitations, a producer to which an interest in a lease or property is transferred may apply the fraction specified in (1) of this subsection of an unused carried-forward annual loss established by lease expenditures that were previously incurred by the transferor of the interest to the same extent as if the lease expenditures had been incurred by the transferee of the interest, if the lease expenditures either were incurred to explore for, develop, or produce oil or gas deposits located within the lease or property or if the lease expenditures are reasonably related to the lease or property under (h) of this section, and if the transferor of the interest in the lease or property provides the transferee at the time of the transfer of the interest with the transferor's written agreement that the allowed fraction of the carried-forward annual loss will not be applied by the transferor of the interest and will be available for application only by the transferee:

(1) the fraction allowed for purposes of this subscction equals the fraction of the transferor's interest in the lease or property transferred to the transferee of the interest;

(2) the transferor of the interest in the lease or property shall provide the transferee of the interest with a description and documentation of the lease expenditures establishing the carried-forward annual loss with sufficient specificity to distinguish them from other lease expenditures incurred by the transferor;

(3) the transferor of the interest in the lease or property shall file, with or as part of the statement required by AS 43.55.030(a) or (e) for the calendar year during which the interest in the lease or property was transferred,

(A) a statement on a form approved or prescribed by the department that identifies the lease or property, the interest transferred, and the transferee, and describes the lease expenditures, with reference to the carried-forward annual loss established by the lease expenditures as reported in the statement required under (e) of this section; and

(B) a copy of the transferor's written agreement that the allowed fraction of the carried-forward annual loss will not be applied by the transferor of the interest and will be available for application only by the transferee;

(4) a claimed lease expenditure and a claimed carried-forward annual loss under this subsection are subject to adjustment or dis allowance on audit to the same extent as if no transfer of an interest in the lease or property had occurred;

(5) if the transferor of the interest in the lease or property does not agree in writing at the time of the transfer of the interest that the allowed fraction of the carried-forward annual loss will not be applied by the transferor of the interest and will be available for application only by the transferee, the full amount of the carried-forward annual loss remains available for use by the transferor of the interest to the extent provided by AS 43.55 and this chapter;

(6) except as provided in this subsection and (n) of this section, a carried-forward annual loss may not be transferred.

(n) If the transferee of an interest in a lease or property under (m) of this section or under this section having the right to apply a fraction of a carried-forward annual loss subject to (m) of this section transfers all or part of the interest to a subsequent transferee, and if the transferor of the interest in the lease or property provides the subsequent transferee at the time of the transfer of the interest with the transferor's written agreement that the fraction allowed under this subsection of the carried-forward annual loss will not he applied by the transferor of the interest and will be available for application only by the subsequent transferee, the subsequent transferee may apply the fraction allowed under this subsection of the unused carried-forward annual loss to the extent allowed under, and subject to the provisions of, (m) of this section, except as provided as follows:

(1) if the interest in a lease or property transferred under this subsection is less than the entire interest owned by the transferor under this subsection, the fraction of the unused carried-forward annual loss that the subsequent transferee under this subsection may apply is equal to the fraction of the interest in the lease or property transferred multiplied times the fraction of the carried-forward annual loss that the transferor under this subsection had the right to apply before the transfer;

(2) the description and documentation of lease expenditures referred to in (m)(2) of this section and required to be provided by the transferor under this subsection to the subsequent transferee under this subsection may be a copy of the description and documentation that the transferor under (m) of this section provided under (m)(2) of this section to the transferee under (m) of this section;

(3) the statement referred to in (m)(3)(A) of this section and required to be filed by the transferor under this subsection need not include a reference to the statement required under (e) of this section to be filed by the transferor under (m) of this section.

(o) The limitation provided under AS 43.55.165(n), that a carried-forward annual loss may only be applied beginning in the calendar year in which regular production of oil or gas from the lease or property where the lease expenditure resulting in the carried-forward annual loss was incurred commences, is satisfied if the first calendar year for which part or all of the carried-forward annual loss is deducted in calculating an annual production tax value is not earlier than the calendar year during which that regular production commences. If the lease expenditure was incurred on more than one lease or property, the calendar year during which regular production of oil or gas commences may be determined with reference to any one of those leases or properties for purposes of this subsection. Upon receiving a written request from a producer, the department will request the Alaska Oil and Gas Conservation Commission to determine whether, and if so when, regular production of oil or gas has commenced from a lease or property.

(p) As used in

(1) AS 43.55.165(s)(1) "loss" means an amount of adjusted lease expenditures described in AS 43.55.165(a)(1) and (2) incurred during a calendar year after 2017 that would otherwise be deductible by the producer in calculating an annual production tax value for that calendar year under AS 43.55.160(a)(1) or (h) but whose deduction would cause the annual production tax value to be less than zero, subject to the requirements in AS 43.55.160(e) to add back a reduction under AS 43.55.160(f) or (g) and to account for the adjusted lease expenditures if the producer's tax liability is limited by AS 43.55.011(o) or (p);

(2) AS 43.55.165(n)(2), (o), and (r), and this section, the lease or property "on" which a lease expenditure is incurred or "where" a lease expenditure is incurred means

(A) in the case of a lease expenditure incurred to explore for, develop, or produce oil or gas deposits located within a lease or property of the producer, the lease or property within which is located the oil or gas deposits to explore for, develop, or produce which the lease expenditure is incurred;

(B) a lease or property, if any, to which the lease expenditure is determined to be reasonably related under (h)(1) - (5) of this section;

(C) a lease or property that incorporates the lease or property described in (A) or (B) of this paragraph, such as a participating area that when established encompasses an oil and gas lease subject to (A) or (B) of this paragraph and other oil and gas leases; the first calendar year the lease expenditure is considered to be on a lease or property described in this subparagraph is the calendar year during which the lease or property incorporates the lease or property described in (A) or (B) of this paragraph;

(3) this section;

(A) "carried-forward annual loss" has the meaning given in AS 43.55.165(s)(1);

(B) "participating area" means a participating area described in 15 AAC 55.815(1);

(D) "producer" includes "explorer" with regard to lease expenditures incurred to explore for oil or gas deposits located in land in which the explorer does not own an operating right, operating interest, or working interest in a mineral interest in oil or gas;

(E) "reservoir" has the meaning given in 11 AAC 83.395.

(q) In accordance with AS 43.55.011(e) and 43.55.160(h), lease expenditures incurred after December 31, 2021 for both oil and gas are included in the calculation of the carried-forward annual loss for oil, and a carried-forward annual loss calculation may not be made for gas except as provided in (f) of this section.

History

Authority: AS 43.05.080; AS 43.55.160SSSLA 2017 AS 43.55.011; AS 43.55.165 AS 43.55.110Sec. 35, ch. 3
Eff. 12/6/2018, Register 228; am 9/20/2020, Register 235; am 1/1/2022, Register 240

15 AAC 55.220 Oil and gas exploration tax credit

Repealed.

History

Eff. 1/1/2004, Register 168; repealed 5/3/2007, Register 182

15 AAC 55.223 Cook Inlet lease expenditures incurred before July 1, 2007

Repealed.

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; repealed 9/20/2020, Register 235

15 AAC 55.224 Lease expenditures incurred after June 30, 2007, for Cook Inlet, for gas used in the state, and for oil and gas subject to AS 43.55.011(p)

(a) For purposes of the calculations required under (d), (e), or (f) of this section, in calculating an annual production tax value for a segment described in 15 AAC 55.206(c)(1)(C), (D), (E), or (F), a producer shall deduct applicable adjusted lease expenditures for the calendar year to the maximum extent that deductibility is allowed under applicable law, including (d), (e), or (f), as applicable of this section.

(b) Repealed 1/1/2022.

(d) For a calendar year after 2013 and before 2017 for which a limitation under AS 43.55.011(j), (k), (o), or (p) on the tax levied by AS 43.55.011(e) has the effect of reducing the producer's tax on oil or gas produced from one or more leases or properties below the amount of the tax that would be levied in the absence of that limitation, the producer shall account under this subsection for adjusted lease expenditures that are excess adjusted lease expenditures, if any, under 15 AAC 55.206(b) in the calculation of annual production tax values for segments described in 15 AAC 55.206(c)(1)(C), (D), (E), or (F). Only the amount, if any, of those excess adjusted lease expenditures that is calculated under (7) of this subsection may be used to establish a carried-forward annual loss under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018. The fraction of the amount calculated under (7) of this subsection that is subject to a 25 percent tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, is equal to the amount calculated under (1) of this subsection divided by the sum of the amounts calculated under (1) and (2) of this subsection. The fraction of the amount calculated under (7) of this subsection that is subject to a 45 percent tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, in the case of lease expenditures incurred after December 31, 2013, and before January 1, 2016, or a 35 percent tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, in the case of lease expenditures incurred after December 31, 2015 and before January 1, 2017, is equal to the amount calculated under (2) of this subsection divided by the sum of the amounts calculated under (1) and (2) of this subsection. The calculations to be performed for the accounting under this subsection are as follows:

(1) calculate the total amount of excess adjusted lease expenditures subject to this subsection for segments described in 15 AAC 55.206(c)(1)(C), (D), and (F) and for segments described in 15 AAC 55.206(c)(1)(E) for gas produced from leases or properties no part of which is north of 68 degrees North latitude;

(2) calculate the total amount of excess adjusted lease expenditures subject to this subsection for segments described in 15 AAC 55.206(c)(1)(E) for gas produced from leases or properties that include land north of 68 degrees North latitude;

(3) sum the amounts calculated under (1) and (2) of this subsection and multiply that sum by 35 percent;

(4) calculate for each segment the amount by which a limitation under AS 43.55.011(j), (k), (o), or (p) reduces the amount of the producer's tax otherwise levied by AS 43.55.011(e);

(5) sum the total of the reductions calculated under (4) of this subsection for all affected segments;

(6) if the amount calculated under (3) of this subsection is

(A) greater than the amount calculated under (5) of this subsection, subtract the latter amount from the former amount;

(B) equal to or less than the amount calculated under (5) of this subsection, consider the amount calculated under this paragraph to be zero;

(7) divide the amount calculated under (6) of this subsection by 0.35.

(e) For calendar year 2017 for which a limitation under AS 43.55.011(j), (k), (o), or (p) on the tax levied by AS 43.55.011(e) has the effect of reducing the producer's tax on oil or gas produced from one or more leases or properties below the amount of the tax that would be levied in the absence of that limitation, the producer shall account under this subsection for adjusted lease expenditures that are excess adjusted lease expenditures, if any, under 15 AAC 55.206(b) in the calculation of annual production tax values for segments described in 15 AAC 55.206(c)(1)(C), (D), (E), or (F). Only the amount, if any, of those excess adjusted lease expenditures that is calculated under (7) of this subsection may be used to establish a carried-forward annual loss under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018. The fraction of the amount calculated under (7) of this subsection that is subject to a 15 percent tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, is equal to the amount calculated under (1) of this subsection divided by the sum of the amounts calculated under (1) and (2) of this subsection. The fraction of the amount calculated under (7) of this subsection that is subject to a 35 percent tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, is equal to the amount calculated under (2) of this subsection divided by the sum of the amounts calculated under (1) and (2) of this subsection. The calculations to be performed for the accounting under this subsection are as follows:

(1) calculate the total amount of excess adjusted lease expenditures subject to this subsection for segments described in 15 AAC 55.206(c)(1)(C), (D), and (F) for oil and gas produced from leases or properties no part of which is north of 68 degrees North latitude;

(3) sum the amounts calculated under (1) and (2) of this subsection and multiply that sum by 35 percent;

(4) calculate for each segment the amount by which a limitation under AS 43.55.011(j), (k), (o), or (p) reduces the amount of the producer's tax otherwise levied by AS 43.55.011(e);

(5) sum the total of the reductions calculated under (4) of this subsection for all affected segments;

(6) if the amount calculated under (3) of this subsection is

(A) greater than the amount calculated under (5) of this subsection, subtract the amount calculated under (5) of this subsection from the amount calculated under (3) of this subsection;

(B) equal to or less than the amount calculated under (5) of this subsection, consider the amount calculated under this paragraph to be zero;

(7) divide the amount calculated under (6) of this subsection by 0.35.

(f) For a calendar year after 2017 and before 2022 for which a limitation under AS 43.55.011(o) or (p) on the tax levied by AS 43.55.011(e) has the effect of reducing the producer's tax on oil or gas produced from one or more leases or properties below the amount of the tax that would be levied in the absence of that limitation, the producer shall account under this subsection for adjusted lease expenditures that are excess adjusted lease expenditures, if any, under 15 AAC 55.206(b) in the calculation of annual production tax values for segments described in 15 AAC 55.206(c)(1)(E) or (F). Only the fraction calculated under (7) of this subsection of those excess adjusted lease expenditures, if greater than zero, may be used to establish carried-forward annual losses under AS 43.55.160(e) and 43.55.165(a)(3) and (l) - (s)(1). The calculations to be performed for the accounting under this subsection are as follows:

(1) calculate the total amount of excess adjusted lease expenditures subject to this subsection;

(2) multiply that total amount by 35 percent;

(3) calculate for each segment the amount by which a limitation under AS 43.55.011(o) or (p) reduces the amount of the producer's tax otherwise levied by AS 43.55.011(e);

(4) sum the total of the reductions calculated under (3) of this subsection for all affected segments;

(5) if the amount calculated under (2) of this subsection is

(A) greater than the amount calculated under (4) of this subsection, subtract the amount calculated under (4) of this subsection from the amount calculated under (2) of this subsection;

(B) equal to or less than the amount calculated under (4) of this subsection, consider the amount calculated under this paragraph to be zero;

(6) divide the amount calculated under (5) of this subsection by 0.35;

(7) divide the amount calculated under (6) of this subsection by the amount calculated under (1) of this subsection.

(g) For a calendar year after 2021 for which a limitation under AS 43.55.011(p) on the tax levied by AS 43.55.011(e) has the effect of reducing the producer's tax on oil produced from one or more leases or properties below the amount of the tax that would be levied in the absence of that limitation, the producer shall account under this subsection for adjusted lease expenditures that are excess adjusted lease expenditures, if any, under 15 AAC 55.206(c)(3) in the calculation of annual production tax values for segments described in 15 AAC 55.206(c)(3)(D). Only the fraction calculated under (7) of this subsection of those excess adjusted lease expenditures, if greater than zero, may be used to establish carried-forward annual losses under AS 43.55.160(e) and 43.55.165(a)(3) and (l) - (s)(1). The calculations to be performed for the accounting under this subsection are as follows:

(1) calculate the total amount of excess adjusted lease expenditures subject to this subsection;

(2) multiply that total amount by 35 percent;

(3) calculate for each segment the amount by which a limitation under AS 43.55.011(p) reduces the amount of the producer's tax otherwise levied by AS 43.55.011(e);

(4) sum the total of the reductions calculated under (3) of this subsection for all affected segments;

(5) if the amount calculated under (2) of this subsection is

(A) greater than the amount calculated under (4) of this subsection, subtract the amount calculated under (4) of this subsection from the amount calculated under (2) of this subsection;

(B) equal to or less than the amount calculated under (4) of this subsection, consider the amount calculated under this paragraph to be zero;

(6) divide the amount calculated under (5) of this subsection by 0.35;

(7) divide the amount calculated under (6) of this subsection by the amount calculated under (1) of this subsection.

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.160 AS 43.55.011; AS 43.55.110; AS 43.55.165
Eff. 10/21/2009, Register 192; am 12/25/2013, Register 208; am 3/1/2017, Register 221; am 12/6/2018, Register 228; am 1/1/2022, Register 240

15 AAC 55.225 Oil and gas exploration tax credit claim

Repealed.

History

Eff. 1/1/2004, Register 168; repealed 5/3/2007, Register 182

15 AAC 55.230 Qualified exploration expenditures

Repealed.

History

Eff. 1/1/2004, Register 168; repealed 5/3/2007, Register 182

15 AAC 55.235 Transfer of a production tax credit certificate

Repealed.

History

Eff. 1/1/2004, Register 168; repealed 5/3/2007, Register 182

15 AAC 55.240 Applying production tax credit certificates against production tax liability

Repealed.

History

Eff. 1/1/2004, Register 168; repealed 5/3/2007, Register 182

15 AAC 55.245 Lease expenditures under operating agreements

(a) Repealed 12/4/2010.

(b) Repealed 12/4/2010.

(d) The department will not approve or require use of operating agreements under former AS 43.55.165(c) or (d).

History

Authority: AS 43.05.080; AS 43.55.160; AS 43.55.170 AS 43.55.110; AS 43.55.165
Eff. 5/3/2007, Register 182; am 12/4/2010, Register 196

15 AAC 55.250 Standards for lease expenditures other than overhead

(a) Repealed 9/20/2020.

(b) Costs incurred after June 30, 2007, satisfy the requirements established in AS 43.55.165(a)(1)(B), as enacted by sec. 58, ch. 1, SSSLA 2007, only if they are

(1) direct charges under 15 AAC 55.260 incurred for an activity or purpose described in (c) of this section; and

(2) not excluded under AS 43.55.165(e), as amended by sec. 60, ch. 1, SSSLA 2007.

(1) conducting a geological or geophysical survey to explore for oil or gas;

(2) performing a geological, geophysical, geotechnical, or geochemical examination or investigation specific to reservoir to support development of that reservoir;

(3) processing or interpreting data acquired from an activity described in (1) or (2) of this subsection to support oil or gas exploration, development, or production operations;

(4) designing, surveying, preparing, constructing, operating, or maintaining a drill site for an exploration well or a well to produce oil or gas or to support oil or gas production;

(5) transporting, mobilizing, or demobilizing a rig, coil tubing unit, or similar equipment, or associated supplies, to and on a drill site to drill or perform downhole operations described in (6) - (8) of this subsection on a well described in (4) of this subsection; demobilization does not include transportation out of the state;

(6) designing, drilling, testing, logging, completing, operating, maintaining, repairing, or suspending a well described in (4) of this subsection;

(7) plugging and abandoning an exploration well, but excluding restoration of the drill site;

(8) plugging a well described in (4) of this subsection, or a portion of the well, for the purpose of redrilling;

(9) designing, constructing, acquiring, transporting, installing, operating, repairing, or maintaining a facility or equipment, other than a well, if the facility or equipment is

(A) used in oil or gas production operations and handles produced fluids upstream of the point of production or fluids injected in a reservoir for reservoir pressure maintenance, repressuring, or enhanced recovery purposes; and

(B) not a refinery, crude oil topping plant, or other manufacturing facility; for purposes of this subparagraph, "manufacturing facility" does not include a gas processing plant;

(10) designing, constructing, acquiring, transporting, installing, operating, repairing, or maintaining a communications system for communications between the site of oil or gas exploration, development, or production operations, and the operator's headquarters in the state, and that are necessary for the operations;

(11) designing, constructing, acquiring, transporting, installing, operating, repairing, or maintaining a field automation system solely dedicated to and specific to a unit or a lease or property and necessary for oil or gas production operations of the unit or the lease or property;

(12) preparing and submitting an application, data, or report necessary to obtain or maintain a governmental permit or similar governmental approval for oil or gas exploration, development, or production operations, or for a facility, equipment, or infrastructure described in (16) of this subsection;

(13) performing an archaeological, geophysical, or environmental survey or preparing an environmental impact statement required by law or otherwise required by a government agency, or required by an oil and gas lease, for oil or gas exploration, development, or production operations, or for a facility, equipment, or infrastructure described in (16) of this subsection, or otherwise complying with environmental requirements imposed by law or oil and gas lease for those operations, or for that facility, equipment, or infrastructure;

(14) performing one or more of the following activities with respect to an oil or hazardous substance cleanup contingency plan, fire response plan, or disaster recovery plan required for safe operation or by law or oil and gas lease, for oil or gas exploration, development, or production operations, or for a facility, equipment, or infrastructure described in (16) of this subsection:

(A) preparing and maintaining the plan;

(B) training personnel or performing practice drills, monitoring, or inspection under the plan;

(15) monitoring and maintaining the safety of personnel located at the site, or in the vicinity, of oil or gas exploration, development, or production operations;

(16) designing, constructing, acquiring, transporting, installing, operating, repairing, or maintaining a facility, equipment, or infrastructure that is located in the vicinity of and is used to support oil or gas exploration, development, or production operations; that facility, equipment, or infrastructure

(A) includes

(i) camps;

(ii) operations centers;

(iii) laboratories;

(iv) staging pads, roads, bridges, docks, helipads, landing areas, and similar transportation structures;

(v) medical facilities;

(vi) emergency response facilities;

(vii) storage facilities;

(viii) security facilities;

(ix) repair and maintenance shops; and

(x) vehicles;

(B) does not include refineries, topping plants, or other manufacturing facilities.

(d) A cost incurred jointly for both an activity or purpose described in (c) of this section and an activity or purpose not described in (c) of this section must be allocated between the activity or purpose described in (c) of this section and the other activity or purpose using a reasonable allocation methodology.

(e) Repealed 9/20/2020.

(f) Costs incurred after June 30, 2007, that satisfy the requirements of (b)(1) and (2) of this section are not a producer's or explorer's lease expenditures under AS 43.55.165(a), as repealed and reenacted by sec. 58, ch. 1, SSSLA 2007, unless the costs also satisfy the requirements of AS 43.55.165(a)(1)(A), as enacted by sec. 58, ch. 1, SSSLA 2007.

(g) For purposes of this section, "designing" is limited to activities specific to an identifiable well, facility, item of equipment, or system, and does not include activities of more general applicability or that would ordinarily be considered research and development.

History

Authority: AS 43.05.080; AS 43.55.160; AS 43.55.170 AS 43.55.110; AS 43.55.165
Eff. 2/27/2010, Register 193; am 12/4/2010, Register 164; am 9/20/2020, Register 235

15 AAC 55.260 Direct charges

(a) Except as limited by (d) and (e) of this section, direct charges for purposes of 15 AAC 55.250(b) are

(1) costs paid to real property owners to acquire surface rights in real property located in the vicinity of oil or gas exploration, development, or production operations, and used in support of those operations;

(2) net profit shares required to be paid to the state under leases issued under AS 38.05.180(f)(3)(B), (D), or (E) and paid after June 30, 2007;

(3) labor costs, not including work on tax, legal, purchasing, or accounting matters, or matters involving a dispute before a government agency, in the form of salaries and wages of

(A) employees of the operator, when those employees are directly employed in or in support of oil or gas exploration, development, or production operations, and

(i) on the site or in the vicinity of those operations;

(ii) in transit to or from the site or vicinity of those operations;

(iii) on a site of a system described in 15 AAC 55.250(c)(10) or (11) if assigned to and working on that system; or

(iv) on the site of the construction, transportation, repair, or maintenance of a facility, a system, equipment, or infrastructure described in 15 AAC 55.250(c)(9) - (11) or (16) if assigned to and working on that construction, transportation, repair, or maintenance; or

(B) any of the following employees of the operator, while those employees are assigned to a specific lease or property or unit that is the subject of oil or gas exploration, development, or production, and only as to that portion of the salaries and wages attributable to the time actually devoted to that exploration, development, or production, as supported by an approved timesheet or other time writing document:

(i) technical employees having special and specific engineering, geological, or other technical skills, including engineers, geologists, geophysicists, environmental specialists, and other technical personnel whose primary function with respect to that exploration, development, or production is the handling of specific problems or operating conditions involving the oil or gas exploration, development, or production operations or the support of those operations;

(ii) employees engaged in developing field automation systems dedicated to and specific to a unit or a lease or property and necessary for oil or gas production operations of the unit or the lease or property;

(iii) employees engaged in developing computer applications specific to a unit or a lease or property and necessary for oil or gas development or production operations of the unit or the lease or property;

(4) costs of employee training that directly relates to the job duties for the employees described in (3) of this subsection; the costs of professional memberships, dues, or periodicals, or of education or training in pursuit of an academic degree or professional credential, are not direct charges;

(5) expenditures or contributions made under assessments imposed by governmental authority that are applicable to the operator's labor costs described in (3) of this subsection; as to workers' compensation, if the operator self-insures, it may treat as an expenditure or contribution under this paragraph the charge that is regularly recorded as an accrual in the operator's general ledger as representing the fair and reasonable cost of the self-insurance;

(6) reasonable expenses incurred or reimbursed by the employer of those employees described in (3) of this subsection for travel by those employees to or from the site or vicinity of oil or gas exploration, development, or production operations, and for associated living quarters and meals; a reasonable per diem allowance, if paid by the employer in place of reimbursement of actual expenses, may be substituted for actual expenses for living quarters and meals;

(7) the employer's share of contributions to established plans for employee group life, disability, or medical insurance, pension, retirement, stock purchase, thrift, bonus, or other similar benefit plans, applicable to the operator's labor costs described in (3) of this subsection, if

(A) the plans are available on a regular basis to all employees of the operator who are directly working in oil or gas exploration, development, or production operations, other than employees excluded from a plan's coverage because of participation under a collective bargaining agreement; and

(B) the amount of the employer's share of contributions does not exceed the following percentage, as applicable, of the costs under (3) of this subsection incurred for employees covered by the plans:

(i) 32 percent for calendar year 2006;

(ii) 33 percent for calendar year 2007;

(iii) 36 percent for calendar year 2008;

(iv) 35 percent for calendar year 2009;

(v) 30 percent for a calendar year after 2009;

(8) the employer's share of contributions to established plans for employee group life, disability, or medical insurance, pension, retirement, stock purchase, thrift, bonus, or other similar benefit plans, applicable to the operator's labor costs described in (3) of this subsection, and available to employees under a collective bargaining agreement;

(9) costs to purchase or transport a facility, equipment, materials, or supplies used in oil or gas exploration, development, or production operations;

(10) costs to purchase or transport a facility, a system, equipment, or infrastructure described in 15 AAC 55.250(c)(10), (11), or (16), or to purchase or transport equipment, materials, or supplies used in a facility, a system, equipment, or infrastructure described in 15 AAC 55.250(c)(10), (11), or (16);

(11) costs paid to a third party for contract services, utilities, or use of a facility, equipment, or infrastructure provided by the third party and used in oil or gas exploration, development, or production operations, or used in support of those operations, or for use of a system described in 15 AAC 55.250(c)(10) or (11) provided by the third party; for purposes of this paragraph,

(A) contract services

(i) do not include work in tax, legal, or accounting matters, or matters involving a dispute before a government agency;

(ii) are limited to services the labor costs of which, under (3) of this subsection, would be allowable as direct charges if the operator's employees performed the services;

(B) support facilities, equipment, and infrastructure are limited to the categories described in 15 AAC 55.250(c)(16);

(12) costs charged to a unit or other joint operation for use in its oil or gas exploration, development, or production operations of a facility or equipment that

(A) is wholly or partly owned by a producer or explorer with an interest in the unit or other joint operation; and

(B) is not, and has not previously been, wholly or partly owned or acquired by or on behalf of the unit or other joint operation;

(13) a premium paid to a third-party insurer for insurance covering oil or gas exploration, development, or production operations;

(14) standby costs paid to a third party drilling rig contractor, and incurred

(A) while rig operations are deferred, suspended, or curtailed by reason of force majeure or another cause beyond the reasonable control of the operator; or

(B) to secure a rig for drilling if the rig is actually used for the operation for which it was secured;

(15) payments of property taxes, sales or use taxes, motor fuel taxes, or excise taxes if incurred with respect to the sale, acquisition, ownership, or use of a good, service, or property, the cost of which is a lease expenditure under AS 43.55.165, or would be a lease expenditure if incurred during the period for which the payment is made;

(16) payments in lieu of property taxes, sales or use taxes, motor fuel taxes, or excise taxes that would otherwise be incurred with respect to the sale, acquisition, ownership, or use of goods, services, or property, the cost of which is a lease expenditure under AS 43.55.165, or would be a lease expenditure if incurred during the period for which the payment is made;

(17) a regulatory cost charge under AS 31.05.093;

(18) a fee charged by a government agency for a regulatory license, permit, or similar regulatory approval required for oil or gas exploration, development, or production operations, or for a facility, equipment, or infrastructure described in 15 AAC 55.250(c)(16);

(19) costs to transport to the injection site, oil, gas, or other fluid recovered from a well and injected for reservoir pressure maintenance, repressuring, or enhanced recovery purposes, and costs paid to a third party producer to purchase that oil, gas, or other fluid from the producer;

(20) if a producer owns a refinery or crude oil topping plant that is located on or near the premises of the producer's lease or property in the state and that processes the producer's oil produced from that lease or property into a product that the producer uses in the operation of the lease or property in drilling for or producing oil or gas, the amount calculated by subtracting from the fair market value of the product used the prevailing value of the oil that is processed; for purposes of this paragraph,

(A) the amount of the oil that is processed equals the number of barrels of the product into which the oil is processed;

(B) the prevailing value of the oil that is processed in a field topping plant in the Alaska North Slope area is the gross value at the point of production of that oil as determined under 15 AAC 55.163(b);

(21) costs paid to a third party to acquire geological or geophysical data used in oil or gas exploration, development, or production operations.

(b) For purposes of this section, an employee's salary or wages for a given period of time includes the cost in salary or wages for the employee's earned or compensatory time off attributable to the employee's work during that time period.

(c) In the absence of evidence to the contrary, and for purposes of AS 43.55.165(e)(12), the department will accept a charge under (a)(12) of this section as being not more than fair market value if the charge does not exceed the cost calculated on the basis of the net book value of the equipment or facility multiplied by the number of hours, days, miles, or throughput volumes for which the equipment or facility is used in the oil or gas exploration, development, or production operations, divided by the number of hours, days, miles, or throughput volumes, as applicable, of estimated remaining useful life of the equipment or facility, or calculated using another method approved by the department. For purposes of this subsection, "net book value" means the dollar amount the owner of an asset records in its financial statements, consistent with generally accepted accounting principles, as the historical cost of the asset, excluding capitalized interest and net of accumulated depreciation or amortization, if the historical cost does not exceed the fair market value of the asset at the time it was acquired by the owner.

(d) Except for a cost described in (a)(2), (13), or (19) of this section, a cost that relates to the exploration, development, or production of oil or gas deposits that are subject to a unit operating agreement or other agreement that provides for an operator to conduct the oil or gas exploration, development, or production on behalf of itself and other producers or explorers is not a direct charge under this section if the cost is not (1) incurred in the first instance by the operator on behalf of the producers or explorers under the agreement; (2) actually billed to the producers or explorers under the agreement; and (3) paid, as to the producer's or explorer's share, by the producer or explorer to whom that share is billed. For purposes of this subsection, an agreement includes an instrument or arrangement among the parties to the agreement that modifies a party's rights or obligations under the agreement.

(e) A fee or other consideration paid to, or for the benefit of, a producer in connection with the use of a facility in which that producer has an ownership interest or in connection with the producer's management of a facility is not a direct charge under this section to the extent that the fee or other consideration

(1) compensates that producer for the deferral or loss of that producer's oil or gas production resulting from the payer's use of the facility; or

(2) reimburses that producer for its additional tax liability resulting from the receipt of a fee or other consideration in connection with the payer's use of the facility or in connection with the producer's management of the facility.

(f) Direct charges under this section are net of any credits, refunds, reimbursements, purchase discounts, and cost recoveries, unless the credit, refund, reimbursement, or cost recovery is accounted for as an adjustment to lease expenditures under AS 43.55.170. For purposes of this subsection, "credits" do not include tax credits.

(g) For purposes of this section, "operator" means, in the case of

(1) a producer or explorer carrying out oil or gas exploration, development, or production on behalf of itself, that producer or explorer;

(2) a unit operating agreement or other agreement that provides for an operator to carry out oil or gas exploration, development, or production on behalf of itself and other producers or explorers, the producer or explorer acting as operator under that agreement.

History

Authority: AS 43.05.080; AS 43.55.160; AS 43.55.170 AS 43.55.110; AS 43.55.165
Eff. 2/27/2010, Register 193; am 12/4/2010, Register 196; am 9/20/2020, Register 235

15 AAC 55.270 Overhead before March 1, 2010

Repealed.

History

Eff. 5/3/2007, Register 182; am 2/27/2010, Register 193; am 12/4/2010, Register 196; repealed 9/20/2020, Register 235

15 AAC 55.271 Overhead on or after March 1, 2010

(a) For purposes of AS 43.55.165(a)(2), as repealed and reenacted by sec. 58, ch. 1, SSSLA 2007, a reasonable allowance for the calendar year for a producer's or explorer's overhead expenses directly related to exploring for, developing, or producing oil or gas deposits located within a lease or property or other land in the state is 4.5 percent of the producer's or explorer's lease expenditures, net of adjustments under AS 43.55.170, that are incurred during the calendar year and that are allowed as direct charges under 15 AAC 55.260, excluding

(1) payments of or in lieu of taxes other than

(A) payroll taxes under 15 AAC 55.260(a)(3);

(B) sales taxes, use taxes, or excise taxes on goods or services;

(2) net profit share payments under 15 AAC 55.260(a)(2).

(b) An allowance for overhead expenses is not a qualified capital expenditure.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.165
Eff. 2/27/2010, Register 193

15 AAC 55.275 Exclusions from lease expenditures

(a) The portion of a producer's expenditures incurred during a calendar year before 2022 that is excluded under AS 43.55.165(e)(18) is calculated separately for each segment under 15 AAC 55.206. Subject to prorating for only a portion of a calendar year as provided under AS 43.55.165(e)(18), the excluded portion for a segment is $1 less than the product of $.30 multiplied by the total amount of taxable

(1) oil and gas, in BTU equivalent barrels, produced by the producer from leases or properties corresponding to the segment described in 15 AAC 55.206(c)(1)(A) for that segment;

(2) oil and gas, in BTU equivalent barrels, produced by the producer from leases or properties corresponding to the segment described in 15 AAC 55.206(c)(1)(B) for that segment;

(3) oil, in BTU equivalent barrels, produced by the producer from a lease or property corresponding to a segment described in 15 AAC 55.206(c)(1)(C) for that segment;

(4) gas, in BTU equivalent barrels, produced by the producer from a lease or property corresponding to a segment described in 15 AAC 55.206(c)(1)(D) for that segment;

(5) gas, in BTU equivalent barrels, produced by the producer after June 30, 2007, from a lease or property corresponding to a segment described in 15 AAC 55.206(c)(1)(E), for that segment.

(b) The portion of a producer's expenditures that is excluded for a segment under AS 43.55.165(e)(18) may not exceed the total amount of expenditures that would be qualified capital expenditures applicable to the segment but for the exclusion provided under AS 43.55.165(e)(18).

(c) For purposes of AS 43.55.165(e)(18) and (a) and (d) of this section, taxable oil or gas is all oil or gas produced from a lease or property in the state except oil and gas the ownership or right to which is exempt from taxation.

(d) The portion of a producer's expenditures incurred during a calendar year after 2021 that is excluded under AS 43.55.165(e)(18) is calculated separately for each segment under 15 AAC 55.206. Subject to prorating for only a portion of a calendar year as provided under AS 43.55.165(e)(18), the excluded portion for each segment is $1 less than the product of $.30 multiplied by the total amount of taxable oil and gas, in BTU equivalent barrels, produced by the producer from leases or properties corresponding to each segment described in 15 AAC 55.206(c)(3) for that segment.

History

Authority: AS 43.05.080; AS 43.55.110 AS 43.55.023; AS 43.55.165
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 9/20/2020, Register 235; am 1/1/2022, Register 240

15 AAC 55.280 Adjustments to lease expenditures

(a) In adjusting a producer's or explorer's lease expenditures for the receipt of a payment or credit for the sale or other transfer of an asset under AS 43.55.170(a)(3)(A), if the acquisition cost of the asset was incurred during a calendar year for which a portion of the producer's or explorer's expenditures was excluded under AS 43.55.165(e)(18) and 15 AAC 55.275, the amount required to be subtracted from the producer's or explorer's lease expenditures under AS 43.55.170(a) is reduced by a fraction of the payment or credit received for the sale or transfer of the asset as provided in this section. That fraction is equal to the quotient of (1) the total of the excluded portions of the producer's or explorer's expenditures described in this section for all segments in the state under 15 AAC 55.206 divided by (2) the sum of the (A) producer's or explorer's qualified capital expenditures incurred with respect to all segments in the state during the calendar year or portion of the calendar year for which that excluded portion was excluded, plus (B) the amount described in (1) of this subsection.

(b) A fee or other consideration received by a producer or by an operator acting for the producer in connection with a person's use of a production facility in which the producer has an ownership interest or in connection with the producer's management of a production facility does not constitute a payment or credit for the use or management of the production facility under AS 43.55.170(a)(1) or a reimbursement or similar payment that offsets the producer's lease expenditures under AS 43.55.170(a)(2), to the extent that the fee or other consideration

(1) reimburses the producer for the share of the producer's costs to operate or maintain the production facility that is attributable to another person's use of the facility, except to the extent the producer treats that share of the costs as the producer's lease expenditure;

(2) compensates the producer for the deferral or loss of the producer's oil or gas production resulting from another person's use of the production facility;

(3) reimburses the producer for the producer's additional tax liability resulting from the receipt of a fee or other consideration in connection with another person's use of the production facility or in connection with the producer's management of the production facility; or

(4) in the case of a production facility in which the producer has an ownership interest,

(A) consists of a contribution of a share of new capital investment to acquire, construct, or improve the production facility, and is in lieu of an increase in the fee that would otherwise be charged to the person making the contribution in connection with that person's use of the facility, except to the extent the producer treats that person's share of the capital investment as the producer's lease expenditure; or

(B) constitutes a charge, as determined under (d) of this section, for use of capital invested in the production facility before April 1, 2006.

(1) costs to operate or maintain the production facility do not include costs that are treated as capitalized expenditures under 26 U.S.C. (Internal Revenue Code), as amended;

(2) except as otherwise provided in (3) of this subsection, if the facility use agreement or management agreement between the person using the facility and the producer provides for an identifiable amount of a fee that represents the person's share of the costs to operate or maintain the production facility, that amount will be considered the share of the producer's costs to operate or maintain the production facility that is attributable to the person's use of the facility;

(3) if the facility use agreement or management agreement between the person using the facility and the producer does not provide for an identifiable amount of a fee representing the person's share of the costs to operate or maintain the production facility, or if the department determines that, under a facility use agreement or management agreement executed after December 31, 2009, or under an amendment executed after December 31, 2009, to a facility use agreement or management agreement, the identifiable amount of a fee purporting to represent the person's share of the costs to operate or maintain the production facility (A) overstates those costs; or (B) fails to reasonably reflect the relative quantities of produced fluids processed by the facility and differences in other characteristics, if any, of the produced fluids that materially affect the costs to operate or maintain the facility, the department will determine the share of the producer's costs to operate or maintain the production facility that is attributable to the person's use of the facility, using a method of allocation that is based on relative quantities of produced fluids processed by the facility and differences in other characteristics, if any, of the produced fluids that materially affect the costs to operate or maintain the facility.

(d) For purposes of (b)(4)(B) of this section, the extent of a fee or other consideration in connection with a person's use of a production facility for a given time period that constitutes a charge for use of capital invested in the production facility before April 1, 2006, is equal to the following:

F x (CB/(CB + CA)),

where

(1) F equals the total amount of the fee or other consideration, excluding amounts described in (b)(1), (2), (3), or (4)(A) of this section, regardless of whether treated as a lease expenditure, that would be charged for that given time period in connection with the person's use of the facility if the total were calculated on the same per-unit basis that was used to calculate the total fee or other consideration for the

(A) last time period beginning before April 1, 2006, for which the person was charged a fee or other consideration in connection with the person's use of the facility, but not exceeding the amount of the actual total fee or other consideration for the given time period for which the calculation is made; or

(B) first time period for which the person was charged a fee or other consideration for use of the facility, if that first time period began after March 31, 2006, but not exceeding the amount of the actual total fee or other consideration for the given time period for which the calculation is made;

(2) CB equals the producer's total capital investment, if any, incurred before April 1, 2006, to acquire, construct, or improve the production facility, without deduction of depreciation; the producer's capital investment excludes any contribution described in (b)(4)(A) of this section, regardless of whether treated as a lease expenditure; and

(3) CA equals the producer's total capital investment, if any, incurred after March 31, 2006, and before the beginning date of the first time period for which the person was charged a fee in connection with the person's use of the facility, to acquire, construct, or improve the production facility, without deduction of depreciation; the producer's capital investment excludes any contribution described in (b)(4)(A) of this section, regardless of whether treated as a lease expenditure.

(e) For purposes of AS 43.55.170(a)(1), if a producer treats as the producer's lease expenditure a fee or other consideration that the producer pays or imputes to or on behalf of itself, whether directly or through an operator's billing, in connection with the producer's use of a production facility that the producer owns in whole or in part or that the producer manages, that fee or other consideration constitutes a payment or credit received by the producer for the use by another person of a production facility in which the producer has an ownership interest or for the management by the producer of a production facility under a management agreement providing for the producer to receive a management fee.

(f) For purposes of AS 43.55.170(a)(2), a payment, credit, or portion of a payment or credit received by or on behalf of a producer to reimburse the producer for a cost passed through to another person does not constitute a reimbursement or similar payment that offsets the producer's lease expenditures if the reimbursed producer does not treat that cost as the producer's lease expenditure.

(g) For purposes of AS 43.55.170(a)(3), a fee or other consideration received by or on behalf of a producer in connection with another person's use of a production facility in which the producer has an ownership interest does not constitute a payment or credit for the sale or transfer of an asset,

(1) if the fee or other consideration

(A) consists of a contribution of a share of new capital investment to acquire, construct, or improve the production facility and is in lieu of an increase in the fee that would otherwise be charged in connection with use of the facility; or

(B) represents a charge for use of capital invested in the production facility; and

(2) unless legal title or a similar ownership interest in the facility is transferred from the producer.

History

Authority: AS 43.05.080; AS 43.55.110; AS 43.55.170 AS 43.55.023; AS 43.55.165
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 12/4/2010, Register 196; am 9/20/2020, Register 235

15 AAC 55.290 When cost is incurred

(a) Unless otherwise provided under (c) of this section, for purposes of AS 43.55.165 and this chapter, a cost incurred by a producer or explorer is incurred during the calendar year

(1) for which the operator of a lease or property bills the producer for the cost, if

(A) the cost is a cost of exploring for, developing, or producing oil or gas deposits located within the lease or property;

(B) the operator operates the lease or property on behalf of the producer; and

(C) at least one producer, other than the operator, on behalf of which the operator operates the lease or property has a material interest in the lease or property;

(2) in which the cost is recorded on the producer's or explorer's financial accounting books or federal income tax books as incurred or, in the case of a cost that is treated as a capitalized expenditure under 26 U.S.C. (Internal Revenue Code), as amended, regardless of elections made under 26 U.S.C. 263(c) (Internal Revenue Code), as amended, as placed in the producer's or explorer's work-in-process, construction-in-process, or similar account, if

(A) a material portion of the cost is not billed to at least one non-operator producer by the operator of a lease or property with respect to whose oil or gas exploration, development, or production the cost is incurred; and

(B) the producer's or explorer's fiscal year for financial accounting purposes or federal income tax purposes, as applicable, is the calendar year;

(3) in which the cost is recorded on the producer's or explorer's financial accounting books as incurred after those books have been restated on a calendar year basis using a method approved or prescribed by the department, if the circumstances are other than those described in (1) or (2) of this subsection.

(b) If a cost is subject to (a)(2) of this section, the producer or explorer may elect to rely on either its financial accounting books or its federal income tax books, but that election once made may not be changed without the department's approval. An election under this subsection

(1) is solely for the purpose of determining during which calendar year a cost is incurred; and

(2) does not affect the categorization of a lease expenditure as a qualified capital expenditure or as not a qualified capital expenditure under AS 43.55.023(k).

(c) For purposes of AS 43.55.023(i), AS 43.55.165, and this chapter, whether a cost incurred by a producer or explorer was incurred before April 1, 2001, or after March 31, 2001, before April 1, 2006, or after March 31, 2006, before July 1, 2007, or after June 30, 2007, before July 1, 2008, or after June 30, 2008, before July 1, 2016, or after June 30, 2016, and before July 1, 2017, or after June 30, 2017 is determined by the month

(1) for which the operator of a lease or property contemporaneously billed the producer for the cost, if

(A) the cost is a cost of exploring for, developing, or producing oil or gas deposits located within the lease or property;

(B) the operator operated the lease or property on behalf of the producer; and

(C) at least one producer, other than the operator, on behalf of which the operator operated the lease or property had a material interest in the lease or property;

(2) in which the cost was contemporaneously recorded on the producer's or explorer's financial accounting books as incurred or, in the case of a cost that is treated as a capitalized expenditure under 26 U.S.C. (Internal Revenue Code), as amended, regardless of elections made under 26 U.S.C. 263(c) (Internal Revenue Code), as amended, as placed in the producer's or explorer's work-in-process, construction-in-process, or similar account, if the circumstances were other than those described in (1) of this subsection.

History

Authority: AS 43.05.080; AS 43.55.110Sec. 72, ch. 1, AS 43.55.023; AS 43.55.165SSSLA 2007 AS 43.55.028
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 12/6/2018, Register 228

Article 3 Tax Credits

15 AAC 55.305 Application of tax credits

(a) A producer may apply a tax credit as allowed by law only against the specified type of tax liability. A producer may not apply a tax credit against a penalty or interest, except for as provided in (c) of this section for interest associated with an additional amount of tax due when filing an amended return and any self-reported penalty.

(b) If a provision of AS 43.55, as that chapter read on June 30, 2007, or this chapter refers to application of a tax credit against a tax liability under AS 43.55.011(e) but not also AS 43.55.011(f), the tax credit may not be applied against the minimum tax for oil and gas produced before July 1, 2007, from leases or properties in the state north of 68 degrees North latitude determined under AS 43.55.011(f), as that subsection read on June 30, 2007. Nothing in this subsection prevents a producer from applying a tax credit based on a lease expenditure applicable to oil and gas produced from those leases or properties against a tax on oil or gas produced from leases or properties elsewhere in the state.

(c) A producer reporting an additional amount of tax due and associated interest from the tax levied by AS 43.55.011(e) for oil or gas produced in a prior year in an amended return filed with the department before the department has issued an assessment for the tax levied by AS 43.55.011(e) for oil or gas produced in that prior year may carryback a tax credit under AS 43.55.023 or 43.55.025 or a tax credit certificate under AS 43.55.023 or 43.55.025 for application against the additional amount of tax and associated interest. A producer reporting a penalty associated with the tax levied by AS 43.55.011(e) before the department has issued an assessment for the penalty may carryback a tax credit under AS 43.55.023 or 43.55.025 or a tax credit certificate under AS 43.55.023 or 43.55.025 for application against the penalty. If a producer uses a tax credit under AS 43.55.023 or AS 43.55.025 or a tax credit certificate under AS 43.55.023 or AS 43.55.025 to satisfy a self-reported penalty, the producer must specify the amount of the credit being applied to the self-reported penalty. The amount of a tax credit under AS 43.55.023 or 43.55.025 or the amount of a tax credit certificate under AS 43.55.023 or 43.55.025 that the producer may carryback for application against the additional amount due for that prior year is limited to the additional amount of tax and associated interest and any self-reported penalty. The percentage limitation in AS 43.55.023(e) for a tax credit certificate is inapplicable when a producer carries back a tax credit certificate under AS 43.55.023(e) against the additional amount of tax due for a prior year. For a producer that elected to apply the tax credit in AS 43.55.024(j) in the prior year, the amount of a tax credit under AS 43.55.023 or 43.55.025 or the amount of a tax credit certificate under AS 43.55.023 or 43.55.025 that the producer may carryback for application against the additional amount of tax due for that prior year is limited to the amount of the tax credit under AS 43.55.023 or 43.55.025 or tax credit certificate under AS 43.55.023 or 43.55.025 that would reduce the tax liability under AS 43.55.011(e) for that prior year to the amount in AS 43.55.011(f) as provided in 15 AAC 55.335(g). A producer that elected to apply the tax credit in AS 43.55.024(j) in that prior year may, in its amended return reporting the additional amount of tax, withdraw the producer's application of all or a portion of tax credit in AS 43.55.024(j) in order to carryback a tax credit under AS 43.55.023 or 43.55.025 or a tax credit certificate under AS 43.55.023 or 43.55.025 for application against the additional amount of tax provided no claim for refund would result and no assessment has been issued by the department for the prior year and the carryback is consistent with 15 AAC 55.335(g) if only a portion of the tax credit in AS 43.55.024(j) is withdrawn. No claim for refund may be requested by a producer carrying back a tax credit under AS 43.55.023 or 43.55.025 or a tax credit certificate under AS 43.55.023 or 43.55.025 for application against the additional amount of tax, associated interest for that prior year, or a self-reported penalty. The department may issue a notice and demand for payment, including interest, not later than six years after the date the producer files an amended return that carries back a tax credit under AS 43.55.023 or 43.55.025 or a tax credit certificate under AS 43.55.023 or 43.55.025 if the department reduces the amount of the tax credit under AS 43.55.023 or 43.55.025 or tax credit certificate under AS 43.55.023 or 43.55.025 following an audit of the tax credit claim to which the tax credit or tax credit certificate relates. A producer may carryforward any excess amount of a tax credit or tax credit certificate if the producer overstated the additional amount of a tax, associated interest, or self-reported penalty, due in its amended return that carried back a tax credit under AS 43.55.023 or 43.55.025 or tax credit certificate under AS 43.55.023 or 43.55.025.

(d) The following examples illustrate (c) of this section:

Example 1. Producer A has a tax credit under AS 43.55.023(b) in Year 6 due to an annual loss in Year 5. In Year 7, Producer A is required under AS 43.55.075(b) to file amended returns for Year 2 and Year 3 reporting additional tax and associated interest due to a decision of a regulatory agency that results in a retroactive change to costs of transportation that has a corresponding increase on the production tax value of oil produced in Year 2 and Year 3. The department has not issued a notice of assessment and demand for payment for oil and gas produced by Producer A in Year 2 and Year 3 when Producer A files the amended return in Year 7. Producer A in its amended return filed in Year 7 for oil and gas produced in Year 2 and Year 3 may carryback the tax credit under AS 43.55.023 from Year 6 against the additional amount of tax and associated interest due in Year 2 and Year 3.

Example 2. The facts are the same as in Example 1 except the department has determined in Year 10 after an audit that the annual loss in Year 5 for Producer A was a lower amount than claimed in Producer's original return for Year 5. The amount of the tax credit under AS 43.55.023(b) in Year 6 is correspondingly reduced. Producer A overstated its tax credit under AS 43.55.023(b) that it carried back in its amended return for Year 2 and Year 3. The department issues a notice and demand for payment for Year 3 to account for the reduction in the tax credit after the audit in Year 10.

Example 3. The facts are the same as in Example 1 except Producer A in Year 6 purchased a tax credit certificate under AS 43.55.023 from Explorer B. The department has determined in Year 10 after an audit that the annual loss in Year 5 from Explorer B for a tax credit issued as a carried-forward annual loss under AS 43.55.023(b) was a lower amount than claimed in Explorer B's application for the tax credit certificate. The department issues a notice of assessment and demand for payment pursuant to AS 43.55.023(g) to Explorer B. The department does not issue a demand for payment to Producer A despite the reduction in the tax credit certificate.

Example 4. The facts are the same as in Example 1 except Producer A in Year 8 realizes that it overstated the additional tax and associated interest due in its amended return for Year 3 filed in Year 7. Producer A files an amended return for Year 3 to correct its error. Producer A carried back an excess amount of its tax credit under AS 43 55.023(b) in Year 6 against its amended return in Year 7 for Year 3. Producer A may not request a refund of the excess tax credit in its amended return filed in Year 8. The department will adjust the tax credit to reflect the additional amount of tax credit available due to the decrease in tax.

Example 5. The facts are the same as in Example 1 except Producer A filed its original return late for Year 3. Producer A realizes its failure before the department issues a notice of assessment and demand for payment for the failure to file penalty under AS 43.05.220. Producer A in its amended return for Year 7 includes a self-report of the penalty. Producer A may carryback the tax credit under AS 43.55.023 to apply against its self-reported penalty.

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.075 AS 43.55.011; AS 43.55.025; AS 43.55.110 AS 43.55.023; AS 43.55.030
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 1/1/2018, Register 224

15 AAC 55.310 Qualified capital expenditure credits

For purposes of AS 43.55.023(a), (n), and (o), if an expenditure incurred by a producer or explorer during a calendar year is an outlay for work-in-progress with respect to an asset the cost of which is treated as a capitalized expenditure under 26 U.S.C. (Internal Revenue Code), as amended, regardless of elections made under 26 U.S.C. 263(c) (Internal Revenue Code), as amended, the fact that the asset is not placed in service until a later calendar year does not prevent the expenditure from constituting a qualified capital expenditure.

History

Authority: AS 43.05.080; AS 43.55.023; AS 43.55.110
Eff. 5/3/2007, Register 182; am 9/14/2012, Register 203

15 AAC 55.315 Carried-forward annual loss credits

(a) Except as provided in 15 AAC 55.305, a carried-forward annual loss tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, may not be applied against a tax liability for the calendar year in which the adjusted lease expenditures on which the credit is based are incurred.

(b) A determination of a carried-forward annual loss subject to AS 43.55.023(b)(2), as the provisions of that paragraph read before January 1, 2018, for oil and gas produced before January 1, 2018, may be performed by subtracting the reduction under AS 43.55.160(f) or (g) from the amount of excess adjusted lease expenditures otherwise calculated under 15 AAC 55.206(b) for the segment described in 15 AAC 55.206(c)(1)(A). Only the remainder, if positive, constitutes excess adjusted lease expenditures that may establish a carried-forward annual loss under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, for oil and gas produced before January 1, 2018. If the remainder is zero or less, there is no carried-forward annual loss.

Example 1. Producer A produces only oil in a calendar year after 2016 that qualifies for a 20 percent reduction in the gross value at the point of production under AS 43.55.160(f) but not a reduction under AS 43.55.160(g). The gross value at the point of production, before reduction, is $10 million. After reduction under AS 43.55.160(f), the gross value at the point of production is $8 million. The producer's adjusted lease expenditures for the calendar year applicable to the oil are $9 million. The annual production tax value of the oil would be calculated by deducting $9 million from $8 million, except that an annual production tax value may not be less than zero. Therefore, the annual production tax value of the oil is zero, and the $1 million in adjusted lease expenditures that are not deductible are considered excess adjusted lease expenditures. However, for the purpose of determining a carried-forward annual loss and a potential tax credit under AS 43.55.023(b)(2), as the provisions of that paragraph read before January 1, 2018, for oil and, gas produced before January 1, 2018, the $2 million reduction in the gross value at the point of production is subtracted from that $1 million in excess adjusted lease expenditures. This results in a negative value. Therefore, there is no carried-forward annual loss under AS 43.55.023(b)(2), as the provisions of that paragraph read before January 1, 2018, for oil and, gas produced before January 1, 2018, and no tax credit.

Example 2. The facts are the same as in Example 1 except that the producer's adjusted lease expenditures for the calendar year applicable to the oil are $11 million instead of $9 million. In this situation, the annual production tax value of the oil again is zero, but the amount of excess adjusted lease expenditures is $3 million. After the $2 million reduction in the gross value at the point of production is subtracted from the $3 million figure, the resulting excess adjusted lease expenditures are $1 million. Therefore, there is a $1 million carried-forward annual loss under AS 43.55.023(b)(2), as the provisions of that paragraph read before January 1, 2018, for oil and, gas produced before January 1, 2018.

History

Authority: AS 43.05.080; AS 43.55.110Sec. 39, ch. 3 AS 43.05.023; AS 43.55.160SSSLA 2017
Eff. 5/3/2007, Register 182; am 3/1/2017, Register 221; am 1/1/2018, Register 224; am 12/6/2018, Register 228

15 AAC 55.320 Transferable tax credit certificates

(a) A producer or explorer may apply for a transferable tax credit certificate for

(1) a qualified capital expenditure credit under AS 43.55.023(a) or a well lease expenditure credit under AS 43.55.023( l) at any time after the expenditure in question is incurred but no more frequently than once a calendar quarter;

(2) a carried-forward annual loss credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, for lease expenditures incurred before January 1, 2018, no earlier than January 1 of the calendar year following the calendar year in which the carried-forward annual loss in question is incurred.

(b) Information and documentation that the department will require a producer or explorer to provide in an application for a transferable tax credit certificate under AS 43.55.023(d) include

(1) the applicant's certification, under oath, that the expenditures for which the credit is claimed have been incurred, that the credit has not been used, and that the applicant is aware of no reason why the applicant does not qualify for the credit;

(2) a list of any authorizations for expenditure that apply to the expenditures for which the credit is claimed and copies of those authorizations;

(3) a schedule of the relevant expenditures incurred, identifying any applicable authorizations for expenditure and showing the accounts charged and, in the case of expenditures included in a joint interest billing, the month billed;

(4) a description of the lease or property or other land where the exploration, development, or production activities with respect to which the relevant expenditures were incurred took place, and a map or survey showing the location of the activities;

(5) if the relevant expenditures include costs associated with drilling a well, a

(A) copy of

(i) the Well Completion or Recompletion Report and Log (Form 10-407) filed with the Alaska Oil and Gas Conservation Commission under 20 AAC 25.070; or

(ii) a well completion report that is filed with a federal agency and that is substantially similar to the filing described in (i) of this subparagraph; or

(B) well status report, if at the time the application is made material described in (A) of this paragraph is not yet due to be filed and has not been filed;

(6) if the lease or property where the exploration, development, or production activities with respect to which the relevant expenditures were incurred took place is subject to a unit operating agreement, identification of the applicable unit operating agreement;

(7) a list of any partners or other entities that shared in costs of which the relevant expenditures incurred by the applicant are the applicant's share;

(8) if the relevant expenditures are subject to joint venture audit by a participant in a joint venture, identification of and contact information for the joint interest auditor;

(9) for a tax credit under AS 43.55.023(a) or ( l) for an expenditure incurred in connection with geological or geophysical exploration or in connection with an exploration well,

(A) the applicant's written agreements described in AS 43.55.023(a)(2)(A) or ( l)(2)(A), as applicable; and

(B) documentation that the applicant has submitted to the Department of Natural Resources all data referred to in AS 43.55.023(a)(2)(B) or ( l)(2)(B), as applicable;

(10) copies of the applicant's most recent audited financial statements, including the auditor's opinion, notes to the audited financial statements, and information related to any contingent liabilities that may be owed by the applicant to another party; and

(11) any unresolved notices of violations, liens filed, or notices of assessment of or liability for tax, interest, penalty, fee, rental, royalty or other charge of any kind issued to the applicant related to an applicant's oil or gas exploration, development, or production in the state.

History

Authority: AS 43.05.080; AS 43.55.023; AS 43.55.110
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 9/14/2012, Register 203; am 3/1/2017, Register 221; am 12/6/2018, Register 228

15 AAC 55.325 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.325. Cash purchases of tax credit certificates.

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; repealed 3/1/2017, Register 221

15 AAC 55.325 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.325 repealed in Register 221 was readopted under a new section 15 AAC 55.525. Repealed.

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; repealed 3/1/2017, Register 221

15 AAC 55.330 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.330. Transitional investment expenditure credits. Repealed.

History

Eff. 5/3/2007, Register 182; repealed 3/1/2017, Register 221

15 AAC 55.335 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.335. Additional nontransferable credits. (a) Repealed 1/1/2022. (b) For a calendar year during which two or more producers that qualify under AS 43.55.024(e) are succeeded through merger, acquisition, or a similar transaction by a single producer that qualifies under AS 43.55.024(e), (1) each of the predecessor producers may take that percentage of an entire credit to which it is otherwise entitled under AS 43.55.024(a) or (c) that equals the percentage of days in the calendar year during which those producers are separate entities; (2) the successor producer may take that percentage of a single entire credit to which it is otherwise entitled under AS 43.55.024(a) or (c) that equals the percentage of days in the calendar year during which that producer is the successor to the predecessor producers. (c) An application under AS 43.55.024(e) must be filed with the department, as part of the statement described in AS 43.55.030(a), on or before March 31 of the calendar year after the calendar year for which the producer seeks the department's determination that the producer was qualified under AS 43.55.024(a) or (c). The application must include (1) the producer's certification that the producer's operation in the state or its ownership of an interest in a lease or property in the state as a distinct producer is not for the purpose of dividing among multiple producer entities any production tax liability under AS 43.55.011(e) that would otherwise be attributed to a single producer; (2) information requested on the application form prescribed by the department concerning the producer's transactions or relationships affecting (A) interests in leases or properties in the state; (B) rights to oil or gas production from leases or properties in the state; and (C) interests in other business entities or interests of other business entities in the producer; and (3) other pertinent information required by the department. (d) AS 43.55.024(i) applies only to oil produced from a lease or property north of 68 degrees North latitude. (e) Subject to (g) of this section, the total amount of a producer's tax credits for a calendar year under AS 43.55.024(j) is determined by (1) calculating for each month of the calendar year the number of barrels of oil taxable under AS 43.55.011(e) that the producer produces during the month from leases or properties north of 68 degrees North latitude and, (A) for oil produced before January 1, 2017, that does not meet the criteria in any of AS 43.55.160(f)(1), (2), or (3); for purposes of this subparagraph, oil does not meet the criteria in AS 43.55.160(f)(3) if (i) the producer has not reduced the gross value at the point of production of the oil under AS 43.55.160(f)(3); and (ii) the oil is not included in the volume of oil the producer is required under 15 AAC 55.212(l) to determine qualifies for a reduction in gross value at the point of production under AS 43.55.160(f)(3); (B) for oil produced after December 31, 2016, that does not receive a reduction in the gross value at the point of production under AS 43.55.160(f) or (g); (2) multiplying for each month of the calendar year the number of barrels of oil calculated for the month under (1) of this subsection by the applicable dollar amount per barrel for the month under AS 43.55.024(j)(1) - (9) using the average gross value at the point of production for the month calculated under (f) of this section; (3) summing over all months of the calendar year the products calculated for each month under (2) of this subsection. (f) For purposes of AS 43.55.024(j) and of (e) of this section, the average gross value at the point of production for a month is calculated by (1) calculating the total gross value at the point of production of the oil taxable under AS 43.55.011(e) that the producer produces during the month from leases or properties north of 68 degrees North latitude and, (A) for oil produced before January 1, 2017, that does not meet the criteria in any of AS 43.55.160(f)(1), (2), or (3); for purposes of this subparagraph, oil does not meet the criteria in AS 43.55.160(f)(3) if (i) the producer has not reduced the gross value at the point of production of the oil under AS 43.55.160(f)(3); and (ii) the oil is not included in the volume of oil the producer is required under 15 AAC 55.212(l) to determine qualifies for a reduction in gross value at the point of production under AS 43.55.160(f)(3); (B) for oil produced after December 31, 2016, that does not receive a reduction in the gross value at the point of production under AS 43.55.160(f) or (g); (2) dividing the amount calculated under (1) of this subsection by the number of barrels of oil calculated for the month under (e)(1) of this section. (g) If a producer's application of tax credits other than a tax credit under AS 43.55.024(j) against a tax levied by AS 43.55.011(e) reduces the producer's tax liability to the amount calculated for a calendar year after 2013 under AS 43.55.011(f) or less, the producer may not apply a tax credit under AS 43.55.024(j) against the tax for that calendar year. If a producer's application of tax credits other than a tax credit under AS 43.55.024(j) against a tax levied by AS 43.55.011(e) does not reduce the producer's tax liability to the amount calculated for a calendar year after 2013 under AS 43.55.011(f) or less, the producer may apply against the tax no more than the portion of a tax credit under AS 43.55.024(j) that is equal to the difference between the amount calculated for the calendar year under AS 43.55.011(f) and the tax liability after reduction by application of tax credits other than a tax credit under AS 43.55.024(j). In calculating that reduction, if the tax credits to be applied include one or more tax credits subject to a percentage limitation under AS 43.55.023(e), calculation of the percentage limitations under 15 AAC 55.375(a) must take account of any tax credit or portion of a tax credit under AS 43.55.024(j) that the producer will apply against the producer's tax, to the extent allowed under this subsection. (h) As applied only to oil produced by a municipal entity, "oil taxable under AS 43.55.011(e)" in (e) and (f) of this section means oil produced from a lease or property in the state that the municipal entity sells to another party, other than oil in which the federal government or the state has an ownership interest or the ownership or right to which constitutes a landowner's royalty interest.

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.110 AS 43.55.011; AS 43.55.030; AS 43.55.160
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 12/25/2013, Register 208; am 3/1/2017, Register 221; am 1/1/2022, Register 240

15 AAC 55.337 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.337. Tax credits for a municipal entity. (a) For a tax credit based on expenditures incurred during a calendar year, other than a tax credit under AS 43.55.023(b), as the provisions of that subsection read before Januarv 1, 2018, the amount of the municipal entity's tax credit may not exceed the amount of the tax credit otherwise allowed under this chapter, multiplied by the fraction calculated under (d) of this section for that calendar year. (b) For a tax credit not based on expenditures, other than tax credits under AS 43.55.024(i) and (j), the amount of the municipal entity's tax credit for a calendar year may not exceed the amount of the tax credit otherwise allowed under this chapter, multiplied by the fraction calculated under (d) of this section for that calendar year. (c) A municipal entity is eligible for tax credits under AS 43.55.024(i) or (j) only for oil, otherwise qualifying under AS 43.55.024(i) or (j), that it sells to another party, other than oil in which the federal government or the state has an ownership interest or the ownership or right to which constitutes a landowner's royalty interest. (d) For each calendar year, the municipal entity shall calculate a fraction, the numerator of which is equal to the amount of oil and gas produced by the municipal entity from leases or properties in the state during the calendar year, in BTU equivalent barrels, that the municipal entity sells to another party, other than oil or gas in which the federal government or the state has an ownership interest or the ownership or right to which constitutes a landowner's royalty interest, and the denominator of which is equal to the total amount of oil and gas produced by that municipal entity from leases or properties in the state during the calendar year, in BTU equivalent barrels, other than oil or gas in which the federal government or the state has an ownership interest or the ownership or right to which constitutes a landowner's royalty interest. The fraction is equal to zero for a calendar year during which the municipal entity does not produce any oil or gas, or produces oil or gas from a lease or property, but does not sell any of that oil or gas to another party.

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.895 AS 43.55.019; AS 43.55.025 AS 43.55.023; AS 43.55.110
Eff. 3/1/2017, Register 221; am 12/6/2018, Register 228

15 AAC 55.340 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.340. Cook Inlet credit provisions before July 1, 2007. Repealed.

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; repealed 9/20/2020, Register 235

15 AAC 55.341 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.341. Credit provisions after June 30, 2007, and before January 1, 2011, for Cook Inlet and for gas used in the state. (a) For purposes of AS 43.55.011(m) and this section, the portion of a tax credit for the calendar year of production that is allocated to gas produced by a producer during a calendar year from leases or properties (1) in the Cook Inlet sedimentary basin is, for a credit under (A) AS 43.55.024(c), a fraction whose numerator is the amount of gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties in the Cook Inlet sedimentary basin and whose denominator is the total amount of oil and gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties in the state; (B) AS 38.05.180(i), AS 41.09.010, or AS 43.55.025 for an expenditure incurred for exploration in the Cook Inlet sedimentary basin and that is available to be applied for the calendar year of production, a fraction whose numerator is the amount of gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties in the Cook Inlet sedimentary basin and whose denominator is the amount of oil and gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties in the Cook Inlet sedimentary basin; (C) AS 38.05.180(i), AS 41.09.010, or AS 43.55.025 for an expenditure incurred for exploration outside the Cook Inlet sedimentary basin, zero; (D) AS 43.55.024(a), zero; (2) outside the Cook Inlet sedimentary basin and used in the state is, for a credit under (A) AS 43.55.024(c), a fraction whose numerator is the amount of gas subject to AS 43.55.011(o) in BTU equivalent barrels produced by the producer during the calendar year, and whose denominator is the total amount of oil and gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties in the state; (B) AS 38.05.180(i), AS 41.09.010, or AS 43.55.025 for an expenditure incurred for exploration outside the Cook Inlet sedimentary basin and that is available to be applied for the calendar year of production, a fraction whose numerator is the amount of gas subject to AS 43.55.011(o) in BTU equivalent barrels produced by the producer during the calendar year, and whose denominator is the amount of oil and gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties outside the Cook Inlet sedimentary basin; (C) AS 38.05.180(i), AS 41.09.010, or AS 43.55.025 for an expenditure incurred for exploration in the Cook Inlet sedimentary basin, zero; (D) AS 43.55.024(a), a fraction whose numerator is the amount of gas subject to AS 43.55.011(o) in BTU equivalent barrels produced by the producer during the calendar year from leases or properties no part of which is north of 68 degrees North latitude, and whose denominator is the amount of oil and gas taxable under AS 43.55.011(e) in BTU equivalent barrels produced by the producer during the calendar year from all leases or properties outside the Cook Inlet sedimentary basin, no part of which is north of 68 degrees North latitude. (b) Except for excess tax credits remaining after the accounting required under (c) of this section, a tax credit allocated under (a) of this section to gas produced from leases or properties (1) in the Cook Inlet sedimentary basin (A) may be applied, if at all, only against the tax levied by AS 43.55.011(e) for that gas; (B) to the extent not applied as described in (A) of this paragraph, is not available to be used as a tax credit in any manner and is considered lost; (2) outside the Cook Inlet sedimentary basin and used in the state (A) may be applied, if at all, only against the tax levied by AS 43.55.011(e) for that gas; (B) to the extent not applied as described in (A) of this paragraph, is not available to be used as a tax credit in any manner and is considered lost. (c) For a calendar year for which a limitation under AS 43.55.011(j), (k), or (o) on the tax levied by AS 43.55.011(e) has the effect of reducing the producer's tax for oil or gas produced from one or more leases or properties below the amount of the tax that would be levied in the absence of that limitation, the producer shall account under (d) and (e) of this section for the tax credits that are allocated under (a) of this section to gas produced from leases or properties in the Cook Inlet sedimentary basin or to gas produced from leases or properties outside the Cook Inlet sedimentary basin and used in the state. (d) A producer subject to (c) of this section shall calculate its excess tax credits under this subsection as follows: (1) first, if the producer has a tax credit under AS 43.55.024(a) whose portion allocated under (a)(2)(D) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(o), for gas produced from leases or properties outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude and that is used in the state; (2) second, if the producer has a tax credit under AS 43.55.024(c) whose portion allocated under (a)(2)(A) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(o), for gas produced from leases or properties outside the Cook Inlet sedimentary basin and that is used in the state, and after further reducing that amount of tax, but not below zero, by the lesser of the two amounts, if any, compared in (1) of this subsection; (3) third, if the producer has a tax credit under AS 43.55.024(c) whose portion allocated under (a)(1)(A) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(j), for gas produced from leases or properties in the Cook Inlet sedimentary basin; (4) fourth, if the producer has a tax credit under AS 43.55.025 whose portion allocated under (a)(2)(B) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(o), for gas produced from leases or properties outside the Cook Inlet sedimentary basin and that is used in the state, and after further reducing that amount of tax, but not below zero, by the sum of the lesser of the two amounts, if any, compared in (1) of this subsection and the lesser of the two amounts, if any, compared in (2) of this subsection; (5) fifth, if the producer has a tax credit under AS 43.55.025 whose portion allocated under (a)(1)(B) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(j), for gas produced from leases or properties in the Cook Inlet sedimentary basin, and after further reducing that amount of tax, but not below zero, by the lesser of the two amounts, if any, compared in (3) of this subsection; (6) sixth, if the producer has a tax credit under AS 41.09.010 whose portion allocated under (a)(2)(B) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(o), for gas produced from leases or properties outside the Cook Inlet sedimentary basin and that is used in the state, and after further reducing that amount of tax, but not below zero, by the sum of the lesser of the two amounts, if any, compared in (1) of this subsection, the lesser of the two amounts, if any, compared in (2) of this subsection, and the lesser of the two amounts, if any, compared in (4) of this subsection; (7) seventh, if the producer has a tax credit under AS 41.09.010 whose portion allocated under (a)(1)(B) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(j), for gas produced from leases or properties in the Cook Inlet sedimentary basin, and after further reducing that amount of tax, but not below zero, by the sum of the lesser of the two amounts, if any, compared in (3) of this subsection and the lesser of the two amounts, if any, compared in (5) of this subsection; (8) eighth, if the producer has a tax credit under AS 38.05.180(i) whose portion allocated under (a)(2)(B) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(o), for gas produced from leases or properties outside the Cook Inlet sedimentary basin and that is used in the state, and after further reducing that amount of tax, but not below zero, by the sum of the lesser of the two amounts, if any, compared in (1) of this subsection, the lesser of the two amounts, if any, compared in (2) of this subsection, the lesser of the two amounts, if any, compared in (4) of this subsection, and the lesser of the two amounts, if any, compared in (6) of this subsection; (9) ninth, if the producer has a tax credit under AS 38.05.180(i) whose portion allocated under (a)(1)(B) of this section is greater than zero, the producer shall compare that portion to the amount of tax levied by AS 43.55.011(e), after application of any limitation under AS 43.55.011(j), for gas produced from leases or properties in the Cook Inlet sedimentary basin, and after further reducing that amount of tax, but not below zero, by the sum of the lesser of the two amounts, if any, compared in (3) of this subsection, the lesser of the two amounts, if any, compared in (5) of this subsection, and the lesser of the two amounts, if any, compared in (7) of this subsection; (10) tenth, for each comparison made in (1) - (9) of this subsection, if the former amount exceeds the latter amount, the difference constitutes excess tax credits, and the producer's total amount of excess tax credits is the sum of the excess tax credits, if any, calculated for all comparisons. (e) If a producer's total amount of excess tax credits calculated under (d) of this section is greater than zero, the producer shall (1) for each lease or property for which a limitation under AS 43.55.011(j), (k), or (o) on the tax levied by AS 43.55.011(e) has the effect of reducing the producer's tax below the amount of tax that would be levied in the absence of that limitation, calculate the amount of that reduction; (2) calculate the total of the reductions calculated under (1) of this subsection for all affected leases or properties; (3) reduce the amount of excess total tax credits by the total calculated under (2) of this subsection, but not to less than zero; (A) the total calculated under (2) of this subsection, unless the producer has excess adjusted lease expenditures for the calendar year that are accounted for under 15 AAC 55.224(b); (B) if the producer has excess adjusted lease expenditures for the calendar year that are accounted for under 15 AAC 55.224(b), (i) the remainder calculated by subtracting the amount calculated under 15 AAC 55.224(b)(2) from the amount calculated under 15 AAC 55.224(b)(4), if the former amount is less than the latter amount; or (ii) zero, if the amount calculated under 15 AAC 55.224(b)(2) is greater than or equal to the amount calculated under 15 AAC 55.224(b)(4). (f) Any amount of excess tax credits remaining after reduction under (e)(3) of this section may be used for a later calendar year, transferred to another person, or applied against a tax levied for oil or gas not subject to AS 43.55.011(j), (k), or (o), to the extent allowed under the law applicable to those tax credits. The remaining amount of excess tax credits is treated as a credit under AS 43.55.025 to the extent, if any, that the producer correctly included a credit under AS 43.55.025 in determining excess tax credits, and the balance of the remaining amount of excess tax credits, if any, is first treated as a credit under AS 38.05.180(i) or AS 41.09.010 to the extent, if any, that the producer correctly included a credit under AS 38.05.180(i) or AS 41.09.010 in determining excess tax credits, and next as a credit under AS 43.55.024(c) to the extent, if any, that the producer correctly included a credit under AS 43.55.024(c) in determining excess tax credits, and finally as a credit under AS 43.55.024(a) to the extent, if any, that the producer correctly included a credit under AS 43.55.024(a) in determining excess tax credits. (g) A tax credit under AS 38.05.180(i), AS 41.09.010, or AS 43.55.025 is subject to AS 43.55.011(m) and (a) - (f) of this section if the person that originally qualified for the tax credit fails to transfer the tax credit to another person before or during the calendar year that the credit becomes available to be applied against a tax levied by AS 43.55.011(e) for gas produced from leases or properties in the Cook Inlet sedimentary basin or for gas produced from leases or properties outside the Cook Inlet sedimentary basin and used in the state, as applicable. If the tax credit is transferred to another person before or during that calendar year, the transferee's use of the tax credit is not subject to AS 43.55.011(m) or (a) - (f) of this section, irrespective of whether the transferee produces gas from a lease or property in the Cook Inlet sedimentary basin or gas from a lease or property outside the Cook Inlet sedimentary basin and that is used in the state. For purposes of this subsection, a tax credit under AS 43.55.025 is not available to be applied against a tax until the department has issued a production tax credit certificate for the credit under AS 43.55.025(f)(5). (h) At the request of the person seeking a production tax credit certificate under AS 43.55.025(f), the department will defer issuing a certificate that is otherwise ready for issuance in December of a calendar year until January of the next calendar year. (i) This section applies to oil and gas produced and expenditures incurred after June 30, 2007, except that for a tax credit under (1) AS 38.05.180(i), AS 41.09.010, or AS 43.55.025, this section does not apply to expenditures incurred after December 31, 2010; (2) AS 43.55.024, this section does not apply to oil or gas produced after December 31, 2010. (j) The following example illustrates (a) - (f) of this section: A producer produces oil or gas from three leases or properties, called Property A, Property B, and Property C. All three properties are located outside the Cook Inlet sedimentary basin; only Property A is located south of 68 degrees North latitude. In the calendar year in question, the producer's oil and gas production from the respective properties taxable under AS 43.55.011(e) is as follows: Property A:1,000,000 BTU equivalent barrels of gas used in the state, with a volume of 5,649,718 Mcf and a tax under AS 43.55.011(e) of $3,000,000, before application of the tax limitation under AS 43.55.011(o); and 4,000,000 barrels of oil;Property B:5,000,000 BTU equivalent barrels of gas used in the state, with a volume of 28,248,587 Mcf and a tax under AS 43.55.011(e) of $10,000,000, before application of the tax limitation under AS 43.55.011(o); and 5,000,000 BTU equivalent barrels of gas not used in the state;Property C:10,000,000 barrels of oil. For the calendar year in question, the producer qualifies for a tax credit under AS 43.55.024(c) of up to $7,562,000, a tax credit under AS 43.55.025 of $50,000,000 for expenditures incurred outside the Cook Inlet sedimentary basin, and a tax credit under AS 43.55.024(a) of up to $6,000,000. Step One: Allocate the tax credits to gas produced from leases or properties outside the Cook Inlet sedimentary basin and used in the state: Under (a)(2)(A) of this section, the allocated fraction of the tax credit under AS 43.55.024(c) is 6,000,000 BTU equivalent barrels (the amount of gas subject to AS 43.55.011(o)), divided by 25,000,000 BTU equivalent barrels (the total amount of taxable oil and gas produced from all leases or properties in the state), or 6/25. 6/25 * $7,562,000 = $1,815,000. Under (a)(2)(B) of this section, the allocated fraction of the tax credit under AS 43.55.025 is 6,000,000 BTU equivalent barrels (the amount of gas subject to AS 43.55.011(o)), divided by 25,000,000 BTU equivalent barrels (the amount of taxable oil and gas produced from all leases or properties outside the Cook Inlet sedimentary basin), or 6/25. 6/25 * $50,000,000 = $12,000,000. Under (a)(2)(D) of this section, the allocated fraction of the tax credit under AS 43.55.024(a) is 1,000,000 BTU equivalent barrels (the amount of gas subject to AS 43.55.011(o) produced only from leases or properties south of 68 degrees North latitude), divided by 5,000,000 BTU equivalent barrels (the amount of taxable oil and gas produced from all leases or properties outside the Cook Inlet sedimentary basin and south of 68 degrees North latitude), or 1/5. 1/5 * $6,000,000 = $1,200,000. Step Two: Calculate excess tax credits: Under (d) of this section, first the allocated portion of the tax credit under AS 43.55.024(a), $1,200,000, is compared to the tax for the gas used in the state and produced outside the Cook Inlet sedimentary basin and south of 68 degrees North latitude, after application of the tax limitation under AS 43.55.011(o). With that limitation applied as set out in 15 AAC 55.440(d), the tax is 5,649,718 Mcf multiplied by $.177 per Mcf, or $1,000,000, which is also the actual tax, since it is less than the tax would be without the limitation. The allocated portion of the tax credit exceeds the tax by $200,000, which is excess tax credits. Second, the allocated portion of the tax credit under AS 43.55.024(c), $1,815,000, is compared to the tax for the gas used in the state and produced anywhere outside the Cook Inlet sedimentary basin, after application of the tax limitation under AS 43.55.011(o), and after further reduction by the $1,000,000 in tax credit assumed, in accordance with (b)(2) of this section, to be used in the first comparison. With that limitation applied as set out in 15 AAC 55.440(d), the tax is 33,898,305 Mcf multiplied by $.177 per Mcf, or $6,000,000, which is also the actual tax, since it is less than the tax would be without the limitation. After subtracting the $1,000,000 from the first comparison, the amount to be compared to the allocated portion of the tax credit is $5,000,000. Because the allocated portion of the tax credit is less than $5,000,000, no excess tax credits are associated with the tax credit under AS 43.55.024(c). Third, the allocated portion of the tax credit under AS 43.55.025, $12,000,000, is compared to the tax after application of the tax limitation as used in the second comparison, after reduction as in the second comparison, and after further reduction by the $1,815,000 tax credit assumed to be used in the second comparison. Therefore, the amount to be compared to the allocated portion of the tax credit is $6,000,000 minus $1,000,000 minus $1,815,000, or $3,185,000. The allocated portion of the tax credit exceeds that amount by $8,815,000 which is excess tax credits. The total excess tax credits are therefore $200,000 plus $8,815,000, or $9,015,000. Step Three: Calculate tax reductions resulting from the tax limitation under AS 43.55.011(o): Under (e)(1) of this section, the tax reduction for Property A is calculated by subtracting the tax after application of the tax limitation under AS 43.55.011(o), $1,000,000, from the tax as calculated without that limitation, $3,000,000, for a reduction of $2,000,000. The tax reduction for Property B is calculated by first calculating the tax with the limitation applied as set out in 15 AAC 55.440(d), $.177 per Mcf multiplied by 28,248,587 Mcf, or $5,000,000, and subtracting that amount from the tax as calculated without that limitation, $10,000,000, for a reduction of $5,000,000. Under (e)(2) of this section, the total of the tax reductions is $2,000,000 plus $5,000,000, or $7,000,000. Step Four: Reduce excess tax credits under (e)(3) of this section: The total excess tax credits calculated in Step Two, $9,015,000, are reduced by the total of the tax reductions calculated in Step Three, $7,000,000. The amount of remaining excess tax credits is $2,015,000. Step Five: Classify remaining excess tax credits under (f) of this section: The $2,015,000 in remaining excess tax credits is compared to the allocated portion of the tax credit under AS 43.55.025, $12,000,000. Since $2,015,000 is less than $12,000,000, the entire amount of remaining excess tax credits is treated as a tax credit under AS 43.55.025.

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.110 AS 43.55.011; AS 43.55.025
Eff. 10/21/2009, Register 192; am 9/14/2012, Register 203; am 1/1/2022, Register 240

15 AAC 55.345 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.345. Procedures for applying certain tax credits. (a) To apply a tax credit allowed under AS 43.55.023 or 43.55.024 against a tax liability under AS 43.55.011, a producer must file, no later than March 31 of the year following the calendar year for which the tax was levied, a claim for the tax credit in the statement described in AS 43.55.030(a), setting out the information required by the department on a form prescribed by the department as part of that statement. (b) In addition to other information required by the department, a claim under this section for a tax credit for a qualified capital expenditure under AS 43.55.023(a), carried-forward annual loss under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, or well lease expenditure under AS 43.55.023( l) must include (1) a description and accounting of the expenditures for which the credit is claimed, including a summary of the types of expenditures and the month and calendar year each expenditure was incurred; (2) a description of the lease or property or other land where the exploration, development, or production activities with respect to which the relevant expenditures were incurred took place, and if the producer is not the operator, identification of the operator; (3) a list of any partners or other entities that shared in costs of which the relevant expenditures incurred by the producer are the producer's share, providing the respective shares of the partners or other entities, including the producer, and identifying the operator of the venture; (4) identification of the custodians of the accounting records for the relevant expenditures, including the general ledgers, contracts, progress billings and invoices, and joint interest billings; (5) if applicable, the producer's written (A) agreement required under AS 43.55.023(a)(2), as the provisions of that paragraph read on June 30, 2007, in the case of an expenditure incurred for exploration work performed before July 1, 2008; (B) agreements required under AS 43.55.023(a)(2), as amended by sec. 25, ch. 1, SSSLA 2007, or AS 43.55.023( l)(2), and documentation that the producer has submitted to the Department of Natural Resources all data referred to (i) in AS 43.55.023(a)(2)(B), as amended by sec. 25, ch. 1, SSSLA 2007, in the case of a claim for a tax credit under AS 43.55.023(a) for an expenditure incurred for exploration work performed after June 30, 2008; (ii) in AS 43.55.023( l)(2)(B), in the case of a claim for a tax credit under AS 43.55.023( l) for a well lease expenditure; (6) in the case of a (A) claim for a tax credit under AS 43.55.023(a) for a qualified capital expenditure, the producer's certification that a tax credit has not been and is not being taken for the expenditure under AS 43.55.023( l) or 43.55.025, except as provided under (c) of this section; (B) claim for a tax credit under AS 43.55.023( l) for a well lease expenditure, the producer's certification that a tax credit has not been and is not being taken for the expenditure under AS 43.55.023(a) or 43.55.025, except as provided under (c) of this section; (7) copies of the applicant's most recent audited financial statements, including the auditor's opinion, notes to the audited financial statements, and information related to any contingent liabilities that may be owed by the applicant to another party; and (8) any unresolved notices of violations, liens filed, or notices of assessment of or liability for tax, interest, penalty, fee, rental, royalty or other charge of any kind issued to the applicant related to an applicant's oil or gas exploration, development, or production in the state. (c) A producer that files an application under 15 AAC 55.356 for an alternative oil and gas exploration tax credit under AS 43.55.025 for an expenditure that the producer believes is a qualified capital expenditure may file a contingent claim under this section for a qualified capital expenditure tax credit under AS 43.55.023(a) or ( l), if and to the extent that the expenditure later is determined not to qualify for a tax credit under AS 43.55.025 but is determined to qualify for a tax credit under AS 43.55.023(a). (d) In addition to other information required by the department, a claim under this section for a tax credit shown on a transferable tax credit certificate under AS 43.55.023(e) must (1) identify the certificate and the person that transferred the certificate to the producer claiming the tax credit; and (2) state the percentage, if any, of the tax credit that was subtracted in calculating the amount of an installment payment for each month under 15 AAC 55.381(b). (e) Repealed 3/1/2017. (f) Repealed 3/1/2017. (g) Repealed 3/1/2017. (h) A producer that files a claim for a tax credit under this section shall retain and make available to the department upon request all financial and technical source records supporting the credit claimed. If the credit claimed relates to an exploration well or to geological or geophysical exploration, the records to be retained and made available must include drill rig logs, daily drilling logs, and activity logs.

History

Authority: AS 43.05.080; AS 43.55.025; AS 43.55.110 AS 43.55.023; AS 43.55.030 AS 43.55.024; AS 43.55.040
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 9/14/2012, Register 203; am 3/1/2017, Register 221; am 12/6/2018, Register 228; am 9/20/2020, Register 235

15 AAC 55.350 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.350. Alternative tax credit for exploration expenditures for work performed after June 30, 2003, and before July 1, 2008. Repealed.

History

Eff. 5/3/2007, Register 182; am 12/25/2009, Register 192; repealed 9/20/2020, Register 235

15 AAC 55.351 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.351. Alternative tax credit for exploration expenditures for work performed after June 30, 2008, and for certain seismic exploration work performed before July 1, 2003. (a) An explorer may request an alternative oil and gas exploration tax credit under AS 43.55.025 by filing an application with the department (1) no later than six months after completion of the exploration activity for which the tax credit is claimed; or (2) in the case of seismic exploration performed before July 1, 2003, at any time before January 1, 2016. For a tax credit that the applicant wishes to use for a previous calendar year, as provided under 15 AAC 55.370(c), an application may be filed with the statement filed under AS 43.55.030(a) for that calendar year. (b) For purposes of AS 43.55.025(c)(2)(B), the distance between the bottom hole locations of two wells is measured as the horizontal distance between the surface location directly above the bottom hole location of each well. (c) For purposes of AS 43.55.025(d)(2), the distance between an exploration well and the outer boundary of a unit is measured as the horizontal distance between the surface location directly above the bottom hole location of the well and the nearest point on the outer boundary of the unit. (d) This section applies to exploration expenditures for work performed after June 30, 2008 and before July 1, 2016, and to seismic exploration expenditures for work performed before July 1, 2003, except that exploration expenditures for work conducted outside of the Cook Inlet sedimentary basin and south of 68 degrees North latitude must be incurred for work performed (1) after June 30, 2008 and before January 1, 2022 for a tax credit under AS 43.55.025(a)(1), (2), or (3); (2) after June 30, 2008 and before January 1, 2018 for a tax credit under AS 43.55.025(a)(4); or (3) as provided in (e) of this section. (e) AS 43.55.025(a)(6) exploration expenditures that qualify under AS 43.55.025(m) must be incurred for work performed after June 1, 2012 for a well spudded before July 1, 2017.

History

Authority: AS 43.05.080; AS 43.55.025; AS 43.55.110
Eff. 12/25/2009, Register 192; am 3/1/2017, Register 221; am 1/1/2018, Register 224

15 AAC 55.355 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.355. Alternative oil and gas exploration tax credit claim for expenditures for work performed after June 30, 2003, and before July 1, 2008. Repealed.

History

Eff. 5/3/2007, Register 182; am 12/25/2009, Register 192; repealed 9/20/2020, Register 235

15 AAC 55.356 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.356. Alternative oil and gas exploration tax credit claim for expenditures for work performed after June 30, 2008, and for certain seismic exploration work performed before July 1, 2003. (a) An application for an alternative oil and gas exploration tax credit under AS 43.55.025 for a particular exploration activity may, on a form provided by the department, be filed by (1) a single explorer that (A) holds the entire interest in the particular well or seismic or other geophysical exploration activity; and (B) incurred 100 percent of the expenditures for which the credit is claimed; or (2) a designated joint applicant that is authorized in a writing, signed by each explorer that incurred expenditures, to file a joint tax credit application on behalf of all those explorers; a joint application must be for the total qualified expenditures incurred by all the explorers for the exploration activity for which the credit is claimed and must include a copy of the written authorization signed by each explorer. (b) An application for a tax credit for an exploration well must include the following information: (1) the applicant's name, permanent contact address, and telephone number; (2) if the applicant is a designated joint applicant, under (a)(2) of this section, the name and address of each explorer represented in the application and the percentage of the total qualified exploration expenditures incurred by each explorer; (3) a description of the exploration activities for which the credit is claimed; (4) an accounting of the qualified exploration expenditures for which credit is claimed; (5) the date the exploration well was spudded, the dates drilling occurred, and the date the well was completed, suspended, or abandoned as reported to the Alaska Oil and Gas Conservation Commission under 20 AAC 25.070; (6) the bottom hole location and the surface location of the exploration well; (7) for an application for a tax credit requiring qualification under AS 43.55.025(b) and (c), (A) the determination of the commissioner of natural resources under (i) AS 43.55.025(c)(2)(A)(iii) that the geological objective of the well is a potential oil or gas trap that is distinctly separate from any trap that has been tested by a preexisting well; and (ii) AS 43.55.025(c)(2)(C) that the well was consistent with achieving the explorer's stated geological objective; if the determination is not available before the application deadline under 15 AAC 55.351(a), it may instead be submitted as a later supplement to the filed application; and (B) for a well other than a well to explore a Cook Inlet prospect, the spud date and bottom hole location of the nearest preexisting well and the distance between the bottom hole location of the exploration well and the bottom hole location of the nearest preexisting well; (8) if the exploration well is within a unit boundary, (A) identification of the unit; and (B) if a plan of exploration or plan of development was in effect for the unit before May 14, 2003, a copy of the plan; (9) for an application for a tax credit requiring qualification under AS 43.55.025(b) and (d), (A) identification of the nearest unit that is under a plan of development; and (B) the distance between the bottom hole location of the exploration well and the outer boundary of the nearest unit that is under a plan of development, as the boundary was delineated on July 1, 2003; (10) a survey plat that graphically identifies all the locations, distances, and dates required to be reported under this subsection; (11) a copy of the Well Completion or Recompletion Report and Log (Form 10-407) for the exploration well filed with the Alaska Oil and Gas Conservation Commission under 20 AAC 25.070, or a copy of a well completion report that is substantially similar to that filing and that is filed with a federal agency; in addition, if the application is for expenditures that qualify under AS 43.55.025(c), the application must include a copy of the Well Completion or Recompletion Report and Log (Form 10-407) for the nearest preexisting well, or the substantially similar federal filing; (12) the written agreements required under AS 43.55.025(f)(2); (13) other information requested by the department, as the department considers necessary for reviewing the application. (c) An application for a tax credit requiring qualification under AS 43.55.025(b) and (e) or under AS 43.55.025(k) for a particular seismic or other geophysical exploration activity must include the following information: (1) the name, permanent contact address, and telephone number of the applicant; (2) if the applicant is a designated joint applicant, under (a)(2) of this section, the name and address of each explorer represented in the application and the percentage of the total qualified exploration expenditures incurred by each explorer; (3) a description of the seismic or other geophysical exploration activities for which the credit is claimed; (4) an accounting of the qualified exploration expenditures for which credit is claimed; (5) the date and location where the seismic or other geophysical activity occurred; (6) a statement verifying (A) that the seismic or other geophysical exploration activities occurred outside of the boundaries of a unit that is under a plan of exploration or a plan of development or, in the case of seismic exploration under AS 43.55.025(k), outside of the boundaries of a production unit; or (B) the percentage of the seismic or other geophysical exploration activities that occurred inside the unit boundary, if a portion of those activities crossed into the boundary of a unit; (7) the written agreements required under AS 43.55.025(f)(2); (8) in the case of seismic exploration under AS 43.55.025(k), a written statement from the Department of Natural Resources that the commissioner of natural resources considers acquiring the seismic exploration data for public distribution to be in the best interest of the state; (9) other information requested by the department, as the department considers necessary for reviewing the application. (d) An applicant under this section shall retain, and make available to the department upon request, all financial and technical source documents and records supporting the credit claimed for an exploration well or seismic or other geophysical exploration activities, including the rig logs, daily drilling logs, and activity logs. (e) If the department determines that all data required to be submitted to the Department of Natural Resources under AS 43.55.025 have been submitted, and, except for a credit under AS 43.55.025(k), after the six-month application period in AS 43.55.025(f) has expired, the department will issue one or more production tax credit certificates for the qualified expenditures allowed under AS 43.55.025. A conditional tax credit certificate issued under AS 43.55.025(q) expires on the date the department denies the application for a production tax credit certificate under AS 43.55.025(f) or the date the department issues the production tax credit certificate under AS 43.55.025(f). The department will issue a conditional tax credit certificate under AS 43.55.025(q) on and after July 1, 2017 for an application for a tax credit certificate under AS 43.55.025(f) for exploration expenditures incurred before July l, 2017 if (1) the application is submitted to the department on or after July l, 2017; or (2) the applicant requests a conditional tax credit certificate for an application submitted before July 1, 2017 and the department has not (A) denied the application; or (B) issued a production tax credit certificate under AS 43.55.025(f). (f) The department may allocate claimed expenditures between exploration and non-exploration activities, and will deny a claimed exploration expenditure that it determines not to be reasonably required or not incurred for qualified exploration activities. (g) This section applies to exploration expenditures for work performed after June 30, 2008 and before July 1, 2016, and to seismic exploration expenditures under AS 43.55.025(k) for work performed before July 1, 2003, except that exploration expenditures for work conducted outside of the Cook Inlet sedimentary basin and south of 68 degrees North latitude must be incurred for work performed (1) after June 30, 2008 and before January 1, 2022 for a tax credit under AS 43.55.025(a)(1), (2), or (3); (2) after June 30, 2008 and before January 1, 2018 for a tax credit under AS 43.55.025(a)(4); or (3) as provided in (h) of this section.

History

Authority: AS 43.05.080; AS 43.55.025; AS 43.55.110
Eff. 12/25/2009, Register 192; am 3/1/2017, Register 221; am 1/1/2018, Register 224

15 AAC 55.360 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.360. Qualified exploration expenditures. (a) For purposes of the alternative oil and gas exploration tax credit under (1) AS 43.55.025(a)(1) - (4), as the provisions of that section read on June 30, 2008, qualified exploration expenditures are the reasonably required direct costs for work performed on a particular exploration well or seismic or geophysical exploration project on or after July 1, 2003 and before July 1, 2008; (2) AS 43.55.025(a)(1) - (4), in effect on July 1, 2008, qualified exploration expenditures are the reasonably required direct costs for work performed on a particular exploration well or seismic or other geophysical exploration project after June 30, 2008, and before July 1, 2016, or on a particular seismic exploration project before July 1, 2003, except that exploration expenditures for work conducted outside of the Cook Inlet sedimentary basin and south of 68 degrees North latitude must be incurred for work performed after June 30, 2008 and before; (A) January 1, 2022 for a tax credit under AS 43.55.025(a)(1), (2), or (3); or (B) January 1, 2018 for a tax credit under AS 43.55.025(a)(4); (3) AS 43.55.025(a)(6) exploration expenditures that qualify under AS 43.55.025(m) must be incurred for work performed after June l, 2012 for a well spudded before July l, 2017. (b) Qualified exploration expenditures for an exploration well include costs incurred for (1) surveying and preparing the exploration well drill site; (2) constructing new ice or gravel roads, from the terminus of an existing ice or gravel road used in oil or gas operations to the exploration well site, and building and maintaining docks, helipads, or landing areas necessary to the exploratory drilling activity; costs for these activities are calculated as follows: (A) for a road, dock, helipad, or landing area, the cost is the actual cost incurred; (B) if the road, dock, helipad, or landing area is used for any activity other than the exploration activity for which the credit is claimed, the cost is allocated among the different activities based on the number of hours or days, as appropriate, that it is used for each activity, divided by the total number of hours or days it is used for all activities; (3) in-state travel, temporary living quarters, and subsistence at or near the exploration well site for drilling crew and personnel engaged in onsite exploration activities; (4) drilling rig costs, including (A) transportation and preparation, including the costs of moving the drilling rig to the exploration well site, mobilization, rigging-up, de-mobilization, and rigging-down of the drilling rig on the exploration well site; (B) onsite costs for operating the drilling rig, including onsite coring and well logging; onsite drilling rig operating costs are calculated as follows: (i) if the drilling rig is under a third-party contract, the costs are calculated at the contractual operating rate; (ii) if the drilling rig is owned wholly or partly by an explorer, the costs are calculated on the basis of the net book value of the rig on the date it arrives on the exploration well site; if the exploration well drilling activities are the first use of a drilling rig after it is transported into the state, the cost of transporting the drilling rig to the state and to the area-wide dock is added to the net book value of the drilling rig; (iii) drilling rig operating costs may be claimed from the date the drilling rig arrives on the exploration well site until the earliest of the completion date, the date the drilling rig is released from the drilling operation, or the date the drilling rig moves off the exploration well site; if drilling activities are suspended for any reason for 15 consecutive calendar days, drilling rig operating costs are not allowed under this subparagraph for those 15 days or for any subsequent day until drilling activities are resumed; and (C) drilling materials, supplies, maintenance, repairs, drilling crew labor, and drilling waste handling; (5) transportation equipment used for drilling crews; the cost of transportation equipment is calculated as follows: (A) if the equipment is under a third-party contract, the cost is calculated at the hourly or daily contract rate, as appropriate, multiplied by the number of hours or days the equipment is actually used for the exploration activity for which the credit is claimed, divided by the number of hours or days the equipment was available by contract for use in the exploration activity; (B) if the equipment is owned wholly or partly by an explorer, the cost is calculated on the basis of the net book value of the equipment multiplied by the number of days or hours, as appropriate, the equipment is used in the exploration activity for which the credit is claimed, divided by the number of days or hours of estimated remaining useful life of the equipment; (C) if the equipment is used for any activity other than the exploration activity for which the credit is claimed, the cost is allocated among the different activities based on the number of hours or days, as appropriate, it is used for each activity, divided by the total number of hours or days it is used for all activities; and (6) communications expenses necessary to the exploration well. (c) Qualified exploration expenditures for seismic and geophysical exploration include costs incurred for (1) seismic exploration activities, initial processing of data derived from seismic exploration activities, and downhole geophysical surveys associated with well logging; (2) in-state travel, temporary living quarters, and subsistence at or near the exploration site for seismic crew and other personnel engaged in the exploration activities; (3) the seismic exploration crew; seismic exploration crew costs are calculated as follows: (A) if the crew is provided under a third-party contract, at the rate provided in the contract; (B) if the crew is provided by an explorer, as actual payments to the crew for time expended on the seismic activity; (4) goods, services, and materials; costs for goods, services, and materials are calculated as follows: (A) if goods, services, and materials are provided under a third-party contract, the costs are calculated at the contract rate; (B) if goods, services, and materials are provided in whole or in part by an explorer, the costs are the actual costs incurred; (C) if a good, service, or material is used for any activity other than the exploration activity for which the credit is claimed, the cost is allocated among the different activities based on the number of hours or days, as appropriate, it is used for each activity, divided by the total number of hours or days it is used for all activities; and (5) seismic and geophysical equipment, off-site computers, and other modeling equipment used in the initial seismic data processing; the cost of that equipment, including maintenance and repairs, is calculated as follows: (A) if the equipment is under a third-party contract, the cost is calculated at the hourly or daily contract rate multiplied by the number of hours or days, as appropriate, that the equipment is actually used for the exploration activity for which the credit is claimed, divided by the number of hours or days the equipment was available by contract for use in the exploration activity; (B) if the equipment is owned wholly or partly by an explorer, the cost is calculated on the basis of the net book value of the equipment multiplied by the number of days or hours, as appropriate, the equipment is used in the exploration activity for which the credit is claimed, divided by the number of days or hours of estimated remaining useful life of the equipment; (C) if the equipment is used for any activity other than the exploration activity for which the credit is claimed, the cost is allocated among the different activities based on the number of hours or days, as appropriate, it is used for each activity, divided by the total number of hours or days it is used for all activities. (d) Qualified exploration expenditures for work performed after June 30, 2003 and before July 1, 2008, do not include costs that are disallowed under AS 43.55.025(b)(3) or (4), as the provisions of those paragraphs read on June 30, 2008. Qualified exploration expenditures for work performed after June 30, 2008, do not include costs that are disallowed under AS 43.55.025(b)(3) or (4), in effect on July 1, 2008. Qualified exploration expenditures for seismic exploration work performed before July 1, 2003, do not include costs that are disallowed under AS 43.55.025(b)(3), in effect on July 1, 2008. For purposes of this subsection and (1) AS 43.55.025(b)(3), as the provisions of that paragraph read on June 30, 2008, "testing, stimulation, or completion costs" means costs incurred on the exploration site after discovery of oil or gas potential at the site, including costs incurred to prepare an exploration well for, or convert it to production, to prepare or monitor an exploration well for status as a producer or potential producer, or to conduct flow tests; in this paragraph, "discovery of oil or gas potential" means drilling an exploration well into a formation capable of producing previously undiscovered oil or gas reserves; (2) AS 43.55.025(b)(3), as the provisions of that paragraph read on June 30, 2008, and as those provisions are in effect on July 1, 2008, (A) "administration, supervision, engineering, or lease operating costs" means overhead costs incurred for activities that (i) do not occur on the exploration site; and (ii) are not directly related to drilling an exploration well or conducting seismic exploration, including geophysical surveys other than seismic surveys; (B) "geological or management costs" means costs incurred before drilling begins to determine or select possible exploration targets; "geological or management costs" includes airborne gravity and magnetic surveys; (C) "community relations or environmental costs" includes costs incurred for environmental compliance programs required as a result of an environmental incident, spill, or disaster; (D) "indirect or financing costs" includes (i) bottom hole and dry hole contributions, and reimbursements and fees assessed for late participation; and (ii) seismic or geophysical data purchased from another person. (e) In this section, (1) "labor costs" means the actual costs of labor, including the amount of customary or required benefits; (2) "net book value" means, under generally accepted accounting principles, the dollar amount the owner of an asset records in its financial statement as the historical cost of the asset, excluding capitalized interest and net of accumulated depreciation or amortization. (f) Qualified exploration expenditures for work performed on an exploration well after June 30, 2008, in the case of (1) testing or stimulation costs, are limited to costs incurred to conduct activities necessary to appraise the well for its oil or gas production potential; those costs must be incurred before the well is suspended or abandoned; (2) completion costs, (A) are limited to costs incurred to equip and condition the well for the purpose of conducting activities described in (1) of this subsection; (B) do not include expenditures to abandon or suspend a well; this subparagraph does not affect the treatment as qualified exploration expenditures of expenses required for abandonment of a dry hole within 18 months after the date the well was spudded as provided in AS 43.55.025(b)(3)(D).

History

Authority: AS 43.05.080; AS 43.55.025; AS 43.55.110
Eff. 5/3/2007, Register 182; am 12/25/2009, Register 192; am 3/1/2017, Register 221; am 1/1/2018, Register 224

15 AAC 55.365 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.365. Transfer of a transferable tax credit certificate or production tax credit certificate. (a) A person may transfer an interest in a transferable tax credit certificate issued under AS 43.55.023(d) or a production tax credit certificate issued under AS 43.55.025 by notifying the department, on a transfer form provided by the department. A transfer form must include the following information: (1) the names, federal tax identification numbers, and addresses of the transferor and the transferee; (2) the amount of tax credit that was transferred, the nature of the transfer, and the monetary or other value received. (b) Transfer of a tax credit certificate is effective on the date the department sends notice to the transferor that the certificate has been transferred. (c) After a person has notified the department of a transfer under (a) of this section, the person may not use or transfer any additional interest in the tax credit certificate until the effective date of the transfer under (b) of this section. (d) In this section, "transfer" means to sell, assign, exchange, or convey in any manner an interest in a tax credit certificate, regardless of whether compensation is received. (e) On or after January 1, 2018, a tax credit certificate for a tax credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, may be assigned in the same manner as provided under AS 43.55.029 for a tax credit certificate for a tax credit under AS 43.55.023(a) or ( l), or 43.55.025(a).

History

Authority: AS 43.05.080; AS 43.55.025Sec. 39, ch. 3 AS 43.55.023; AS 43.55.110SSSLA 2017
Eff. 5/3/2007, Register 182; am 1/1/2018, Register 224

15 AAC 55.370 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.370. Applying production tax credit certificates against production tax liability. (a) To apply a production tax credit certificate issued under AS 43.55.025 against a production tax liability under AS 43.55.011(e), a producer must submit to the department, with the statement described in AS 43.55.030(a), a written designation, on a form prescribed by the department, stating the (1) amount of tax credit to be applied against the tax liability; (2) calendar year for which the tax credit is to be applied; and (3) percentage, if any, of the tax credit that was subtracted in calculating the amount of an installment payment for each month under 15 AAC 55.381(b). (b) On receipt of a written designation under (a) of this section, subject to the provisions of 15 AAC 55.341, the department will apply the designated tax credit against the producer's production tax liability under AS 43.55.011(e) for the designated calendar year in the order listed under 15 AAC 55.375 or, if the producer submits a schedule under 15 AAC 55.375(c), in the order listed in that schedule. Subject to the provisions of 15 AAC 55.341, an unused amount of a tax credit designated for a calendar year under (a) of this section will be applied as a credit for the next calendar year for which the producer has a tax liability under AS 43.55.011(e) in the order listed under 15 AAC 55.375 or listed in the producer's then-current schedule. (c) Except for a tax credit based on an expenditure for seismic exploration under AS 43.55.025(k) or except as provided in 15 AAC 55.305, (1) the earliest calendar year for which a production tax credit under AS 43.55.025 may be applied against the tax liability of the producer that incurred the exploration expenditure on which the tax credit is based is the calendar year in which the exploration expenditure was incurred; (2) subject to the department's later issuance of a production tax credit certificate covering the amount of the tax credit, the producer may apply the tax credit before the certificate is issued. (d) Except as provided in 15 AAC 55.305, the earliest calendar year for which a production tax credit under AS 43.55.025 (1) that is based on an expenditure for seismic exploration under AS 43.55.025(k) may be applied against the tax liability of the producer that incurred the expenditure is the calendar year in which the production tax credit certificate is issued; (2) may be applied against the tax liability of a transferee of the production tax certificate is the calendar year in which the effective date of the transfer of the certificate occurs. (e) A production tax credit certificate does not accrue interest, and except for application against a tax liability as provided in this section or as provided in 15 AAC 55.305 for an additional amount of tax, associated interest, or a self-reported penalty, may not be used in payment of any tax or other amount owed. A production tax credit certificate for exploration expenditures incurred for work performed on or after July 1, 2016 may be applied against the tax levied by AS 43.20.011(e) by the producer or explorer that incurred the expenditures for the production tax credit certificate.

History

Authority: AS 43.05.080; AS 43.55.025 AS 43.20.044; AS 43.55.110
Eff. 5/3/2007, Register 182; am 12/25/2009, Register 192; am 1/1/2018, Register 224; am 9/20/2020, Register 235

15 AAC 55.375 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.375. Order of applying tax credits. (a) For purposes of applying a percentage limitation under AS 43.55.023(e) on the use of tax credits against a tax levied by AS 43.55.011(e), a producer shall, subject to 15 AAC 55.335(g), (1) first, apply all tax credits allowable against the tax levied by AS 43.55.011(e) other than credits subject to a percentage limitation under AS 43.55.023(e); (2) repealed 3/1/2017; (3) second, apply a credit subject to a percentage limitation under AS 43.55.023(e) against not more than 20 percent of the balance of the remaining tax liability under AS 43.55.011(e), if any. (b) Repealed 3/1/2017. (c) Except as provided under (a) of this section, and subject to 15 AAC 55.335(g), a producer may apply tax credits in any order, if the producer submits with the statement required under AS 43.55.030(a) a separate schedule setting out the order in which the tax credits are applied. In the absence of that schedule, tax credits must be applied in the following order: (1) first, any credit under AS 43.55.024(a); (2) second, any credit under AS 43.55.024(c); (3) third, for a calendar year after 2013, any credit under AS 43.55.024(i); (4) fourth, any credit under AS 43.55.019; (5) fifth, for a calendar year after 2013, any credit under AS 43.55.024(j); (6) sixth, any credit under AS 43.55.025; (7) repealed 3/1/2017; (8) seventh, any credit under AS 43.55.023(a); (9) eighth, any credit under AS 43.55.023( l); (10) ninth, any credit under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018; (11) repealed 3/1/2017; (12) repealed 3/1/2017; (13) tenth, any credit under AS 43.55.023(e).

History

Authority: AS 43.05.080; AS 43.55.024; AS 43.55.110 AS 43.55.023; AS 43.55.025
Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; am 9/14/2012, Register 203; am 12/25/2013, Register 208; am 3/1/2017, Register 221; am 12/6/2018, Register 228

15 AAC 55.380 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.380. Subtraction of tax credits in calculation of installment payment of estimated tax for oil and gas produced before July 1, 2007. Repealed.

History

Eff. 5/3/2007, Register 182; am 10/21/2009, Register 192; repealed 9/20/2020, Register 235

15 AAC 55.381 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.381. Subtraction of tax credits in calculation of installment payment of estimated tax for oil and gas produced after June 30, 2007. (a) For purposes of the (1) calculation required under AS 43.55.020(a)(5) or (7), the amount of the tax credits that are allowed by law to be applied against the tax levied by AS 43.55.011(e) for a calendar year does not include any amount of a tax credit that the producer transfers to another person; (2) installment payment required under AS 43.55.020(a)(3), a tax credit is not deductible in calculating the amount of the payment. (b) The provisions of AS 43.55.020(a)(5) and (7) prescribing a limit of 1/12 of certain tax credits do not apply to a tax credit shown on a transferable tax credit certificate that has been issued under AS 43.55.023(d) or a tax credit for which a production tax credit certificate has been issued under AS 43.55.025(f). Subject to the provisions of AS 43.55.020(a)(5) and (7) that the amount of an installment payment may not be less than zero and subject to the 80 percent limitation provided under AS 43.55.023(e), in calculating the amount of an installment payment under AS 43.55.020(a)(5) or (7) for a month, a producer that owns a transferable tax credit certificate or production tax credit certificate may subtract any percentage, irrespective of whether it is equal to or greater than 1/12, of the credit that was not previously subtracted, to the extent that the credit is allowed by law to be applied against the tax levied by AS 43.55.011(e) for the calendar year. (c) If in calculating the amount of an installment payment for a month required under AS 43.55.020(a)(5) or (7), a producer is unable to subtract the full amount of tax credits described in AS 43.55.020(a)(5) or (7), the unused amount of tax credits is not considered an overpayment, does not accrue interest, and except as provided under (b) of this section may not be carried forward to or used in calculating an installment payment for a future month. The amount of tax credits subtracted in calculating the amount of an installment payment does not affect the availability of tax credits to be applied as allowed by law against an annual tax liability under AS 43.55.011 in calculating the amount due under AS 43.55.020(a)(4). (d) This section applies to oil and gas produced after June 30, 2007. (e) Subject to the provisions of AS 43.55.020(a)(5) and (7) that the amount of an installment payment may not be less than zero, and subject to the provision of AS 43.55.024(i) that a tax credit authorized by that subsection may not reduce a producer's tax liability for a calendar year under AS 43.55.011(e) below zero, in calculating the amount of an installment payment under AS 43.55.020(a)(5) or (7) for each month of a calendar year, a producer may substitute the following amount for 1/12 of the tax credits under AS 43.55.024(i) that are allowed by law to be applied against the tax levied by AS 43.55.011(e) for the calendar year: the product of $5 and the number of barrels of oil produced by the producer during the month that qualify for a tax credit under AS 43.55.024(i). A producer may not make a substitution under this subsection for a month of a calendar year unless the producer does so for every month of the calendar year. (f) Subject to the provisions of AS 43.55.020(a)(5) or (7) that the amount of an installment payment may not be less than zero, and subject to the provision of AS 43.55.024(j), as implemented by 15 AAC 55.335(g), that a tax credit authorized by that subsection may not reduce a producer's tax liability for a calendar year under AS 43.55.011(e) below the amount calculated under AS 43.55.011(f), in calculating the amount of an installment payment under AS 43.55.020(a)(5) or (7) for each month of a calendar year, a producer may substitute the amount calculated for the month under 15 AAC 55.335(e)(2) for 1/12 of the tax credits under AS 43.55.024(j) that are allowed by law to be applied against the tax levied by AS 43.55.011(e) for the calendar year. A producer may not make a substitution under this subsection for a month of a calendar year unless the producer does so for every month of the calendar year.

History

Authority: AS 43.05.080; AS 43.55.020; AS 43.55.110 AS 43.55.011; AS 43.55.024
Eff. 10/21/2009, Register 192; am 12/25/2013, Register 208; am 1/1/2022, Register 240

Authority: AS 43.05.080; AS 43.55.011; AS 43.55.110
Eff. 4/30/2010, Register 194

Authority: AS 43.05.080; AS 43.55.028SSSLA 2017 AS 43.55.023; AS 43.55.110 AS 43.55.025Sec. 38, ch 3
Eff. 3/1/2017, Register 221; am 1/1/2018, Register 224

Authority: AS 43.05.080; AS 43.55.025; AS 43.55.165 AS 43.55.011; AS 43.55.028; AS 43.55.170 AS 43.55.020; AS 43.55.110; AS 43.55.895 AS 43.55.023; AS 43.55.150; AS 43.55.900 AS 43.55.024; AS 43.55.160
Eff. 1/1/95, Register 132; am 1/1/2000, Register 152; am 1/1/2002, Register 160; am 1/1/2003, Register 164; am 1/1/2004, Register 168; am 5/3/2007, Register 182; am 10/21/2009, Register 192; am 2/27/2010, Register 193; am 4/30/2010, Register 194; am 12/4/2010, Register 196; am 9/14/2012, Register 203; am 12/25/2013, Register 208; am 3/1/2017, Register 221; am 12/6/2018, Register 228; am 9/20/2020, Register 235; am 1/1/2022, Register 240

15 AAC 55.9660 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.9660. Number of oil wells. Repealed 7/1/77.

15 AAC 55.9670 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.9670. Daily per well oil production. Repealed 7/1/77.

15 AAC 55.9690 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.9690. Sales production ratio. Repealed 3/7/74.

15 AAC 55.9694 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.9694. Tax rate changes based on wholesale price index. Repealed 7/1/77.

15 AAC 55.9699 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.9699. Point of valuation of oil. Repealed 1/6/80.

15 AAC 55.9700 Oil and Gas Production Tax and Oil Surcharge

15 AAC 55.9700. Definitions. Repealed 1/6/80.

Chapter 56 Oil and Gas Exploration, Production and Pipeline Transportation Property Tax

15 AAC 56.005 Mandatory property statement

(a) Unless the deadline is extended under (c) of this section, a person owning property taxable under AS 43.56 shall file an accurate and complete property statement no later than January 15 of the tax year. The property statement must be in a form prescribed by the department and must list all property that is taxable under AS 43.56. The statement must be signed by the property owner under penalty of perjury and must be filed with the director by personal delivery or mail service or, if authorized in advance by the director, by facsimile transmission or electronic mail.

(b) A property statement under this section is a report or return for purposes of AS 43.05 and 15 AAC 05. Failure of the department to request or secure a property statement under this section does not render an assessment invalid or relieve the property owner from the obligation to file the statement or pay any taxes due.

(c) The director may, on a case by case basis, extend the deadline for filing a property statement if the property owner shows reasonable cause for the extension as provided in 15 AAC 05.200. To request an extension of time to file a property statement, a property owner must file a request for an extension with the department in writing or by electronic mail no later than January 15 of the tax year for which the statement is due, setting out a full statement of the reasons why an extension is necessary. If an extension is granted, the property statement must be filed before the extended period expires.

(d) A property statement under this section is subject to investigation and amendment for three years after the date it was filed. In the case of failure to file a property statement, the property is subject to investigation and assessment at any time.

(e) A property statement is inaccurate or incomplete if it

(1) fails to report all taxable property;

(2) reports property in such a way that the department is unable to determine if all taxable property has been accurately reported;

(3) fails to provide accurate information on the property's age, use, location, or value; or

(4) contains any other error or inaccuracy.

History

Authority: AS 43.05.080; AS 43.05.260; AS 43.56.200 AS 43.05.220; AS 43.56.070
Eff. 7/30/82, Register 83; am 1/1/2003, Register 164

15 AAC 56.010 Notice of assessment

(a) The department will send a notice of assessment to the owner of taxable property no later than March 1 of the tax year. A notice of assessment will state

(1) the name and address of the owner of the taxable property;

(2) a brief description of the property; and

(3) the assessed valuation.

(b) The department will send a copy of the notice of assessment to each municipality in which the taxable property is located at the same time that the department sends the notice to the owner of the property.

History

Authority: AS 43.05.080; AS 43.56.100; AS 43.56.200
Eff. 8/8/74, Register 51; am 1/1/2003, Register 164

15 AAC 56.015 Appeal procedures

Repealed.

History

Eff. 5/10/86, Register 98; am 1/1/2003, Register 164; repealed 12/29/2016, Register 220

15 AAC 56.020 Appeal to the department

(a) An owner of taxable property or a municipality receiving a notice of assessment may object to the assessed value of the property by filing a written appeal with the department no later than 20 days after the effective date of the notice of assessment. The appeal must be signed by the appealing party or the party's authorized representative and must state

(1) the identity of the appealing party;

(2) the name and address of each owner of the assessed property;

(3) a brief description of the property and its physical location as of January 1 of the tax year;

(4) all objections to the assessment, the grounds for each objection, a brief summary of the facts relating to each objection, and the generally accepted appraisal principles that support each objection; and

(5) the appealing party's opinion as to the full and true value of the property and the basis for that opinion.

(b) Upon the timely receipt of an appeal under (a) of this section filed by an owner of taxable property, the department will send notice of the appeal to each municipality in which the taxable property is located and to each other owner of the property identified in the appeal. Upon the timely receipt of an appeal under (a) of this section filed by a municipality, the department will send written notice of the appeal to each property owner identified in the appeal and any other municipality in which the property is located by United States mail. In addition to sending written notice by United States mail, the department may also notify a property owner or municipality by telephone, facsimile transmission, or electronic mail at the owner's or municipality's address of record. Only a property owner or municipality that receives written notice of an appeal from the department under this subsection will be considered a party to the appeal for purposes of appealing to the State Assessment Review Board.

(1) the identity of the appealing party;

(2) the name and address of each owner of the taxable property;

(3) the name of each municipality in which the property was located as of January 1 of the tax year;

(4) a brief description of the taxable property;

(5) any adjustments to the assessment and the assessment roll; and

(6) the reasons for upholding or adjusting the assessment.

(d) The department will mail a copy of the informal conference decision to the appellant no later than 30 days after the effective date of the notice of assessment. The department will mail a notice of the decision to each other party to the appeal stating whether there has been a change in the assessment.

History

Authority: AS 43.05.080; AS 43.56.110; AS 43.56.200
Eff. 8/8/74, Register 51; am 7/30/82, Register 83; am 4/2/88, Register 106; am 1/1/2003, Register 164; am 12/29/2016, Register 220

15 AAC 56.030 Appeal to the state assessment review board

(a) An owner of the taxable property or a municipality that was a party in an appeal under 15 AAC 56.020 and was adversely affected by the informal conference decision issued under 15 AAC 56.020(c) may appeal that decision to the board by filing an appeal with the board in writing no later than 50 days after the effective date of the notice of assessment. The appeal must be signed by the appealing party or the party's authorized representative and must state

(1) the identity of the appealing party;

(2) the date and number of the informal conference decision being appealed;

(3) the name and address of each owner of the taxable property;

(4) a brief description of the property and its physical location as of January 1 of the tax year;

(5) all objections to the assessment, the grounds for each objection, a brief summary of the facts relating to each objection, and the generally accepted appraisal principles that support each objection; and

(6) the appealing party's opinion as to the full and true value of the property and the basis for that opinion.

(b) Upon the timely receipt of an appeal under (a) of this section filed by an owner of taxable property, the board will send notice and a copy of the appeal to each municipality in which the taxable property is located and to each other owner of the property. Upon the timely receipt of an appeal under (a) of this section filed by a municipality, the board will send notice and a copy of the appeal to each owner of the taxable property and to each other municipality in which the property is located. The notice will be sent by United States mail.

(c) A property owner or municipality that was a party to an appeal under 15 AAC 56.020 and has not appealed the informal conference decision to the board may file a cross-appeal or notice of intervention in the appeal with the board no later than 60 days after the effective date of the notice of assessment. A cross-appeal must state the identity of the cross-appellant, the grounds for the cross-appeal, a brief description of the property, the cross-appellant's opinion as to the full and true value of the property, and the basis for that opinion. A notice of intervention must state the identity of the intervenor, whether the intervention is in support of the state or the appellant, the grounds for the intervention, a brief description of the property, the intervenor's opinion as to the full and true value of the property, and the basis for that opinion.

(d) On motion by the department, other party to the appeal, or its own motion, the board may dismiss a timely filed appeal, cross-appeal, or intervention that fails to provide the information required under (a) or (c) of this section, as applicable. The board may decline to consider any issue that was not first raised, considered, or decided by the department in the informal conference decision that is the subject of the appeal.

(e) The board will set a date for a hearing on the appeal to convene approximately 80 days after the effective date of the notice of assessment. No later than 20 days before the scheduled hearing date, the board will send written notice of the time and place of the hearing to the department and to each property owner and municipality that received notice under 15 AAC 56.020(b) of an appeal of the department's notice of assessment.

(f) On timely motion by the department, other party to the appeal, or on its own motion, the board may approve a prehearing schedule that requires the parties, including any cross-appellant or intervenor, to file statements, briefs, and documentary evidence before the hearing is convened. If a party, including a cross-appellant or intervenor, fails to submit documentary evidence as required in a prehearing schedule, the board may preclude the party, cross appellant, or intervenor from relying on the documentary evidence at the hearing. The board may issue other orders it determines necessary to expedite and conduct the prehearing or hearing processes.

History

Authority: AS 43.56.120; AS 43.56.130; AS 43.56.200
Eff. 11/4/74, Register 52; am 5/10/86, Register 98; am 1/1/2003, Register 164; am 12/29/2016, Register 220

15 AAC 56.040 Hearings of the state assessment review board

(a) Any three members of the board constitute a quorum for the transaction of all business and duties of the board. A quorum of the board members must be present in order to hear an appeal. The board may grant or deny an appeal, in whole or in part, by the majority vote of the members present at the appeal hearing.

(b) A board-elected chairperson, or the chairperson's designee, shall preside at the hearing. The chairperson may administer oaths, subpoena witnesses, and rule on the admissibility of evidence. The chairperson may exercise control over the proceedings as necessary to establish the order, time, and presentation of arguments and evidence by each party.

(c) A member of the board must inform the board at the commencement of the hearing of any possible conflict of interest the member may have. A board member must voluntarily withdraw from hearing an appeal when the member believes a conflict of interest prevents the member from participating in a fair and impartial manner. A party may request that a board member be disqualified from hearing an appeal on grounds that, due to a conflict of interest the member may have, a fair and impartial hearing cannot be accorded if the member is allowed to participate. Upon a request for disqualification, the other board members shall vote upon whether the member should be disqualified from participating in an appeal due to a conflict of interest.

(d) At any time after commencement of a hearing, the board may, on motion by the department, other party to the appeal, or on its own motion, grant a stay or continuance of the hearing to provide additional time to obtain information necessary to resolve the issues on appeal or for other good reason.

(e) In a hearing under this section

(1) relaxed rules of evidence apply;

(2) each party may present oral and written statements, call witnesses, and, subject to (4) and (5) of this subsection, introduce relevant documents and material into the record;

(3) witnesses will be required to testify under oath;

(4) documents and other evidence that were submitted to the board and other parties before the hearing under a prehearing order are admissible if they are relevant to the issues on appeal;

(5) documentary evidence that was not submitted to the board and the other parties before the hearing as required by a prehearing order may not be presented for the first time at the hearing unless

(A) the board grants permission after the party offering the evidence has shown reasonable cause for not complying with the prehearing order as provided in 15 AAC 05.200; and

(B) the party offering the evidence has provided the board and all parties with adequate opportunity to examine the documents.

(f) The proceedings at the hearing will be recorded electronically or by other means that assure an accurate record and may be transcribed at the request and expense of the party requesting the transcript.

(g) The appellant bears the burden of proof at the hearing. The assessed value of the property in the notice of assessment, including any adjustments determined in the informal conference, is presumed to be correct. The board will not adjust that assessed value unless the appellant has shown that the assessed value is the result of unequal, excessive, or improper valuation or that the valuation was not determined in accordance with the standards or provisions set out in AS 43.56.

(h) The decision of the board will include

(1) the identity of the appealing party;

(2) the name and address of each owner of the taxable property;

(3) the name of each municipality in which the property was located as of January 1 of the tax year;

(4) a brief description of the taxable property;

(5) any adjustments made by the board to the assessed value of the property; and

(6) the reasons for upholding or adjusting the assessment.

(i) The board will certify its decision in writing to the department no later than seven days after the hearing is concluded. A copy of the decision will be mailed to each party to the appeal.

History

Authority: AS 43.05.220; AS 43.56.130 AS 43.56.040; AS 43.56.200
Eff. 11/4/74, Register 52; am 1/1/2003, Register 164

15 AAC 56.042 Effect of certification

No later than June 1 of each year the department will certify the assessment roll for the tax year. By certifying the assessment roll, the department verifies that it has prepared the assessment roll in the manner required by law and, based on the best information available to the department, the assessed values represent the department's determination of the full and true value of the listed property as of January 1 of the tax year. A certified assessment roll is subject to supplementation, correction, and amendment within the period provided in AS 43.05.260.

History

Authority: AS 43.05.010; AS 43.56.060; AS 43.56.140 AS 43.05.080; AS 43.56.080; AS 43.56.200 AS 43.05.260; AS 43.56.135
Eff. 1/1/2003, Register 164

15 AAC 56.043 Investigations

(a) Subject to the limitations period provided in AS 43.05.260 and regardless of whether the property was previously assessed, a previous assessment of the property was certified under AS 43.56.135, or an investigation was previously conducted, the department may at any time

(1) investigate AS 43.56 property and property statements;

(2) correct, supplement, and amend an assessment under this chapter; and

(3) issue a supplementary or amended assessment to assess the property for the tax imposed under AS 43.56.010.

(b) The department will determine the property to be investigated and when the investigation will be conducted. When the department schedules an investigation, the department will notify each property owner and each municipality in which the property is located of the general schedule and scope of the investigation.

History

Authority: AS 43.05.010; AS 43.56.060; AS 43.56.200 AS 43.05.080; AS 43.56.080 AS 43.05.260; AS 43.56.140
Eff. 1/1/2003, Register 164

15 AAC 56.045 Supplementary and amended assessments

(a) Subject to the limitations period provided in AS 43.05.260, the department may issue a supplementary or amended assessment roll to assess the amount of tax imposed under AS 43.56.010 at any time.

(b) A supplementary or amended assessment may result in increases or decreases in the assessed values reported on an original assessment roll due to

(1) assessment of property or property value that was omitted from a previous assessment roll; or

(2) correction of an error, whether the error was made by the property owner, the department, or otherwise.

(c) The municipal mill rate applicable to a supplementary or amended assessment roll is the mill rate that applied to the property in the year the property originally was or should have been assessed.

(d) The department will send notice of a supplementary or amended assessment to each property owner and each municipality as provided in 15 AAC 56.010, except that the March 1 deadline for the current tax year does not apply to a notice of a supplementary or amended assessment. A notice of supplementary or amended assessment will be sent within a reasonable time after the department makes the supplementation or amendment, but no later than March 1 of the tax year immediately following completion of the supplementary or amended assessment. The department may issue supplementary and amended assessments in separate documents or together in one document.

(e) The effective date of a notice of a supplementary or amended assessment is the mailing date certified by the department in the notice.

History

Authority: AS 43.05.010; AS 43.05.260; AS 43.56.140 AS 43.05.080; AS 43.56.060; AS 43.56.200
Eff. 7/30/82, Register 83; am 1/1/2003, Register 164

15 AAC 56.047 Appeal of supplementary and amended assessments

(a) A property owner or municipality that receives a notice of supplementary or amended assessment may object to the assessed value of the property by filing a written appeal with the department no later than 20 days after the effective date of the notice of supplementary or amended assessment in the same manner as provided for an appeal from a notice of assessment under 15 AAC 56.020(a).

(b) Upon receipt of a timely filed appeal under (a) of this section, the department will send notice as provided in 15 AAC 56.020(b) for appeal from a notice of assessment. A property owner or municipality that receives written notice under this subsection will be considered a party to the appeal for purposes of appealing to the board.

(c) On appeal the department may consider all issues related to the full and true value of the property and is not limited by the issues raised in the appeal. The department will issue an informal conference decision as provided under 15 AAC 56.020(c). The department will mail a copy of the informal conference decision to the appellant no later than 30 days after the effective date of the supplementary or amended notice of assessment. The department will mail a notice of the decision to each other party to the appeal stating whether there has been a change in the assessment.

(d) An owner of taxable property or a municipality that was a party in an appeal under (a) - (c) of this section and was adversely affected by the informal conference decision may appeal from that decision to the board by filing an appeal with the board in writing no later than 50 days after the effective date of the notice of supplementary or amended assessment and providing the information required in 15 AAC 56.030(a).

(e) Upon receipt of a timely filed appeal from an owner of taxable property, the board will send notice and a copy of the appeal to each municipality in which the taxable property is located. Upon receipt of a timely filed appeal from a municipality, the board will send notice and a copy of the appeal to each owner of the taxable property.

(f) A party may cross-appeal or intervene as provided in 15 AAC 56.030(c).

(g) The board will schedule a hearing on the appeal at its next regularly scheduled meeting, but no later than May 30 of the tax year in which the notice of supplementary or amended assessment is issued, or May 30 of the following year if the notice is issued after March 1.

(h) Except as otherwise provided in this section, the notice and appeal procedures applicable to a notice of assessment under 15 AAC 56.030 and 15 AAC 56.040 apply to a notice of supplementary or amended assessment.

History

Authority: AS 43.05.010; AS 43.56.110; AS 43.56.140 AS 43.05.080; AS 43.56.120; AS 43.56.200 AS 43.05.260; AS 43.56.130
Eff. 1/1/2003, Register 164

15 AAC 56.050 Credit and refund

(a) In accordance with (b) and (c) of this section, a credit against, or refund of, the tax levied by the state under AS 43.56.010(a) will be allowed in an amount equal to the total current property taxes collected by all municipalities as authorized by AS 29.45.080. The credit or refund will be applied against the total state tax levied under AS 43.56.010(a) for each taxpayer. The credit or refund will only be allowed for taxes paid for the current tax year. No carry-back or carry-forward of the credit or refund will be allowed to any other tax year.

(b) Credit for current property taxes paid to municipalities on or before June 30 may be claimed by the taxpayer against the tax levied by the state under AS 43.56.010(a) at the time the taxpayer pays that tax to the state, but only if the taxpayer remits copies of receipts or other evidence of payment with the claim. In the event that receipts are not received from municipalities in time to be included with the claim for credit filed with the state, the taxpayer may include copies of municipal tax bills, a copy of his transmittal letter to the municipality, and an affidavit of timely mailing of his payment to the municipality as evidence of payment. The taxpayer shall provide receipts for the municipal taxes paid, within 60 days of filing the claim, as final evidence of payment. Credit against the tax levied by the state under AS 43.56.010(a) will not, at the time that tax is paid to the state, be allowed for current property taxes to be paid to municipalities after June 30.

(c) A refund of tax levied by the state under AS 43.56.010(a) may be requested by the taxpayer for current property taxes either (1) paid to municipalities after June 30 or (2) paid to municipalities on or before June 30 but for which receipts or other evidence of payment was not available in time to be remitted as required in (b) of this section for a claim for credit. No refund will exceed the total amount paid by the taxpayer for state tax levied under AS 43.56.010(a).

(d) The provisions of this section apply to the January 1, 1976, assessment roll and any rolls supplemental to it.

History

Authority: AS 29.45.080; AS 43.56.010; AS 43.56.150 AS 43.05.080; AS 43.56.135; AS 43.56.200
Eff. 3/1/75, Register 53; am 6/2/76, Register 58; am 7/30/82, Register 83; am 12/29/2016, Register 220

15 AAC 56.060 Method of payment

Repealed 9/15/82.

15 AAC 56.065 Payment of tax

(a) The tax levied under AS 43.56.010(a) is payable to the department no later than June 30 of the tax year regardless of whether the taxable property is included on the assessment roll for the current tax year or on a supplementary or amended assessment roll. No extension of time will be granted for the payment of tax.

(b) If the tax is not paid as required in (a) of this section for property included on the assessment roll for the current tax year, or if the tax is not paid by the 30th day after a demand for payment of a supplementary or amended assessment, the 10 percent penalty provided in AS 43.56.160 will be applied to the net amount of the tax remaining unpaid after deduction of the credit for municipal tax payments under AS 43.56.010(d).

(d) Payment under this section must be made as required in 15 AAC 05.310.

History

Authority: AS 43.05.080; AS 43.05.250; AS 43.56.200 AS 43.05.150; AS 43.56.160
Eff. 5/10/86, Register 98; am 1/1/2003, Register 164

15 AAC 56.066 Refund claims for overpayment of taxes

(a) If a property owner believes that the owner has paid more taxes than the amount due under AS 43.56.010(a), the property owner may file a claim for refund with the department. In order to be considered, a claim for refund must be filed within the period provided in AS 43.05.275. The claim for refund must be signed by the owner and must state

(1) a brief description of the affected property and its physical location as of January 1 of the tax year or years affected;

(2) the name and address of each owner of the property;

(3) the name of each municipality in which the property was located as of January 1 of the tax year or years affected; and

(4) a brief description of the information that supports the claim.

(b) Upon filing a claim for refund, the property owner must provide a copy of the claim for refund to each municipality that taxes the property for which the refund is claimed.

(c) If the department determines on investigation or audit of the account in question that the property owner paid more taxes than the amount due under AS 43.56.010(a), the department will notify the property owner and the municipality where the property is located that the property owner has remitted more taxes than the amount due and is entitled to a refund.

(d) Subject to the limitations periods provided in AS 43.05.275, the department will issue a refund to the property owner in the amount of the overpayment that the state received. However, the department will not refund any portion of an overpayment for which the property owner received a credit or refund under AS 43.56.010(d) in the same tax year for which the refund is claimed, or any amount greater than the difference between 20 mills and the municipal mill rate in the same tax year for which the refund is claimed times the change in the assessed full and true value of the property.

(e) The department will notify the property owner in writing if a claim for refund is denied. A claim for refund will be denied if it is untimely, unsupported by the information required in the claim for refund, or involves disputed facts or valuation methodology or for other reasons determined by the department.

(f) The department's grant or denial of a claim for refund may be appealed as provided in 15 AAC 05.001 - 15 AAC 05.050.

History

Authority: AS 43.05.080; AS 43.05.275; AS 43.56.080 AS 43.05.260; AS 43.10.210; AS 43.56.200
Eff. 1/1/2003, Register 164

15 AAC 56.068 Limitation periods

(a) Subject to the limitations period provided in AS 43.05.260, the department may assess the amount of tax imposed under this chapter, and may investigate an account and supplement or amend an assessment under this chapter, at any time.

(b) The department may collect taxes, penalties, and interest under this chapter within the limitations periods provided in AS 43.05.270.

(c) The department may refund the amount of an overpayment under this chapter as provided in AS 43.05.275 and AS 43.10.210.

History

Authority: AS 43.05.080; AS 43.05.275; AS 43.56.080 AS 43.05.260; AS 43.10.210; AS 43.56.140 AS 43.05.270; AS 43.56.060; AS 43.56.200
Eff. 1/1/2003, Register 164

15 AAC 56.069 Filing

(a) A property statement, appeal, notice, or other document that is required or permitted to be filed with the department or the board under this chapter is considered to be filed as follows:

(1) if it is delivered in person, by United States mail, or by facsimile transmission, it is filed at the time and date it is received and date-stamped by the department or board, as applicable; and

(2) if it is delivered by electronic mail, it is filed at the time and date the department or board, as applicable, confirms to the sender by electronic mail that it has been received.

(b) A property statement, appeal, notice, or other document may be filed by facsimile transmission or electronic mail only with prior written or electronic mail approval by the director. If a document or filing requires a signature, the document or filing may not be filed by facsimile transmission or electronic mail unless the director has also authorized an electronic signature, follow-up written copy, or other means to verify the authorized signature.

(c) To be timely, a filing must be received and date-stamped or, if it is submitted by electronic mail, confirmed before 5 p.m. on the date it is due, unless a different time has been specified by the department or board, as applicable, in writing or by electronic mail in advance of the due date. In this chapter, all times and dates will be determined according to local time in Anchorage, Alaska. If the due date day falls on a day when the department is officially closed, the filing must be received before 5 p.m. on the department's next official working day.

(d) The failure-to-file penalties in 15 AAC 05.210 apply to property statements, returns, and reports required under this chapter.

History

Authority: AS 43.05.080; AS 43.56.160; AS 43.56.200
Eff. 1/1/2003, Register 164

15 AAC 56.070 Average per capita assessed full and true value of property in the state

(a) On or before January 15 of each year, the department will determine and report the average per capita assessed full and true value of property in the state to each municipality that imposes a tax under AS 29.45.080. The department will base its determination on the average per capita assessed full and true value of property in the state for the previous calendar year as determined by the Department of Commerce, Community, and Economic Development.

(b) When a municipality uses the method of taxation provided under AS 29.45.080(c) and the total assessed value of property within the municipality, per capita, exceeds the percentage determined in AS 29.45.080(f) of the average per capita assessed full and true value of property in the state, the municipality shall reduce the value of all state assessed AS 43.56 oil and gas property and all locally assessed property within the municipality in equal proportion.

(c) The limitation on taxation of property established by AS 29.45.080(c) applies to taxes levied for a municipality's operating budget. The limitation does not apply to taxes levied for repayment of the municipality's bonded debt.

(d) A municipality shall apply an equal proportionate reduction of the value of all state assessed AS 43.56 oil and gas property within the municipality and all locally assessed property within the municipality by determining the maximum effective tax rate allowed under AS 29.45.080(c) and then levying a millage rate that is no greater than the calculated maximum effective tax rate on all taxable property within the municipality. The maximum effective rate is calculated using the following formula:

((Statewide average per capita full value) X (the percentage determined in AS 29.45.080(f) X (Population of the municipality) X (30 mills) + (Budget of the municipality for debt service)) / ((Total value of state assessed AS 43.56 property within the municipality) + (Total value of locally assessed property within the municipality)) = Maximum Effective Tax Rate.

History

Authority: AS 29.45.080; AS 43.05.080; AS 43.56.200 AS 29.45.090; AS 43.56.010
Eff. 3/1/75, Register 53; am 1/1/2003, Register 164; am 12/29/ 2016, Register 220

15 AAC 56.075 Taxable property

(a) For purposes of AS 43.56 and this chapter, property is

(1) "used primarily" for a purpose described in AS 43.56.210(5)(A) if that property is actually used for one or more of those purposes more than 50 percent of the property's total operational time during the preceding tax year; and

(2) subject to (b) of this section, "committed by contract or other agreement for use primarily" for a purpose described in AS 43.56.210(5)(A) if that property is committed by contract, specification, or other expressed intention of the property owner to one or more of those purposes, regardless of whether the property was actually used in the preceding tax year.

(b) Property that is used for or committed by contract or other agreement to a state approved oil spill response, prevention, or recovery plan is only taxable under AS 43.56 if the department determines that

(1) the property is used or committed for use for an oil spill response, prevention, or recovery plan necessary to the pipeline transportation of gas or unrefined oil or to the operation or maintenance of a marine terminal or other facility used in the pipeline transportation of gas or unrefined oil; and

(2) the property is not used or committed for use primarily for a purpose other than a plan described in (1) of this subsection.

(c) A motor-propelled vehicle designed primarily for normal public highway use or an aircraft licensed and regulated as an aircraft owned by a person whose principal business in the state is exploration for, production of, or pipeline transportation of gas or unrefined oil, may be excluded from taxation under AS 43.56 if the primary use of the vehicle or aircraft does not directly relate to the conduct of that business.

History

Authority: AS 43.05.080; AS 43.56.200 AS 43.56.060; AS 43.56.210
Eff. 7/30/82, Register 83; am 1/1/2003, Register 164

15 AAC 56.080 Multiple use property

Repealed 7/30/82.

15 AAC 56.090 Exploration property

(a) Property used or committed by agreement for use in the exploration for gas or unrefined oil, or in the operation or maintenance of facilities used in the exploration for gas or unrefined oil will be valued on a market value concept which is the estimated price the property would bring in an open market and under the then prevailing market conditions in a sale between a willing seller and a willing buyer both conversant with the property and with prevailing general price levels. Market data including recent sales in the area of like property will be used where there is reliable information available. In the absence of sufficient reliable market data other accepted appraisal techniques will be applied.

(b) Exploration property includes but is not limited to land, buildings, facilities, machinery, appliances, supplies, equipment, and materials used in the operation or maintenance of seismograph and geophysical activities, well service activities, drilling activities and other exploration activities.

History

Authority: AS 43.05.080; AS 43.56.060
Eff. 3/1/75, Register 53

15 AAC 56.100 Production property

(a) Property used or committed by agreement for use in the production of gas or unrefined oil, or in the operation or maintenance of facilities for the production of gas or unrefined oil will be valued on a use value standard. Value will be determined on a replacement cost less depreciation basis using the following methods:

(1) before the commencement of regular production full and true value is the actual cost incurred or accrued as of the assessment date;

(2) after the commencement of regular production replacement cost will be calculated on January 1 of each calendar year by the use of accepted appraisal techniques or other acceptable methods and will reflect the full current cost of a modern replacement for the production property physically present and installed as of the assessment date;

(3) depreciation will be determined on January 1 of each calendar year based on the economic life of proven reserves using the following methods:

(A) for production property serving one or more reservoirs that combined are in production ramp-up or plateau, deprecation will be determined by application of a one-percent per year deduction to the replacement cost;

(B) for production property serving one or more reservoirs that combined are in production decline, depreciation will be determined through application of a percent good factor to the replacement cost; the percent good factor is the result of applying an exponent to a quotient; the quotient will be determined by dividing the total calendar year production from each reservoir the property serves for the year immediately preceding the assessment date by the calendar year historic peak production for each reservoir the property serves; the exponent must scale the quotient to ensure the correct amount of depreciation is applied to the replacement cost for the property as of the assessment date;

(4) depreciation of the replacement cost may not exceed 80 percent in any assessment year while a production property is in operation; if a production property is permanently no longer in operation as of the assessment date but has not yet been dismantled and removed, depreciation of the replacement cost may not exceed 90 percent in any assessment year; if new proven reserves reverse a production decline and increase annual production above 90 percent of the historic peak production, or results in a new peak of production, depreciation reverts back to where it left off on the original one-percent per year schedule for the property as described in (3)(A) of this subsection, until production decline;

(5) the department will use the methodology set out in this section to assess production property unless the department determines deviation from the methodology necessary when either (A) a new reservoir immediately and significantly underperforms relative to documented expectations and directly results in the abnormal and excessive super-adequacy of a property; or (B) a non-reservoir related circumstance occurs that significantly alters production relative to what would otherwise be typical reservoir production; a taxpayer or municipality may also request deviation from the methodology set out in this section but only under the same two circumstances; when requesting deviation from the methodology set out in this section the burden is on the taxpayer or municipality to establish that deviation is necessary and that the assessment would be unequal, excessive, or improper without deviation; the mere presence of a circumstance described in (A) or (B) of this paragraph does not require the department to deviate from the methodology set out in this section if the department determines the assessment is not unequal, excessive, or improper without deviating; when deviating from the methodology set out in this section the department may rely on other acceptable methods to assess the property.

(b) Production properties include but are not limited to wells, gathering lines, tank batteries, separators, treators, pumping equipment, compressors, platforms, camps, buildings, rolling stock, and all related support and service facilities and equipment.

(1) "production" means the sum of all regular production produced and sold from reservoirs served by the production property plus the amount of all other oil or gas produced that is used in the operation of those leases or other leases in drilling for or producing oil or gas, including fuel and reservoir recovery uses;

(2) "production decline" means when production for the calendar year preceding the assessment date is 90 percent or less of the historic peak production for the reservoirs served by the property;

(3) "regular production" with respect to oil or gas has the meaning given in AS 31.05.170.

History

Authority: AS 43.05.080; AS 43.56.060; AS 43.56.200
Eff. 3/1/75, Register 53; am 12/29/2016, Register 220; am 1/1/2018, Register 224

15 AAC 56.110 Pipeline property

(a) Property used or committed by agreement for use in the pipeline transportation of gas or unrefined oil or in the operation or maintenance of facilities used for pipeline transportation of gas or unrefined oil shall be valued at its full and true value as of January 1 of each year.

(b) The full and true value of pipeline property under construction will be all the actual costs incurred or accrued with respect to the pipeline property, regardless of the nature of the items of costs, as of the assessment date. Pipelines under construction will be valued in the context of the entire pipeline being constructed. The costs will be included in the valuation of the pipeline as they are incurred except as otherwise specifically provided in (1), (2), and (3) of this subsection. Examples of those costs which are included as they are incurred, include but are not limited to permanent camps and related facilities, pump stations, permanent storage facilities, roads, permanent airstrips, terminal facilities, tank farms, docks, labor, materials, supplies, machinery, equipment, pipe, easements, rights-of-way, improvements, structures, and all other related costs.

(1) Those costs which are more properly attributable to the period of construction of the pipeline project will be included as they are accrued with respect to the property. These costs, which may be included as they accrue, are construction machinery and equipment, construction camps and related facilities. These accrued costs also include unallocated costs which relate to the overall project and are incurred both within and without the state and include such items as overhead and administrative costs, engineering costs, design costs, and research and development costs. The method for the allocation of these accrued costs will be based on a formula which prorates the costs accrued in a given year over the estimated months remaining to complete the pipeline project from the date the cost is incurred. It will be presumed that the cost is incurred at the midpoint of the calendar year in which it has been incurred.

For the purpose of illustration of this method of allocation the following example is offered:

EXAMPLE

A pipeline transportation company anticipates that the construction phase of its project will commence during January, 1975, and will terminate in December, 1976. (A 24-month construction period.) During 1974 the company acquires construction equipment, construction camps, and related facilities for a cost of $20,000; during 1975, $200,000; and during 1976, $100,000. For the purpose of accrual of these costs it is assumed that they were expended at midyear. This accounts for a six-month depreciation factor on the first year's investment and a 30-month depreciation period for the costs incurred in the first year. Subsequent investment periods are treated in the same manner with annual adjustments made for the months remaining during the construction period.

The costs accrued with respect to the pipeline project for each assessment date during the construction period will be calculated as follows:

Date Factor Cost Value 1-1-756/30x20,000=4,0001-1-7618/30x20,000=12,0006/18x200,000=66,66778,6671-1-7630/30x20,000=20,00018/18x200,000=200,0006/6x100,000=100,000320,000

(2) Salvage value will be recognized as a reduction of the actual costs incurred or accrued with respect to the pipeline project under the following circumstances:

(A) In the case of equipment, machinery, or facilities sold, there will be deducted the actual realized sales price from the cost of the pipeline project for subsequent assessment purposes.

(B) In the case of roads or airstrips that are used during the construction period or a portion thereof, and are subsequently dedicated to and accepted by the state; as of January 1 following the date that the pipeline begins to transport gas or unrefined oil, there will be deducted the salvage value of these roads or airstrips. The deductible salvage value of the road or airstrip as of that date will be assumed to be the undepreciated cost based on a useful life of 10 years.

(3) Ad valorem taxes assessed and paid during construction will be excluded from the costs incurred or accrued with respect to the pipeline project.

(c) Except as provided in (d) of this section, the full and true value of pipeline property in operation is its economic value based upon the estimated life of proven reserves of the gas or oil then technically, economically and legally deliverable into the transportation facility. Economic value is determined by the use of standard appraisal methods such as replacement cost less depreciation, capitalization of estimated future net income, analysis of sales, or other acceptable methods. The valuation may include any item contributing to value including capitalized interest.

(d) If the taxpayer can show that the economic life of proven reserves is materially shorter than the estimated physical life of the pipeline, then the pipeline property will be valued at actual cost less depreciation on a straight-line basis over the economic life of proven reserves of gas or oil then technically, economically and legally deliverable into the transportation facility. Where a portion of the economic life of proven reserves exists before the date of assessment, that portion will be included for purposes of determining depreciation at the date of assessment. The burden is on the taxpayer to come forward with convincing evidence to show that the economic life of the proven reserves is materially shorter than the estimated physical life of the pipeline. It is not sufficient for the taxpayer merely to show that the economic life of the proven reserves is actually shorter than the estimated life of the pipeline. Instead, the taxpayer must show that the economic life of the proven reserves is materially shorter than the physical life of the pipeline. If incurred and accrued costs are used as a criterion for the valuation of the pipeline property in operation, ad valorem taxes assessed and paid during construction and deductible salvage value as described in (b)(2) of this section may not be included.

History

Authority: AS 43.05.080; AS 43.56.060
Eff. 3/1/75, Register 53; am 7/30/82, Register 83

15 AAC 56.120 Intangible drilling expenses

(a) In valuing property upon the basis of actual cost or replacement cost, the department will exclude the value of intangible drilling expenses.

(b) For purposes of AS 43.56 and this chapter, "intangible drilling expenses" means the intangible drilling expenses defined under 26 U.S.C. 263(c) (Internal Revenue Code) in effect on January 1, 1974, and includes only expenditures for items that do not have a salvage value even if those items are used in connection with the construction or installation of physical property that has a salvage value. "Intangible drilling expenses" includes expenditures made by an operator, or under contract to an operator, for labor, fuel, repairs, hauling, and supplies incident and necessary to

(1) drilling wells;

(2) clearing ground, draining, road making, surveying, and geological works necessary to drilling wells; and

(3) construction of derricks, tanks, pipelines, and other physical structures necessary to drilling wells.

(1) intangible development expenses;

(2) expenditures for tangible property ordinarily considered to have a salvage value, such as drilling tools, pipe, casing, tubing, tanks, engines, boilers, machines, and the actual materials used in the construction or installation of physical structures in the wells or on the property;

(3) expenditures made by an operator, or under contract to an operator,

(A) for wages, fuel, repairs, hauling, and supplies that are not incident and necessary to drilling wells; or

(B) that are properly allocable to the cost of depreciable property ordinarily considered to have a salvage value.

(d) In addition to the expenditure items described in (b) of this section, intangible drilling expenses for offshore oil platforms include expenditures incident and necessary to transport the platform to the well site and to position, erect, and permanently anchor the platform to the ocean floor.

History

Authority: AS 43.05.080; AS 43.56.060; AS 43.56.210 AS 43.56.020; AS 43.56.200
Eff. 3/1/75, Register 53; am 1/1/2003, Register 164

15 AAC 56.130 Preservation of municipal powers

The fact that the assessment of pipeline facilities by the department includes costs accrued in the construction of that pipeline does not mean that the department is assessing and taxing construction equipment and machinery as such. The powers of municipalities under AS 29.53 to assess and tax property are preserved.

History

Authority: AS 43.05.080; AS 43.56.010; AS 43.56.210
Eff. 3/1/75, Register 53

15 AAC 56.900 Definitions

In this chapter,

(1) "board" means the State Assessment Review Board established by AS 43.56.040;

(2) "department" means the Department of Revenue;

(3) "director" means the director of the tax division of the department and an authorized representative or agent of the director;

(4) "error" means a mistake, due to any reason, that may affect the amount of tax levied or collected under AS 43.56,

(A) including a mistake by the department in assessing or collecting property tax resulting from

(i) a mistake in reporting or entering information, whether caused by the property owner or the department;

(ii) an incorrect description or designation of the property, its use, or its location, whether caused by the property owner or the department;

(iii) the department applying a classification or valuation schedule to the property that was incorrect under, or inconsistent with, the department's usual practice and policy at the time of the original assessment;

(B) including any other objectively verifiable mistake, whether caused by the property owner or the department, that does not, in the department's judgment, require the department to exercise discretion, judgment, or opinion as to the classification, valuation schedule, use, or value of the property;

(i) a change to the value of a previously assessed asset based on the department's subjective reclassification of the property, retrospective application of a policy change or practice, or use of a classification or valuation schedule that did not exist at the time of the original assessment; or

(ii) a property owner's or municipality's disagreement or dissatisfaction with the department's discretionary judgment concerning application of a classification or factor schedule;

(5) "investigation" means a systematic examination of books, records, property, and accounts to verify that all property taxable under AS 43.56 has been identified and reported as required by 15 AAC 56.005, that the information reported is correct, and that the property has been valued in conformity with applicable statutes, regulations, and departmental procedures; "investigation" may include observation, inquiry, audit, and confirmation, as necessary, to obtain information to establish the full and true value of all taxable property;

(6) "omitted property" means property or property value that is omitted from an assessment roll because the property owner files an inaccurate or incomplete property statement or fails to file a property statement;

(7) "property owner" means the owner of property taxable under AS 43.56 and the authorized representative or agent of the owner;

(8) "supplementary or amended assessment roll" means an assessment roll issued after the original assessment roll is certified for a tax year;

(9) "tax year" means a period beginning on January 1 and ending on the following December 31.

History

Authority: AS 43.05.080; AS 43.56.080; AS 43.56.200 AS 43.05.260; AS 43.56.100 AS 43.56.010; AS 43.56.140
Eff. 1/1/2003, Register 164

Eff. 12/24/75, Register 56; repealed 1/1/2002, Register 160

Chapter 60 Excise Tax on Alcoholic Beverages

Article 1 Administration

15 AAC 60.010 Filing requirements

(a) Every brewer, distiller, bottler, jobber, wholesaler, manufacturer, or other seller or consignor of alcoholic beverages in the state shall file a monthly return to the department showing all sales or consignments of alcoholic beverages in or into the state made during the preceding month. The return and any tax remittance under AS 43.60.010 must be received by the department before the end of the month following the month the alcoholic beverage was sold or consigned.

(b) Repealed 7/8/2020.

(c) Each return must be accompanied by an inventory report on a form provided by the department, showing the quantities of alcoholic beverages

(1) on hand at the first of the month;

(2) received at the warehouse during the month;

(3) shipped from the warehouse during the month;

(4) lost due to breakage during the month; and

(5) on hand at the end of the month.

(d) Subsection (c) of this section does not apply to a return filed by a taxpayer that is a holder of a direct shipper license issued under AS 04.09.370 with respect to the inventory reporting requirements for a brewery retail license issued under AS 04.09.320, winery retail license issued under AS 04.09.330, or distillery retail license issued under AS 04.09.340.

History

Authority: AS 43.05.080; AS 43.60.010; AS 43.60.020
Eff. 8/7/82, Register 83; am 7/8/2020, Register 235; am 3/24/2024, Register 249

15 AAC 60.020 Direct shipper

A direct shipper required to pay the alcoholic beverage tax in AS 43.60.010 is

(1) a holder of the manufacturer direct shipment license issued by the Alcoholic Beverage Control Board under AS 04.09.370(a);

(2) an out-of-state distributor with a physical presence in the state or that has a licensed bonded warehouse in the state; or

(3) an out-of-state direct distributor that sells and ships alcohol directly into the state for resale.

History

Authority: AS 43.05.080; AS 43.60.010
Eff. 3/24/2024, Register 249

15 AAC 60.030 Excise Tax on Alcoholic Beverages

15 AAC 60.030 - 15 AAC 60.040. Reserved.

Article 2 Warehouses

15 AAC 60.050 Excise Tax on Alcoholic Beverages

15 AAC 60.050. Licensed warehouses. (a) In AS 43.60.011 and 15 AAC 60, "licensed warehouse" means an alcoholic beverage warehouse that is (1) bonded for the amount of tax that will be due the state on its contents once they are removed; and (2) licensed by the department under 15 AAC 60. (b) No one may operate or advertise an alcoholic beverage warehouse as a licensed warehouse unless the warehouse is bonded and licensed under 15 AAC 60. (c) An alcoholic beverage shipped to a licensed warehouse in the state is not subject to the tax imposed by AS 43.60 until it is removed from the licensed warehouse. (d) No alcoholic beverage may be stored in any location in the state other than a licensed warehouse unless the tax imposed by AS 43.60 has been paid.

History

Authority: AS 43.05.080; AS 43.60.011
Eff. 8/7/82, Register 83; am 7/8/2020, Register 235

15 AAC 60.060 Excise Tax on Alcoholic Beverages

15 AAC 60.060. Application for warehouse license. (a) The owner or operator of a warehouse may apply for a license to operate a licensed warehouse at any time. However, all warehouse licenses expire on June 30 of each year. (b) Repealed 7/8/2020. (c) If an operator of a warehouse is not the owner of the warehouse, the owner and operator shall apply jointly for a license to establish the warehouse as a licensed warehouse. (d) An application for issuance or renewal of a warehouse license must be on a form provided by the department and must include the following information: (1) location and address of the warehouse; (2) a complete list of personnel who may authorize immediate inspection and inventory of the alcoholic beverages stored in the licensed warehouse by department representatives; or (3) a list of the names and business addresses of the owners of alcoholic beverages which are stored or expected to be stored in the licensed warehouse during the license period.

History

Authority: AS 43.05.080; AS 43.60.011
Eff. 8/7/82, Register 83; am 7/8/2020, Register 235

15 AAC 60.070 Excise Tax on Alcoholic Beverages

15 AAC 60.070. Conditions of warehouse license. (a) A warehouse licensee must (1) agree to pay all taxes imposed by AS 43.60 on alcoholic beverages removed from the licensed warehouse which are not collected, for any reason, from the owners of the alcoholic beverages; (2) post a bond that guarantees payment of the alcoholic beverage excise taxes on the alcoholic beverages to be stored in the licensed warehouse in compliance with 15 AAC 60.080; and (3) file the reports and returns required by 15 AAC 60.010. (b) A person with the authority to allow immediate inspection and inventory of the alcoholic beverages in the licensed warehouse by department representatives shall be available at all times during the operation of a licensed warehouse. (c) Within 10 business days after any change in the information required by 15 AAC 60.060(d), a licensee shall file a statement with the department reporting the change. (d) At all times during the operation of a licensed warehouse, the books, records, and federal excise tax returns of the licensee must be available for audit or inspection by department representatives for the purpose of verifying the validity of the reported inventories and tax liabilities under AS 43.60 and 15 AAC 60.

History

Authority: AS 43.05.010; AS 43.05.080 AS 43.05.040; AS 43.60.011
Eff. 8/7/82, Register 83

15 AAC 60.080 Excise Tax on Alcoholic Beverages

15 AAC 60.080. Warehouse bonds. (a) An applicant for a warehouse license shall post a bond in an amount sufficient to guarantee payment of the alcoholic beverage excise tax on the alcoholic beverages to be stored in the licensed warehouse, as defined in (c) of this section. The bond may be in the form of a surety bond and made payable to the department, cash deposited with the department, or a letter of credit from a bank. (b) Repealed 7/8/2020. (c) The alcoholic beverage excise tax on the alcoholic beverages to be stored in the licensed warehouse is the amount of tax that would be payable on the anticipated maximum quantity of inventory to be held in the warehouse at any time during the license period. The anticipated maximum quantity of inventory must be determined subject to the approval of the department, on the basis of past experience and any reasonably expected changes in the market during the license period.

History

Authority: AS 43.05.080; AS 43.60.011; AS 43.60.040
Eff. 8/7/82, Register 83; am 7/8/2020, Register 235

15 AAC 60.090 Excise Tax on Alcoholic Beverages

15 AAC 60.090. Revocation of warehouse license. (a) If the department intends to revoke a license to operate a licensed warehouse issued under 15 AAC 60, the department will give the licensee 30 days' notice of the intended revocation. If the basis for revocation still exists on the 30th day, the department will notify the licensee of immediate revocation, unless an appeal under (d) of this section has been timely filed by the licensee. Upon revocation of the license, the tax on the quantity of alcoholic beverages which is stored in the warehouse is due and payable as provided in 15 AAC 60.100. (b) The basis for revocation of a warehouse license may include any of the following circumstances: (1) notice of bond cancellation is received by the department; (2) the amount of alcoholic beverage excise tax on the inventory in the warehouse exceeds the bond amount by more than 10 percent; (3) a discrepancy exists between the licensee's records or returns to be filed with the department and the physical inventory in a licensed warehouse which is not accounted for on a timely basis; (4) the licensee fails to pay any alcoholic beverage excise taxes which are not collected, for any reason, from the owners of those alcoholic beverages; (5) repealed 7/8/2020; (6) the license holder fails to meet any of the conditions specified or required by AS 43.60, 15 AAC 60 or by the license itself. (c) When a license to operate a warehouse is revoked under this section, the licensee may not apply for a new license until 60 days after the date of revocation. The date of revocation is the date on which the notice of immediate revocation is issued. If a formal hearing has been requested, the date of revocation is the date of the hearing decision. (d) If a person is aggrieved by a notice of intended revocation, that person may appeal to the department for a formal hearing, under AS 43.05.240 and 15 AAC 05.001 - 15 AAC 05.050. The appeal must be submitted to the department in person or by mail within 10 days of the date of mailing the notice of intended revocation by the department. (e) Upon receipt of a timely appeal under (d) of this section, the department will schedule a formal hearing to be held within 10 working days of the receipt of the appeal form. If the department determines that a correction is warranted, the department shall make the correction. A written decision concerning the appeal will be issued within 10 working days after the formal hearing has been conducted.

History

Authority: AS 43.05.080; AS 43.05.240; AS 43.60.011
Eff. 8/7/82, Register 83; am 7/8/2020, Register 235

15 AAC 60.100 Excise Tax on Alcoholic Beverages

15 AAC 60.100. Taxes due when warehouse license expired or revoked. An alcoholic beverage is considered removed from a licensed warehouse on the last day the licensee held a valid current license. An alcoholic beverage is subject to the alcoholic beverage excise tax for the month in which that date falls. The return and tax remittance will be due by the last day of the month following the month during which the license was revoked.

History

Authority: AS 43.05.080; AS 43.60.010; AS 43.60.011
Eff. 8/7/82, Register 83

15 AAC 60.110 Excise Tax on Alcoholic Beverages

15 AAC 60.110. Transition. Repealed.

History

Eff. 8/7/82, Register 83; repealed 7/8/2020, Register 235

15 AAC 60.120 Excise Tax on Alcoholic Beverages

15 AAC 60.120. Penalty. Repealed.

History

Eff. 8/7/82, Register 83; repealed 7/8/2020, Register 235

Article 3 General Provisions

15 AAC 60.300 Excise Tax on Alcoholic Beverages

15 AAC 60.300. Quantity definition. In this chapter, "quantity" means the total liquid content expressed in U.S. gallons. All volume and quantity figures in returns and reports required by AS 43.60 and 15 AAC 60 must be expressed in U.S. gallons, not in pallets, cases, bottles, cans, or metric units unless expressly authorized by the form provided by the department. For purposes of conversion, one U.S. gallon equals 3.785 liters.

History

Authority: AS 43.05.010; AS 43.60.010; AS 43.60.020 AS 43.05.080; AS 43.60.011; AS 43.60.040
Eff. 8/7/82, Register 83

15 AAC 60.310 Excise Tax on Alcoholic Beverages

15 AAC 60.310. General definitions. In this chapter, (1) "department" means the Department of Revenue; (2) "licensee" means a person who has been authorized by the department, under 15 AAC 60, to operate a licensed warehouse; (3) "alcoholic beverage" means all beverages described in AS 43.60.010(a); (4) repealed 7/8/2020. (5) "malt beverages" means beverages that are brewed or produced from malt, wholly or in part, or from a substitute for malt, containing at least one percent of alcohol by volume. Malt beverages include beer, sake, kombucha, hard seltzers, and other similar products. (6) "cider" means a fruit wine containing at least one-half of one percent of alcohol by volume, but not more than seven percent alcohol by volume, that is derived wholly from apples or pears, except for sugar, water, or added alcohol, and lacks vinous taste, aroma, and characteristics. (7) "beer" has the meaning given in 26 U.S.C. 5052(a). (8) "substitute for malt" means rice, grain of any kind, glucose, sugar, and molasses but does not include fruit, fruit juice, fruit concentrate, herbs, spices, or other food materials.

History

Authority: AS 43.05.080; AS 43.60.011; AS 43.60.040 AS 43.60.010; AS 43.60.020
Eff. 8/7/82, Register 83; am 5/28/2021, Register 238

Chapter 61 Marijuana Tax

Article 1 Administration

15 AAC 61.010 Returns

(a) Each marijuana cultivation facility shall file a monthly tax return and report the total amount of marijuana sold or transferred in ounces, with fractional ounces calculated to the third decimal place, for the preceding month.

(b) The return must be filed electronically over the Internet, using tax preparation software that has been provided or preapproved by the department. If electronic filing is impractical or impossible for the taxpayer, the taxpayer must receive department approval to file a return on a paper form prescribed by the department.

History

Authority: AS 43.05.080; AS 43.61.010; AS 43.61.020
Eff. 5/28/2016, Register 218

15 AAC 61.020 License revocation and suspension

The department will inform the Marijuana Control Board of failure to pay tax due or file a return as required under AS 43.61.010 and 43.61.020 to initiate license suspension or revocation proceedings by filing an accusation as provided under 3 AAC 306.820.

History

Authority: AS 43.05.080; AS 43.61.030
Eff. 5/28/2016, Register 218

Article 2 Taxation

15 AAC 61.100 Marijuana tax

(a) All non-exempt marijuana sold or transferred from a marijuana cultivation facility will be taxed as follows:

(1) mature bud will be taxed at $50 an ounce;

(2) immature bud will be taxed at $25 an ounce;

(3) abnormal bud will be taxed at $25 an ounce;

(4) the remainder of the plant will be taxed at $15 an ounce; and

(5) clones will be taxed at $1 per plant.

(b) A marijuana cultivation facility that is also licensed as a marijuana product manufacturing facility shall pay tax on all marijuana transferred from the marijuana cultivation facility to the marijuana product manufacturing facility for the month in which the marijuana was transferred.

(c) A marijuana cultivation facility that is also licensed as a retail marijuana store shall pay tax on all marijuana transferred from the marijuana cultivation facility to the retail marijuana store for the month in which the marijuana was transferred.

(d) Marijuana offered for sale in a manner that contains a combination of plant parts will be taxed at the tax rate applicable to the plant part subject to the highest tax rate under this section.

History

Authority: AS 43.05.080; AS 43.61.010; AS 43.61.020
Eff. 5/28/2016, Register 218; am 1/1/2019, Register 228

15 AAC 61.110 Exemptions

Transfers to a licensed marijuana testing facility are exempt from the excise tax on marijuana under AS 43.61 and this chapter.

History

Authority: AS 43.05.080; AS 43.61.010
Eff. 5/28/2016, Register 218

15 AAC 61.120 Credits and refunds

A marijuana cultivation facility may claim a credit for tax paid for marijuana that is returned to the marijuana cultivation facility. The credit must be claimed for the month in which the marijuana was returned. The marijuana cultivation facility must provide proof acceptable to the department that the tax had been previously paid and was refunded to the purchaser.

History

Authority: AS 43.05.080; AS 43.61.010; AS 43.61.020
Eff. 5/28/2016, Register 218

Article 3 General Provisions

15 AAC 61.900 Record keeping

(a) A marijuana cultivation facility shall keep records to support the information required on the monthly tax returns including sales and transfers. The records must include an accounting for inventories of live plants, trimmings, and dried product on the first and last day of the month.

(b) An invoice, sales receipt, or other record of the sale or transfer of marijuana products from a marijuana cultivation facility must separately state the amount of tax due after the sale or transfer.

History

Authority: AS 43.05.080; AS 43.61.020
Eff. 5/28/2016, Register 218

15 AAC 61.990 Definitions

In AS 43.61 and this chapter,

(1) repealed 1/1/2019;

(2) "department" means the Department of Revenue;

(3) "marijuana" has the meaning given in AS 17.38.900;

(4) "marijuana cultivation facility"

(A) has the meaning given in AS 17.38.900;

(B) includes

(i) a standard marijuana cultivation facility as licensed under 3 AAC 306.400; and

(ii) a limited marijuana cultivation facility as licensed under 3 AAC 306.400;

(5) "marijuana establishment" has the meaning given in AS 17.38.900;

(6) "marijuana product manufacturing facility" has the meaning given in AS 17.38.900;

(7) "marijuana products" has the meaning given in AS 17.38.900;

(8) "marijuana testing facility" has the meaning given in AS 17.38.900;

(9) "retail marijuana store" has the meaning given in AS 17.38.900;

(10) "transfer" means the exchange of marijuana, with or without consideration, or by barter, between marijuana establishments, or within marijuana establishments possessing multiple permits, for commercial purposes.

(11) "abnormal bud" means a flower formed on a flowering marijuana plant, and consists of calyx, pistils, resin, and trichomes, that also

(A) failed a microbial testing required by 3 AAC 306.645(b); or

(B) contains observable seeds;

(12) "clones" has the meaning given in 3 AAC 306.990(b);

(13) "flowering" has the meaning given in 3 AAC 306.990(a);

(14) "immature bud" means an immature flower formed on a flowering marijuana plant, and consists of calyx, pistils, resin, and trichomes that generally;

(A) appear loose, wispy, or leafy; and

(B) are not dense to sight or touch;

(15) "mature bud" means a mature flower formed on a flowering marijuana plant, and consists of calyx, pistils, resin, and trichomes that are generally

(A) swelled with resin;

(B) dense to sight and touch; and

(16) "remainder of the plant" means any part of a flowering marijuana plant not included in (11), (14), or (15) of this section.

History

Authority: AS 43.05.080; AS 43.61.020 AS 43.61.010; AS 43.61.030
Eff. 5/28/2016, Register 218; am 1/1/2019, Register 228

Chapter 65 Mining License Tax

Article 1 Licensing and Filing Requirements

15 AAC 65.010 When license is required

(a) Except as provided in (b) of this section, a person engaged in one or more of the following activities in the state is in the business of mining and shall obtain a mining license:

(1) a person owning and operating a mining property;

(2) a person owning a mining property and receiving lease or royalty payments based on production from the property;

(3) a person leasing a mining property from another person and operating the property;

(4) a person possessing a mineral interest, whether an economic or a production interest, in a producing property, including royalty, working or operating interests, net profits, overriding royalties, carried interests, and production payments;

(5) a person who is temporarily exempt from taxation under AS 43.65.010(a).

(b) The following persons are not in the business of mining and are not required to obtain a mining license:

(1) a person whose mining activities are restricted to the holding of property for exploration to locate and delineate mineral deposits or for future development;

(2) a person who holds mineral interests described in (a)(4) of this section in undeveloped and non-producing properties;

(3) repealed 2/20/2022.

(c) A mining license must be obtained for each mining operation conducted in this state. A person owning several mining properties that constitute a single mining operation may apply for one license.

(d) repealed 7/8/2020.

History

Authority: AS 43.05.080; AS 43.65.010
Eff. 8/9/86, Register 99; am 7/8/2020, Register 235; am 2/20/2022, Register 241

15 AAC 65.020 Mining license application and renewal

(a) A person required to obtain a license by AS 43.65.010 and 15 AAC 65.010 shall file an application for a license on a form provided by the department. The following information must be provided:

(1) applicant's name;

(2) mailing address;

(3) federal employer identification number (EIN) or social security number (SSN);

(4) year for which the license is requested;

(5) location of operation, i.e., creek, property, recording district;

(6) the date on which production first began;

(7) the name and address of the owner of the property, if the property is being leased by the applicant;

(8) the serial number of the lease or sale, if applicable, as assigned by the Department of Natural Resources;

(9) the nature or type of mining activity to be conducted; and

(10) other information required by the department.

(b) Application for an initial mining license must be made on or before the time the mining operation enters the developmental phase.

(c) A license expires on April 30 of each year and must be renewed by filing a renewal application before May 1, on a form provided by the department.

(d) Upon receipt of an application, the department will issue a mining license to the applicant.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.030
Eff. 8/9/86, Register 99; am 7/8/2020, Register 235

15 AAC 65.030 Returns

(a) Except as provided in (c) of this section, each license holder, including a license holder temporarily exempt from taxation under AS 43.65.010(a), shall file a mining license return on a form provided by the department. A person receiving gross income from more than one licensed mining property shall report that income on a single return.

(b) For each person required to file a return, the mining license tax year is the same as that person's tax year for federal income tax purposes. The mining license return must be filed before the first day of the fifth month following the end of the applicable tax period.

(c) Each joint venture member which was elected not to be treated as a partnership for purposes of sec. 761 of the Internal Revenue Code 26 U.S.C. 761 may include its share of joint venture income and expenses on its separate mining license return.

History

Authority: AS 43.05.080; AS 43.65.020
Eff. 8/9/86, Register 99

15 AAC 65.040 Extensions

(a) Upon application, the department will, in its discretion, grant an extension of time to file a mining license return.

(b) An application for an extension of time for filing a return must be filed with the department no later than the date the return is due.

History

Authority: AS 43.05.080; AS 43.65.020
Eff. 8/9/86, Register 99; am 2/20/2022, Register 241

Article 2 Computation of Tax

15 AAC 65.100 Taxable income

For the purpose of computing the mining license tax due, taxable income is gross income as defined by 15 AAC 65.110 less deductible mining expenses as defined by 15 AAC 65.120 and 15 AAC 65.125.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.060
Eff. 8/9/86, Register 99

15 AAC 65.110 Gross income

(a) A person's gross income from a mining property in the state equals the sum of

(1) sale price or value actually received, including cash, credits, in-kind exchanges, and other valuable consideration for the mined materials;

(2) advance royalty payments received; however, advance payments may not be included in gross income until the tax year in which the mined material to which the payments relate is actually extracted;

(3) production payments retained in a lease; and

(4) other royalty payments received from mining properties in the state, including royalty payments received in kind; if the payment is in kind, gross income includes the fair market value of the mined material on the date that payment is received.

(b) For the purposes of this section, the sales price of

(1) mined material sold in the state to an affiliate of the person is the greater of

(A) the cash value of the consideration given for the materials sold;

(B) the price attributable to the sale as entered on the person's books and records in accordance with generally accepted accounting principles; or

(2) the person's inventory of mined material, retained by and put to personal use by the person, or transferred from the mining division to another division within the same corporate entity, is the greater of

(A) the price attributable to the mining division for the material as entered on the person's books and records in accordance with generally accepted accounting principles, or

(B) fair market value.

(c) If a person is engaged in a mining operation in the state and mined materials are commingled with non-mining materials to form a refined product such as asphalt paving, concrete, or jewelry, gross income includes the fair market value of the mined materials after they are mined and subjected to ordinary treatment processes but before incorporation into the finished product.

(d) If a person transports mined materials and products containing mined materials out of state before sale of the materials or products, gross income includes the fair market value of the materials before their exportation in the tax year exported, whether or not the mined materials are sold during that tax year.

(e) For the purpose of this section, "fair market value" must be determined by one of the following methods, except that, if fair market value cannot be fairly determined by the use of these methods, the person may request, or the commissioner will, in his or her discretion, require, the use of another method acceptable to the commissioner:

(1) Fair market value may be computed by using the representative market or field price of materials after they are mined and subjected to ordinary treatment processes. "Representative market or field price" is the competitive sales price for ores or minerals of like kind and grade. If no Alaska market exists for a mined material, the representative market or field price is the United States or world market price for a similar kind and grade of resource.

(2) Fair market value may be computed by deducting from the out-of-state sales price of Alaska mined materials the

(A) ordinary and necessary costs incurred to apply non-mining processes to the mined materials before sale;

(B) ordinary and necessary costs incurred to transport the mined materials from the point of completion of ordinary treatment processes to its destination before sale;

(C) ordinary and necessary costs incurred out-of-state in further processing the mined materials to produce a marketable product; and

(D) out-of-state sales expense and other administrative costs incurred to bring the mined materials to the point of sale.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.060
Eff. 8/9/86, Register 99

15 AAC 65.120 Deductible mining expenses; inventory costs

(a) Except for a person permitted to compute federal net income using the cash basis method, a person shall inventory the costs of production in the state and deduct those costs at the time of sale, the time of export, or the time when the value of the mineral product is included in gross income for the purpose of calculating the mining license tax.

(b) In order to reflect mining net income accurately, both direct and indirect mining expenses must be included in the computation of costs to be inventoried, in a manner consistent with the person's federal income tax records, if the records are kept in a method consistent with generally accepted accounting principles and are consistent from year to year. Mining costs must be allocated to the product extracted during the tax year, whether sold during the tax year or in inventory at the close of the taxable year. Costs that must be accounted for in inventory include:

(1) direct mining expenses that are costs incident and necessary to the extraction of mined materials and ordinary treatment processes, including

(A) direct labor costs that are specifically identified or associated with particular units of mined materials;

(B) mine costs incurred in severing and extracting the materials from the mine, pit, or ground;

(C) maintenance and repair of mining equipment and facilities directly associated with the mine operation and ordinary treatment processes;

(D) supplies used in the mining operation and ordinary treatment processes;

(E) payments made to holders of economic interests in the mining property, including royalties, production payments and net profits;

(F) depreciation on mining equipment, buildings, and other facilities engaged directly in extraction and ordinary treatment processes, computed in accordance with 15 AAC 65.125(f);

(G) depletion as calculated in accordance with 15 AAC 65.125(d) and (e);

(H) costs associated with transporting the mined materials through completion of ordinary treatment processes, except transportation costs to transport the resource out of the state.

(2) indirect mining expenses that are costs incident and necessary to extraction and ordinary treatment processes other than direct mining costs, including:

(A) insurance;

(B) general administrative and office expenses;

(D) utilities;

(E) repair expenses;

(F) losses relating to casualty or theft to the extent uncompensated by insurance;

(G) employee benefits;

(H) taxes paid on Alaska operations, including severance, property, sales, use, and excise taxes.

(c) If two or more properties are involved, indirect expenses allowed under 15 AAC 65.120(b)(2) must be allocated between the properties, based upon the ratio of each property's production during the tax year to the person's total production from the properties.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.060
Eff. 8/9/86, Register 99

15 AAC 65.125 Deductible mining expenses; other expenses; depletion

(a) Other expenses that cannot be inventoried are deductible when paid or accrued. These expenses must be allocated in accordance with (b) of this section, and include:

(1) except as provided in (2) and (3) of this subsection, interest expense paid or accrued in connection with the mining operation is deductible as a current operating expense;

(2) construction period interest expense, including all interest paid or accrued in connection with depreciable property to be used in the mining operation in the state, is to be capitalized and recovered through depreciation or amortization in accordance with the person's election for federal income tax purposes;

(3) interest expense paid or accrued by a consolidated business in connection with the mining operation in the state is deductible as follows:

(A) 100 percent of the interest on specific new borrowings made with the purpose, expressed at the time of the borrowing, of financing the mining operation in the state; specific new borrowings may not exceed the amount of accumulated expenditures made for fixed capital and working capital to finance the mining operation in the state;

(B) if no specific new borrowing is made to finance the mining operation in the state, the interest deduction may not exceed a portion of the total interest paid or accrued by the consolidated business; that portion is determined by multiplying the total interest by a fraction, the numerator of which is the cost of the taxpayer's real and tangible personal property in the state and the denominator of which is the cost of all real and tangible personal property of the business; in this subparagraph, "total interest paid or accrued by the consolidated business" does not include interest expense arising from intercompany obligations within the consolidated business except to the extent that the interest expense reflects a pass-through of interest on a third-party borrowing by the parent or other member of the consolidated business;

(4) advertising expenses;

(5) Alaska corporate net income tax;

(6) salaries paid to officers and others for the performance of services that are incident and necessary to the person's business activities as a whole rather than to extraction and ordinary treatment processes;

(7) other expenses that are incident and necessary to the person's business activities as a whole rather than to extraction and ordinary treatment processes.

(b) For the purpose of expense allocation under (a) of this section,

(1) interest expense and taxes allowed under (a)(1) of this section are deductible to the extent that they relate to a person's mining activity in the state and are determined by multiplying total expenses by a fraction, the numerator of which is the person's direct mining expenses in the state and the denominator of which is the person's total direct expenses related to both mining and non-mining activities in the state;

(2) the expenses allowed under (a)(4) - (7) of this section are deductible to the extent they relate to mining activities in the state and are determined by multiplying the total expenses by a fraction, the numerator of which is the person's direct mining expenses in the state and the denominator of which is the person's total direct expenses related to both mining and non-mining activities.

(c) While a mining property is in the development stage, all development expenditures in excess of net income from the sale of mined materials must be included in the mine's basis and are recoverable through the depletion allowance. Development expenses incurred after the mine has reached the production stage are deductible as a current operating cost. The mine is considered to have passed from a development to a production stage when the principal activity of the mining property becomes the production of ore from the property rather than the development of the ore body before production.

(d) A deduction for depletion may be taken by a person for each economic interest held in an Alaska mining property; an economic interest is held when a person has acquired by investment any interest in a mineral in place and that person derives, under any form of legal relationship, income from the extraction of the mineral, to which the person must look for a return of capital.

(e) A percentage depletion allowance is permitted for each property described in AS 43.65.010(e), if the allowance is not less than if it were computed on a cost basis. If computed on a percentage basis, the depletion allowance may not exceed 50 percent of the person's mining net income as computed without the allowance for depletion. Cost depletion must be used for all other mineral types not described in AS 43.65.010(e).

(f) In computing mining taxable income, depreciation expense on all mining equipment, buildings, and other facilities located in Alaska, is allowed as a deduction. A property's basis for computing depreciation is the adjusted basis of the asset for federal income tax purposes on the date the asset is placed in service in Alaska. Depreciation on mining assets may be computed using any of the methods allowed under secs. 167 and 168 of the Internal Revenue Code (26 U.S.C. 167 and 168). In place of the depreciation expense deduction, a person may elect to amortize the cost of pollution control facilities used in the mining operation in accordance with sec. 169 of the Internal Revenue Code (26 U.S.C. 169).

(g) Exploration costs, federal income taxes, taxes under this chapter, losses on the sale of mining equipment or properties, net operating losses and other capital losses are not deductible.

(h) If the allocation provisions of this section do not fairly represent the amount of the person's expenses paid or accrued in connection with the mining operation in the state, the person may petition the commissioner for the use of another method to effectuate an equitable allocation of the person's expenses.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.060
Eff. 8/9/86, Register 99; am 2/20/2022, Register 241

15 AAC 65.130 Tax rate

The following rates are applicable to the taxable income of a person subject to the mining license tax:

TAXABLE INCOME TAX RATE $40,000 and under . . . . . no taxOver $40,000 and not over $50,000 . . . . . 3 percent of theentire taxable incomeOver $50,000 and not over $100,000 . . . . . $1,500 plus 5 percentof the excess over $50,000Over $100,000 . . . . . $4,000 plus 7 percentof the excess over $100,000.

History

Authority: AS 43.05.080; AS 43.65.010
Eff. 8/9/86, Register 99

Article 3 Exemption from Tax

15 AAC 65.200 Temporary exemption for new mining operation

(a) As provided in AS 43.65.010(a), a new mining operation is exempt from the tax under AS 43.65 for three and one-half years after production begins. The department may suspend passage of the exemption period if mine production ceases for other than seasonal or ordinary shutdowns.

(b) As provided in AS 43.65.010(b) and 15 AAC 65.210, the Department of Natural Resources will notify the department of the date on which production begins for each new mining operation. If the department determines that an operation qualifies as a new mining operation, the department will issue a certificate of exemption in accordance with 15 AAC 65.220.

(c) The department will consider the following factors in determining whether a person's operation is a new mining operation eligible for the three and one-half year exemption:

(1) whether the person or a prior owner or operator of the property was liable to pay the mining license tax on net income from the property after January 1, 1948;

(2) the location of the operation in relation to other properties being operated by the person;

(3) the geological structure of the ore body in relation to other ore bodies the person mines;

(4) the mining techniques and technology used; and

(5) the extent to which the person is required to invest new capital, employ different personnel and use additional facilities to exploit the resource.

(d) A temporary exemption will be granted to a person making extensive capital additions or improvements, and to a person applying new mining methods and techniques to a property previously owned and operated by another person, but only if the previous mining operation has been closed, shut down, or abandoned for more than one mining season. An exemption will not be granted

(1) to a person who merely extends or expands an operation onto previously unmined properties, or

(2) when changes in ownership of an existing operation take place.

(e) The following examples illustrate eligibility for the three and one-half year tax exemption:

(1) Mining Company A has been a gold dredging operator for more than three and one-half years on three properties which it owns or leases. The properties are joined contiguously and lie within a single river valley. To extend its current operation, Company A acquires an additional lease which shares a common boundary with the other properties. Expanding the operation by developing and mining the additional leased property does not create a new mining operation eligible for the exemption.

(2) Company B has been conducting mining operations on 15 coal leases for 20 years. In 1985, the company sells the entire operation to Company C. Company C continues to operate on the properties and expands the operation by adding new equipment, including dredges, crushers, and bulldozers. Company C is not entitled to an exemption. A change in ownership of existing mining properties does not create a new mining operation.

(3) Company D owns and operates a hard rock gold mining operation on the southern side of Hurricane Ridge. This mine has been in production for 10 years. Company D acquired a lease for undeveloped gold mining properties on the northern side of Hurricane Ridge, completed development of the property, and began production on June 1, 1985. In anticipation of this new development, Company D made extensive capital expenditures, leased additional mining equipment and hired additional mining personnel. A geologist's study indicated that the gold bearing ore bodies on the north side of the hill are not part of a geological structure having any correlation with or similarity to the ore bodies on the south side. The distance between the two properties is 40 miles and is linked by a company-owned haul road. Although there is a road link and close proximity between the northern and southern properties, Company D is eligible for the exemption on the northern mining property because it made extensive capital expenditures for an operation on previously unmined property and hired additional personnel to operate the mine. The operation is not merely an extension of another ongoing operation.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.060
Eff. 8/9/86, Register 99; am 2/20/2022, Register 241

15 AAC 65.210 Affidavit of initial production

(a) In order to be granted a certificate of exemption by the department, the owner or operator of a new mining operation shall record, in the recording district in which the operation is located, a sworn affidavit of initial production showing the location of the new mining operation, the commodities produced, the names of the operators, and the new mining operation's date of initial production. The affidavit must be recorded on a form provided by the Department of Natural Resources, or on a substantially similar form, and must be recorded within 90 days after the date of initial production. Failure to record the affidavit timely may result in forfeiture of any right to the three and one-half year exemption from the mining license tax.

(b) For the purpose of determining the date of initial production, the Department of Natural Resources may examine the mining property and books, papers, records, and other documents relevant or material to initial production.

(c) Upon determination that production has begun on a new mining property, the Department of Natural Resources shall notify the department of:

(1) the date of initial production;

(2) the name of the person operating the mining property;

(3) the type of metal, mineral, or other resource being extracted from the mining property; and

(4) a legal description, lease number or other identifying name or characteristic of the property.

(d) For purposes of this section, the date of initial production is generally considered the date initial shipment of mined materials is transported from the mine for sale or additional non-mining processing. Also, production is considered to begin on the date that the mined product is first exported outside this state. However, the transport and sale of a bulk sample does not in and of itself constitute the beginning of production.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.060
Eff. 8/9/86, Register 99

15 AAC 65.220 Certificate of exemption

(a) Upon receipt of notification of initial production from the Department of Natural Resources, the department will issue a certificate of exemption to a new mining operation, unless it determines, as provided by 15 AAC 65.200, that the operation does not qualify for the exemption.

(b) A certificate of exemption will be issued for a single mining operation. A certificate issued for a single mining operation will not exempt a person from tax on income received from other mining operations.

(c) A certificate of exemption issued for a mining operation temporarily exempts from the mining tax all persons receiving income from the property. For example, both the operator of a mining property and a royalty recipient are exempt from mining tax for the three and one-half year period.

(d) If the department determines that it will not issue a certificate of exemption, it will inform the applicant of its decision and the reason for making that decision. An applicant who disagrees with the decision may appeal that decision in accordance with AS 43.05.240 and 15 AAC 05.001 - 15 AAC 05.050.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.020
Eff. 8/9/86, Register 99

15 AAC 65.230 Composition of a mining operation

(a) A mining operation consists of all operating and non-operating mineral deposit interests and may be comprised of one or more mining properties.

(b) In determining whether mining properties are part of the same mining operation, the department will consider whether the operation, in conducting mining activities on several mining properties, uses common personnel, supply and maintenance facilities, mining-related treatment processes, storage facilities, roads, pipelines and transportation equipment, and mining techniques and technology. The department will also consider the extent to which the mineral deposit interests comprise a common mining property.

History

Authority: AS 43.05.080; AS 43.65.010
Eff. 8/9/86, Register 99

15 AAC 65.240 Transition rules

(a) The calendar or fiscal year tax period during which the exemption period described in 15 AAC 65.200 expires is the transition year.

(b) Mining net income subject to tax in a transition year is to be computed by an allocation formula. To determine taxable income, the entire taxable income in the transition year is multiplied by a fraction, the numerator of which is the number of days in the transition year falling outside the exemption period, and the denominator of which is the total number of days in the transition year.

(c) A mining operation that commenced production within three and one-half years before April 1, 1986 has 120 days after August 9, 1986 to record the affidavit required by 15 AAC 65.210. If a certificate of exemption is granted, the exemption period begins on the date of initial production.

History

Authority: AS 43.05.080; AS 43.65.010; AS 43.65.020
Eff. 8/9/86, Register 89

Article 4 General Provisions

15 AAC 65.990 Definitions

In this chapter, unless the context requires otherwise,

(1) "bulk sample" means the quantity of resource mined, gathered, taken, or otherwise accumulated as a specimen for the purpose of testing and analyzing the ore body before its development;

(2) "consolidated business" means a corporation or group of corporations having more than 50 percent common ownership, direct or indirect;

(3) "department" means the Department of Revenue;

(4) "development expense" includes expenses paid or incurred after the determination that a deposit of mineral or ore is shown to exist in sufficient quantity and quality to reasonably justify commercial exploitation;

(5) "exploration expense" includes those expenses incurred for the purpose of ascertaining the existence, location, extent, or quality of any deposit of ore or other mineral paid or incurred before the beginning of development of the mine or other deposit;

(6) "gravel" means a mixture of small stones and pebbles or pebbles and sand that will pass through a three-inch, and be retained on a No. 4 United States standard, sieve;

(7) "mining operation" means a business enterprise associated, directly or indirectly, with developing, removing, extracting, moving, or taking from the earth, water, or under water, metals, ores, minerals, asbestos, gypsum, coal, and any other mineral deposit, including the treatment processes described in sec. 613(c)(4) of the Internal Revenue Code (26 U.S.C. 613(c)(4)), and such treatment processes normally applied by mine owners or operators to obtain a commercially marketable product, but not including the extraction or production of oil and natural gas, marketable earth, quarry rock, sand, gravel, or the harvesting of trees or other natural living, organic resources;

(8) "mining property" means each separate interest owned by the taxpayer in each mineral deposit in each separate tract or parcel of land;

(9) "person" means an individual, trust, estate, partnership, corporation, joint venture, or group or combination of these acting as a unit;

(10) "place" means each geographically separate mining operation not aggregated with another;

(11) "prosecute" means to begin to carry on, to undertake, or to institute an action;

(12) "sand" means separate grains or particles of disintegrated rock, easily distinguished by the unaided eye, and that are finer than gravel and coarser than dust but not large enough to constitute pebbles;

(13) "marketable earth" means peat and topsoil;

(14) "quarry rock"

(A) means rock or stone that is extracted from the earth for the purposes of being crushed and processed into aggregate that can be used for construction purposes, including road building;

(B) does not include coal.

History

Authority: AS 43.05.080; AS 43.65.060
Eff. 8/9/86, Register 99; am 2/20/2022, Register 241

Chapter 70 Alaska Business License Tax

(1) name of the taxpayer;

(2) mailing address;

(3) federal employer identification number (EIN) or social security number (SSN);

(4) fisheries business license number;

(5) year for which tax return is reporting;

(6) location of operation;

(7) value of fisheries resources processed during the license year, by category of fisheries business, pounds, price per pound, and by species;

(8) names of developing commercial fish species processed during the year;

(9) name of fisheries business which first actually and physically processed the fisheries resources or which sold or processed the fisheries resources outside the taxing jurisdiction of Alaska;

(10) for a fisheries business which operates from a floating vessel, the name of the vessel, the date of arrival of the vessel in Alaska, subsequent movement of the vessel from one location to another, the reason for the movement of the vessel, and the date of departure of the vessel from Alaska for any reason; and

(11) other information required by the department on the tax return form.

History

Authority: AS 43.05.080; AS 43.75.030(a)
Eff. 9/9/81, Register 79

15 AAC 75.020 Extension of time for filing returns

(a) Upon a showing of good cause, the department will, in its discretion, grant a reasonable extension of time, not to exceed 180 days in the aggregate, for filing a return or report required by AS 43.75. An extension of time for filing a return or report does not extend the time for the payment of the tax or part of the tax. An estimated payment must be remitted with the request for an extension along with an explanation showing how the estimate was determined. The estimated payment must be equal to or greater than 90 percent of the actual liability shown on the return ultimately filed within the approved extension period, in order to avoid failure-to-pay penalties under AS 43.05.220(a) and 15 AAC 05.210(b).

(b) The application for an extension of time for filing the return or report must be in writing and addressed to the Department of Revenue and must contain a full statement of the causes for the delay. It must be filed no later than 15 calendar days before the date the return is due.

(c) If an extension of time for filing the return or report is granted, the return must be filed before the expiration of the period of extension.

(d) If an application for extension is denied, the return or report must be filed within 10 calendar days after the date the notice of denial is mailed by the department or 10 calendar days after the March 31 due date, whichever is later.

History

Authority: AS 43.05.080; AS 43.75.030(c)
Eff. 9/9/81, Register 79; am 12/17/82, Register 84

15 AAC 75.030 Liability for tax

(a) Repealed 3/3/2023.

(b) For periods after December 31, 1980, the person engaging in a fisheries business who first actually and physically processes a fisheries resource or who has a fisheries resource processed by a fisheries business inside the state, or the person who purchases a fisheries resource that is frozen from a person excluded by AS 43.75.017 from liability for the tax, is liable for and shall pay to the department the entire tax imposed under AS 43.75.015. In determining the tax liability, the person who first actually and physically processed a fisheries resource may deduct from the value of the fisheries resource processed the value of a fisheries resource processed for another fisheries business. If a person custom processes a fisheries resource for another fisheries business, the custom processor is not liable for the tax, but if he custom processes for someone other than another fisheries business, the custom processor must pay the tax.

History

Authority: AS 43.05.080; AS 43.75.015
Eff. 9/9/81, Register 79; am 9/18/81, Register 80; am 3/3/2023, Register 245

15 AAC 75.035 Exclusion from fisheries business tax

For a fisheries resource processed after December 31, 1980, a person is not liable for the fisheries business tax under AS 43.75.015 if that person meets the requirements of AS 43.75.017 and if the person claiming the exclusion is the commercial fisherman who caught the fisheries resource.

History

Authority: AS 43.05.080; AS 43.75.017
Eff. 9/18/81, Register 80

15 AAC 75.040 Statement of value; records

(a) Repealed 3/3/2023.

(b) Repealed 3/3/2023.

(c) For periods after December 31, 1980, the department may require a person, other than a fisheries business, who contracts with a custom processor for fisheries resource processing to furnish the custom processor or the department with a statement of value for the resource processed by the custom processor. The statement of value must report the species of fisheries resources processed, the total pounds of each species, and the actual value by species, as determined in accordance with AS 43.75.290.

(d) The custom processor who processes a fisheries resource for a non-fisheries business is liable for an additional tax assessment, if any, unless the custom processor obtains from the owner of the fisheries resource an assumption of liability for an incorrect statement of value and the owner pays any additional tax assessed resulting from the incorrect statement of value.

(e) The records of the owner of the fisheries resource shall be open to audit for purposes of verifying the values reported under (c) of this section. The owner's records shall be subject to the same statute of limitations as the records of a fisheries business.

History

Authority: AS 43.05.080; AS 43.75.015; AS 43.75.290
Eff. 9/9/81, Register 79; am 9/18/81, Register 80; am 1/16/82, Register 81; am 12/26/2014, Register 212; am 3/3/2023, Register 245

15 AAC 75.050 Statement to be provided by custom processors

After December 31, 1980, a person claiming a deduction under 15 AAC 75.030 for a fisheries resource processed for another fisheries business shall include in his return a schedule, using the form provided by the department, which shows the following information:

(1) name, address, and fisheries business license number of each fisheries business for whom processing is done; and

(2) pounds of fisheries resource processed for the fisheries business, by species.

History

Authority: AS 43.05.080; AS 43.75.015(c)
Eff. 9/18/81, Register 80

15 AAC 75.060 Qualified investments eligible for the fisheries product development tax credit

(a) To be eligible for the fisheries product development tax credit under AS 43.75.037, depreciable tangible personal property claimed as the basis of a qualified investment must

(1) be first used for its intended purposes in the state after July 7, 2022 and before January 1, 2027;

(2) have a useful life of three years or more;

(3) belong to one of the following categories:

(A) new processing equipment, conveyors used specifically in the act of producing a value-added eligible fish product, ice-making machines, canning equipment for herring products, and equipment used to transform eligible fish byproduct into saleable product;

(B) new canning equipment for salmon products; or

(C) new parts necessary for converting a canned salmon line to produce can sizes other than 14.75 ounces or 7.5 ounces, or costs associated with that conversion; and

(4) be used primarily either to

(A) process salmon or herring, if installed on a vessel; or

(B) process salmon, herring, pollock, sablefish, or Pacific cod, if installed in a shore-based plant.

(b) For qualified investment property on which a tax credit is claimed under AS 43.75.037 to be used to predominantly perform a processing, packaging, or product-finishing function the property must have direct contact with the eligible fish while actively performing the relevant processing, packaging, or product-finishing function. Property that fills a passive, secondary, or incidental role in the relevant processing, packaging, or product-finishing function does not meet this requirement.

(c) A fisheries business in the state that operates one or more vessels, shore-based plants, or a combination of both may only claim a tax credit under AS 43.75.037 for new property that is the same type of property purchased in the previous 10 years on which a tax credit has been claimed under AS 43.75.037 if neither the new property or previously purchased property has been removed from the state. To claim a tax credit under these circumstances a fisheries business shall submit to the department

(1) an application in accordance with 15 AAC 75.070 for a preliminary determination of whether the proposed new property qualifies for the credit;

(2) a disclosure that the fisheries business has already received a tax credit for the same type of property;

(3) a certification under penalty of perjury that neither the property purchased in the previous 10 years on which a tax credit has been claimed under AS 43.75.037 nor the proposed new property has been removed from the state; and

(4) any additional documentation required by the department.

(d) If a fisheries business claimed and received a tax credit under AS 43.75.037 on property purchased in the previous 10 years, the fisheries business shall notify the department not later than 30 days after

(1) the fisheries business has disposed of the property;

(2) the property ceases to be qualified investment property,

(3) the property is removed from service; or

(4) the property is removed from the state.

(e) If a fisheries business claims a tax credit under AS 43.75.037 for new property that is the same type of property purchased in the previous 10 years on which a tax credit has been claimed under AS 43.75.037, the fisheries business shall provide documentation to the department establishing that the property on which the tax credit was previously claimed has not been removed from the state. If the fisheries business fails to provide the required documentation, the department will deny any requests for credit under AS 43.75.037 for the same type of property purchased in the previous 10 years on which a tax credit has been claimed under AS 43.75.037.

(f) In AS 43.75.037 and this section,

(1) "same type of property" means property or equipment that performs the same or similar ice-making, processing, packaging, or product-finishing function as property purchased in the previous 10 years on which a tax credit has been claimed under AS 43.75.037;

(2) "shore-based plant" means "shore-based fisheries business" within the meaning given in AS 43.75.290 and 15 AAC 75.290; and

(3) "vessel" means "floating fisheries business" within the meaning given in AS 43. 75.290.

History

Authority: AS 43.05.080; AS 43.75.037; AS 43.75.290
Eff. 12/16/86, Register 101; am 3/3/2023, Register 245

15 AAC 75.070 Application for the fisheries product development tax credit

A fisheries business may, using a form provided by the department, apply for the fisheries product development tax credit before the fisheries business incurs the qualified investment cost on which the fisheries business intends to claim a credit under AS 43.75.037. The application must include

(1) the name of the fisheries business;

(2) the fisheries business license number of each vessel or shore-based plant owned by the fisheries business;

(3) the mailing address for the fisheries business;

(4) the telephone number for the fisheries business;

(5) the location of each vessel or shore-based plant for which eligible expenditures will be made;

(6) a list of all equipment or improvements to depreciable tangible personal property to be purchased or constructed and a description of the equipment or improvements' functions related to the processing of eligible fish;

(7) the approximate cost of each piece of equipment or improvement to depreciable tangible personal property to be purchased or constructed; and

(8) the estimated date that the equipment or improvement to depreciable tangible personal property is to be purchased or constructed, and the date it first will be placed into service.

History

Authority: AS 43.05.080Sec. 6, ch. 79, AS 43.75.037SLA 1986
Eff. 8/12/87, Register 103; am 3/3/2023, Register 245

15 AAC 75.080 Placed in service rule

Repealed.

History

Eff. 8/12/87, Register 103; repealed 3/3/2023, Register 245

15 AAC 75.085 Exception to placed-in-service rule

Repealed.

History

Eff. 12/22/89, Register 113; repealed 3/3/2023, Register 245

15 AAC 75.090 Limitation on credit

(a) If a fisheries business operates in the state one or more vessels, shore-based plants, or a combination of both in the same tax year that eligible qualified investment costs are incurred, the fisheries business may not claim in that tax year a total credit under AS 43.75.037 greater than 50 percent of the fisheries business's combined fisheries business tax liability incurred at all the fisheries business's vessels and shore-based plants.

(b) A fisheries business may not apply a fisheries product development tax credit under AS 43.45.037 that was generated in a tax year at a vessel or shore-based plant to the fisheries business's tax liability incurred in a subsequent tax year and at a different vessel or shore-based plant, unless the fisheries business owned both vessels or shore-based plants at the time the qualified investment costs generating the tax credit were incurred.

(c) A fisheries business may not apply a tax credit under AS 43.75.037 received for property used to perform an ice-making, processing, packaging, or product-finishing function on eligible fish species, within the meaning given in AS 43.75.037(k), against the fisheries business's tax liability generated by a different species not included in the definition of "eligible fish" under AS 43.75.037(k).

History

Authority: AS 43.05.080SLA 1986 Sec. 6, ch. 79,AS 43.75.037
Eff. 8/12/87, Register 103; am 3/3/2023, Register 245

Article 2 Tax Imposed on Acquisition of Fisheries Resources

15 AAC 75.100 Tax imposed on acquisition of fisheries resources

(a) A person who takes, purchases or otherwise acquires a fisheries resource, and who transports the fisheries resource to a point outside the taxing jurisdiction of the state, before processing the fisheries resource, is subject to the tax in AS 43.75.015. This subsection does not apply to a commercial transportation carrier which performs a transportation service for a person subject to the tax.

(b) A person described in (a) of this section who processes the fisheries resource shall pay the rate of tax which he would pay if the processing took place within the taxing jurisdiction of the state.

(c) A person described in (a) of this section who does not process the fisheries resource shall pay the rate of tax which the fisheries business to which the fisheries resources are sold would pay if the fisheries business were located within the taxing jurisdiction of the state. There is a rebuttable presumption that the fisheries resources were sold to a floating fisheries business.

(d) The tax imposed by this section will be computed on the value of the fisheries resources in accordance with AS 43.75.290 and 15 AAC 75.300(3).

(e) A person described in (a) of this section who does not process the fisheries resource and who sells the fisheries resource outside the taxing jurisdiction of the state to someone other than a fisheries business is presumed to be liable for the same rate of tax as a floating fisheries business.

History

Authority: AS 43.05.080; AS 43.75.100 AS 43.75.015; AS 43.75.290
Eff. 9/9/81, Register 79; am 9/18/81, Register 80; am 12/26/2014, Register 212

Article 3 General Provisions

15 AAC 75.200 Fisheries Business Tax

15 AAC 75.200 - 15 AAC 75.280. Reserved.

15 AAC 75.290 Fisheries Business Tax

15 AAC 75.290. Shore-based fisheries business. A fisheries business operated from a floating vessel is not permanently attached to the land. A fisheries business operated from a floating vessel is a shore-based fisheries business only if it remains anchored in one place and does not move from that anchorage during an entire tax year. A movement of the vessel from the anchorage, for any reason, including dry-dock, repairs, maintenance, or a new processing location, either to another location in the state or to another location outside the state, disqualifies the fisheries business as a shore-based fisheries business.

History

Authority: AS 43.05.080; AS 43.75.015
Eff. 9/9/81, Register 79

15 AAC 75.300 Fisheries Business Tax

15 AAC 75.300. Definitions. In AS 43.75 and this chapter, (1) "custom processor" means a fisheries business which does not own the fisheries resources it is processing; (2) "fisheries resource" means fin fish and shellfish, including but not limited to salmon, halibut, herring, flounder, crab, clam, cod, shrimp, and pollock; fish byproducts, such as roe, entrails and carcasses, are separate fisheries resources if they are transferred to another person for processing; (3) "market value" means the prevailing value paid for fisheries resources of like kind and quality by fisheries businesses in the same market area to fishermen who own their vessels; (4) "processing" means any activity which modifies the physical condition of a fisheries resource, including butchering, freezing, salting, cooking, canning, dehydrating, or smoking; however, "processing" does not include decapitating shrimp and gutting, gilling, sliming, or icing a fisheries resource solely for the purpose of maintaining the quality of the fresh resource; (5) "processing fisheries resources for sale" means the series of activities which are performed in preparing the fisheries resources for subsequent sale, regardless of whether the processor owns the fisheries resources and regardless of whether the processor is the seller in the subsequent sale of the fisheries resources; (6) repealed 12/26/2014.

History

Authority: AS 43.05.080; AS 43.75.015; AS 43.75.290
Eff. 9/9/81, Register 79; am 9/18/81, Register 80; am 12/26/2014, Register 212

Chapter 76 Salmon Enhancement Tax

Article 1 Tax Imposition

15 AAC 76.010 Imposition of the tax

There is imposed on each person who holds a limited entry permit under AS 16.43 a salmon enhancement tax on

(1) the value of all salmon sold or otherwise transferred to a buyer within a region designated under AS 16.10.375 if there exists in that region a qualified regional association which has approved the salmon enhancement tax in accordance with AS 43.76.015; and

(2) the value of all salmon that the permit holder catches within a region for which the salmon enhancement tax has been approved, and that the permit holder either removes from the state, or sells or otherwise transfers in the state but outside a region for which the tax has been approved.

History

Authority: AS 43.05.080; AS 43.76.011 AS 43.76.010; AS 43.76.028
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.020 Monthly report and remittance of tax by limited entry permit holders

(a) A limited entry permit holder who is subject to the salmon enhancement tax under 15 AAC 76.010 shall file a monthly report, except when exempt under (d) of this section, using the form provided by the department, stating the following in the places provided on the form:

(1) name of the permit holder;

(2) limited entry permit number;

(3) mailing address;

(4) employer identification number (EIN) or social security number (SSN);

(5) telephone number;

(6) total pounds and value of the salmon which the permit holder either removed from the state, or sold or otherwise transferred in the state but outside a region for which the salmon enhancement tax has been approved;

(7) the region designated under AS 16.10.375 in which the salmon were caught; and

(8) other information required by the department on the form.

(b) The monthly report required under this section must be submitted to the department, together with all taxes due, not later than the last day of the month following the month in which the salmon were either removed from the state or were sold or otherwise transferred in the state but outside a region for which the salmon enhancement tax has been approved.

(c) The monthly report required under this section must be submitted only for a month in which the permit holder either removed salmon from the state, or sold or otherwise transferred salmon in the state but outside a region for which the salmon enhancement tax has been approved.

(d) A permit holder is not required to file a monthly report, or remit the tax, for salmon that the permit holder sells or otherwise transfers directly to a buyer who is responsible for the collection of the salmon enhancement tax under 15 AAC 76.100.

History

Authority: AS 43.05.080; AS 43.76.011 AS 43.76.010; AS 43.76.028
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.030 Records

A permit holder subject to the salmon enhancement tax under 15 AAC 76.010 shall prepare and retain the following records for all salmon subject to the tax and either removed from the state, or sold or otherwise transferred in the state but outside a region for which the salmon enhancement tax has been approved:

(1) Alaska Department of Fish and Game fish tickets for salmon either removed from the state, or sold or otherwise transferred in the state but outside a region for which the salmon enhancement tax has been approved;

(2) a daily journal or other record showing for each transaction the following:

(A) the person to whom the salmon were sold or otherwise transferred either in the state or upon removal from the state;

(B) pounds and value by species of the salmon; and

History

Authority: AS 43.05.080; AS 43.76.011 AS 43.76.010; AS 43.76.028
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.040 Annual report by limited entry permit holder

(a) A permit holder who is required to file a monthly salmon enhancement tax report during a calendar year under 15 AAC 76.020 must file an annual information report, using the form provided by the department, stating the following in the places provided on the form:

(1) name of the permit holder;

(2) limited entry permit number;

(3) mailing address;

(4) employer identification number (EIN) or social security number (SSN);

(5) telephone number;

(6) each region designated under AS 16.10.375 in which salmon were caught and subsequently either removed from the state, or sold or otherwise transferred in the state but outside a region for which the tax has been approved;

(7) total pounds and value of the salmon caught in each region reported under (6) of this subsection, and subsequently removed from the state; and

(8) other information required by the department on the form.

(b) The annual report is due by March 1 of the year following the year in which salmon subject to tax were either removed from the state, or were sold or otherwise transferred in the state but outside a region for which the tax has been approved. The report must be accompanied by any remittance shown to be due upon reconciliation of the monthly reports.

History

Authority: AS 43.05.080; AS 43.76.011 AS 43.76.010; AS 43.76.028
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

Article 2 Salmon Acquired by Buyers

15 AAC 76.100 Collection of tax

The salmon enhancement tax is to be collected by the buyer for every salmon acquired within a region designated under AS 16.10.375 which has approved the imposition of a salmon enhancement tax, from a person holding a limited entry permit under AS 16.43, regardless of whether the salmon was taken in a company-owned or company-subsidized boat operated by employees or agents of the buyer responsible for the collection of the salmon enhancement tax, or in a boat which is operated under lease or other arrangement by the buyer.

History

Authority: AS 43.05.080; AS 43.76.011 AS 43.76.010; AS 43.76.028
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.110 Monthly report and remittance of tax by buyers

(a) A buyer responsible for the collection of the salmon enhancement tax under 15 AAC 76.100 shall file a monthly report using the form provided by the department, stating the following in the places provided on the form:

(1) name of the buyer;

(2) mailing address;

(3) employer identification number (EIN) or social security number (SSN);

(4) telephone number;

(5) location of operation or name of vessel;

(6) fisheries business license number or Alaska business license number;

(7) the region designated under AS 16.10.375 in which the buyer is located;

(8) total pounds and value of the salmon, by region, which the buyer has purchased or otherwise acquired during the preceding month; and

(9) other information required by the department on the form.

(b) The monthly report required under this section must be submitted to the department, together with all taxes required to be collected, not later than the last day of the month following the month in which the tax was collected.

History

Authority: AS 43.05.080; AS 43.76.025
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.120 Records

A buyer responsible for the collection of the salmon enhancement tax shall prepare and retain the following records:

(1) Alaska Department of Fish and Game fish tickets salmon purchased or otherwise acquired;

(2) a daily journal or other record showing for each transaction the following:

(A) the permit holder from whom the salmon was acquired;

(B) the limited entry permit number of the permit holder named under (A) of this paragraph;

(D) the amount of salmon enhancement tax collected; and

(E) the region designated under AS 16.10.375 in which the salmon were caught.

History

Authority: AS 43.05.080; AS 43.76.025
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.130 Annual report by buyers

(a) A buyer responsible for the collection of the salmon enhancement tax under 15 AAC 76.100 shall file an annual information report, using the form provided by the department, stating the following in the places provided on the form:

(1) name of the buyer;

(2) mailing address;

(3) employer identification number (EIN) or social security number (SSN);

(4) telephone number;

(5) location of operation or name of vessel;

(6) fisheries business license number or Alaska business license number;

(7) the region designated under AS 16.10.375 in which the buyer is located;

(8) total pounds and value of the salmon caught in each region designated under AS 16.10.375, or other location, which the buyer has purchased or otherwise acquired during the preceding calendar year;

(9) total value of the salmon purchased or acquired in each region designated under AS 16.10.375, or other location, which the buyer has purchased or otherwise acquired during the preceding calendar year, reconciled with the amounts reported on the monthly reports; and

(10) other information required by the department on the form.

(b) A buyer who files an annual report under (a) of this section shall attach a schedule to the report showing, for all salmon purchased or otherwise acquired, the following:

(1) limited entry permit numbers under which the salmon were caught;

(2) names of permit holders;

(3) total value of salmon purchased or otherwise acquired with respect to each limited entry permit number reported; and

(4) total tax collected for salmon purchased or otherwise acquired with respect to each limited entry permit number reported.

(c) The annual report is due by March 1 of the year following the calendar year in which the salmon were purchased or otherwise acquired and must be accompanied by any remittance shown to be due upon reconciliation of the monthly reports.

History

Authority: AS 43.05.080; AS 43.76.025
Eff. 4/1/81, Register 78; am 8/9/81, Register 79; am 7/31/81, Register 79; am 3/31/85, Register 93

15 AAC 76.140 Reporting of bonus or other additional payments

(a) A buyer making bonus or other additional payments to a limited entry permit holder for salmon purchased or otherwise acquired in a previous calendar year shall collect the tax and file a special salmon enhancement tax report of the additional payments made. The buyer responsible for collection of the tax shall file the report on a form prescribed by the department, stating the following:

(1) name of buyer;

(2) mailing address;

(3) employer identification number (EIN) or social security number (SSN);

(4) telephone number;

(5) location of operation or name of vessel;

(6) fisheries business license number or Alaska business license number;

(7) the region designated under AS 16.10.375 in which the buyer is located;

(8) year in which the salmon were initially purchased or otherwise acquired; and

(9) additional value paid, by species, for the salmon acquired in a previous year.

(b) The salmon enhancement tax report of bonus or other additional payments must be filed and the tax paid no later than the last day of the month following the month in which the additional payment was made.

History

Authority: AS 43.05.080; AS 43.76.025
Eff. 3/31/85, Register 93

Article 3 General Provisions

15 AAC 76.200 - 76.280

Reserved.

15 AAC 76.290 Definitions

In this chapter

(1) "buyer" means a person who purchases or otherwise acquires salmon from a limited entry permit holder, and includes a person required to obtain a license under AS 43.75.011, but does not include a person acquiring salmon for personal consumption or a tender acquiring salmon on behalf of a person required to obtain a license under AS 43.75.011;

(2) "permit" means an entry permit issued under AS 16.43.270 and an interim-use permit issued under AS 16.43.210;

(3) "person" means an individual, partnership, association, company, corporation, or any group or combination acting as a unit;

(4) "region" means a region of the state designated by the commissioner of fish and game under AS 16.10.375 for the purpose of salmon production, in which there exists a regional association organized for the purpose of enhancing salmon production and licensed to do so by the commissioner of fish and game, and in which an election has been held to approve the imposition of the salmon enhancement tax.

History

Authority: AS 43.05.080; AS 43.76.015; AS 43.76.040 AS 43.76.010; AS 43.76.025 AS 43.76.011; AS 43.76.028
Eff. 7/31/81, Register 79; am 3/31/85, Register 93

Chapter 77 Fishery Resource Landing Tax

15 AAC 77.005 Findings, purpose, and intent

(a) The fishery resource landing tax is both designed and intended to be a compensatory tax to complement the fisheries business tax under AS 43.75. The landing tax is intended to compensate the state for the burdens that the fish catcher/processors operating in the Exclusive Economic Zone ("EEZ") imposes upon the state and local communities, as well as for the benefits the EEZ catcher/processors receive from the state and local communities.

(b) The state has various research, management, and enforcement responsibilities in connection with the offshore fisheries. The EEZ catcher/processors have a significant presence in the state, including transferring of the processed fisheries resource product, taking on and disembarking of crew, taking on of fuel and supplies, obtaining repairs, discharging waste, and making use of sheltered waters. Additional burdens resulting from the fleet presence impact the state and local communities through increased demands on educational systems, road maintenance, public safety, airports, docks, hospitals, and other programs provided or financed by the state or local communities.

(c) Fisheries businesses operating in the state pay for benefits and burdens described in (b) of this section through the fisheries business tax which applies to fisheries resources harvested or processed in the state. The landing tax is a substantially equivalent levy designed to impose a comparable burden on interstate commerce. The EEZ catcher/processors are conducting fisheries businesses in the state to no less a degree than in-state operators, subject to the fisheries business tax. The landing tax is not a fee on fisheries resources simply moving through the state. Instead the landing tax is a payment for the services and benefits conferred upon this segment of the industry under which they pay their own way. The landing tax achieves an equality of treatment between local and interstate commerce conducting fisheries businesses in the state.

History

Authority: AS 43.77.010; AS 43.77.070
Eff. 4/20/94, Register 130

15 AAC 77.010 Return, payment, and required information

(a) A person subject to the fishery resource landing tax shall file a single return for all taxable landings of fishery resources in the state, during the tax year. The return must be filed using the forms provided by the department and must specify each vessel employed by the taxpayer and all locations at which fishery resources were landed in the state.

(b) On the form a person shall state the following information:

(1) the name of the person subject to the tax that is filing the return;

(2) the person's mailing address;

(3) the person's federal employer identification number or social security number;

(4) the calendar year covered by the return;

(5) the precise locations in the state where fishery resources were landed, including a specification by weight and species of the fisheries resource landed at each location;

(6) the precise locations in the state where fishery resources harvested under the provisions of a community development quota were landed, including a specification by weight and species of the fisheries resources landed at each location;

(7) the person's Alaska fisheries business license number or Alaska business license number;

(8) the value of the fishery resources;

(9) the amount of credits claimed for other taxes paid and for approved contributions;

(10) the amount of tax liabilities and payments; and

(11) other material required on the form.

History

Authority: AS 43.77.020; AS 43.77.070
Eff. 4/20/94, Register 130; am 11/9/2006, Register 180

15 AAC 77.015 Automatic extension of time to file return

Repealed.

History

Eff. 4/20/94, Register 130; am 11/9/2006, Register 180; repealed 12/26/2014, Register 212

15 AAC 77.020 Request for extension of time to file return

(a) Upon a showing of good cause beyond the control of the requester, the department may grant reasonable extensions of time for the filing of the return from the due date. The extensions may not exceed 90 days in total.

(b) A request for an extension of time to file the return must be in writing, contain a full statement of the reasons supporting the request, and be received by the department no earlier than March 1 after the close of the tax year and no later than 10 calendar days before the date the return is due, including extensions. A person that requests a response by facsimile transmission must provide a facsimile telephone number.

(c) If an extension of time for filing the return is granted, the return must be filed before the expiration of the period of the extension. A return filed after the period of the extension voids all extensions under this section.

(d) If an extension of time for filing the return is denied, the return must be filed by the later of

(1) 10 calendar days after the date the notice of denial is sent by facsimile transmission or mailed by the department; or

(2) the March 31 due date.

History

Authority: AS 43.77.020; AS 43.77.070
Eff. 4/20/94 Register 130; am 12/26/2014, Register 212

15 AAC 77.025 Requirement to make estimated tax payments

(a) Repealed 12/26/2014.

(b) A person who fails to make estimated tax payments in equal installments that total at least 90 percent of the person's tax liability for the year shall pay a penalty computed for each quarter for which a sufficient estimated tax was not paid. The estimated tax penalty is determined by applying the interest rate specified in AS 43.05.225 to the underpayment in each quarter, and runs from the installment payment due date through the payment date or the return due date under AS 43.77.020(a), whichever is earlier.

(c) A person is not subject to the estimated tax penalty if the person was subject to tax under AS 43.77 in the previous year, and makes estimated tax payments in equal installments that equal or exceed the liability of the person for tax under AS 43.77 in the previous tax year.

(d) Repealed 11/9/2006.

(e) Repealed 11/9/2006.

(f) Repealed 12/26/2014.

(g) Repealed 12/26/2014.

History

Authority: AS 43.77.020; AS 43.77.070
Eff. 4/20/94, Register 130; am 11/9/2006, Register 180; am 12/26/2014, Register 212

15 AAC 77.030 Liability for tax

(a) The person owning the fishery resource at the moment it is first landed in this state shall file the return and pay the tax imposed by AS 43.77.010.

(b) The person owning the fishery resource is the person with the legal title and the risk of loss at the moment the act of landing begins in this state. For purposes of this section, and notwithstanding any contract provision to the contrary, legal title and the risk of loss is in the person in possession of the fishery resource who harvested or processed the resource, or a related person or agent in possession that received the fishery resource from the person who harvested or processed the resource. The person described in this subsection retains legal title and risks of loss until the fishery resource is delivered and actual physical possession is transferred to a third-party buyer unrelated to that person.

(c) The tax imposed under AS 43.77.010 does not apply to a fishery resource that becomes subject to tax under AS 43.75. The provisions of AS 43.75 control and take precedence if a fishery resource, or the value of the fishery resource, are subject to both AS 43.75 and AS 43.77.

(d) The tax imposed under AS 43.77.010 does not apply to the landing of a secondary fishery resource product if the secondary product is included in the round weight of the primary product and the primary product is subject to the tax under AS 43.77 and this chapter.

(e) The tax imposed under AS 43.77.010 does not apply if the fishery resource is first landed in the territorial jurisdiction of another state or foreign country, as recognized by the United States. A first landing outside the jurisdiction of a state or foreign country, such as in United States jurisdictional waters, is not a first landing for purposes of AS 43.77.010 and does not preclude the tax under this chapter.

(f) The tax imposed under AS 43.77.010 applies to a fishery resource that is first landed in this state without regard to the final destination of a fishery resource.

History

Authority: AS 43.77.010
Eff. 4/20/94, Register 130

15 AAC 77.035 Credit for other taxes paid

(a) A credit is allowed for taxes paid to another jurisdiction in which the fishery resource was caught, processed, or sold. The credit is only available if the taxes paid to another jurisdiction are equivalent in nature to the taxes imposed by AS 43.75 and AS 43.76. A tax is equivalent in nature to the tax imposed under AS 43.75 if the tax is in the nature of an occupational tax on the conduct of a fisheries business as measured by the value of resources harvested or processed within the jurisdiction, or a tax otherwise imposed on the harvesting or processing of fishery resources within a jurisdiction. A tax is equivalent in nature to the tax imposed under AS 43.76 if the tax is imposed on the harvesting of salmon within a jurisdiction and the tax is intended to be used to promote or enhance salmon production within that jurisdiction. Sales taxes, import or export fees or taxes, income taxes, and similar taxes and fees are not considered to be equivalent in nature to the taxes imposed under AS 43.75 and AS 43.76.

(b) The amount of the credit for taxes paid to another jurisdiction on the fishery resource may not exceed the liability of the person for the tax under AS 43.77 on the same fishery resource.

(c) If taxes paid to another jurisdiction are subsequently refunded or credited to the person, the amount of the credit previously allowed under AS 43.77 or this chapter shall be recaptured as additional tax in the year the taxes were refunded or credited.

(d) The credit for other taxes paid must be claimed on the return. The person claiming the credit shall attach a statement to the return attesting that the tax described in (a) of this section has been paid, indicating the date that payment was made, identifying the jurisdiction to which the payment was made, and describing the nature of the tax and providing citation to the statutory and other legal authority in the jurisdiction for imposition of the tax. A copy of the return or report filed in the other jurisdiction must be submitted with the Alaska return and statement by the person claiming the credit.

(e) For purposes of this section, "jurisdiction" includes a state other than Alaska, a foreign country, or the United States.

History

Authority: AS 43.77.030; AS 43.77.070
Eff. 4/20/94, Register 130

15 AAC 77.040 Value and notice of value

(a) The value of the fishery resource is the statewide average price paid per pound for unprocessed fishery resources of the same species as reported to the Department of Fish and Game under AS 16.05.690. The department will, in its discretion, adjust the statewide average prices paid for fishery resources to eliminate high and low prices and to take into account tendering fees, price adjustments, and deferred payments, such as bonuses.

(b) In the absence of a Department of Fish and Game statewide average price for a particular species, the department will, in its discretion use information from other governmental agencies, such as the United States National Marine Fisheries Service, or other sources, such as Department of Revenue fisheries business tax return information, to arrive at a statewide average price for that species. The department statewide average price must be used to file the return and pay the tax required under AS 43.77 and this chapter, but a person may protest the price determined under this subsection at the time of filing the return and seek a refund. The department statewide average price determination may only be overcome by clear and convincing evidence of the full market value of the unprocessed fishery resources, submitted to the department by the person making the protest.

(c) A person required to file a return and pay the tax under AS 43.77 and this chapter shall notify the department in writing on or before January 31 following the year for which a return and tax is required, and request notice of the value for each species of fishery resources landed in the state in the previous calendar year for which the statewide average price was not available in the previous year. The notification must be made on a form provided by the department. The department will provide the information by United States mail, telephone, or facsimile transmission to the person requesting it as soon as practicable after the information becomes available. The information is considered to have been provided by the department on the date of the facsimile transmission, of the telephone contact, or on the letter, whichever is the earliest. The department is not required to publish the information described in (a) and (b) of this section.

(d) A person that is not required to file a return and pay the tax under this chapter, such as a tax return preparer, may informally request information at any time concerning the values for fishery resources landed in the state. A person subject to (c) of this section may not rely on another person to timely obtain value information under this section.

(e) For the purposes of this section, "average price" means the mean of two or more prices paid per pound for unprocessed fishery resource. In calculating the average price, the department will, in its discretion, use a simple average or a weighted average based on a volume by price or weight, depending on the availability of data to the department at the time and accuracy of that data. The average price may also be computed to take into account seasonal differences in prices.

History

Authority: AS 43.77.010; AS 43.77.070; AS 43.77.200
Eff. 4/20/94, Register 130; am 11/9/2006, Register 180

15 AAC 77.045 Weights and recovery rates

(a) For purposes of the tax under AS 43.77 and this chapter, the unprocessed weight of the fishery resource is determined by actual scale weight, or in the absence of an actual scale weight by volumetric measurement or by a product recovery rate as imposed or required by the United States National Marine Fisheries Service to determine the extent of resources taken by a person in a fishery.

(b) Except as provided in (a) of this section, for purposes of determining the tax on a fishery resource which was processed before landing in the state and that is subject to tax under AS 43.77 and this chapter, the processed weight of the fishery resource at the time it becomes subject to tax must be converted to an unprocessed weight. Secondary fishery resource products must be included in the conversion to an unprocessed weight. In making the conversion, the person may use the person's actual recovery rate experience, if the rates are reliable and verifiable, or a reliable and verifiable industry average recovery rate if the person's processing activities are consistent with the activities underlying the industry average recovery rate. The department will, in its discretion, audit and adjust the recovery rate under this subsection.

(c) For each species, a person shall disclose with the return the nature of the recovery rate used and the percentage of recovery. The person shall maintain records necessary to support the rate utilized.

History

Authority: AS 43.77.010; AS 43.77.070; AS 43.77.200
Eff. 4/20/94, Register 130

15 AAC 77.050 Credit for community development quota contributions

(a) A person who made a contribution to a nonprofit corporation incorporated in the state that qualifies for the credit authorized by AS 43.77.040 must apply to the department no later than January 31 of the year following the year of the contribution for authority to take the credit on the tax return. A person that fails to file a timely and complete application with the department as required by this section waives the credit.

(b) The application must be made on the form provided by the department. The application shall contain the following:

(1) the person's name, federal employer identification number or social security number, telephone number, and mailing address;

(2) the name of the nonprofit corporation receiving the contribution;

(3) the amount of the contribution and a receipt from the nonprofit corporation for the amount of the contribution;

(4) a statement from the nonprofit corporation specifying how the contribution will be used and an agreement by the nonprofit corporation to allow the department audit all of its accounts relating to the contribution;

(5) documentation regarding the authority of the person to harvest under a community development quota;

(6) the fishery resources, by unprocessed weight and species, harvested under the community development quota;

(7) a statement that the contribution to the nonprofit entity was expressly conditioned upon its use exclusively for one or more of the purposes authorized by AS 43.77.040; and

(8) other material required on the form.

(c) The department shall approve or disapprove an application to take the credit within 30 days of receipt of a timely and complete application. A person may consider the application tentatively approved and tentatively take the credit on the tax return if the department does not disapprove the application within the 30-day period and before the filing of the tax return.

(d) A contribution that qualifies for the credit is a cash contribution. A contribution made in-kind or of services, or both, does not quality for the credit.

(e) A contribution allowed as a credit may not be claimed as a credit or deduction under any other provision of AS 43.

History

Authority: AS 43.77.040; AS 43.77.070; AS 43.77.200
Eff. 4/20/94, Register 130

15 AAC 77.055 Requirements for nonprofit corporations

(a) As a condition to a person obtaining a credit under AS 43.77.040, a nonprofit corporation receiving or anticipating receipt of a contribution shall separately account for the amount of the contribution and agree to allow the department to audit all accounts relating to the contributions.

(b) In order to separately account for the expenditure of the contribution, the nonprofit corporation must establish, the following special accounts, as applicable, in its accounting system:

(1) CDQ fisheries scholarships;

(2) CDQ fisheries industry training;

(3) CDQ fisheries transportation grants;

(4) CDQ fisheries transportation loans;

(5) CDQ fisheries facilities grants;

(6) CDQ fisheries facilities loans; and

(7) CDQ fisheries research grants.

(c) The use of monies in the special accounts must be determined on a first-in-first-out (FIFO) basis. All contributions, with the exception of those initially placed in a loan account, must be distributed from the credited account and used for a qualified purpose by the end of the calendar year following the calendar year of receipt. Contributions placed in a loan account may be accumulated without the requirement for distribution within a specified time period. A contribution initially accounted for in a loan account that is transferred to another account must be distributed from that account by the end of the calendar year following the calendar year of the transfer. Contributions may not be transferred from a non-loan account to a loan account.

(d) No credit is allowed, and prior credits will, in the department's discretion, be revoked, if the person, or a party related to the person receives a loan or grant from a nonprofit corporation to which that person has made or will make a contribution that qualifies for the credit, unless the person first obtains written authorization from the department to receive the loan or grant.

(e) A nonprofit corporation, to accommodate potential contributors, may apply to the department and request a determination that the intended use of contributions for a specifically designated program satisfies one or more of the requirements of AS 43.77.040 and this chapter

History

Authority: AS 43.77.040; AS 43.77.070; AS 43.77.200
Eff. 4/20/94, Register 130

15 AAC 77.060 Claim and revocation of credits

(a) A person that is entitled to claim a credit under AS 43.77.040 and this chapter shall take the credit on the tax return for the year that the contribution was made. The credit is a direct reduction of the tax liability for that tax year.

(b) Within the limitations period applicable by statute to the tax year, the department will, deny or revoke at any time a tax credit authorized by AS 43.77.040 and recover by assessment a tax credit authorized by AS 43.77.040 that was claimed on a tax return, if it is later determined by the department that:

(1) the contribution does not qualify or there has been a violation of AS 43.77.040; or this chapter; or

(2) the person claiming the credit is in arrears in the payment of a tax levied under AS 43; for purposes of this paragraph, the tax includes penalties and interest and the tax is not in arrears, if the tax has been timely appealed and is not subject to collection under AS 43.

History

Authority: AS 43.77.040; AS 43.77.070; AS 43.77.200
Eff. 4/20/94, Register 130

15 AAC 77.065 Accounting for revenue sharing

(a) The annual balance in the separate account in the general fund that is available for revenue sharing under AS 43.77 is reduced by all tax credits claimed on returns as a reduction of the tax liability. The effect of this reduction for the tax credits is to reduce dollar-for-dollar the amount that otherwise would have been paid to municipalities.

(b) The department will attempt to specifically allocate the reduction in the amount of revenue sharing as a result of the tax credits to those municipalities in which the fishery resources harvested under the provisions of a community development quota were landed. In the event that information is not available for that purpose, the department will apportion the reduction to all areas in the state in which fishery resources were landed.

History

Authority: AS 43.77.050; AS 43.77.060; AS 43.77.070
Eff. 4/20/94, Register 130

15 AAC 77.070 Taxable nexus

(a) A person meeting the criteria set out in this section may seek a determination of whether the person has a taxable nexus for purposes of AS 43.77. The person must

(1) be buying a processed fishery resource from an unrelated person in an arms-length transaction, and

(2) obtain a transfer of the legal title, risk of loss, and the physical possession of the resource outside the jurisdiction of the state and thereafter land the fishery resource in the state for transshipment to another jurisdiction.

(b) In order to obtain the determination, the person shall apply to the department and provide factual information regarding the person's presence in the state as may be required by the department.

History

Authority: AS 43.77.070
Eff. 4/20/94, Register 130

15 AAC 77.090 Penalties: reasonable cause

Repealed.

History

Eff. 11/9/2006, Register 180; repealed 12/26/2014, Register 212

15 AAC 77.990 Definitions

In AS 43.77 and this chapter, unless the context otherwise requires,

(1) "department" means the Department of Revenue;

(2) "filed" means the date of personal delivery to the department or, if mailed, the date of the United States postmark;

(3) "related person or party" has the meaning of related person in 26 U.S.C. 267 and 26 U.S.C. 318;

(4) "weight" means the poundage of an unprocessed fishery resource after the application of a recovery rate described in 15 AAC 77.045(a) to a processed fishery resource.

History

Authority: AS 43.77.070
Eff. 4/20/94, Register 130

Chapter 80 Salmon Prices

15 AAC 80.010 Report of average wholesale salmon prices

(a) If, during a particular calendar year, the department does not receive a joint request as described in AS 43.80.035(d) for an average wholesale salmon price report, no report will be prepared for that calendar year. If the department does receive a joint request during a calendar year, a report will be prepared for that year on the salmon species for which a report is requested.

(b) If a joint request is not received during a calendar year but is received on or before February 15 of the following year, the department will approve the request if reasonable cause is shown for the delay.

(c) If no joint request is received under (a) of this section and no joint request is approved under (b) of this section for a report on a salmon species, then no report will be prepared for that salmon species in any subsequent year.

(d) If a joint request is received under (a) of this section or approved under (b) of this section, the department will mail a wholesale salmon price information form to each salmon cannery which operated in the state. It will mail the form by January 5 of the year following the year for which the report is requested or within five days after the approval of a request under (b) of this section.

(e) Each cannery shall complete the information form and return it to the department by February 10 or, upon the approval of a request under (b) of this section, within 30 days of the date of mailing the form under (d) of this section.

(f) If a cannery does not return a completed information form to the department by April 1 following the year for which a report is requested under (a) of this section, or within 60 days of the approval of a request under (b) of this section, the person required to file the report shall pay a civil penalty of $5,000 unless it is demonstrated to the department that the failure to file was due to a reasonable cause and not to willful neglect.

History

Authority: AS 43.05.080; AS 43.80.035
Eff. 4/8/82, Register 82; am 8/1/82, Register 83

Chapter 90 Alaska Gasline Inducement Act Provisions

Article 1 Alaska Gasline Inducement Act Reimbursement

15 AAC 90.010 Application for reimbursement and appeal

(a) A licensee may, in a form prescribed by the department and as often as once in each quarter, apply for reimbursement of qualified expenditures from the Alaska Gasline Inducement Act reimbursement fund established under AS 43.90.400(a).

(b) An application under this section must be signed by the licensee, or the authorized representative of the licensee, and must state the licensee's name, the name of a contact person with responsibility for preparing the application, and the contact person's mailing address, electronic-mail address, and telephone number. For each expenditure for which reimbursement is claimed, an application must include

(1) a description of the qualified activity for which the expenditure is claimed and an explanation of how the expenditure directly relates to the qualified activity;

(2) an accounting of the expenditure, including a statement of the amount of the expenditure, the date it was paid, and identification of all financial and technical source documents and records supporting the expenditure, including invoices, contracts, receipts, and employee time records if the expenditure is for labor;

(3) a detailed description of the transaction underlying the expenditure, including the

(A) name, mailing address, electronic-mail address, and telephone number of each seller and service provider;

(B) date of the transaction; and

(4) other information and documentation requested by the department, as the department considers necessary, for reviewing the application for reimbursement.

(c) The department will reimburse the licensee at the rate and in the manner provided under AS 43.90, this chapter, and the license held by the licensee under AS 43.90, for actual and reasonable expenditures that the department determines are qualified expenditures. However, the department will not reimburse the licensee for expenditures that the department determines are not reasonably required, are not qualified expenditures, are not paid as of the date of the application for reimbursement, or are not sufficiently documented. The department will notify the licensee in writing if the department determines that a claimed expenditure does not qualify for reimbursement.

(d) A licensee may appeal to the commissioners from a determination by the department under (c) of this section that a claimed expenditure does not qualify for reimbursement by filing a written appeal, in a form prescribed by the department, on or before the 90th day after the date of the department's notice to the licensee of the reimbursement determination. The appeal must describe the expenditures in dispute, explain why the licensee believes the expenditures qualify for reimbursement, and include supporting documentation.

(e) The commissioners will decide the appeal after providing the licensee with notice and an opportunity to be heard. The written decision of the commissioners is a final agency action for purposes of appeal to the superior court.

History

Authority: AS 43.90.110; AS 43.90.220; AS 43.90.400
Eff. 11/30/2007, Register 184

15 AAC 90.020 Accounting, budget reports and audits

(a) A licensee applying for reimbursement under AS 43.90 and this chapter shall maintain its accounting system in accordance with generally accepted accounting principles applied on a consistent basis, and shall retain for a period of seven years from the date the licensee receives reimbursement of an expenditure under this chapter, and make available to the department upon request, all financial and technical source documents and records supporting the application for reimbursement.

(b) A licensee shall submit the following budget reports to the department, with the expenditures categorized by qualified activity and described in detail:

(1) an initial budget report within 60 days after issuance of the license under AS 43.90, estimating the amount of total qualified expenditures that the licensee expects to pay in each quarter of each fiscal year from the date the license is issued through completion of the project, and estimating the amount of the qualified expenditures that the licensee expects to submit to the department for reimbursement in each quarter during that period;

(2) quarterly updates to the initial budget report described in (1) of this subsection, including

(A) a statement of the total amount of qualified expenditures paid by the licensee, by quarter, from the date of the issuance of the license through the date of the quarterly report, compared with the budgeted qualified expenditures previously reported for each quarter; and

(B) an update of the estimate in the initial budget report of the amount of total qualified expenditures that the licensee expects to pay in each quarter of each fiscal year from the date of the quarterly report through completion of the project, and the estimated amount of the qualified expenditures that the licensee expects to submit to the department for reimbursement in each quarter during that period.

(c) The department and the Department of Natural Resources will jointly audit the records, books, and files of a licensee that has received reimbursement under AS 43.90 and this chapter, at any time on reasonable notice, but not less than annually, to ensure that the expenditures for which the department has reimbursed the licensee are qualified expenditures. If it is determined on audit that a licensee has received reimbursement for an expenditure that is not a qualified expenditure, the provisions of AS 43.90.230 apply.

History

Authority: AS 43.90.110; AS 43.90.230 AS 43.90.220; AS 43.90.400
Eff. 11/30/2007, Register 184

15 AAC 90.030 Qualified expenditures

(a) For purposes of reimbursement under this chapter, an expenditure is a qualified expenditure only if it meets the requirements set out in AS 43.90.110(a)(1)(C) and this chapter, and is an actual and reasonable expenditure directly and reasonably related to a qualified activity that is paid by the licensee. Qualified expenditures include

(1) payment to an employee of the licensee, for the time expended on a qualified activity, for salary and wages, including the amount of customary or required benefits, and costs of business-related travel and meals during travel that the licensee reimburses to an employee under the licensee's contract of employment or standard written operating practice for the employee; however, a qualified expenditure does not include any portion of a

(A) bonus, stock option, or other payment above an employee's salary, wages, and customary or required benefits; or

(B) severance payment or other termination allowance paid to an employee;

(2) costs and expenses, including supplies, of office space leased exclusively for the project after the date that a license is issued under AS 43.90; if the office space is used for any activity other than for the project, the qualified expenditures include only the portion of the costs and expenses that are directly and reasonably related to the amount of use and cost incurred specifically for a qualified activity;

(3) costs of acquiring, leasing, installing, operating, transporting, maintaining, repairing, and replacing equipment and materials, including sales and use taxes, but not if the costs result from damage or loss due to gross negligence, willful misconduct, or criminal conduct by the licensee or an employee, officer, or contractor of the licensee;

(4) costs of transporting and maintaining equipment and materials, and personnel transportation, temporary living quarters, and subsistence for environmental studies, field studies, and surveys;

(5) costs of contract services, subject to the same limitations as the licensee's costs in this section;

(6) net premiums for insurance the licensee is required to carry;

(7) costs of acquiring, leasing, installing, operating, repairing, and maintaining communications systems and computer systems necessary for the project, including sales and use taxes;

(8) costs of required permits and licenses;

(9) costs for non-litigation legal services only;

(10) costs of compliance with ecological, environmental, and health and safety requirements, but not if the costs result from damage or loss due to gross negligence, willful misconduct, or criminal conduct by the licensee or an employee, officer, or contractor of the licensee; and

(11) other costs determined by the commissioners to be qualified expenditures.

(b) Qualified expenditures in (a) of this section do not include expenditures that are not actually paid by the licensee, not reasonable, or not directly and reasonably related to a qualified activity, and do not include any expenditure for

(1) overhead costs, including

(A) salaries, wages, employee benefits, and business-related expenses of the licensee's employees performing functions not directly related to a qualified activity;

(B) office and other expenses not directly related to a qualified activity; and

(C) costs of administration, accounting, human resources, training, property and income taxes, entertainment, self-insurance, and warehousing;

(2) lobbying costs, including costs of engaging in an assignment for the purpose of influencing legislative or administrative action of a government entity if the assignment is substantially the same as an assignment for the purpose of influencing state legislative or administrative action that would require registration under AS 24.45.041;

(3) litigation costs and fees, including costs and fees associated with dispute resolution in judicial, arbitration, or administrative proceedings;

(4) the cost of an asset or work product acquired or developed by the licensee before the license is issued under AS 43.90; or

(5) payments for civil or criminal restitution, judgment or interest on a judgment, penalty, or fine.

History

Authority: AS 43.90.110; AS 43.90.230 AS 43.90.220; AS 43.90.400
Eff. 11/30/2007, Register 184

Article 2 Gas Production Tax Exemption

15 AAC 90.200 Qualification for tax exemption

(a) To qualify under AS 43.90.300 for a tax exemption under AS 43.90.320, a person must

(1) for firm transportation capacity on the Alaska mainline,

(A) enter into a pre-subscription agreement with the licensee before the commencement of the first binding open season of the project;

(B) submit a bid before the close of the first binding open season of the project; however, the person may submit a bid tendered after the close of the first binding open season, but no later than 180 days after expiration of the first binding open season of the project, if

(i) the licensee accepts the bid under 18 C.F.R. 157.34(d)(2); and

(ii) the person makes, to the satisfaction of the commissioners, a good-faith showing of the circumstances that prevented the person from submitting a timely bid, and if the commissioners, on the basis of that showing, approve the tender of the bid; or

(2) execute, no later than 180 days after the close of the first binding open season of the project, a precedent agreement for firm transportation capacity on the Alaska mainline arising out of an action taken to qualify under (1) of this subsection, or must be the holder of an inducement voucher issued by the commissioners to a person that executed a precedent agreement as required under this paragraph;

(3) obtain rights under a transportation services agreement

(A) as a party that executes, no later than five years after the close of the first binding open season of the project or two years after the effective date of the certificate of public convenience and necessity issued for the Alaska mainline, whichever date is later, a transportation services agreement arising out of an action taken to qualify under (1) and (2) of this subsection for firm transportation capacity on the Alaska mainline; or

(B) as the holder of an inducement voucher issued to a person qualified under (A) of this paragraph for a transportation services agreement arising out of an action required to qualify under (1) and (2) of this subsection;

(4) file with the commissioners or be the holder of an inducement voucher obtained from a person that filed with the commissioners a complete copy of each of the following no later than 30 days after execution, or, under (E) of this paragraph, no later than 30 days after receipt of a request:

(A) the bid, precedent agreement, and transportation services agreement required to qualify under (1) - (3) of this subsection;

(B) an amendment to or termination of the bid, precedent agreement, or transportation services agreement required to qualify under (1) - (3) of this subsection;

(C) a bid, precedent agreement, or transportation services agreement, if any, arising out of a first binding open season for the Canada mainline;

(D) any amendment to or termination of the bid, precedent agreement, or transportation services agreement filed under (C) of this paragraph;

(E) other documents and information requested by the commissioners to determine qualification for resource inducements under AS 43.90 and this chapter; and

(5) submit, on a form provided by the commissioners, not later than 90 days after the issuance of a certificate of public convenience and necessity for the Alaska mainline, the agreement regarding rolling in expansion costs required by AS 43.90.320(c) or 43.90.330(d), as applicable.

(b) A person eligible for an inducement voucher under AS 43.90.330 must execute the agreement set out in (a)(5) of this section no later than 90 days after issuance of a certificate of public convenience and necessity for the Alaska mainline, unless the person is eligible by reason of an agreement to transfer the inducement voucher, in which case the person must execute the agreement set out in (a)(5) of this section at the time of filing an application for transfer of the inducement voucher.

(c) The commissioners may extend the deadline set out in (a)(2) of this section if they determine that an extension is in the best interest of the state. However, the commissioners will not extend the deadline later than December 5, 2011.

(d) A person that has satisfied the requirements of (a) of this section and that claims a resource inducement under AS 43.90.320 and this chapter may file an application with the commissioners for a determination that the requirements of (a) of this section have been met. Upon receipt of the application, the commissioners will make a joint determination whether the applicant meets the requirements for qualification set out in (a) of this section. A person is not qualified for a resource inducement before application to the commissioners and approval by the commissioners under this section.

(e) In this section, "Canada mainline" has the meaning given "Yukon - BC Section" in TransCanada Alaska Company LLC's original, November 30, 2007 application for license under AS 43.90. The definition of "Yukon - BC section" at page 12 of the glossary in that application is adopted by reference.

History

Authority: AS 43.90.300; AS 43.90.330 AS 43.90.320; AS 43.90.410
Eff. 4/30/2010, Register 194

15 AAC 90.210 Gas subject to tax exemption

(a) For purposes of AS 43.90.320(b), North Slope gas shipped through firm transportation capacity a producer acquired during the first binding open season or shipped in the firm transportation capacity described in a voucher received by the producer under AS 43.90.330 is North Slope gas that is transported

(1) on the Alaska mainline in the firm transportation capacity acquired through the bid, precedent agreement, and transportation services agreement required to qualify under 15 AAC 90.200(a)(1) - (3);

(2) in an amount no greater than that specified in the bid submitted under 15 AAC 90.200(a)(1); and

(3) for a term of years no longer than specified in the bid submitted under 15 AAC 90.200(a)(1), excluding any option for extension of the term of years.

(b) Regardless of the transportation capacity in which it is transported, North Slope gas produced by a producer from a lease or property and transported on the Alaska mainline, or produced by a producer from multiple leases or properties and commingled before all or part of the commingled gas is transported on the Alaska mainline, consists of the following, in the same proportions as are found in the total amount of gas produced by the producer from that lease or property or from that group of leases or properties, respectively, excluding gas taken as royalty in kind and excluding gas produced before 2022 and used in the state that is not transported on the Alaska mainline:

(1) nontaxable gas;

(2) gas taxable under AS 43.55.011(e) other than gas used in the state if produced before 2022;

(3) gas taxable under AS 43.55.011(i);

(4) gas taxable under AS 43.55.011(e) and used in the state if produced before 2022.

History

Authority: AS 43.90.300; AS 43.90.330 AS 43.90.320; AS 43.90.410
Eff. 4/30/2010, Register 194

15 AAC 90.220 Calculation of gas production tax obligation

(a) For purposes of AS 43.90.320, the amount for a calendar year of a producer's gas production tax obligation that is calculated under the gas production tax in effect at the start of the first binding open season held under AS 43.90, and that applies to production taxes that are levied on North Slope gas produced during the calendar year and transported as described in 15 AAC 90.210(a)(1) - (3) equals TE + TU + TI, as reduced by the application of tax credits under (c) of this section, and

where

(1) TE equals the amount of tax calculated under (b)(4) or (5) of this section, as applicable;

(2) TU equals the amount of tax under AS 43.55.011(e) for North Slope gas that is

(A) taxable under AS 43.55.011(e);

(B) produced by the producer during the calendar year;

(D) transported as described in 15 AAC 90.210(a)(1) - (3); and

(E) used in the state;

(3) TI equals the amount of tax under AS 43.55.011(i) for North Slope gas

(A) that is taxable under AS 43.55.011(i);

(B) that is produced by the producer during the calendar year;

(D) that is transported as described in 15 AAC 90.210(a)(1) - (3).

(b) The calculations required to determine TE under (a)(1) of this section are as follows:

(1) first, the tax levied by AS 43.55.011(e) is calculated for North Slope oil and North Slope gas produced by the producer during the calendar year, other than gas produced before 2022 and used in the state;

(2) second, the applicable minimum amount of tax under AS 43.55.011(f) is calculated for North Slope oil and North Slope gas produced by the producer during the calendar year;

(3) third, the amounts calculated under (1) and (2) of this subsection are compared;

(4) if the minimum amount of tax calculated under (2) of this subsection exceeds the amount calculated under (1) of this subsection, the applicable percentage under AS 43.55.011(f) is multiplied by the greater of

(A) zero; or

(B) the gross value at the point of production of the North Slope gas that

(i) is taxable under AS 43.55.011(e);

(ii) is produced by the producer during the calendar year;

(iii) is transported as described in 15 AAC 90.210(a)(1) - (3); and

(iv) is not gas produced before 2022 and used in the state;

(5) if the minimum amount of tax calculated under (2) of this subsection does not exceed the amount calculated under (1) of this subsection, the amount calculated under (1) of this subsection is multiplied by the fraction: GCG / (GCG + GOG + GVO), where

(A) GCG equals the greater of

(i) zero; or

(ii) the value described in (4)(B) of this subsection;

(B) GOG equals the gross value at the point of production of North Slope gas that

(i) is taxable under AS 43.55.011(e);

(ii) is produced by the producer during the calendar year;

(iii) is not transported as described in 15 AAC 90.210(a)(1) - (3); and

(iv) is not gas produced before 2022 and used in the state;

(i) is taxable under AS 43.55.011(e); and

(ii) is produced by the producer during the calendar year.

(c) A tax credit available to be applied for a calendar year against a tax levied under AS 43.55.011 for North Slope oil and gas or for North Slope gas must be allocated, proportional to the respective gross values at the point of production of the gas or oil, between

(1) North Slope gas transported as described in 15 AAC 90.210(a)(1) - (3); and

(2) other gas or oil produced from leases or properties in the state against a tax levied under AS 43.55.011 for which the tax credit is also available to be applied.

(d) A calculation under this section is made under the provisions of AS 43.55 as those provisions were in effect at the start of the first binding open season held under AS 43.90.

(e) In this section, "North Slope oil" means oil produced from a lease or property in the state north of 68° North latitude.

History

Authority: AS 43.90.300; AS 43.90.330 AS 43.90.320; AS 43.90.410
Eff. 4/30/2010, Register 194

15 AAC 90.230 Voucher for resource inducement

(a) To request an inducement voucher under AS 43.90.330, a person must apply for the inducement voucher on a form provided by the commissioners. No later than 30 days after notice is received, the applicant must provide other documents and information requested by the commissioners to determine whether the applicant meets the requirements of AS 43.90 and 15 AAC 90.200. Upon receipt of the application and other documents and information, the commissioners will make a joint determination on an application for an inducement voucher, and will issue an inducement voucher if the application is approved.

(b) To transfer an inducement voucher issued under (a) of this section, the holder of the voucher and the proposed transferee must file a joint application on a form provided by the commissioners. The joint application must include a copy of a binding contract between the holder and the proposed transferee for the sale and purchase of North Slope gas. No later than 30 days after notice is received, the applicants must provide other documents and information requested by the commissioners to determine whether to approve the transfer under AS 43.90.330 and 15 AAC 90.200. Upon receipt of the application and other documents and information, the commissioners will make a joint determination on the application, and will issue proof of transfer if the application is approved. A transfer is limited in time and quantity as set out in AS 43.90.330(c).

History

Authority: AS 43.90.300; AS 43.90.330 AS 43.90.320; AS 43.90.410
Eff. 4/30/2010, Register 194

Article 3 General Provisions

15 AAC 90.900 Definitions

(a) In this chapter, unless the context otherwise requires,

(1) "commissioners" means the commissioner of revenue and the commissioner of natural resources, acting jointly, as provided in AS 43.90.900;

(2) "department" means Department of Revenue;

(3) "fiscal year" means the period beginning July 1 and ending on June 30 of the following calendar year;

(4) "licensee" has the meaning given in AS 43.90.900;

(5) "project" has the meaning given in AS 43.90.900;

(6) "qualified activity" means an activity directly related to

(A) pursuing firm transportation commitments in a binding open season;

(B) securing financing for the project;

(C) obtaining a certificate of public convenience and necessity from the Federal Energy Regulatory Commission or the Regulatory Commission of Alaska; or

(D) satisfying a requirement of an agency with jurisdiction over the project including a Canadian regulatory agency;

(7) "lease or property" has the meaning given in AS 43.55.900;

(8) "North Slope gas" means gas produced from a lease or property in the state north of 68° North latitude.

(b) In AS 43.90 and this chapter, unless the context otherwise requires,

(1) "Alaska mainline"

(A) means, with respect to the pipeline system licensed under AS 43.90, the section of the pipeline system that is within this state, that originates at a point in or near Prudhoe Bay, and that terminates at one or more of the following locations:

(i) the Alaska/Yukon border near Beaver Creek;

(ii) Valdez; and

(B) does not include a gas pipeline between Point Thomson and Prudhoe Bay, a gas treatment plant on the North Slope, other facilities used to treat gas to meet pipeline specifications, or an LNG plant or terminal;

(2) "first binding open season" means the project's first open season

(A) in which the licensee requires binding bids for capacity from applicants; and

(B) that concludes no later than December 5, 2011.

History

Authority: AS 43.90.110; AS 43.90.300; AS 43.90.400 AS 43.90.220; AS 43.90.320; AS 43.90.410 AS 43.90.230; AS 43.90.330
Eff. 11/30/2007, Register 184; am 4/30/2010, Register 194

Chapter 98 Tire Fees

15 AAC 98.010 Motor vehicles designed for use on a highway

For purposes of AS 43.98.025, motor vehicles designed for use on a highway do not include off-road vehicles. For purposes of this section, off-road vehicles include dozers, graders, loaders, racing cars, lawn mowers, farm tractors and implements, construction and stevedoring cranes, devices used exclusively upon stationary rails or tracks, and mobile homes.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.020 Return filing requirements

(a) A seller shall file the return required under AS 43.98.025(d) on a form prescribed by the department. On that form, the seller shall provide identification of the person filing the return, inventory information, and computation of the fee to be remitted.

(b) For a retail sale in which the seller does not have a nexus with the state, the buyer shall complete the form prescribed in (a) of this section and pay the fee imposed by AS 43.98.025(a).

(c) Subject to 15 AAC 05.310(h), the filing of the return and the remittance of the total fees must be made not later than April 30, July 30, October 30, and January 30, for the calendar quarters ending March 31, June 30, September 30, and December 31, respectively.

(d) If a seller has multiple business locations, all information shall be combined on one return.

(e) The fee imposed in AS 43.98.025 applies to a sale or service to a related person.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.030 Tires on new motor vehicles

For purposes of the fee imposed in AS 43.98.025, the sale or lease by a dealer of a new motor vehicle is not a retail sale of

(1) new tires on the vehicle; or

(2) a single new tire stored on the vehicle as a spare.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.040 Collection of the fee

A fee imposed in AS 43.98.025 upon a sale or service must be collected at the time of the sale or service, without regard to billing practices, installment agreements, credit procedures, or bad debts. The time of the sale or service must be determined on an accrual basis.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.050 Replacement due to defect or recall

A seller is not required to collect a fee under AS 43.98.025 for a tire or service that is replaced or performed again as the result of a defect or recall, if the replaced tire or re-performed service is provided to the purchaser

(1) at no cost; or

(2) according to a fixed warranty schedule, and the cost to the purchaser does not exceed 15 percent of the cost of the replacement or re-performed service.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.060 Tires for resale

(a) For purposes of AS 43.98.025(g)(2), the department will consider a tire to be a tire for resale in a transaction between

(1) the manufacturer of a tire and a distributor of the tire;

(2) a distributor of the tire and a retail dealer of the tire; or

(3) a retail dealer and another retail dealer of the tire.

(b) In a transaction under (a)(3) of this section, the final retail sale receipt, invoice, or other record of sale must state that the fee imposed in AS 43.980.025 was previously paid on the tire or service.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.070 Persons immune or exempt under federal law from tire fees

The department will not apply the tire fee requirements of AS 43.98.025 and this chapter to tires or services sold

(1) for official use to a person that, under federal law, is immune from state taxation as an instrumentality of the federal government, including a federal credit union and the American Red Cross, if the purchaser provides a certificate of use as required under AS 43.98.025(g) and 15 AAC 98.080 for those tires or services; or

(2) to a foreign government, if the purchaser

(A) provides a certificate of use as required under AS 43.98.025(g) and 15 AAC 98.080 for those tires or services; and

(B) presents a valid tax exemption card issued under 22 U.S.C. 4301 - 4316 by the United States Department of State.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.080 Certificate of use

(a) A purchaser must complete a certificate of use on a form prescribed by the department for an exemption specified in AS 43.98.025(g). The certificate of use is effective for the calendar year unless invalidated by the department. The certificate of use must specify the nature of the exemption.

(b) A certificate of use must be signed by an authorized representative of the buyer or transferee. The seller shall retain the certificate of use for three years.

(c) A person obtaining a tire or a service under a certificate of use who subsequently uses the tire or service in a manner that would make the tire or service subject to the fee under AS 43.98.025 shall file a return and pay the fee that would otherwise have been due at the time of the transfer, as well as applicable penalties and interest.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.090 Recordkeeping requirements

(a) Each seller who collects a fee imposed in AS 43.98.025 shall maintain records of inventories to account for

(1) tire inventories on the first day of each month;

(2) tire inventories on the last day of each month;

(3) tires purchased, produced, or otherwise received in each month;

(4) tires sold or transferred in each month; and

(5) tires and services to which a fee imposed in AS 43.98.025 does not apply under AS 43.98.025(g) or this chapter.

(b) A seller shall maintain for three years after the due date of a return, or the date the return was filed, whichever is later, all books and records required by this section

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.100 Administration and enforcement

In this chapter, the seller is subject to AS 43.05 and AS 43.10 with respect to the fee imposed in AS 43.98.025.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

15 AAC 98.900 Definitions

In AS 43.98.025 and this chapter,

(1) "calendar quarter" means the period of three months of the calendar year, each beginning January 1, April 1, July 1, and October 1;

(2) "department" means the Department of Revenue;

(3) "person" means an individual, firm, partnership, joint venture, government, association, corporation, estate, trust, receiver, or other group or combination acting as a unit;

(4) "related person" means a person listed in 26 U.S.C. 267(b) (Internal Revenue Code); for purposes of this paragraph, 26 U.S.C. 267(b), as amended as of December 17, 1999, is adopted by reference;

(5) "retail sale" means a sale of goods or services to the consumer; "retail sale" includes a transaction where the tire is ordered from within the state and delivered for first use in the state, regardless of whether the tire is shipped from outside the state; "retail sale" does not include a sale in which a seller paid the fee imposed in AS 43.98.025 in a transaction specified in 15 AAC 98.060(a)(3);

(6) "sale" means a transfer in the state for consideration of title or possession of property from a seller, agent of a seller, or person acting as an intermediary for the seller for a fee or other consideration; "sale" includes a transaction by barter, an exchange, a lease, a license for use, and an installment, credit, layaway, or conditional transaction.

History

Authority: AS 43.05.080; AS 43.98.025
Eff. 4/16/2004, Register 170

Eff. 9/7/60, Register 2; am 10/1/88, Register 107; repealed 7/30/94, Register 131

History

Eff. 12/31/82, Register 84; repealed 7/30/94, Register 131

15 AAC 105.100 Fishing derby associations

Repealed 10/1/88.

15 AAC 105.105 Nonprofit trade association

Repealed.

History

Eff. 12/31/82, Register 84; repealed 7/30/94, Register 131

15 AAC 105.110 Bingo

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 10/1/88, Register 107; am 12/23/88 - 2/15/89, Register 109; am 6/3/90, Register 114; repealed 7/30/94, Register 131

15 AAC 105.120 Raffles and lotteries

Repealed.

History

Eff. 9/6/60, Register 2; am 11/6/76, Register 60; am 12/31/82, Register 84; am 2/25/84, Register 89; am 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.125 Pull-tab games

Repealed.

History

Eff. 10/1/88, Register 107; am 10/1/88, Register 108; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.130 Ice classics

Repealed 10/1/88.

15 AAC 105.135 Monte Carlo activities

Repealed.

History

Eff. 2/25/84, Register 89; repealed 7/30/94, Register 131

15 AAC 105.140 Dog mushers' contests

Repealed.

History

Eff. 9/7/60, Register 2; repealed 7/30/94, Register 131

15 AAC 105.150 Fish derbies

Repealed.

History

Eff. 9/7/60, Register 2; repealed 7/30/94, Register 131

15 AAC 105.160 Contests of skill

Deleted 2/5/92.

15 AAC 105.170 Issuance of permits

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 2/25/84, Register 89; am 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.180 Renewal of permits

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 10/1/88, Register 107; repealed 7/30/94, Register 131

15 AAC 105.190 Suspension, revocation, or denial of permits and licenses; hearings

(a) Deleted 2/5/92.

(b) Repealed 7/30/94.

(d) Repealed 7/30/94.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 9/17/86, Register 99; am 10/1/88, Register 107; am 1/21/89, Register 109; am 7/30/94, Register 131

15 AAC 105.195 Conduct of hearings

Repealed.

History

Eff. 9/18/86, Register 99; repealed 7/30/94, Register 131

15 AAC 105.200 Investigation

Repealed 10/1/88.

15 AAC 105.210 Member in charge of activities

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.220 Net proceeds

Repealed .

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 10/1/88, Register 107; repealed 7/30/94, Register 131

15 AAC 105.230 Annual financial statement; additional fee

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; am 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.235 Permittee reports to the department

Repealed.

History

Eff. 2/25/84, Register 89; am 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.240 Method of accounting

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; repealed 7/30/94, Register 131

15 AAC 105.250 Maintenance of records

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; repealed 7/30/94, Register 131

15 AAC 105.260 Disposition of funds

Repealed.

History

Eff. 9/7/60, Register 2; repealed 7/30/94, Register 131

15 AAC 105.270 Display of permit

Repealed.

History

Eff. 9/7/60, Register 2; repealed 7/30/94, Register 131

15 AAC 105.280 Use of dedicated net proceeds

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; repealed 7/30/94, Register 131

15 AAC 105.290 Expenses

Repealed.

History

Eff. 9/7/60, Register 2; repealed 7/30/94, Register 131

15 AAC 105.300 Violation - ineligibility

Repealed.

History

Eff. 9/7/60, Register 2; am 11/6/76, Register 60; repealed 7/30/94, Register 131

15 AAC 105.310 Operator reports to the department

Repealed.

History

Eff. 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.320 Operator license and bond

Deleted 2/5/92.

15 AAC 105.325 Minimum return to permittee

Deleted 2/5/92.

15 AAC 105.330 Pull-tab distributor's license; distribution restriction

Deleted 6/3/90.

15 AAC 105.335 Pull-tab tax

Deleted 2/5/92.

15 AAC 105.340 Bond requirement for special pull-tab games

Repealed.

History

Eff. 10/1/88, Register 107; am 1/21/89, Register 109; repealed 7/30/94, Register 131

15 AAC 105.350 Additional prize limitation

Deleted 6/3/90.

Chapter 112 Alaska Retirement Management Board

Article 1 Board Nominations

15 AAC 112.010 Board nominations

(a) By September 13, 2005, for an initial appointment to a PERS seat or TRS seat, or within 10 days after a vacancy occurs for a PERS seat or TRS seat, the department shall publish a notice requesting submission to the department of a list of nominees to serve in a PERS or TRS seat. The notice shall state the terms of the positions for which nominations are sought, if known, the procedures and deadlines for submission, and any other information the department determines is necessary.

(b) The notice published under (a) of this section shall also be posted on the Alaska Online Public Notice system under AS 44.62.175 and on the web sites for the department and, if one exists, for the board. The notice shall also be published in one or more newspapers of general circulation in each judicial district of the state. It is presumed that notice has been given to all affected parties if the publication and posting of notice has occurred under this subsection.

(c) A list of nominees submitted under this section must contain four names, as required under AS 37.10.210(b)(2)(C) and (D),

(1) for an initial appointment to the two PERS seats;

(2) for an initial appointment to the two TRS seats; and

(3) for a vacancy to a PERS seat or TRS seat.

(d) In addition to the requirements of (c) of this section, a list of nominees submitted under this section must contain at least the following information:

(1) the name, mailing address, and phone number of each nominee;

(2) identification with respect to each nominee of the category or categories of qualifications under AS 37.10.210(b)(2) applicable to that nominee and a resume or other representation which support eligibility for that qualification category;

(3) reasonable proof that representatives of each relevant bargaining unit have had the opportunity to participate in a process to select a nominee whether or not that representative or bargaining unit agrees with the nominations submitted; for the purpose of this paragraph, "reasonable proof" includes

(A) a signed declaration by or on behalf of the certified representatives of all affected bargaining units;

(B) an affidavit attesting to discussions or opportunities for discussion; or

(e) The department shall submit a list of nominees received under this section to the governor within 30 days after the publication of the notice prescribed in (a) of this section.

(f) Nothing in this section limits the governor's sole discretion in

(1) determining the length of a term for each initial appointment to the board for the purposes of satisfying the staggered term requirements of AS 37.10.210(c) and sec. 135, ch. 9, FSSLA 2005; and

(2) selecting a board member from a list of nominees submitted under this section.

(g) In this section,

(1) "department" means the Department of Revenue;

(2) "PERS seat" means a board trustee position on the board that is a member of the public employees' retirement system as described in AS 37.10.210(b)(2)(C);

(3) "TRS seat" means a board trustee position on the board that is a member of the teachers' retirement system as described in AS 37.10.210(b)(2)(D).

History

Authority: AS 37.10.210; AS 37.10.240
Eff. 9/3/2005, Register 176

Article 2 Procurement

15 AAC 112.110 Source selection

Source selection shall conform to 2 AAC 12.010 - 2 AAC 12.050.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 5/21/2016, Register 219

15 AAC 112.120 Specifications

Specifications will conform to 2 AAC 12.070 - 2 AAC 12.110 except that

(1) the board will, in its discretion, prepare and approve specifications for supplies and services procured by the board; and

(2) a specification that limits the procurement of items to a specific manufacturer's name or catalog numbers may be used only if the board or its designee makes a written determination that only the identified brand name item or items will satisfy the board's needs.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.130 Competitive sealed bidding; multistep bidding

Competitive sealed bidding will be in accordance with 2 AAC 12.120 - 2 AAC 12.210 except that

(1) when 2 AAC 12.120 - 2 AAC 12.210 requires action by a procurement officer, the action will be taken by the board or its designee; and

(2) when 2 AAC 12.130 applies a $25,000 limit, a $50,000 limit will apply.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.140 Competitive sealed proposals

(a) Except for 15 AAC 112.150 - 15 AAC 112.180, the board will award contracts for professional services on the basis of competitive sealed proposals as described in this section. A request for competitive sealed proposals will contain the date, time, and place for delivering proposals, bidders preferences, the process for resolving disputes or protests respecting proposals and awards, a specific description of the professional services to be provided under the contract, and the terms under which the professional services are to be provided. The board will give public notice of its request for competitive sealed proposals by publishing the request for proposals in at least one of the following methods:

(1) repealed 5/21/2016;

(2) publication in a newspaper of general circulation;

(3) publication in a newspaper of local circulation in the area pertinent to the procurement; or

(4) publication through other appropriate media.

(b) A proposer may correct, modify, or withdraw a proposal before the time and date set for receipt of proposals by written request received in the office designated in the request for proposal before the time and date set for proposal opening. A request under this subsection must be delivered in a sealed envelope with the solicitation number printed on the outside of the envelope and must be accompanied by written authorization by the proposer for the correction, modification, or withdrawal. The board will include all documents relating to the correction, modification, or withdrawal of a bid in the appropriate procurement file.

(c) Upon receipt of a proposal, modification, or correction, the board will note the date and time of receipt upon the envelope and will hold the proposal, modification, or correction in a secure place. After the date set for receipt of proposals, the board will prepare a register of proposals received. The register will include

(1) the name of each offeror; and

(2) a description of the services, supplies, or items offered.

(d) Unless otherwise noted in the request for proposals, the board will not accept a proposal, correction, modification, or withdrawal received after the date set for receipt of proposals unless the board determines that the delay was an error attributable to the board.

(e) The board will, in its discretion, cancel a request for proposal, reject any or all proposals in whole or in part, or delay the date for opening proposals, or decline to accept the recommendations of the evaluation committee as set out in (i) of this section, if the board determines it to be in the best interest of the board to do so. The board will make the reasons for the cancellation, rejection, or delay a part of the procurement file.

(f) The evaluation committee will be appointed by the chair of the board. The evaluation committee shall evaluate the proposals, as follows:

(1) the evaluation committee shall base their evaluations only on the factors set out in the request for proposals;

(2) the evaluation committee may use a numerical or other rating system;

(3) if the evaluation committee uses a numerical system, the evaluation committee shall award the contract to the offeror receiving the highest final score;

(4) if the evaluation committee does not use a numerical system, each member of the committee shall justify or explain that member's ranking determination in writing;

(5) the weighing factor or numerical system that the evaluation committee uses must be as set out in the request for proposals; and

(6) cost may be an evaluation criteria at the discretion of the board.

(g) If the board receives only one responsive and responsible proposal in response to a request for proposal, the board will, in its discretion, accept the proposal, reject the proposal, or resolicit proposals.

(h) Offerors shall fully comply with all terms of the request for proposals and with 15 AAC 112.110 - 15 AAC 112.370. The board, the board's designee, or the evaluation committee may determine nonresponsive proposals and shall reject those proposals.

(i) If the evaluation committee determines, as part of an evaluation conducted under 15 AAC 112.140(f), that a proposal is reasonably susceptible for award, the committee may offer the offeror of the proposal the opportunity to discuss the proposal with the evaluation committee. The evaluation committee may adjust or alter the evaluation of a proposal as a result of the discussion. During a discussion under this subsection,

(1) if there is a need for substantial clarification or change in the request for proposals, the evaluation committee shall amend the request for proposals to incorporate the changes;

(2) the evaluation committee may limit discussion to specific sections of the request for proposals; and

(3) the committee may not use auction techniques that reveal one offeror's bid price to another offeror and may not disclose any information derived from competing proposals.

(j) The evaluation committee shall present one or more offerors to the board for consideration upon a finding that such offerors may qualify as apparently successful proposals. The board will then review the evaluation committee's findings and any recommendations and may select an offeror from among those presented as the apparently successful proposals and issue a notice of intent to award the contract. The notice of intent to award the contract does not constitute a notice to proceed. The notice of intent to award the contract will contain

(1) a statement of the proposed contract amount;

(2) the name of the apparently successful offeror; and

(3) a brief description of the professional services that will be the subject of the contract.

(k) Multi-Step Sealed Proposals. If the board considers it impractical initially to prepare a definitive purchase description to support an award based on listed selection criteria, the board will, in its discretion, issue an expression of interest requesting the submission of unpriced technical offers and will later issue a request for proposals limited to the offerors whose offers are determined to be technically qualified under the criteria set out in the expression of interest.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143; am 5/21/2016, Register 219

15 AAC 112.150 Small purchases

(a) Procurement for supplies, services, including professional services, and construction that is estimated to cost less than $50,000 is governed by this section.

(b) For a procurement described in (a) of this section, the board will use procedures adequate and reasonable to provide competition and to make records to facilitate auditing of the board regarding its purchases of supplies, services, or construction.

(c) For procurement of supplies, services, or construction estimated to cost more than $10,000, but less than $50,000, the procedures set out in this subsection will be followed, except that, if those procedures are not practicable under the circumstances, the procedures required by (b) of this section will be followed:

(1) at least three firms or other persons will be contacted for quotations, either written or oral; if quotations are solicited

(A) orally, the board or its designee will record

(i) who made the solicitation;

(ii) the specifications or items solicited;

(iii) the date that the solicitation took place;

(iv) the name of firms or other persons contacted; if a firm, the name of the person in the firm contacted; and

(v) the response of each firm or other person; or

(B) in writing, the board or its designee will record

(i) a list of persons contacted;

(ii) a summary of the responses; and

(iii) copies of all quotations received;

(2) the record prepared under (1) of this subsection will be made part of the procurement file;

(3) the award will be made to the lowest responsive and responsible bidder, taking into account any applicable Alaskan bidder and Alaskan products preferences, and will be made in accordance with the specifications and award criteria in the solicitation.

(d) The board or its designee will, in its discretion, use an appropriate contractors list. It is not necessary to solicit all vendors on a contractors list. If used, the list will be rotated to the extent necessary to give all interested prospective contractors opportunities to compete. Nothing in this section limits the board or its designee from contracting additional firms or other persons not on the list.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143

15 AAC 112.160 Sole source procurements

(a) A determination by the board that a procurement be restricted to one potential contractor must be accompanied by a written explanation as to why a procurement from a source is in the best interest of the beneficiaries of the pension funds. The board will, in its discretion, advertise an intent to make a sole source award for the purpose of determining if other sources are reasonably available or interested in a particular procurement. The board will make a determination in writing that a sole source exists. The determination must state in detail the factual basis for the determination that sole source conditions exist and for the selection of the particular source. The board will maintain the determination in the procurement file. Award of a sole source procurement may not be made without the signature of the board secretary and the approval of the board given at a regular meeting.

(b) The written determination required in (a) of this section must specify the duration of its effectiveness.

(c) The board or its designee will conduct negotiations, as appropriate, as to price, delivery, and terms of a sole source procurement.

(d) The following are examples of circumstances in which sole source procurement might be appropriate:

(1) if the compatibility of equipment, accessories, or replacement parts is the main consideration;

(2) if a specific item is needed for trial use or testing, including testing of a prototype;

(3) if an item is to be procured for resale;

(4) if public utility services are to be procured;

(5) if specific market information services are to be procured;

(6) if a person possesses a special expertise required to perform the specific professional service; and

(7) if the procurement is for the services of legal counsel for the purpose of advising or representing the state in specific civil or criminal proceedings or on specific matters before federal or state regulatory agencies, boards, or commissions.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143

15 AAC 112.170 Limited competition procurements

(a) Any request by the board that a procurement be restricted to several potential contractors must be accompanied by a written explanation as to why the competitive sealed bidding or competitive sealed proposal processes are impractical or contrary to the public interest. The board will, in its discretion, advertise an intent to make a limited competition procurement for the purpose of determining if other sources are available or interested in a particular procurement. Award of a limited competition procurement may not be made without the signature of the board secretary and the approval of the board.

(b) A procurement under this section must be for less than $100,000.

(c) The board or its designee will conduct negotiations, as appropriate, as to price, delivery, and terms, equally with each potential contractor for a limited competition procurement.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143

15 AAC 112.180 Emergency procurements

(a) The board will, in its discretion, make a procurement under emergency conditions

(1) when a threat to public health, safety, or welfare exists;

(2) when a situation that makes a procurement through competitive sealed bidding impractical or contrary to the public interest exists; or

(3) to protect private or public property.

(b) Reasons for finding that emergency conditions exist include

(1) economic considerations that preclude routine solicitation;

(2) delays inherent in the normal procurement process;

(3) extreme weather conditions; and

(4) equipment failure when the need for timely repair is essential.

(c) The board will make a written determination that emergency conditions exist. The written determination must state in detail the factual basis for the determination that emergency conditions exist and for the selection of the particular contractor. The board will maintain the determination in the procurement file.

(d) The appropriate board officer will also make and promptly forward to the deputy commissioner of the Department of Revenue a record of an emergency procurement. The record must plainly set out

(1) the contractor's name;

(2) the amount spent and the type of contract;

(3) a list of the supplies, equipment, services, construction, office or other space leases, personal property, or professional services procured under the contract;

(4) a brief summary of the emergency determination; and

(5) the assigned identification number of the procurement file.

(e) For a procurement under this section, the board will procure supplies and services by any method the board considers reasonable under the circumstances.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.190 Contract formation and modification

Repealed.

History

Eff. 7/17/94, Register 134; repealed 5/21/2016, Register 219

15 AAC 112.200 Supply management

Supply management will be in accordance with 2 AAC 12.580 - 2 AAC 12.610.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.210 Legal and contract remedies

(a) Other than as provided in this section, legal and contract remedies will be in accordance with AS 36.30.550 - 36.30.670.

(b) Notice of an intent to award a contract does not constitute a formal award of a contract. The notice of intent to award must include

(1) a statement of the bidder's right under this section to protest the award, including the time within which the protest must be received; and

(2) the name of the successful bidder.

(c) A bidder to a request for proposals under 15 AAC 112.110 - 15 AAC 112.360 may protest the proposed award of contract for services by filing a protest with the board's designee identified in the request for proposals within 10 calendar days following notice of intent to award the contract. The minimum contents of a protest will be specified in the request for proposals. Upon receipt of that protest, the board's designee will advise all respondents to the request for proposals of the existence of the protest, and the board's designee will render a written decision based on the protest or such other materials as the board's designee deems relevant. That written decision may be appealed to the office of administrative hearings within the manner and time provided in AS 44.64.060. Unless the board decides to cancel the request for proposals, a written decision by the office of administrative hearings shall be deemed the final decision of the board, including for purposes of any appeal to superior court.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143; am 5/21/2016, Register 219

15 AAC 112.215 Bidder preferences

Proposals submitted under 15 AAC 112.110 - 15 AAC 112.360 shall be evaluated to consider an Alaska bidder preference of five percent under AS 36.30.321(a), an Alaska products preference under AS 36.30.322 - 36.30.338, and a recycled products preference under AS 36.30.337. An Alaska bidder means a person who

(1) holds a current Alaska business license;

(2) submits a bid for goods, services, or construction under the name as appearing on the person's current Alaska business license;

(3) has maintained a place of business within the state staffed by the bidder or an employee of the bidder for a period of six months immediately preceding the date of the bid;

(4) is incorporated or qualified to do business under the laws of the state, is a sole proprietorship and the proprietor is a resident of the state, is a limited liability company organized under AS 10.50 and all members are residents of the state, or is a partnership under former AS 32.05. AS 32.06, or AS 32.11 and all partners are residents of the state; and

(5) if a joint venture, is composed entirely of ventures that qualify under (1) - (4) of this section.

History

Authority: AS 36.30.015; AS 37.10.240
Eff. 5/21/2016, Register 219

15 AAC 112.220 Intergovernmental relations

Requests made to another state procurement unit will be made in accordance with 2 AAC 12.700 - 2 AAC 12.710.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.230 Authority to delegate

(a) The board may delegate its authority under 15 AAC 112.110 - 15 AAC 112.360 to a public official as the board's designee. A delegation of authority must be in writing.

(b) The board may revoke authority that it has delegated. The revocation must be in writing.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 5/21/2016, Register 219

15 AAC 112.240 Determination of contractual terms and conditions

The board or its designee may determine the contractual provisions, terms, and conditions of solicitations and contracts, if the provisions, terms, and conditions are not contrary to statutory or regulatory requirements governing the procurement and if changes to standard contract terms established under provisions such as 2 AAC 12.470 have been reviewed and approved as to form by the attorney general.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143; am 5/21/2016, Register 219

15 AAC 112.250 Non-collusion certification

Solicitations must provide that by submitting a bid or offer, the bidder or offeror certifies under penalty of perjury that the price submitted was independently arrived at without collusion.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.260 Bid, payment, and performance bonds for contracts

Bid, payment, and performance bonds will be in accordance with 2 AAC 12.810.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.270 Conditioning bids or proposals on other awards not acceptable

A bid or proposal that is conditioned upon receiving award to both the particular contract being solicited and another state contract is nonresponsive unless conditioned bids are specifically authorized in the invitation to bid.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.280 Extension of solicitation opening time; cancellation of solicitation; amendment of solicitation

Extensions, cancellations, and amendments will be in accordance with 2 AAC 12.850.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.290 Rejection of all bids or proposals

Rejection of all bids or proposals will be in accordance with 2 AAC 12.860.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.300 Rejection of individual bids or proposals

Rejection of individual bids will be in accordance with 2 AAC 12.870.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.310 Disposition of bids or proposals

If bids or proposals are rejected, the bids or proposals that have been opened must be retained in the procurement file.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.320 Low tie bids or proposals

Low tie bids or proposals are low responsive bids or proposals from responsible bidders or offerors which are either identical in price or appropriate evaluation factors. If low tie bids or proposals exist, award will be made through a random drawing. Award may not be made by dividing the procurement among identical bidders unless the board reserves the discretion to make such a decision.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.330 Extension of time for bid or proposal acceptance

After opening bids or proposals, the board or its designee will, in its discretion, request bidders or offerors to extend the time during which the board will accept a bid or proposal.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134; am 10/13/96, Register 143

15 AAC 112.340 Multiple award

Multiple awards will be in accordance with 2 AAC 12.920.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.345 Alaska Retirement Management Board

15 AAC 112.345. Applicability of AS 36.30 and 2 AAC 12. In applying the provisions of AS 36.30 and 2 AAC 12 to the board's procurement regulations and procedures, references to the departments or commissioners of administration or transportation and public facilities shall be to the board or the board's designee or, if the context requires, to the office of administrative hearings.

History

Authority: AS 37.10.240
Eff. 5/21/2016, Register 219

15 AAC 112.350 Alaska Retirement Management Board

15 AAC 112.350. Procedures for certain board delegations and appointments. (a) As provided in AS 37.10.071, the board may delegate investment, custodial, or depository authority. Contracts for these professional services will be supported under an official delegation of authority issued by the board. (b) Unless otherwise specified by the board and this section, the provisions of this chapter do not apply to appointments of members of the investment advisory council under AS 37.10.270 and the provisions of 15 AAC 112.110 - 15 AAC 112.340 do not apply to the delegation of authority under AS 37.10.071 and (a) of this section.

History

Authority: AS 36.30.015; AS 37.10.240 AS 37.10.071; AS 37.10.270
Eff. 7/17/94, Register 134; am 10/13/96, Register 143; am 5/21/2016, Register 219

15 AAC 112.360 Alaska Retirement Management Board

15 AAC 112.360. Travel. Travel and all expenditures relating to travel will be in accordance with regulations adopted by the commissioner of the Department of Administration.

History

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

15 AAC 112.370 Alaska Retirement Management Board

15 AAC 112.370. Definitions. Relocated.

15 AAC 112.375 Alaska Retirement Management Board

15 AAC 112.375. Applicability. Repealed.

History

Eff. 10/13/96, Register 143; repealed 5/21/2016, Register 219

Article 3 Conflict of Interest Prohibitions

15 AAC 112.400 Alaska Retirement Management Board

15 AAC 112.400. Prohibitions. Members of the Alaska Retirement Management Board may not have a substantial interest, as defined by the regulations of the Securities and Exchange Commission set out in 17 C.F.R. 240.13 d-1, as amended as of February 23, 1979, in an entity or project in which assets under the control of the board are invested.

History

Authority: AS 37.10.230
Eff. 7/17/94, Register 134

Authority: AS 37.10.240
Eff. 7/17/94, Register 134

Chapter 114 Receipt, Custody, Investment and Management of Teachers’ Retirement System Funds

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.020 Prohibited licensing

Repealed 3/25/83.

15 AAC 116.021 Qualifications for appointment as a license officer

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.030 Obligations and duties of license officers

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.040 Compensation

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.050 Employees of license officers

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.060 Suspension or revocation of license officer appointment

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.070 Fees, reports, and license inventory due when license officer appointment expired, suspended, or revoked

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

Article 3 Miscellaneous and General Licensing Provisions

15 AAC 116.300 Reports by licensed guides

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

15 AAC 116.310 Definitions

Repealed.

History

Eff. 3/25/83, Register 85; repealed 1/13/2012, Register 201

Article 4 Common Property Fishery Assessment

15 AAC 116.410 Hatchery reporting requirements

(a) In a year when a hatchery permit holder's cost recovery will be conducted by a common property fishery authorized under AS 16.10.455 or AS 16.12.090, the hatchery permit holder must provide

(1) audited financial statements for the hatchery permit holder for the three most recent years preceding the current year;

(2) the hatchery permit holder's projected current-year costs;

(3) for purposes of AS 16.10.455, the number of salmon, by species, that returned to the hatchery in the three most recent full calendar years and the number of salmon, by species, projected to return to the hatchery in the current year; and

(4) for purposes of AS 16.12.090, the pounds of shellfish, by species, harvested in the hatchery's special harvest area in the three most recent full calendar years and the pounds of shellfish, by species, projected to be harvested in the hatchery's special harvest area in the current year.

(b) The information required under (a) of this section must be filed with the department

(1) for purposes of AS 16.10.455, not later than October 1 of the year preceding the year for which the harvest is sought;

(2) for purposes of AS 16.12.090, not later than July 1 of the year preceding the year for which the harvest is sought.

History

Authority: AS 16.10.455; AS 16.12.090; AS 43.05.080
Eff. 6/24/2012, Register 202; am 1/21/2024, Register 249

15 AAC 116.415 Common property fishery assessment rate for salmon

(a) A person subject to the common property fishery assessment under AS 16.10.455 shall pay an assessment at a rate determined by the department annually on the projected value of the salmon taken in a terminal harvest area that is subject to a common property fishery assessment.

(b) The common property fishery assessment rate will be determined annually by the department using one of the following methods:

(1) as a fraction

(A) the numerator of which is the projected assessment revenue for the current year; and

(B) the denominator of which is the total pounds of salmon projected to return to the terminal harvest area in the current year that will be subject to the common property fishery assessment, multiplied by the projected regional price per pound of salmon for the current year that will be subject to the common property fishery assessment;

(2) as a flat rate on each pound of salmon, determined by multiplying the fraction calculated under (1) of this subsection by the projected value of salmon for the current year that will be subject to the common property fishery assessment.

(c) To calculate the projected assessment revenue for purposes of (b)(1)(A) of this section, the department, in consultation under (d) of this section with the hatchery permit holder, will

(1) calculate the total estimated amount of the hatchery permit holder's

(A) annual debt service to the state;

(B) reasonable operating expenses for the year;

(D) additional revenue needed to develop or maintain a reserve fund up to 100 percent of the hatchery permit holder's annual operating costs; and

(2) subtract, from the total estimated amount, the estimated amount of income from all sources that the hatchery holder expects to expend to satisfy the estimates under (1)(A) - (D) of this subsection, other than money estimated to be appropriated under AS 16.10.455(e) to the hatchery permit holder.

(d) The department will consult with the Department of Commerce, Community, and Economic Development for assistance in identifying current-year market conditions and salmon market trends. The department will consult with the hatchery permit holder to ensure the projected assessment revenue includes all cost components identified under AS 16.10.455(d). The department will consult with representatives of affected commercial fishermen for assistance in determining the projected regional price per pound of salmon subject to the common property fishery assessment.

(e) Repealed 1/21/2024.

History

Authority: AS 16.10.455; AS 43.05.080
Eff. 6/24/2012, Register 202; am 5/23/2013, Register 206; am 6/14/2014, Register 210; am 12/26/2014, Register 212; am 7/22/2015, Register 215; am 10/22/2016, Register 220; am 1/21/2024, Register 249

15 AAC 116.416 Common property fishery assessment rate for shellfish

(a) A person subject to the common property fishery assessment under AS 16.12.090 shall pay an assessment at a rate determined by the department annually on the projected value of the shellfish taken in a special harvest area that is subject to a common property fishery assessment.

(b) The common property fishery assessment rate will be determined annually by the department using one of the following methods:

(1) as a fraction,

(A) the numerator of which is the projected assessment revenue for the current year; and

(B) the denominator of which is the total pounds of shellfish projected to be harvested in the terminal harvest area in the current year that will be subject to the common property fishery assessment, multiplied by the projected regional price per pound of shellfish for the current year that will be subject to the common property fishery assessment;

(2) as a flat rate on each pound of shellfish, determined by multiplying the fraction calculated under (1) of this subsection by the projected value of shellfish for the current year that will be subject to the common property fishery assessment.

(c) To calculate the projected assessment revenue for purposes of (b)(1)(A) of this section, the department, in consultation under (d) of this section with the hatchery permit holder, will

(1) calculate the total estimated amount of the hatchery permit holder's

(A) annual debt service to the state;

(B) reasonable operating expenses for the year;

(D) additional revenue needed to develop or maintain a reserve fund up to 100 percent of the hatchery permit holder's annual operating costs; and

(d) The department will consult with the Department of Commerce, Community, and Economic Development for assistance in identifying current-year market conditions and shellfish market trends. The department will consult with the hatchery permit holder to ensure the projected assessment revenue includes all cost components identified under AS 16.12.090(d). The department will consult with representatives of affected commercial fishermen for assistance in determining the projected regional price per pound of shellfish subject to the common property fishery assessment.

History

Authority: AS 16.12.090; AS 43.05.080
Eff. 1/21/2024, Register 249

15 AAC 116.420 Liability for common property fishery assessment

(a) A person subject to AS 16.43 who participates in a common property fishery under AS 16.10.455 or AS 16.12.090 shall pay a common property fishery assessment at the rate established by the department under 15 AAC 116.415 for the harvest of salmon or 15 AAC 116.416 for the harvest of shellfish, if the harvest occurs in an area and during a time of year designated by the commissioner of fish and game as a common property fishery under AS 16.10.455 or AS 16.12.090.

(b) Except as provided under (c) of this section, a buyer who acquires salmon or shellfish from a person who is subject to a common property fishery assessment under AS 16.10.455 or AS 16.12.090 shall collect the assessment at the time of purchase.

(c) A person who transfers salmon or shellfish to a buyer who is not a fisheries business licensed under AS 43.75 is liable for the payment of the common property fishery assessment imposed under AS 16.10.455 or AS 16.12.090 if, at the time possession of the salmon or shellfish is transferred to the buyer, the common property fishery assessment has not been collected.

History

Authority: AS 16.10.455; AS 16.12.090; AS 43.05.080
Eff. 6/24/2012, Register 202; am 1/21/2024, Register 249

15 AAC 116.425 Annual report and remittance of tax

(a) A buyer responsible for the collection of the common property fishery assessment under 15 AAC 116.420 shall file an annual report for each business location on a form or in a format prescribed by the department, reporting

(1) the name of the buyer;

(2) the buyer's federal employer identification number (EIN) or social security number;

(3) the buyer's fisheries business license number;

(4) the year of purchase;

(5) the total pounds and value of salmon or shellfish, by hatchery and species, that the buyer has purchased or acquired; and

(6) the signature, printed name, and title of the buyer or its authorized representative, and date of signing.

(b) If a person other than the buyer is liable under 15 AAC 116.420(c) for payment of the common property fishery assessment, the person shall file the report required under (a) of this section, reporting

(1) the name of the person;

(2) the person's federal employer identification number (EIN) or social security number;

(3) the person's fisheries business license number;

(4) the year of sale or export;

(5) the total pounds and value of salmon or shellfish, by hatchery and species, that the person has sold or exported; and

(6) the signature, printed name, and title of the person or its authorized representative, and date of signing.

(c) No later than October 31 of the year in which the common property fishery was conducted, the annual report required under this section shall be filed with the department, together with each assessment required to be collected.

History

Authority: AS 16.10.455; AS 16.12.090; AS 43.05.080
Eff. 6/24/2012, Register 202; am 1/21/2024, Register 249

15 AAC 116.430 Reporting of bonus or other additional payments

(a) A buyer making a bonus or other additional payment to a person after October 31 for salmon or shellfish purchased in a previous year shall file a report of the bonus or additional payment made. The buyer shall file the report on a form or in a format prescribed by the department, reporting

(1) the year in which the salmon or shellfish were initially reported; and

(2) the value of the bonus or additional payment.

(b) No later than the last day of the month following the month in which a bonus or additional payment was made, the report required under this section shall be filed.

History

Authority: AS 16.10.455; AS 16.12.090; AS 43.05.080
Eff. 6/24/2012, Register 202; am 12/26/2014, Register 212; am 1/21/2024, Register 249

15 AAC 116.435 Report by department upon failure to make report or making false or fraudulent report

If a person fails to file a report at the time prescribed under 15 AAC 116.410 - 15 AAC 116.490 or makes, willfully or otherwise, a false or fraudulent report, the department will make the report from the information it obtains.

History

Authority: AS 16.10.455
Eff. 6/24/2012, Register 202

15 AAC 116.490 Definitions

In 15 AAC 116.410 - 15 AAC 116.490, unless the context requires otherwise,

(1) "buyer" means a person who purchases or otherwise acquires salmon from a person who participates in a common property fishery;

(2) "department" means the Department of Revenue;

(3) "person" means an individual, partnership, association, limited liability company, corporation, or any group or combination acting as a unit;

(4) "projected regional price" means the average price of salmon

(A) reported to the department in the prior year on returns filed under AS 43.75 (fisheries business license and taxes) that reflect processing activity in the area nearest to the terminal harvest area where the common property fishery assessment will be imposed; and

(B) adjusted up or down after taking into account current-year market conditions and salmon market trends;

(5) "salmon" means Pacific salmon and Pacific salmon byproducts such as roe if sold separately by the holder of the limited entry permit under AS 16.43.

History

Authority: AS 16.10.455
Eff. 6/24/2012, Register 202

Article 5 Seafood Marketing Assessment on Processors

15 AAC 116.600 Imposition of seafood marketing assessment

(a) There is imposed an assessment under AS 16.51.120 on the total value paid for seafood products by all processors, except on those transactions excluded from liability for tax under AS 43.75 as provided in AS 43.75.017, for the calendar year 1982 and each year following until amended or terminated under AS 16.51.140 or AS 16.51.130. The assessment is on all processors whose value paid for seafood products during a calendar year is at least $50,000, and is calculated at the rate of .2 percent of the total value paid for the seafood products.

(b) All processors shall file returns under 15 AAC 116.610 and shall pay the total assessment due under this chapter on or before March 31 after the close of the calendar year to which the assessment applies.

(c) A processor is liable for the tax under AS 16.51 on the value of a seafood product processed for a person not licensed under AS 43.75.

(d) A person taking, purchasing, or otherwise acquiring a seafood product that has not been subject to the tax imposed in AS 16.51, who transports the seafood product to a point outside the taxing jurisdiction of the state for sale or processing, is liable for the tax under AS 16.51 on the value of the seafood product.

History

Authority: AS 16.51.120; AS 43.05.080; AS 43.05.250
Eff. 12/17/82, Register 84; am 4/20/94, Register 130

15 AAC 116.610 Filing the return

(a) Each processor shall file a return on a form provided by the department and remit the total amount of the assessment to the department on or before March 31 after the close of the calendar year to which the assessment applies. The information required by the return will include the following:

(1) name of the taxpayer;

(2) mailing address;

(3) federal employer identification number or social security number;

(4) fisheries business license number;

(5) year for which tax return is being filed;

(6) locations of operation and vessel name, if applicable;

(7) total value paid for seafood products in Alaska during the calendar year for which the return is being filed;

(8) other information required by the department.

(b) Processors doing business in more than one location shall, on the return, list for each business location the same information required by (a) of this section.

History

Authority: AS 16.51.150; AS 43.05.080 AS 16.51.160; AS 43.05.250
Eff. 12/17/82, Register 84

15 AAC 116.620 Extension of time for filing return

(a) Upon a showing of good cause, the department will, in its discretion, grant a reasonable extension of time, not to exceed 180 days in the aggregate, for filing a return. An extension of time for filing a return does not extend the time for the payment of the assessment. An estimated payment must be remitted with the request for an extension along with an explanation showing how the estimate was determined. The estimated payment must be equal to or greater than 90 percent of the actual liability shown on the return ultimately filed within the approved extension period in order to avoid failure-to-pay penalties under AS 43.05.220(a) and 15 AAC 05.210(b).

(b) The application for an extension of time for filing the return must be in writing and addressed to the department and must contain a full statement of the causes for the delay. It must be filed no later than 15 calendar days before the date the return is due.

(c) If an extension of time for filing the return is granted, the return must be filed before the expiration of the period of extension.

(d) If an application for extension is denied, the return must be filed within 10 calendar days after the date the notice of denial is mailed by the department or 10 calendar days after the March 31 due date, whichever is later.

History

Authority: AS 16.51.160; AS 43.05.080
Eff. 12/17/82, Register 84

15 AAC 116.630 Administration and enforcement

The provisions of AS 43.05.010 - 43.05.290, AS 43.10.010 - 43.10.200, and 15 AAC 05 apply to the administration of the assessment imposed by this chapter and they include the following:

(1) the confidentiality of tax return information is provided for under AS 43.05.230;

(2) the availability of taxpayer remedies is provided for under AS 43.05.240 and 15 AAC 05.001 - 15 AAC 05.050;

(3) the imposition of penalties for failure to file a return or pay the assessment required by this chapter will be calculated as provided in AS 43.05.220 and 15 AAC 05.200 - 15 AAC 05.230;

(4) interest on assessments not timely paid will be calculated under AS 43.05.225; and

(5) the prosecution of criminal violations and the collection of the assessment under this chapter is provided for under AS 43.10.010.

History

Authority: AS 16.51.170; AS 43.05.080
Eff. 12/17/82, Register 84; am 9/19/2020, Register 235; add'l am 9/20/2020, Register 235

15 AAC 116.640 Common Property Fishery Assessment and Seafood Marketing Assessment

15 AAC 116.640 - 15 AAC 116.660. Reserved.

15 AAC 116.670 Common Property Fishery Assessment and Seafood Marketing Assessment

15 AAC 116.670. Processors eligible for elections. (a) For purposes of participating in an election to approve or terminate an assessment under AS 16.51 and this chapter, only those processors whose total value paid for seafood products during the previous calendar year exceeds $50,000 are eligible to (1) vote on whether to approve or terminate an assessment under AS 16.51.140; and (2) petition and vote on whether to terminate the assessment under AS 16.51.130. (b) For purposes of determining, under AS 16.51.120, 51 percent of the value paid by processors, "value" means the total value reported in returns filed under AS 43.75 for the calendar year preceding the year of election.

History

Authority: AS 16.51.120; AS 16.51.140 AS 16.51.130; AS 43.05.080
Eff. 12/17/82, Register 84

15 AAC 116.680 Common Property Fishery Assessment and Seafood Marketing Assessment

15 AAC 116.680. Elections imposing, amending or terminating the assessment. (a) The certification of an election held in accordance with AS 16.51.140 to either impose an assessment or amend an existing assessment must occur before December 1 of the year for which the assessment is being imposed. (b) The certification of an election held in accordance with AS 16.51.130 to terminate an assessment must occur before December 1 of the year for which the assessment would have been imposed. (c) An election held in accordance with AS 16.51.130 and AS 16.51.140 to impose, amend or terminate an assessment which is certified after December 1 of any year will apply to the following year. In addition, no imposition, amendment or termination of an assessment can be made retroactive to years before the year in which the election is certified.

History

Authority: AS 16.51.130; AS 43.05.080
Eff. 12/17/82, Register 84

15 AAC 116.690 Common Property Fishery Assessment and Seafood Marketing Assessment

15 AAC 116.690. Reserved.

15 AAC 116.700 Common Property Fishery Assessment and Seafood Marketing Assessment

15 AAC 116.700. Definitions. In AS 16.51 and 15 AAC 116.600 - 15 AAC 116.700, (1) "assessment" means a seafood marketing assessment imposed by AS 16.51 and this chapter; (2) "department" means the Department of Revenue; (3) "processor" means the same as "processor" in AS 16.51.180(3), and the same as "fisheries business" in AS 43.75.290 and includes one engaged in the act of "processing" as defined in 15 AAC 75.300(4) and one who both harvests and processes seafood for commercial sale, except those processors the value of whose seafood products is excluded from the tax imposed under AS 43.75 by virtue of AS 43.75.017 and 15 AAC 75.035; (4) "seafood products" means the same as "seafood" in AS 16.51.180(5), and the same as "fishery resource" in AS 43.75.290 and as interpreted in 15 AAC 75.300(2); (5) "value paid" means the same as "value" in AS 16.51.180(6), and "value" in AS 43.75.290 and as interpreted in 15 AAC 75.300(3) and (3).

History

Authority: AS 16.51.150; AS 16.51.180 AS 16.51.160; AS 43.05.080
Eff. 12/17/82, Register 84; am 6/24/2012, Register 202; am 12/26/2014; Register 212

Chapter 118 Health and Safety

Article 1 Alaska Medical Facility Authority

15 AAC 118.010 Scope of regulations

This chapter applies to all applications for assistance in financing or refinancing the construction or equipment of medical facilities under the Alaska Medical Facility Authority Act.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.020 Application procedures

(a) An application for financial assistance under this chapter must be made under oath as to the truth and accuracy of its contents.

(b) At the time the applicant initiates the application process by submitting to the executive director any of the information required in subsection (c) of this section, the applicant must pay the application fee and the estimated direct costs of the authority for evaluating its application. At the discretion of the executive director, a partial advance payment of the estimated direct costs may be accepted, provided the applicant agrees to a payment schedule established by the executive director. All direct costs incurred by the authority must be reimbursed before the authority will consider the applicant's bond resolution or, at the discretion of the authority, the outstanding balance due from the applicant for these costs may be paid from the financing fee set out under 15 AAC 118.060(a). Direct costs will be credited against the financing fee paid to the authority under 15 AAC 118.060(a); however, the credit may not exceed 50 percent of the financing fee. For purposes of this subsection, the nonrefundable application fee and the annual fee set out under 15 AAC 118.060(b) are not direct costs.

(c) For informational purposes and informal review, the executive director shall receive, acknowledge receipt and notify the authority that an applicant has initiated the application process. However, the authority will not consider an application for purposes of acceptance under 15 AAC 118.030 until the executive director confirms that the following information and data have been received:

(1) the amount and type of financing requested;

(2) a general description of the existing and proposed medical facility, the existing and proposed equipment for the medical facility, and the services offered or to be offered;

(3) a copy of the applicant's current Certificate of Need issued by the Department of Health;

(4) a detailed description of the projected use of the requested financing;

(5) an opinion of counsel, who must be an active member in good standing of the Alaska Bar Association, stating that the proposed financing is for a statutorily authorized purpose of the authority, and specifying the purpose;

(6) a statement by applicant that an existing medical facility complies with, or a proposed medical facility will comply with, all state requirements relating to public buildings, structures, grounds, works and improvements;

(7) a statement by applicant that all contract awards will meet the requirements of competitive bidding;

(8) a statement by applicant describing the status of any application under section 1122 of the 1972 amendments to the Social Security Act for the applicant's medical facility or proposed medical facility;

(9) a nonrefundable application fee of $1,000;

(10) unless applicant is an individual, in which case the individual's authorization is required, a resolution by the board of directors of applicant, signed by the chairperson and secretary, authorizing a named representative to submit an application for financing to the authority and to release information and copies of corporate documents requested or required by the authority or the executive director of the authority;

(11) the name, address and statements of the experience of the operator or proposed operator, if other than the applicant, of the medical facility or proposed medical facility, in managing or operating medical facilities;

(12) a statement by the applicant and operator or proposed operator that under Alaska law it is authorized to conduct business in Alaska;

(13) statements by the applicant and the operator or proposed operator that they will individually and jointly abide by the requirements of AS 18.26 and the regulations adopted under that title and chapter;

(14) a statement that the medical facility or proposed medical facility will not be used for any unlawful purpose;

(15) a letter of determination from the Internal Revenue Service that the applicant qualifies as a 501(c)(3) organization under the Internal Revenue Code; and

(16) any additional information or data requested by the executive director or the authority.

(d) When the executive director determines that an applicant has complied with the requirements of (a), (b) and (c) of this section, the executive director shall

(1) request written verification from the Department of Health that the applicant has met all of the current requirements of AS 18.07, even for those applicants holding a certificate of need issued under sec. 4 ch. 275, SLA 1976, which exempts holders from complying with the current requirements for purposes other than financial assistance from the authority; and

(2) receive and solicit offers for services from potential financial advisors and other persons helpful or necessary to the authority's evaluation of an application.

History

Authority: AS 18.26.050(4)AS 18.26.210; AS 18.26.220
Eff. 9/28/79, Register 71

15 AAC 118.030 Acceptance and approval of application; rejection and postponement

(a) When the requirements of 15 AAC 118.020 have been met, the executive director shall present the application to the authority for its consideration. However, nothing in this section prohibits the executive director from forwarding to members portions of the proposed application, as received.

(b) Acceptance of an application will be by motion or resolution. The acceptance motion or resolution will authorize the executive director to retain or further negotiate the services of a nationally recognized financial advisor and other necessary services for the evaluation of the proposed issue, and to request and review additional information and data pertinent to the application.

(c) The authority may request additional information and data or authorize the executive director to make these requests at any time during the application process.

(d) Before the authority approves an application, the applicant must have

(1) repealed 6/15/80;

(2) complied with 15 AAC 118.020 and 15 AAC 118.030;

(3) selected an underwriter acceptable to and approved by the authority; and

(4) submitted financial statements for the applicant and the operator or proposed operator of the existing or proposed medical facility, including balance sheets, income statements and statements of change in financial position, certified by an independent certified public accountant, for the immediately preceding three fiscal years or all fiscal years if the applicant or operator or proposed operator have been in operation for less than three years. Financial statements must also be provided for any parties acting as guarantors, indemnitors or sureties for the applicant or operator or proposed operator. The applicant must also provide pro forma financial statements showing the financial viability of the proposed project.

(e) The authority may consider any relevant information in deciding whether an applicant or operator or proposed operator is qualified to carry out the business of operating and maintaining a medical facility.

(f) The authority may reject or postpone acceptance of an application if the authority determines additional information is necessary. If the authority postpones or rejects an application, the executive director shall notify the applicant in writing of the reasons for the postponement or rejection.

(g) If, after the authority has approved the bond sale or other financial assistance but before the transaction has been completed, the executive director determines that approval was based upon a false or misleading statement by the applicant or operator or proposed operator, the executive director may order the transaction stayed pending a special meeting of the authority. At the special meeting, the authority may affirm its previous action or revoke the bond resolution.

History

Authority: AS 18.26.050(4)AS 18.26.080
Eff. 9/28/79, Register 71; am 6/15/80, Register 74

15 AAC 118.040 Bond counsel

(a) The authority will retain the services of a nationally recognized bond counsel for either a specified term or on an issue-by-issue basis.

(b) Before issuance of the bonds, the authority must receive an opinion of a nationally recognized bond counsel, who must be an active member in good standing of any state bar, that the interest in the bonds of the authority issued on behalf of an applicant will be tax exempt under the provisions of Section 103 of the Internal Revenue Code (26 USC $ 103. .

History

Authority: AS 18.26.040(c)AS 18.26.050(4)
Eff. 9/28/79, Register 71; am 6/15/80, Register 74

15 AAC 118.050 Records and reports

(a) An applicant and operator or proposed operator must, by signed resolution of their individual boards of directors, make all books and records available to the authority, executive director and agents of the authority, for inspection at any reasonable time during the pendency of the application and, if the authority approves the bond issue, for the time during which any bonds remain outstanding.

(b) The applicant and operator or proposed operator shall keep accurate books and records showing the financial status of the medical facility and shall annually file financial statements with the authority.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.060 Fees

(a) Upon issuance of the authority's bonds, and prior to the disbursement of proceeds for any other purpose, the authority shall receive as a financing fee an amount equal to one percent of the first $1,000,000, plus 1/2 of one percent of the next $9,000,000, plus one-tenth of one percent of the face amount of the issue in excess of $10,000,000, less the authority's previously reimbursed direct costs of evaluating the application as set out in 5 AAC 118.020(b).

(b) As a condition to receiving bond proceeds, the applicant must agree to pay on an annual basis an amount no less than one-fortieth of one percent of the outstanding balance of the bond issue. If applicant fails to timely pay the authority this annual fee, the authority may, in addition to other remedies, withdraw, or cause to be withdrawn, the amount due and owing from any special funds under the control of the authority or the control of the trustee, if the authority has entered into a trust agreement.

(c) Enumeration of costs and fees in this section is not a limitation upon any other costs and fees as may be permitted by law or contract.

History

Authority: AS 18.26.050(4)AS 18.26.100
Eff. 9/28/79, Register 71

15 AAC 118.070 Primary documents between applicant and operator

(a) No agreement, contract or any other document which is a component part of the underlying documents to an applicant's bond issue, or for which authority verification or approval is required, may be modified or partially or wholly assigned without the authority's written approval of the terms of the modification or of the assignment and the assignee.

(b) An applicant is considered the operator of the medical facility or proposed medical facility under this chapter. However, should the operator or proposed operator be other than the applicant, the applicant and operator or proposed operator, by whatever designation called, must submit to the authority for its approval the lease, operation contract, management contract or other primary documents defining the relationship between the applicant and the operator or proposed operator.

(c) The lease, operation contract, management contract or other primary documents between the applicant and operator or proposed operator if other than the applicant, must contain clauses granting to the authority and its assignees the same remedies upon default granted to the applicant and disallowing the removal of improvements during the default period. Should this clause be omitted from the lease, operation contract, management contract or other primary agreement between the applicant and operator or proposed operator, it shall be considered to be inferentially part of that lease or contract and shall be added by amendment by the applicant and operator. If they fail to amend the lease or contract within a reasonable time, the authority may so amend the appropriate documents on behalf of the applicant and operator or proposed operator.

(d) The applicant and operator may not assign or modify the lease, operation contract, management contract or other primary agreement without the prior approval of the authority.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.080 Supervision of proceeds of bond issue

As long as there are outstanding bonds under a bond issue, the authority may require the applicant to

(1) have made an annual audit or examination of its books and records by an independent firm of certified public accountants to determine whether the provisions of the bond issue have been complied with, and applicant must pay the cost of this audit or examination;

(2) permit the authority or its agents access to its books and records at any reasonable time; and

(3) submit, on written request from the authority, a sworn-to, detailed statement by an officer of the applicant stating the purposes to which bond proceeds have been applied.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.090 Meetings

(a) Regular Meetings. All regular meetings of the authority must be noticed in a newspaper of general circulation not more than two weeks, nor less than five days, prior to the meeting.

(b) Special Meetings. Special meetings may be held upon the call of the chairperson or any three members of the board. The call must designate the time and place of the meeting and the public notified of the special meeting in a manner reasonable under circumstances which shall include notice in a newspaper of general circulation.

(c) Public Meetings. All meetings of the authority are open to the public, though a member may move to hold any portion of the meeting in executive session. Only those subjects set out in AS 44.62.310(c) and specified in the motion may be discussed in executive session.

History

Authority: AS 18.26.040; AS 18.26.050(4)AS 44.62.310
Eff. 9/28/79, Register 71

15 AAC 118.100 Public record

Applications, and data provided to the authority in support of the applications, are public record under AS 40.25.110 - 40.25.120 unless they qualify for a statutory or judicial exemption.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.110 Conflict of interest

No member of the board may vote on any motion or resolution relating to any portion of the application if the board member has a direct or indirect interest in that portion of the application or any contract or understanding that will come into existence if the bond issue is approved.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.120 Notice of default

All notices of default provided for in underlying documents to the bond issue shall be in writing and forwarded to the authority, applicant, operator, lessee, trustee, assignee and all other parties who are subject to AS 18.26 and these regulations.

History

Authority: AS 18.26.050(4)
Eff. 9/28/79, Register 71

15 AAC 118.130 Definitions

In this chapter, unless the context requires otherwise, the definitions shall be as follows:

(1) "applicant" means the person or entity seeking monetary assistance to finance or refinance a medical facility or proposed medical facility under AS 18.26 and these regulations;

(2) "executive director" means the executive director or acting executive director of the Alaska Medical Facility Authority;

(3) "lessee" means, for purposes of AS 18.26 and these regulations, a political subdivision or nonprofit corporation that leases medical facilities from the authority;

(4) "nonprofit corporation" means a corporation, no part of the net earnings of which inures to the benefit of any private shareholder or individual, which is in compliance with the provisions of AS 10.20, the Alaska Nonprofit Corporations Act, and which is an organization described in Section 501(c)(3) of the Internal Revenue Code (26 USC $ 501. c)(3)); and

(5) "operator" or "proposed operator" means the applicant or, if other than the applicant, the person or entity responsible for the management, day-to-day operation and maintenance, and the development and implementation of long-range goals and objectives for the medical facility or proposed medical facility.

History

Authority: AS 18.26.050
Eff. 9/28/79, Register 71

Article 2 Alaska Housing Finance Corporation

15 AAC 118.210 Authority for and scope of regulations

Repealed 9/17/81.

15 AAC 118.220 Borrower eligibility

Repealed 9/17/81.

15 AAC 118.230 Loan terms

Repealed 9/17/81.

15 AAC 118.235 General provisions

Repealed.

History

Eff. 2/17/82, Register 82; repealed 12/16/93, Register 130

15 AAC 118.240 Public notice of meeting

Repealed.

History

Eff. 11/29/78, Register 68; am 8/17/82, Register 83; repealed 12/16/93, Register 130

15 AAC 118.250 Determination of interest rates

Repealed.

History

Eff. 11/29/78, Register 68; repealed 12/16/93, Register 130

15 AAC 118.260 Purchases of loans from seller/servicers

Repealed.

History

Eff. 11/29/78, Register 68; am 5/9/80, Register 78; am 2/17/82, Register 82; am 8/17/82, Register 83; am 1/4/83, Register 85; am 8/20/84, Register 92; am 2/25/86, Register 98; am 5/16/86, Register 99; repealed 12/16/93, Register 130

15 AAC 118.263 Contractor prerequisites for loans

Repealed.

History

Eff. 10/27/82, Register 84; am 6/24/85, Register 95; repealed 12/16/93, Register 130

15 AAC 118.267 Assumptions of mortgage loans

Repealed.

History

Eff. 2/17/82, Register 82; am 5/15/84, Register 90; am 8/28/85, Register 96; am 8/26/87, Register 104; repealed 12/16/93, Register 130

15 AAC 118.269 Minimum construction standards and standard deviation

Repealed.

History

Eff. 2/17/82, Register 82; am 3/18/92, Register 122; am 5/27/92, Register 123; repealed 12/16/93, Register 130

15 AAC 118.270 Servicing fee

Repealed 2/17/82.

15 AAC 118.272 Appeals procedure

Repealed.

History

Eff. 2/17/82, Register 82; am 11/20/89, Register 113; repealed 12/16/93, Register 130

15 AAC 118.280 General housing programs

Repealed.

History

Eff. 11/29/78, Register 68; am 3/10/80, Register 74; am 10/2/80, Register 78; am 2/17/82, Register 82; am 4/29/82, Register 82; repealed 12/16/93, Register 130

15 AAC 118.281 Delegated underwriting program

Repealed.

History

Eff. 8/20/84, Register 92; am 8/28/85, Register 96; repealed 12/16/93, Register 130

15 AAC 118.282 Mobile home loan program

Repealed 10/1/83.

15 AAC 118.283 Mobile home loan program

Repealed.

History

Eff. 10/1/83, Register 87; am 2/1/84, Register 89; am 8/20/84, Register 92; am 8/7/85, Register 95; am 2/15/86, Register 97; am 5/16/86, Register 99; am 8/26/87, Register 104; am 5/22/91, Register 119; am 11/6/91, Register 121; repealed 12/16/93, Register 130

15 AAC 118.284 Nonconforming housing program

Repealed.

History

Eff. 6/24/85, Register 95; am 12/23/87, Register 105; repealed 12/16/93, Register 130

15 AAC 118.285 Rental program

Repealed.

History

Eff. 2/25/86, Register 98; am 5/22/91, Register 119; repealed 12/16/93, Register 130

15 AAC 118.286 Mortgage purchase program

Repealed.

History

Eff. 2/25/86, Register 98; repealed 12/16/93, Register 130

15 AAC 118.287 Refinance program

Repealed.

History

Eff. 5/16/86, Register 99; am 12/23/87, Register 105; repealed 12/16/93, Register 130

15 AAC 118.288 Home owners' assistance program - Part I

Repealed.

History

Eff. 3/15/88, Register 106; repealed 12/16/93, Register 130

15 AAC 118.289 Home owners' assistance program - Part II

Repealed.

History

Eff. 8/23/88, Register 108; repealed 12/16/93, Register 130

15 AAC 118.290 Definitions

Repealed 2/17/82.

15 AAC 118.291 Second mortgage program for health and safety repairs (HSR)

Repealed.

History

Eff. 11/7/88, Register 109; repealed 12/16/93, Register 130

15 AAC 118.292 Low income finance experiment program

Repealed.

History

Eff. 2/24/89, Register 110; repealed 12/16/93, Register 130

15 AAC 118.293 Condominium stabilization program

Repealed.

History

Eff. 2/24/89, Register 110; am 9/29/89, Register 112; am 6/5/90, Register 116; am 2/14/92, Register 122; repealed 12/16/93, Register 130

15 AAC 118.295 REO financing program

Repealed.

History

Eff. 11/20/89, Register 113; repealed 12/16/93, Register 130

15 AAC 118.296 Home owners' assistance program - Part III

Repealed.

History

Eff. 11/20/89, Register 113; repealed 12/16/93, Register 130

15 AAC 118.300 Special mortgage loan purchase program scope

Repealed.

History

Eff. 6/30/80, Register 78; am 9/17/81, Register 80; am 2/17/82, Register 82; am 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.305 Borrower eligibility

Repealed.

History

Eff. 10/2/80, Register 78; am 1/27/81, Register 78; am 2/17/82, Register 82; am 10/27/82, Register 84; am 1/26/83, Register 85; am 10/19/83, Register 88; am 5/15/84, Register 90; am 6/24/85, Register 95; am 5/16/86, Register 99; repealed 12/16/93, Register 130

15 AAC 118.310 Loan terms

Repealed.

History

Eff. 6/30/80, Register 78; am 6/18/81, Register 79; am 9/17/81, Register 80; am 2/17/82, Register 82; am 10/27/82, Register 84; am 1/4/83, Register 85; am 9/14/83, Register 88; am 10/19/83, Register 88; am 5/16/85, Register 95; am 2/25/86, Register 98; am 5/16/86, Register 99; am 9/4/86, Register 100; am 12/23/87, Register 105; repealed 12/16/93, Register 130

15 AAC 118.342 Home ownership assistance program

Repealed.

History

Eff. 12/15/80, Register 78; am 9/17/81, Register 81; am 1/26/83, Register 85; am 2/1/84, Register 89; am 5/15/84, Register 90; am 5/16/85, Register 95; am 5/16/86, Register 99; am 8/8/86, Register 100; am 5/27/92, Register 123; repealed 12/16/93, Register 130

15 AAC 118.344 Fairbanks North Star Borough program

Repealed.

History

Eff. 6/30/80, Register 78; am 4/29/82, Register 82; repealed 12/16/93, Register 130

15 AAC 118.345 Definitions

Repealed 2/17/82.

15 AAC 118.400 Qualified mortgage bond program (special mortgage loan purchase program)

Repealed.

History

Eff. 9/17/81, Register 80; am 2/17/82, Register 82; am 10/27/82, Register 84; am 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.401 Eligibility

Repealed.

History

Eff. 5/11/83, Register 86; repealed 12/16/93, Register 130

15 AAC 118.405 Single-family residences

Repealed.

History

Eff. 9/17/81, Register 80; repealed 12/16/93, Register 130

15 AAC 118.410 Ownership requirements

Repealed.

History

Eff. 9/17/82, Register 80; am 10/27/82, Register 84; repealed 12/16/93, Register 130

15 AAC 118.411 Income limits

Repealed.

History

Eff. 7/28/89, Register 112; am 5/27/92, Register 123; repealed 12/16/93, Register 130

15 AAC 118.415 Purchase price requirements

Repealed.

History

Eff. 9/17/82, Register 80; am 10/27/82, Register 84; am 7/28/89, Register 112; repealed 12/16/93, Register 130

15 AAC 118.416 Assumption requirements

Repealed.

History

Eff. 7/28/89, Register 112; repealed 12/16/93, Register 130

15 AAC 118.417 Allocation of proceeds after September 3, 1982

Repealed.

History

Eff. 10/27/82, Register 84; repealed 12/16/93, Register 130

15 AAC 118.420 Qualified home improvement loans

Repealed.

History

Eff. 9/17/81, Register 80; am 2/17/82, Register 82; repealed 12/16/93, Register 130

15 AAC 118.425 Qualified rehabilitation loan

Repealed.

History

Eff. 9/17/81, Register 80; repealed 12/16/93, Register 130

15 AAC 118.430 Qualified mortgage loans

Repealed.

History

Eff. 9/17/81, Register 80; am 2/17/82, Register 82; repealed 12/16/93, Register 130

15 AAC 118.440 Loan terms

Repealed 2/17/82.

15 AAC 118.450 Purchase of qualified mortgage loans from seller/servicers

Repealed.

History

Eff. 9/17/81, Register 80; am 2/17/82, Register 82; repealed 12/16/93, Register 130

15 AAC 118.490 Qualified veterans' mortgage bond program (special mortgage loan purchase program)

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.492 Qualified veterans' mortgage loans

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.494 Purchase of qualified veterans' mortgage loans from seller/servicers

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.500 Veterans

Repealed.

History

Eff. 1/26/83, Register 58; am 8/18/84, Register 92; repealed 12/16/93, Register 130

15 AAC 118.510 Duty in armed forces

Repealed.

History

Eff. 1/26/83, Register 85; am 9/18/84, Register 92; repealed 12/16/93, Register 130

15 AAC 118.520 Duty in public health service

Repealed.

History

Eff. 1/26/83, Register 85; am 9/18/84, Register 92; repealed 12/16/93, Register 130

15 AAC 118.530 Duty in National Oceanic and Atmospheric Administration or in Coast and Geodetic Survey

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.540 Duty in United States Military, Air Force, Coast Guard, or Naval Academy

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.550 Duty in Alaska national guard or air national guard

Repealed 9/18/84.

15 AAC 118.560 Travel to or from duty

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.570 Spouses

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.580 Evidence of qualifications

Repealed.

History

Eff. 1/26/83, Register 85; repealed 12/16/93, Register 130

15 AAC 118.600 Sale of repossessed mobile homes

Repealed.

History

Eff. 8/23/88, Register 108; repealed 12/16/93, Register 130

15 AAC 118.700 Multi-family loan program

Repealed.

History

Eff. 5/22/91, Register 119; am 11/6/91, Register 121; am 2/14/92, Register 122; repealed 12/16/93, Register 130

15 AAC 118.730 Senior housing loan program

Repealed.

History

Eff. 3/18/92, Register 122; repealed 12/16/93, Register 130

15 AAC 118.800 Procurement management

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.805 Bid specifications

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.810 Competitive sealed bidding

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.815 Competitive sealed proposals

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.820 Small procurements

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.825 Sole source procurements

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.830 Limited competition

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.835 Emergency procurement

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.840 Contract formation and modifications

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.845 Protests and controversies

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.850 Exemptions to procurement regulations

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.855 Supply management

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.860 Purchases through state department of administration

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.865 Procedures

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.870 Authority to delegate; exercise of delegated authority

Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.875 Health and Safety

15 AAC 118.875. Definitions for 15 AAC 118.800 - 15 AAC 118.875. Repealed.

History

Eff. 8/28/90, Register 115; repealed 6/28/96, Register 138

15 AAC 118.900 Health and Safety

15 AAC 118.900. Definitions. Repealed.

History

Eff. 2/17/82, Register 82; am 2/25/86, Register 98; am 2/24/89, Register 110; am 5/22/91, Register 119; am 3/18/92, Register 122; repealed 12/16/93, Register 130

Chapter 125 Child Support Enforcement

Article 1 Calculation of Child Support Awards in Administrative Establishment or Review Proceedings

15 AAC 125.010 Determination of support obligation

Alaska Rule of Civil Procedure 90.3, effective August 1, 1987, as amended as of April 16, 2018, by Supreme Court Order 1919, is adopted by reference as the agency's child support guidelines.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.200
Eff. 8/23/80, Register 75; am 10/1/85, Register 95; am 9/30/87, Register 103; am 2/24/90, Register 113; am 11/28/96, Register 140; am 10/1/98, Register 147; am 6/15/2001, Register 158; am 4/15/2005, Register 174; am 4/15/2009, Register 190; am 10/15/2013, Register 208; am 5/2/2018, Register 226

15 AAC 125.011 Medical support

Repealed.

History

Eff. 10/1/85, Register 95; am 2/27/86, Register 97; repealed 10/1/98, Register 147

15 AAC 125.015 Failure to provide financial information

Repealed.

History

Eff. 12/27/90, Register 116; repealed 10/1/98, Register 147

15 AAC 125.020 Determination of total income from all sources and potential income

(a) In every matter in which the agency must establish or review a child support order, the agency will determine the obligor's and, if appropriate, the custodial parent's total income from all sources. In determining total income, the agency will use a parent's Department of Labor and Workforce Development records, tax documents, leave and earnings statements, pay stubs, child support affidavits required by Alaska Rule of Civil Procedure 90.3(e), bank records, sworn testimony, or other confirmation of the parent's income that the agency determines is reliable.

(b) In every matter in which the agency has determined that a parent is voluntarily unemployed or underemployed, as provided in 15 AAC 125.060, the agency will also determine the parent's potential income. The agency will determine potential income by considering, based on available information, the parent's past income, skills, work history, and education, and the job opportunities in the area where the parent physically resides.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.200 AS 25.27.140; AS 25.27.170
Eff. 8/23/80, Register 75; am 10/1/85, Register 95; am 2/27/86, Register 97; am 12/27/90, Register 116; am 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.030 Total income from all sources

(a) For purposes of 15 AAC 125.020, total income from all sources is the expected actual annual income that the parent will earn or receive when the child support award is to be paid. The expected actual annual income consists of

(1) salaries and wages, including overtime and tips;

(2) commissions;

(3) severance pay paid over an extended period of time;

(4) royalties;

(5) bonuses and profit sharing;

(6) interest and dividends, including permanent fund dividends;

(7) income derived from self-employment and from business partnerships;

(8) social security benefits;

(9) veterans benefits, except those that are means-based;

(10) insurance benefits in place of earned income, such as workers' compensation or periodic disability payments;

(11) workers' compensation;

(12) unemployment compensation;

(13) pensions;

(14) annuities;

(15) income from trusts;

(16) capital gains in real and personal property transactions to the extent that they represent a regular source of income;

(17) spousal support received from a person not a party to the order;

(18) income from contractual agreements;

(19) prerequisites or in-kind compensation, such as employer provided housing and transportation benefits, to the extent that they are significant and reduce living expenses;

(20) income from life insurance or endowment contracts;

(21) income from interest in an estate, whether received directly or through a trust;

(22) lottery or gambling winnings received either in a lump sum or an annuity;

(23) prizes and awards;

(24) net rental income;

(25) G.I. benefits, excluding education allotments;

(26) National Guard and Reserves drill pay; and

(27) Armed Service Members base pay plus the parent's allowances for quarters, rations, cost of living allowance, and specialty pay.

(b) Except as provided in (e) of this section, the expected actual annual income that a parent will earn or receive does not include

(1) a lump sum withdrawal from a pension or profit sharing plan, to the extent the proceeds have already been treated as a portion of total income for the purpose of calculating a child support award under Alaska Rule of Civil Procedure 90.3;

(2) means-based sources of income such as Alaska Temporary Assistance Program (ATAP), Food Stamps, and Supplemental Security Income; however, Children's Insurance Benefits paid to the parent's dependents is considered income; or

(3) one time gifts and inheritances, but interest from the principal amount is considered income and the agency may consider the amount of the principal as income in determining whether unusual circumstances exist as provided in 15 AAC 125.075.

(4) tax deferred dividends and interest

(A) earned on pension or retirement accounts, including individual retirement accounts under 26 U.S.C. 408 - 408A (Internal Revenue Code; and

(B) not distributed to the parent; or

(5) child support payments received from another individual.

(c) For the purposes of determining the total income of a parent, income from self-employment, rent, royalties, or an ownership interest in a partnership or closely held corporation includes the gross receipts minus the ordinary and necessary expenses required to produce the income. Ordinary and necessary expenses do not include any accelerated component of depreciation, investment tax credit, or any other business expense determined by the agency to be inappropriate. The agency will include an expense reimbursement and an in-kind payment, such as use of a company car, free housing, or reimbursed meals, as income if the amount is significant and reduces living expenses. The agency will offset expenses against the gross receipts from the business in which the expenses were generated, but the agency may not offset the expenses incurred in one business against income from another source such as wages or rents.

(d) If the parent has experienced a wide variation in total income from year to year, the agency may average income over more than one year to determine the parent's expected actual annual income. Except in unusual circumstances, the agency will not average more than the last three years of income.

(e) For purposes of 15 AAC 125.020, when the agency is calculating arrears under 15 AAC 125.105, total income from all sources is the actual annual income that the parent earned or received in each calendar year for which arrears are sought to be established in each category listed under (a) of this section. When the agency calculates arrears under 15 AAC 125.105, total income from all sources

(1) includes one time or lump sum payments, including one time gifts and inheritances that would otherwise be excluded from income under (b)(3) of this section; and

(2) does not include payments that are excluded from income under (b)(1), (b)(2), (b)(4), or (b)(5) of this section.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.200 AS 25.27.140; AS 25.27.170
Eff. 8/23/80, Register 75; am 10/1/85, Register 95; am 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.040 Financial and medical information required

(a) Upon receipt of a request for financial or medical information, or both, or an order for production of that information, a parent to whom the request is addressed shall provide to the agency accurate financial or medical information or both from which the parent's child support obligation can be calculated. The parent shall provide the financial or medical information or both within 20 days after the agency sends a request for information to the parent. The agency will send a request for information to a parent by first-class mail or by electronic means.

(b) The information that a parent must provide under (a) of this section includes the following, as appropriate:

(1) completed child support guidelines affidavits for the current year and for the year immediately preceding the request or order for financial information, and all supporting documentation necessary to verify the statements in the affidavits;

(2) copies of signed income tax returns, with all applicable schedules, for the two tax years immediately preceding the request or order for financial information, and all supporting documentation necessary to verify the statements in the tax returns;

(3) if the parent is employed, the parent's three most recent pay stubs;

(4) if the parent is self-employed, the business records reflecting the parent's business income and expenses for the past three months;

(5) documentation concerning any periodic benefits, such as workers' compensation, unemployment compensation, social security benefits (including Children's Insurance Benefits received under 42 U.S.C. 402(d)(2) by the parent's dependents), veterans benefits, interest or dividends, insurance benefits, dividends and other monetary benefits paid by corporations organized under 43 U.S.C. 1601 - 1629e (Alaska Native Claims Settlement Act), and any in-kind compensation, that were received by the parent whether or not those benefits are required to be reported on the parent's income tax returns; and

(6) documentation concerning any health care coverage that may be available to the parent for the child or children to be covered by the support order.

(c) When the agency is calculating or intends to calculate arrears under 15 AAC 125.105, the agency may request and each parent shall provide, in addition to the information required by (b) of this section, the following information:

(1) completed child support guidelines affidavits for each year for which arrears are sought to be established and all supporting documentation necessary to verify the statements in the affidavits;

(2) copies of signed income tax returns, with all applicable schedules, for each year for which arrears are sought to be established, and all supporting documentation necessary to verify the statements in the tax returns; and

(3) documentation concerning any periodic benefits, such as workers' compensation, unemployment compensation, social security benefits (including Children's Insurance Benefits received by the parent's dependents), veterans benefits, interest or dividends, insurance benefits, dividends and other monetary benefits paid by corporations organized under 43 U.S.C. 1601 - 1629e (Alaska Native Claims Settlement Act), and any in-kind compensation, that were received by the parent during each year for which arrears are sought to be established, whether or not those benefits were required to be reported on the parent's income tax returns.

History

Authority: AS 25.27.020(a)AS 25.27.140; AS 25.27.170 AS 25.27.060; AS 25.27.160; AS 25.27.200
Eff. 8/23/80, Register 75; am 10/1/85, Register 95; am 2/27/86, Register 97; am 10/1/98, Register 147

15 AAC 125.050 Determining total income from all sources

(a) Except when the agency determines that a parent is voluntarily unemployed or underemployed under 15 AAC 125.060, the agency will use the best information available, including any information available to it through automated sources such as information maintained by the Department of Labor and Workforce Development, to determine the parent's total income from all sources for the periods for which support is to be paid.

(b) When the agency calculates arrears under 15 AAC 125.105, and except when the agency determines that a parent is voluntarily unemployed or underemployed under 15 AAC 125.060, the agency will base the support calculation on the parent's actual total income for the period for which support is being calculated. If the agency has

(1) complete information concerning the parent's total income for a year for which support is being calculated, the agency will use that information to calculate support for that year, even if the parent worked less than full time or worked sporadically during the year;

(2) limited information concerning the parent's actual total income for a year for which support is being calculated, the agency will estimate the parent's total income for that year based on the parent's earnings in prior or subsequent years, job skills, training, work history, and education, and the employment available in the area where the parent physically resides or previously resided; or

(3) no information concerning the parent's total income in a past year, the agency will base the support calculation on the

(A) Male and Female Average Annual Wage Income by Age Group statistics provided by the Department of Labor and Workforce Development if the parent is 19 years of age or older and resides in this state;

(B) federal minimum wage as set out in 29 U.S.C. 206(a)(1) or minimum wage where the party resides, whichever is greater, if the parent is 19 years of age or older and resides outside of this state; or

(C) minimum $50-per-month support amount set out in Alaska Rule of Civil Procedure 90.3(c)(3) if the parent is less than 19 years of age.

(c) When the agency calculates a parent's ongoing support obligation under 15 AAC 125.100, and except when the agency determines that a parent is voluntarily unemployed or underemployed under 15 AAC 125.060, the agency will base the support calculation on the total annual income that the parent is likely to earn or receive when the child support is to be paid. To determine the parent's expected annual income, the agency will use the best available information, including

(1) the parent's current income as of the date of the agency's calculation of support, as reflected in recent pay stubs or other information from the parent or the parent's employer;

(2) the parent's actual income during the immediately preceding calendar year or, if the parent's income is erratic or information is not available for the immediately preceding calendar year, the parent's actual income during prior calendar years;

(3) partial wage information for periods of less than one year;

(4) the parent's wage rate at a previous job;

(5) the parent's job skills, training, work history, and education;

(6) the average wage or salary available to a person in the parent's particular profession or occupation and, if applicable, location;

(7) the availability of employment in the area where the parent physically resides;

(8) the minimum wage for the area in which the parent physically resides; and

(9) any physical or other restrictions on the parent's ability to work.

(d) If the agency has none of the information listed in (c) of this section for a parent, the agency will base the parent's ongoing support calculation on

(1) the Male and Female Average Annual Wage Income by Age Group statistics provided by the Department of Labor and Workforce Development if the parent is 19 years of age or older and resides in this state;

(2) the federal minimum wage as set out in 29 U.S.C. 206(a)(1) if the parent is 19 years of age or older and resides outside of this state;

(3) the minimum $50-per-month support amount set out in Alaska Rule of Civil Procedure 90.3(c)(3) if the parent is less than 19 years of age.

(e) When calculating income under this section, the agency will include in the parent's estimated total income a

(1) permanent fund dividend payable under AS 43.23, unless the evidence available to the agency indicates that the parent is not eligible for a permanent fund dividend; and

(2) dividend payable by a corporation organized under 43 U.S.C. 1601 - 1629h (Alaska Native Claims Settlement Act), if evidence available to the agency indicates that the parent is a member of or shareholder in that corporation.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.200 AS 25.27.140; AS 25.27.170
Eff. 8/23/80, Register 75; am 10/1/98, Register 147; am 6/15/2001, Register 158; am 4/1/2005, Register 173; am 4/15/2005, Register 174; am 2/16/2013, Register 205

15 AAC 125.060 Voluntary unemployment and underemployment and potential income

(a) If, after considering the relevant circumstances, including the parent's education, training, occupation, health, employment opportunities, and the extent to which the parent is participating in a reasonably diligent work search, the agency determines that the parent is voluntarily and unreasonably underemployed or unemployed, the agency will determine the parent's potential income under 15 AAC 125.020(b) based on the parent's work history, qualifications, and job opportunities. The agency may also impute potential income for non-income or low income producing assets.

(b) The agency may not determine that a parent is voluntarily and unreasonably underemployed or unemployed if the parent is mentally or physically incapacitated or if the obligor parent is caring for a child under two years of age to whom the parents owe a joint legal responsibility.

(c) For purposes of (a) of this section, if a parent makes a career change, the agency will consider the extent to which the children will ultimately benefit from the change.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.200 AS 25.27.140; AS 25.27.170
Eff. 10/1/85, Register 95; am 2/27/86, Register 97; am 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.065 Determining adjusted annual income

(a) If a child support award is based on a parent's total income from all sources, the adjusted annual income equals the parent's total income from all sources determined under 15 AAC 125.030 minus the deductions specified in Alaska Rule of Civil Procedure 90.3(a)(1).

(b) If the child support award is based on a parent's potential income, the adjusted annual income equals the parent's potential income determined under 15 AAC 125.060 minus the deductions specified in Alaska Rule of Civil Procedure 90.3(a)(1), based on the parent's potential income.

History

Authority: AS 25.27.020(a)AS 25.27.160; AS 25.27.200 AS 25.27.140(a)AS 25.27.170
Eff. 10/1/98, Register 147

15 AAC 125.070 Calculation of support award

(a) If one parent has primary custody of the child or children, as defined by Alaska Rule of Civil Procedure 90.3(f)(2), the agency will calculate the child support award by multiplying the adjusted annual income determined under 15 AAC 125.065 by the appropriate percentage under Alaska Rule of Civil Procedure 90.3(a).

(b) If the parents have shared custody of the child or children, as defined by Alaska Rule of Civil Procedure 90.3(f)(1), the agency will calculate the child support award by applying the formula set out in Alaska Rule of Civil Procedure 90.3(b) to the adjusted annual income of each parent, as determined under 15 AAC 125.065.

(c) If the parents have divided custody of the children, as defined by Alaska Rule of Civil Procedure 90.3(f)(3), or hybrid custody, as defined by Alaska Rule of Civil Procedure 90.3(f)(4), the agency will calculate the child support award by applying the formula set out in Alaska Rule of Civil Procedure 90.3(b) based on the adjusted annual income of each parent and the amount of time all of the children will spend with each parent. The agency will then consider whether that support amount should be varied under 15 AAC 125.075 because of the divided or hybrid custody arrangement.

(d) In determining whether there is primary, shared, divided, or hybrid custody, the agency will follow the current custody order, if a custody order is in effect. If a custody order is not in effect, the agency will base the support calculation on the actual custody arrangement. The agency may require the parents to provide proof of the actual custody arrangement. As proof the parents may include school records, sworn statements from neighbors or other persons with knowledge of the child's residence, and any other reliable evidence of the child's residence. If a parent is receiving assistance through AS 47.27 (Alaska Temporary Assistance Program (ATAP)) on behalf of a child, the agency will presume that the parent has primary custody of the child unless the parent disputing the presumption of primary custody provides proof to establish, by a preponderance of the evidence, that a different custody arrangement exists.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.200 AS 25.27.140; AS 25.27.170
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 4/15/2005, Register 174; am 8/4/2005, Register 175

15 AAC 125.075 Variances and exceptions

(a) At the request of a parent, the agency may, for good cause, vary a child support award calculated under 15 AAC 125.070 if the parent provides to the agency clear and convincing evidence that

(1) repealed 4/15/2005;

(2) manifest injustice will result unless the child support award under 15 AAC 125.070 is varied because of unusual circumstances; for purposes of this paragraph, unusual circumstances may include:

(A) especially large family size;

(B) significant income of a child;

(C) divided custody under which one parent has primary custody of one or more children of the relationship and the other parent has primary custody of one or more other children of the relationship;

(D) health or other extraordinary expenses;

(E) unusually low expenses;

(F) the existence of subsequent children of the obligor parent, but only if failure to vary the child support award under 15 AAC 125.070 would cause substantial hardship to the subsequent children;

(G) a consideration of the incomes of both parents; or

(H) in a modification action, the fact that the obligor parent has taken a second job in order to better provide for a subsequent family; or

(3) the parent has an adjusted annual income that is more than $126,000, as calculated under 15 AAC 125.065; if a parent qualifies for a variance under this paragraph, the agency will base the support award on an adjusted annual income of $126,000; the agency will make an additional award under this paragraph if the agency determines that an additional award is just and proper, taking into account the needs of the children, the standard of living of the children, and the extent to which that standard should be reflective of the parent's ability to pay.

(4) repealed 8/4/2005.

(b) The following reasons do not, alone, provide good cause for varying a child support award under (a) of this section, but the agency may consider them if there is evidence of other unusual circumstances in a particular case:

(1) agreement of the parents;

(2) prior and subsequent debts of the obligor parent;

(3) income of a new spouse of either the custodial or obligor parent; or

(4) the age of the children.

(c) The agency may not consider the following reasons in determining whether there is good cause to vary a child support award under (a) of this section:

(1) denial of visitation; or

(2) relocation of the custodial or obligor parent.

(d) The agency will set a support award at no less than the minimum support amount of $50 per month set out in Alaska Rule of Civil Procedure 90.3(c)(3), except to the extent that

(1) the parent is entitled to an extended visitation credit under a valid order granting the parent visitation in excess of 27 consecutive days and providing for a credit for a period in which the extended visitation is actually exercised; or

(2) a lesser amount is required under a shared, divided, or hybrid custody calculation under Alaska Rule of Civil Procedure 90.3(b).

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.200
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 11/30/2002, Register 164; am 4/15/2005, Register 174; am 8/4/2005, Register 175; am 4/15/2009, Register 190; am 2/16/2013, Register 205; am 10/15/2013, Register 208; am 5/2/2018, Register 226

15 AAC 125.080 Determining manifest injustice

For purposes of 15 AAC 125.075, a support award determined under the provisions of Alaska Rule of Civil Procedure 90.3(a) or (b) is manifestly unjust if the agency determines that a reasonable person would be convinced that the award is either unjustly large or unjustly small after carefully evaluating the award amount with reference to the considerations set out in the Commentary to Alaska Rule of Civil Procedure 90.3 and 15 AAC 125.075(a)(2) and (b).

History

Authority: AS 25.27.020(a)AS 25.27.160; AS 25.27.200 AS 25.27.140; AS 25.27.170
Eff. 10/1/98, Register 147

15 AAC 125.085 Medical support

(a) If the agency establishes or modifies a support order administratively, the agency will require health care coverage for the children covered by the support order if health care coverage is available to either or both parents at a reasonable cost and accessible to the children, as defined in Alaska Rule of Civil Procedure 90.3(d). The agency will include in the support order a provision allowing a credit or debit for one-half of the cost of the health care coverage depending on which parent purchases the coverage, unless the agency finds good cause to order a credit or debit in a different amount.

(b) When the agency is enforcing a child support order issued by a tribunal other than the agency, the agency will seek a modification

(1) through the appropriate legal process to add a provision requiring health care coverage for the children covered by the support order if the order does not already include a health care coverage provision, and allowing a credit or debit for one-half of the cost of the health care coverage depending on which parent purchasers the coverage, unless good cause exists to request a credit or debit in a different amount; or

(2) of the order's existing health care coverage provision if the provision does not comply with state or federal law.

History

Authority: AS 25.27.020; AS 25.27.060; AS 25.27.190 AS 25.27.045; AS 25.27.140
Eff. 10/1/98, Register 147; am 11/30/2002, Register 164; am 10/15/2013, Register 208

15 AAC 125.090 Written findings

(a) In any matter in which the agency has established or modified a child support order, the agency will make specific written findings concerning a decision on each of the following issues:

(1) a parent's total income from all sources;

(2) the existence of voluntary unemployment or underemployment;

(3) a parent's potential income;

(4) a support award;

(5) the existence or absence of good cause to vary a child support obligation under the provisions of 15 AAC 125.075; and

(6) the availability of health insurance and a parent's obligation to provide that insurance.

(b) Written findings concerning the presence or absence of good cause to vary a child support award under 15 AAC 125.075 must include a statement of the reasons for the variation and the amount of support that would have been required but for the variation.

History

Authority: AS 25.27.020; AS 25.27.170; AS 25.27.190 AS 25.27.160; AS 25.27.180
Eff. 10/1/98, Register 147

Article 2 Administrative Establishment of Child Support Orders

15 AAC 125.100 Notice and finding of financial responsibility; establishment of support obligation

(a) Before initiating an administrative action to establish a support order, the agency will send by first-class mail or by electronic means to the noncustodial parent and to the custodial parent or, if appropriate, to a child support enforcement agency of another state, a request for financial and medical information as provided in 15 AAC 125.040.

(b) Upon receipt of the information required by 15 AAC 125.040 or upon the expiration of the period in which the parents are required to provide the information, the agency may initiate an action to establish a support order by serving a notice and finding of financial responsibility on the noncustodial parent as required by AS 25.27.160. The agency will also send a copy of the notice and finding of financial responsibility to the custodial parent or legal custodian of the children for whom support is sought and, if appropriate, to a child support enforcement agency of another state.

(c) The agency's notice and finding of financial responsibility establishes an ongoing support obligation owed by the noncustodial parent. The ongoing support obligation is effective as of the first day of the month following service on the noncustodial parent of the notice and finding of financial responsibility, a notice of paternity and financial responsibility, or a paternity complaint, whichever is the earliest.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.170
Eff. 10/1/98, Register 147

15 AAC 125.105 Establishment of pre-order arrears

(a) When the agency establishes an ongoing support obligation, or at any time after an ongoing support obligation has been established by a tribunal of this or another state, the agency may issue a notice and finding of financial responsibility that sets the support obligation for periods before the effective date of the ongoing support obligation. Except as provided in (f) of this section, in issuing a notice and finding of financial responsibility under this section, the agency will act as follows:

(1) if initiated by this state or another state because public assistance or medical assistance is being provided on behalf of the child for whom support is sought or because the child is in state placement or state-sponsored foster care, the agency will establish arrears beginning as of the first month in which state assistance was provided on behalf of the child or the first month of state placement, but not to exceed six years before the service on the obligor of the notice and finding of financial responsibility, a notice of paternity and financial responsibility, or a paternity complaint, whichever is the earliest; the agency will establish arrears up to the effective date of the ongoing support obligation for the child, including any arrears owed to the custodial parent if the state assistance or state placement terminates for any period of time before the service of the notice and finding of financial responsibility under this section;

(2) if initiated by a parent, the agency will establish arrears beginning with the month the custodial parent most recently applied for the agency's services; the agency will establish arrears up to the effective date of the ongoing support obligation for the child, including any arrears owed to the state because the child received public assistance or medical assistance or was placed in state custody or state-sponsored foster care after the most recent application by the custodial parent for services; however, any arrears owed to the state may not exceed six years before the service on the obligor of the notice and finding of financial responsibility, a notice of paternity and financial responsibility, or a paternity complaint, whichever is the earliest;

(3) if the applicant withdraws from the agency's services before the service on the obligor of the notice and finding of financial responsibility under this section, the agency will

(A) complete the establishment of the arrears under (1) or (2) of this subsection if the child for whom support is sought has received public assistance or was in state-sponsored foster care or state placement for any period of time to be covered by the order; however, in the order the agency will not establish arrears that exceed the total public assistance grant amount; or

(B) terminate its action to establish arrears under (1) or (2) of this subsection if the child for whom support is sought has not received public assistance or been in state-sponsored foster care or state placement for any period of time to be covered by the order;

(4) when the agency is acting as the responding state in a case initiated by another state under the Uniform Interstate Family Support Act of this or another state, the agency will, at the request of the initiating state, establish arrears under this section for periods before the effective date of the ongoing support obligation, beginning as of the date the custodial parent applied for child support enforcement services in the initiating state or as of the date the custodial parent began receiving state assistance or state-sponsored placement for the child in the initiating state, whichever date is earlier; however, any arrears owed to the initiating state may not exceed six years before the service on the obligor of the notice and finding of financial responsibility, a notice of paternity and financial responsibility, or a paternity complaint, whichever is the earliest.

(b) When calculating arrears under (a) of this section, the agency will give credit for direct payments made by or on behalf of the obligor directly to the custodial parent in the form of cash, a money order, a check made payable to the custodial parent, or a deposit or electronic funds transfer to a bank or equivalent financial account held by the custodial parent. In order for the obligor to receive credit for direct payments, evidence must show a likelihood, in the determination of the agency, that the direct payment was actually made to the custodial parent for the period for which arrears are being calculated and that the direct payment was intended by both parents to be a direct payment of child support.

(c) When calculating arrears under (a) of this section, the agency will give credit for in-kind contributions if the parents agree in writing to allow credit for the in-kind contribution and the parents agree in writing to the dollar value of the in-kind contribution. The agency will not give credit for an in-kind contribution under this subsection for any period of time during which the child received public assistance or was in state-sponsored foster care or state placement.

(d) When giving credit for direct payments under (b) of this section or in-kind contributions under (c) of this section, the agency will give credit only up to the amount of the support that is charged for the period for which support is established under (a) of this section. If the direct payments or in-kind contributions exceed the amount of the support established under (a) of this section, the excess payments or contributions will be treated as voluntary payments for which the agency will not give credit unless a parent provides clear and convincing evidence that both parents intended the payment or contribution to be applied toward future child support. The agency will not give credit for the excess payments or contributions as future child support for any period of time during which the child received public assistance or was in state-sponsored foster care or state placement.

(e) When establishing arrears under (a) of this section, the agency will calculate the support obligation under 15 AAC 125.070 for the first year of the period for which support is being established. For each year afterwards, the agency will determine whether a material change of circumstances occurred justifying a modification of the support amount for that year. For each year in which a material change of circumstances occurred, the agency will set the support obligation at the amount required under 15 AAC 125.070. For each year in which a material change of circumstances did not occur, the agency will set the support obligation at the amount set for the preceding year.

(f) Notwithstanding (a) of this section, if the agency vacates an administrative support order under 15 AAC 125.121, the agency will establish a new administrative support order for the entire period of time covered by the previous administrative support order.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.195 AS 25.27.022; AS 25.27.170
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.110 Agency services

Repealed

History

Eff. 8/23/80, Register 75; am 6/4/83, Register 86; am 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.112 Failure to respond to notice in paternity establishment cases under AS 25.27.165

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.113 Certain procedures for paternity establishment cases under AS 25.27.165

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.115 Review of support orders

Repealed.

History

Eff. 12/27/90, Register 116; repealed 10/1/98, Register 147

15 AAC 125.118 Administrative review of notice and finding of financial responsibility

(a) A person served with a notice and finding of financial responsibility or with a copy of a notice and finding of financial responsibility setting a support obligation may request an administrative review of the notice and finding. The person making the request shall make it in writing, and shall send the request to the agency by first class mail or electronic means. The request must be postmarked or received by the agency within 30 days after service of the notice and finding of financial responsibility. The request must state the specific reasons for the request for administrative review and be accompanied by the documentation upon which the person requesting the administrative review intends to rely. If a request for administrative review does not fully comply with the requirements of this subsection, the agency may return the request unprocessed or accept a request for administrative review that substantially complies with the requirements of this subsection.

(b) Upon acceptance of a written request for administrative review, the agency will promptly notify the nonrequesting party of the request and provide the nonrequesting party a copy of the request and documentation. The nonrequesting party may respond to the reasons asserted by the requesting party, and shall respond in writing within 15 days after notice of the request for administrative review is mailed to the nonrequesting party.

(c) An agency employee, referred to as the review officer, may conduct the administrative review by correspondence, by telephone, or in person. During an administrative review, the review officer may relax the requirements of the Alaska Rules of Evidence. The review officer may accept any relevant evidence that appears to be reasonably accurate. Upon request, the review officer will make available to either party to an administrative review the relevant, non-privileged portion of the agency's file relating to the support obligation for which review has been sought. The review officer may

(1) request additional information from either party, to the extent the review officer considers the information necessary to the review; and

(2) conduct additional investigation using the agency's administrative subpoena power or other investigative action, to the extent the review officer considers the information to be obtained from the additional investigation to be necessary to the review.

(d) In an administrative review under this section, the burden of proof is on the person requesting the administrative review to establish:

(1) that a valid court order already exists that covers the support obligation in question;

(2) that a duty of support is not owed; or

(3) that the amount of support determined by the agency in its notice and finding of financial responsibility is incorrect because the financial circumstances of the obligor or of the custodial parent are not as the agency has determined.

(e) After considering the facts, information, and arguments presented by the parties, the review officer shall promptly render a written decision. The review officer's decision must make the specific written findings required by 15 AAC 125.090. If the review officer believes that an adjustment of the agency's action is appropriate, in the written decision the review officer will direct the agency to make the adjustment, and the agency will make the adjustment that is directed to be made in the written decision.

(f) The decision of the review officer made under (e) of this section is final for purposes of appeal to a formal hearing but is not a final administrative determination for purposes of appeal to the superior court. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals under this subsection.

(g) If, under (f) of this section, a person requests a formal hearing from an administrative review decision, enforcement of the administrative review decision may not be stayed unless the obligor posts security or a bond in an amount sufficient to secure payment of support owed as of the date of the administrative review decision, conditioned upon final determination of the formal hearing. The collection and disbursement of the ongoing support obligation that is stated in the administrative review decision will continue regardless of posting of a bond or security under this section.

(h) In this section,

(1) "nonrequesting party" means the person who, under (b) of this section, may respond to a request for administrative review of the agency's notice and finding of financial responsibility;

(2) "requesting party" means the person who, having been served with a notice and finding of financial responsibility, requests an administrative review of the person's support obligation as set out in the notice and finding of financial responsibility.

History

Authority: AS 25.27.020; AS 25.27.160; AS 25.27.170
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205; am 9/15/2022, Register 243

15 AAC 125.120 Waiver of child support

Repealed.

History

Eff. 10/1/85, Register 95; am 2/27/86, Register 97; repealed 10/1/98, Register 147

15 AAC 125.121 Vacating administrative support order based on a default income figure

(a) Upon request from an obligor, the agency will vacate an administrative support order if the support order was based on a default income figure and the agency determines that the default income figure is not an accurate reflection of the obligor's income for purposes of calculating the obligor's child support obligation.

(b) An obligor may request relief under this section by sending a written request to the agency. The request must be accompanied by the financial information required under 15 AAC 125.040(b) for each year for which relief is sought.

(c) If the obligor does not provide sufficient information as required in (b) of this section, the agency will notify the obligor that the information provided is insufficient and will state the additional information that the agency needs in order to review the obligor's request for relief under this section. If the obligor fails to provide the additional information, the agency will

(1) cease further action on the obligor's request for relief; or

(2) review and take action upon the obligor's request for relief if the agency can obtain sufficient actual income information for the obligor from other sources, including the Department of Labor and Workforce Development.

(d) Upon accepting a request for relief under this section, the agency will promptly send a notice of the request for relief by first class mail to the obligor, to the custodial parent or legal custodian and, if appropriate, to a child support enforcement agency of another state. Any party may respond to the notice. The response must be in writing and must be postmarked or received by the agency within 30 days after the notice of request for relief is mailed to the party.

(e) The agency will issue an administrative review decision either granting or denying the request for relief as soon as practicable after the time for response under (d) of this section. The agency will grant the request to vacate the support order if the agency finds that the support order was based on a default income figure and that granting the request will not cause undue hardship to a party because of the party's reasonable reliance on the support order. If the agency grants the request, the agency will at the same time issue a new support order for the time periods covered by the previous support order.

(f) The administrative review decision granting or denying the request for relief under this section and, if appropriate, establishing a new administrative support order is final for purposes of appeal to a formal hearing but is not a final administrative determination for purposes of appeal to the superior court. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals under this subsection.

(g) If the agency grants a request for relief under this section, the agency will apply 15 AAC 125.010 - 15 AAC 125.090 to calculate the amount of the new support order. The agency will charge interest at the applicable rate under AS 25.27.025 on the support amounts established in the new support order effective as of the dates those amounts would have accrued if the new support order had been issued when the original default order was issued.

(h) If the agency grants a request for relief under this section, and if the support order was based on

(1) a default income figure for some periods of time and on actual income information or an estimated, projected, or potential income for other periods of time, the agency will grant or deny relief for the entire period of time covered by the support order;

(2) a default income figure but was subsequently modified based on actual income information or on an estimated, projected, or potential income, the agency will grant relief only from the original support order that was based on a default income figure, and will keep the modified support order in place; or

(3) actual income information or on an estimated, projected, or potential income and was subsequently modified based on a default income figure, the agency will grant relief only from the modified support order that was based on a default income figure, and will keep the original support order in place for the periods before the effective date of the modified support order.

(i) If the agency grants a request for relief under this section and issues a new support order, the agency will adjust the obligor's account, including any child support arrears and, if appropriate, the ongoing support obligation, to reflect the support amounts established in the new support order. However, the agency will not adjust the obligor's account below zero as of the effective date of the order granting relief or refund any amounts collected before the effective date of the order granting relief. An order granting relief under this section is effective as of the date the request for relief was received by the agency or the date the agency receives all documentation necessary to complete the review, whichever is later.

(j) For purposes of this section, a support order is

(1) based on a default income figure if the agency imputed an annual adjusted income to the parent based on

(A) former 7 AAC 45.020 (Alaska Needs Standard);

(B) the Male and Female Average Annual Wage Income by Age Group statistics or other group wage statistics provided by the Department of Labor and Workforce Development;

(C) the federal minimum wage or minimum wage where the party resides, whichever is greater, if the support amount was imputed under 15 AAC 125.050(b)(3)(B) or 15 AAC 125.050(d)(2); or

(D) a minimum $50 per month if the support amount was imputed under 15 AAC 125.050(b)(3)(C) or 15 AAC 125.050(d)(3);

(2) not based on a default income figure if the agency based the support order on

(A) actual income information for the obligor;

(B) an estimated or projected income based on incomplete but actual income information for the obligor for the current or a prior year; or

(3) not based on a default income figure if the agency established arrears under 15 AAC 125.105 and for a particular year, the agency based the support amount on the obligor's actual income from a prior or subsequent year or estimated the obligor's annual adjusted income based on incomplete but actual income information for the obligor for the year for which support is being established;

(4) not based on a default income figure solely because the obligor failed to respond to the notice and finding of financial responsibility; if the obligor failed to respond to the notice and finding of financial responsibility but the support order was based on information described in (2) or (3) of this subsection, the order is not based on a default income figure for purposes of this section.

History

Authority: AS 25.27.020; AS 25.27.195
Eff. 6/15/2001, Register 158; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.125 Request for relief from agency administrative orders after the appeal deadline

(a) A party to an administrative order, or the agency on its own initiative, may file with the director a written request for relief from the order after the deadline set out in 15 AAC 125.118 for filing an appeal. The request must state one or more of the specific grounds for relief listed in (b) of this section and explain why relief is justified.

(b) The director will grant relief under this section from an administrative order if the party demonstrates, to the director's satisfaction,

(1) mistake, inadvertence, or excusable neglect;

(2) newly discovered evidence that by due diligence could not have been discovered before issuance of the order;

(3) fraud, misrepresentation, or other misconduct of an adverse party;

(4) that the order is void; or

(5) that the order, if the order is an administrative support order, has been satisfied, released, or discharged, or that a prior paternity judgment upon which that support order was based has been reversed or otherwise vacated, so that prospective application of the support order is no longer equitable.

(c) Upon receipt by the agency of a request for relief under this section, or upon the agency's own initiative, the agency will send, by first class mail, copies of the request for relief to the parties and, if appropriate, a child support enforcement agency of another state. Any party may respond to the request. The response must be in writing and must be postmarked or received by the agency within 20 days after a copy of the request for relief is mailed to the party.

(d) Within 30 days after receipt of a request for relief under (a) of this section, the director, or the director's designee, will consider the administrative order and any arguments raised with respect to the request for relief. As necessary to determine any ground for relief under (b) of this section, the director may request the submission of additional information or argument or order the administrative review process reopened to receive further evidence.

(e) If the director determines that relief from an administrative order is to be granted under (b) of this section, the agency will issue an amended administrative order with any corrections that the director determines to be appropriate to provide relief If the director grants relief under this section, the agency will adjust the obligor's account to reflect the correction of the administrative order. The amended administrative order is final for purposes of appeal to a formal hearing but is not a final administrative determination for purposes of appeal to the superior court. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals under this subsection.

(f) If the director denies a request for relief under this section, the director's decision becomes final for purposes of appeal to formal hearing as of the date of the director's written order denying the request.

(g) In this section, "administrative order" means an order of the agency.

History

Authority: AS 25.27.020; AS 25.27.166; AS 25.27.195
Eff. 6/15/2001, Register 158

15 AAC 125.130 Bad check fee

Repealed.

History

Eff. 8/23/80, Register 75; repealed 10/1/98, Register 147

15 AAC 125.140 Overdue payment penalty

Repealed 10/1/85.

15 AAC 125.145 Interest on child support arrearages

Repealed.

History

Eff. 6/4/83, Register 86; am 10/1/85, Register 95; am 2/27/86, Register 97; am 12/27/90, Register 116; repealed 10/1/98, Register 147

15 AAC 125.150 Service of administrative process

Repealed 10/1/85.

15 AAC 125.155 Reporting of arrearages to credit bureaus and lenders

Repealed.

History

Eff. 10/1/85, Register 95; am 2/27/86, Register 97; repealed 10/1/98, Register 147

15 AAC 125.160 Definitions

Relocated.

15 AAC 125.163 Administrative appeal from notice of liability

Repealed.

History

Eff. 12/27/90, Register 116; repealed 10/1/98, Register 147

15 AAC 125.165 Orders to withhold and deliver

Repealed.

History

Eff. 12/27/90, Register 116; repealed 10/1/98, Register 147

15 AAC 125.170 Income withholding; employer's transmittal of money to agency

Repealed.

History

Eff. 10/1/85, Register 95; am 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.180 Spousal support

Repealed.

History

Eff. 10/1/85, Register 95; am 2/27/86, Register 97; am 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.190 Medical support

Relocated.

15 AAC 125.191 Interstate establishment of support order

Repealed.

History

Eff. 12/27/90, Register 116; repealed 11/28/96, Register 140

15 AAC 125.195 Interstate income withholding and support orders

Repealed.

History

Eff. 10/1/85, Register 95; am 2/27/86, Register 97; repealed 11/28/96, Register 140

15 AAC 125.200 Notice to employer of income withholding

Repealed.

History

Eff. 10/1/85, Register 95; am 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.205 Procedures for disestablishment of paternity under AS 25.27.166

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

Article 3 Paternity

15 AAC 125.210 Obligor to file

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

15 AAC 125.212 Failure to respond to notice in paternity establishment cases

(a) Except as provided in (b) and (c) of this section, if the agency serves a putative father with a notice of paternity and financial responsibility under AS 25.27.165(b) and the putative father fails to file the response required by AS 25.27.165(c), the agency will consider the failure to be an admission of paternity and will issue a decision establishing the putative father's paternity.

(b) If the agency determines that a putative father who fails to file the response required by AS 25.27.165(c) is an unemancipated minor or incompetent person, the agency will terminate the administrative establishment of paternity proceeding without making a determination of paternity and may bring the paternity proceeding in court. In this subsection, "incompetent person" means a person who is mentally or physically incapable of effectively responding to and participating in an administrative matter such as a paternity establishment matter.

(c) If more than one putative father is named in an application submitted under 15 AAC 125.216, the agency will not issue a decision establishing a putative father's paternity on the basis of failure to file a response under (a) of this section unless the agency has issued a decision of nonpaternity under 15 AAC 125.218(e) or 15 AAC 125.222 with regard to all other putative fathers named in the application.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.165
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.216 Application for determination of paternity

(a) When presented with a written application for the determination of paternity of a minor child born out of wedlock under AS 25.27.165 from a child's mother, custodian, putative father, legal custodian, or agency representative, or the representative of a child support enforcement agency of another state, the agency shall initiate an administrative proceeding to determine paternity under AS 25.27.165. The application for the determination of paternity must contain the following information, to the extent the information is available to the person applying for the determination:

(1) a copy of the birth certificate for each child for whom paternity is sought to be established;

(2) the name of the alleged father and any other information or vital statistics that may aid the agency in identifying the alleged father;

(3) the location of the alleged father and any other information that may lead to the location of the alleged father;

(4) the name of any person who had the legal status of the father of the child for whom paternity is sought to be established as a result of the person's marriage to the child's mother or the legitimation of the child under AS 25.20.050 and copies of any orders excluding that person as the child's biological father;

(5) copies of any orders previously issued concerning the support or custody of the child for whom paternity is sought to be established.

(b) The agency will deny an application for administrative paternity determination if

(1) the paternity of the child has already been established in this state under AS 25.20.050;

(2) the agency has notice of a determination of paternity concerning the child made by another state that is entitled to full faith and credit under AS 25.20.050(h);

(3) the child was not born out of wedlock; or

(4) the child is no longer a minor or is otherwise emancipated.

(d) Repealed 6/15/2001.

(e) Repealed 6/15/2001.

(f) Repealed 6/15/2001.

(g) Repealed 6/15/2001.

(h) Repealed 6/15/2001.

(i) Repealed 6/15/2001.

(j) In this section, a child is born out of wedlock if the mother of the child is not married to the child's biological father. The agency will consider a child to be born out of wedlock even if the child's mother marries the putative father after the child is born.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.165
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.217 Notice of paternity and financial responsibility

(a) After receiving a written application for paternity determination under 15 AAC 125.216(a), unless the application is denied under 15 AAC 125.216(b), the agency will serve the child's mother, the child's legal guardian if not the mother, and the child's putative father, as appropriate, with a notice of paternity and financial responsibility. The agency will serve the notice in the manner and in the form required by AS 25.27.165(b).

(b) A person served with a notice of paternity and financial responsibility under (a) of this section shall file a response with the agency within 30 days after the date of service. The response must either admit or deny paternity and provide the required financial and medical insurance information in the form required by 15 AAC 125.040(b) and (c).

(c) If the putative father timely files a written admission of paternity, the agency will issue a decision establishing paternity unless

(1) the putative father was the individual who filed the application for paternity determination; or

(2) the agency, a child support enforcement agency of another state, or a party requests genetic testing and supports the request with an affidavit meeting the requirements of AS 25.20.050(e).

(d) If a party files a written denial of paternity, the putative father, the child, and the mother of the child shall submit to genetic testing within 45 days after the date of service of the notice of paternity and financial responsibility under (a) of this section unless a party's request under (e) of this section is pending before the agency.

(e) A person served with a notice of paternity and financial responsibility under (a) of this section may request under 15 AAC 125.218 that the agency vacate its genetic testing order for the reasons stated in 15 AAC 125.218(c). The request must be filed with the agency within 30 days after the date the party was served under (a) of this section.

(f) If the person served with a notice of paternity and financial responsibility under (a) of this section fails to file a response within 30 days after the date of service, or fails to comply with an agency order for genetic testing, the agency will enter a default finding of paternity under 15 AAC 125.212.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.165
Eff. 6/15/2001, Register 158

15 AAC 125.218 Reasons for agency to vacate genetic testing order in paternity establishment proceeding

(a) A party's request under 15 AAC 125.217(e) for the agency to vacate the genetic testing order must be in writing and state in detail why one or more of the reasons in (c) of this section apply to support the request.

(b) If a party submits a request under (a) of this section, the agency will send the parties, by first class mail, a notice of administrative review. In its notice, the agency will inform the parties about the deadlines to submit evidence or argument under this subsection. If a party wishes to submit evidence or argument for the agency to consider, the party shall submit the evidence or argument to the agency within 30 days after the date the agency mailed the notice to the party. The agency shall provide copies of evidence or argument submitted by a party to all other parties. A party may respond to another party's evidence or argument within 10 days after the date the agency mails the evidence or argument to the party. After the deadline for the parties' responses has passed, the agency will review the evidence and issue a decision under (d) or (e) of this section.

(1) at least one of the following circumstances exists:

(A) one or more of the conditions of AS 25.27.040(b) are met;

(B) the cooperation of the child's custodian in the establishment of paternity is reasonably likely to result in physical or emotional harm to the child or to the child's custodian;

(C) the child's custodian is being assisted by a public agency, or by a child placement agency, licensed under AS 47.35 or under similar law of the state where the agency is located, to resolve the issue of whether to keep the child or relinquish the child for adoption;

(D) evidence indicates the possibility of paternity by estoppel; or

(2) there is not reasonable cause to require testing because clear and convincing evidence establishes that the putative father could not be the child's biological father.

(d) If the agency vacates the genetic testing order under (c)(1) of this section, the agency will issue an administrative review decision terminating the proceeding without making a determination of paternity and support. If the agency vacates the genetic testing order under (c)(1)(D) of this section, the agency may pursue further paternity proceedings through the appropriate judicial forum or through another state's administrative process.

(e) If the agency vacates the genetic testing order under (c)(2) of this section, the agency will issue an administrative review decision finding nonpaternity.

(f) If a party requests the agency to vacate the genetic testing order for one or more reasons under (c) of this section, and the agency denies the request, the mother, child, and putative father shall submit to genetic testing within 30 days after the date of notice of the agency's decision.

(g) An appeal to formal hearing is not available from an agency decision under this section. A decision under this section may be appealed to the superior court.

History

Authority: AS 25.27.020; AS 25.27.140 AS 25.27.040; AS 25.27.165
Eff. 6/15/2001, Register 158; am 11/30/2002, Register 164

15 AAC 125.220 Agency to verify

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

15 AAC 125.222 Genetic testing in conjunction with the determination of paternity

(a) Upon receipt of the results of the genetic test required by AS 25.27.165, the agency will serve by first class mail a copy of the results on the putative father, the mother, and the child's legal custodian if the child's legal custodian is not the child's mother or putative father. With the test results, the agency will send the parties a notice of the date for an administrative review and the deadline for submission of evidence or argument under this subsection. The parties may submit evidence or argument concerning the determination of paternity within 10 days after the date the agency mailed the notice to the parties.

(b) If the test results received under (a) of this section establish a presumption of parentage under the standard set in AS 25.20.050(d), and unless the agency orders additional genetic testing under (d) of this section, the agency will issue an administrative review decision that finds that the putative father is the child's father. The agency will issue the administrative review decision within 20 days after the agency's receipt of the test results.

(c) If the test results received under (a) of this section do not establish a presumption of parentage under the standard set in AS 25.20.050(d), the agency will issue an administrative review decision that finds nonpaternity. The agency will issue the administrative review decision within 20 days after the agency's receipt of the test results, unless the agency orders additional genetic testing under (d) of this section.

(d) A party may request, in writing, a second genetic test within 10 days after the genetic test results are mailed to the parties under (a) of this section. If the agency receives a timely request and advance payment of all costs of a second genetic test from a party, the agency will order a second genetic test. The agency will provide to the parties copies of the results obtained under this subsection and a notice of the deadline for submission of additional evidence or argument under this subsection. The parties may submit additional evidence or argument concerning the determination of paternity within 10 days after the test results are mailed to the parties. If a second genetic test is requested under this subsection, the agency will issue an administrative review decision under (b) or (c) of this section within 20 days after the agency's receipt of the second genetic test results.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.165
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.226 Procedures applicable to determinations of paternity

(a) The party who disputes paternity in a proceeding under 15 AAC 125.216 - 15 AAC 125.222 must specify in writing the basis for disputing paternity.

(b) On its own motion or that of a party, the agency may issue a temporary order for the support of the child whose paternity is being determined under 15 AAC 125.216 - 15 AAC 125.222. The agency may issue the temporary support order if the agency finds, by clear and convincing evidence, that the putative father is the child's biological father on the basis of genetic test results and other evidence submitted in support of the motion for temporary support order. The temporary support order is effective until a tribunal issues a final paternity determination and a final support order or until the agency dismisses the proceeding to determine paternity under this section.

(c) A party who submits evidence or written argument in a proceeding described in 15 AAC 125.216 - 15 AAC 125.222 may include evidence of medical records, affidavits, or other evidence tending to negate the genetic test results. Genetic test results submitted as evidence must be accompanied by an authenticating affidavit signed by the person who performed the test or by an authorized representative of the entity that performed the test, verifying that the test was conducted under scientifically accepted standards and that procedures necessary to make the test valid were followed. The agency will not rely on genetic test results that are not properly authenticated as described in this subsection to establish paternity.

(d) The agency may require additional evidence from a party in order to determine whether the presumption of paternity resulting from genetic test results meeting the standard set in AS 25.20.050(d) has been rebutted by clear and convincing evidence.

(e) If additional evidence or written argument is not submitted under (d) of this section by the date of the administrative review, the agency will issue its administrative review decision based on the evidence available at the time of the review, including genetic test results meeting the standard set in AS 25.20.050(d).

(f) If the agency issues an administrative review decision under 15 AAC 125.222 establishing paternity, the agency may establish the amount of the support obligation under 15 AAC 125.010 - 15 AAC 125.090.

(g) The provisions of 15 AAC 125.118 apply to proceedings under 15 AAC 125.216 - 15 AAC 125.222 and this section, to the extent that those provisions are not inconsistent with a provision of AS 25.27.165, 15 AAC 125.216 - 15 AAC 125.222, or this section. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals of administrative review decisions issued under 15 AAC 125.222.

(h) The provisions of AS 25.20.050(d) apply to all genetic testing ordered by the agency under 15 AAC 125.216 - 15 AAC 125.222 and this section.

(i) The agency will include the social security numbers of the father, mother, and child in the records relating to all determinations establishing paternity.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.165
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 11/30/2002, Register 164; am 2/16/2013, Register 205

15 AAC 125.230 Agency to notify obligee

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

15 AAC 125.232 Disestablishment of paternity

(a) The agency will undertake the disestablishment of paternity under AS 25.27.166 only if

(1) paternity has not already been established in the manner described in AS 25.27.166(a)(1)-(2) or by the order of another state that is entitled to full faith and credit under AS 25.20.050(h);

(2) each party other than the petitioner resides in this state; however, if the agency established paternity under AS 25.27.165, a party need not reside in this state; and

(3) the child whose paternity the petitioner seeks to disestablish was born in this state.

(b) The parties to a paternity disestablishment proceeding are:

(1) the petitioner, who is the person whose paternity is at issue in the proceeding;

(2) the custodian of the subject child;

(3) the mother of the subject child, if different from the custodian;

(4) the child or children whose paternity the petitioner seeks to disestablish; and

(5) any person who has the legal status of the child's father as a result of the person's marriage to the child's mother or the legitimation of the child under AS 25.20.050, if that person is not the person whose paternity is at issue in the proceeding.

History

Authority: AS 25.27.020; AS 25.27.166
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.236 Procedures to initiate disestablishment of paternity

(a) To disestablish paternity under AS 25.27.166, the petitioner shall submit to the agency a petition to disestablish paternity on forms provided by the agency. The petition to disestablish paternity must be accompanied by an affidavit that meets the requirements of (c) of this section and the information required by (e) of this section. The petitioner shall supply the last known addresses and social security numbers of the other parties to the paternity disestablishment proceeding, to the extent that information is available to the petitioner.

(b) The agency will serve the petition to disestablish paternity, and all other documents received under (a) of this section, upon the parties.

(c) The petitioner's affidavit in support of a petition to disestablish paternity must contain the following information, to the extent available to the petitioner:

(1) the full name, birth date, and social security number of each child whose paternity the petitioner seeks to disestablish;

(2) a statement explaining how paternity was established for each child;

(3) as to each child, a description of any previous request or attempt to deny or disestablish paternity of the child in this or another jurisdiction or venue, together with relevant case numbers and copies of any relevant court documents that are in the possession of the petitioner;

(4) the date when and circumstances under which the petitioner first became aware that the petitioner might not be the biological father of the child;

(5) a description of the extent of the petitioner's relationship with the child;

(6) as to each child, a specific denial of paternity; and

(7) a description of any facts establishing a reasonable possibility that the petitioner and the child's mother did not have sexual contact that could have resulted in the conception of the child.

(d) The agency will reject a petition if

(1) the affidavit and any accompanying documents do not provide sufficient information on which to proceed under this section;

(2) a party other than the petitioner does not reside in this state, unless the agency established the paternity of the subject child under AS 25.27.165; or

(3) a court action or an administrative action in another state involving the parties addressed the paternity or support of the child for whom the petitioner seeks to disestablish paternity.

(e) If the petitioner has ever been a party to any court action involving any of the other parties, the petitioner shall submit with the petition to disestablish paternity copies of all court orders relating to the court action, including orders relating to divorce, dissolution, child support, or paternity.

History

Authority: AS 25.27.020; AS 25.27.166
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.240 Response by obligee

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

15 AAC 125.242 Agency action on paternity disestablishment petition

(a) Upon receipt of a complete petition to disestablish paternity, the affidavit required by 15 AAC 125.236(a), and supporting documents required under 15 AAC 125.236(e), unless the agency rejects the petition under 15 AAC 125.236(d), the agency will issue an order requiring the petitioner, the mother of each child whose paternity the petitioner seeks to disestablish, and each child to submit to genetic testing.

(b) In an order under (a) of this section, the agency will state the time set for the genetic testing, give notice to the parties of the right to administrative review within 20 days after the date that the parties are served with the genetic test results, and give notice that a party may request that the agency vacate its genetic testing order under 15 AAC 125.244(c).

(c) A party shall comply with an order served under (a) of this section to that party unless, within 30 days after the date of service of the order, the party files a written request for the agency to vacate the order under 15 AAC 125.244.

History

Authority: AS 25.27.020; AS 25.27.166
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.244 Reasons for agency to vacate genetic testing order in a paternity disestablishment proceeding

(a) A party's request under 15 AAC 125.242(c) for the agency to vacate the genetic testing order must be in writing and state in detail why one or more reasons in (c) of this section apply to support the request.

(b) If a party submits a request under (a) of this section, the agency will send the parties, by first class mail, a notice of the request. In its notice, the agency will inform the parties about the deadlines to submit evidence or argument under this subsection. If a party wishes to submit evidence or argument for the agency to consider, the party shall submit the evidence or argument to the agency within 30 days after the date the agency mailed the notice to the party. The agency shall provide copies of evidence or argument submitted by a party to all other parties. A party may respond to another party's evidence or argument within 10 days after the date the agency mails the evidence or argument to the party. After the deadline for the parties' responses has passed, the agency will review the evidence and issue a decision under (d) or (e) of this section.

(1) to conduct genetic testing would not be in the best interests of the child, because evidence indicates the possibility of paternity by estoppel; or

(2) there is no reasonable cause to require genetic testing because clear and convincing evidence establishes that the petitioner is the biological father of the child.

(d) If the agency vacates the genetic testing order under (c)(1) of this section, the agency will issue an administrative review decision terminating the proceeding to disestablish paternity without making a determination concerning paternity. The agency may pursue further paternity proceedings through the appropriate judicial forum or through another state's administrative process.

(e) If the agency vacates the genetic testing order under (c)(2) of this section, the agency will issue a decision finding paternity.

(f) If a party requests that the agency vacate the genetic testing order for one or more reasons under (c) of this section, and the agency denies the request, the mother, child, and putative father shall submit to genetic testing within 30 days after the date of notice of the agency's decision.

(g) An appeal to formal hearing is not available from an agency decision under this section. A decision under this section may be appealed to the superior court.

History

Authority: AS 25.27.020; AS 25.27.166
Eff. 6/15/2001, Register 158

15 AAC 125.246 Genetic testing in conjunction with the disestablishment of paternity

(a) Upon receipt of the results of the genetic test required by 15 AAC 125.242(a), the agency will serve the parties, by first class mail, with a copy of the results. With the test results the agency will send the parties a notice of the date for an administrative review and the deadline for submission of evidence and argument under this subsection. The parties may submit evidence or argument concerning the disestablishment of paternity within 10 days after the date the agency mailed the notice to the parties.

(b) If the test results received under (a) of this section do not establish a presumption of parentage under the standard set in AS 25.20.050(d), and unless the agency orders additional genetic testing under 15 AAC 125.252(a), the agency will issue an administrative review decision disestablishing the petitioner's paternity. The agency will issue the administrative review decision within 20 days after the agency's receipt of the test results.

(c) If the test results received under (a) of this section establish a presumption of parentage under the standard set out in AS 25.20.050(d), and unless the agency orders additional genetic testing under 15 AAC 125.252(a), the agency will issue an administrative review decision finding paternity. The agency will issue the administrative review decision within 20 days after the date the agency received the test results.

History

Authority: AS 25.27.020; AS 25.27.166
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.250 Obligee objection to release

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

15 AAC 125.252 Provisions applicable to disestablishment of paternity

(a) A party may request, in writing, a second genetic test within 10 days after the genetic test results are mailed to the parties under 15 AAC 125.246(a). If the agency receives a timely request and advance payment of all costs of a second genetic test by the requesting party, the agency will order a second genetic test. The agency will provide copies of the second genetic test results to the parties and a notice of the deadline for submission of additional evidence or argument under this subsection. The parties may submit additional evidence or argument concerning the disestablishment of paternity within 10 days after the test results are mailed to the parties. The agency will issue an administrative review decision under 15 AAC 125.246(b) and (c) within 20 days after the date the agency received the second genetic test results.

(b) Genetic test results must be accompanied by an authenticating affidavit by the person who performed the test, or by an authorized representative of the entity that performed the test, verifying that the test was conducted under scientifically accepted standards and that procedures necessary to make the test valid were followed. The agency may not rely on genetic test results that are not properly authenticated as described in this subsection to disestablish paternity.

(d) The agency may consult with independent experts for assistance in resolving any issue, including disparities or conflicts in the medical evidence, paternity by estoppel, and the best interests of the child.

(e) Repealed 2/16/2013.

(f) A decision under 15 AAC 125.232 - 15 AAC 125.246 and this section to disestablish paternity is effective from the date of filing of the petition to disestablish paternity under 15 AAC 125.236(a) unless the agency determines there is good cause to select a different effective date.

(g) The provisions of 15 AAC 125.118(c), (d), and (f) apply to proceedings under 15 AAC 125.232 - 15 AAC 125.246 and this section to the extent that those provisions are not inconsistent with a provision of AS 25.27.166, 15 AAC 125.232 - 15 AAC 125.246, or this section. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals of administrative review decisions issued under 15 AAC 125.232, 15 AAC 125.246, and this section.

(h) During the pendency of a proceeding under 15 AAC 125.232 - 15 AAC 125.246, and this section, the petitioner shall pay to the agency all support payments that are due.

(i) If the agency administratively disestablishes a party's paternity, the party's uncollected arrearages accrued under the state administrative child support order will be extinguished in accordance with AS 25.27.166.

History

Authority: AS 25.27.020; AS 25.27.166
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.259 Paternity by estoppel

For purposes of 15 AAC 125.218(c), 15 AAC 125.244(c), and 15 AAC 125.252, paternity by estoppel is indicated, based on a person's actions despite a lack of biological evidence of paternity, by evidence that the

(1) person directly or impliedly represented to the child that he is the child's father;

(2) person intended the child to rely on this representation;

(3) child relied on the representation and suffered financial prejudice as a result; and

(4) child remained ignorant of the true facts.

History

Authority: AS 25.27.020; AS 25.27.165; AS 25.27.166
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158

15 AAC 125.260 Agency to release location

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

15 AAC 125.261 Genetic testing costs in paternity proceedings

(a) Except as provided in (b) of this section, the agency will assess against a child's putative father any costs that the agency pays to obtain genetic testing. For genetic testing costs assessed under this section, the agency will include

(1) the amount billed to the agency for the genetic tests in the subject case by the genetic testing laboratory;

(2) the costs paid by the agency to transport the individuals to be tested in the subject case to the nearest available facility for collection of genetic testing samples;

(3) per diem meal allowances calculated under (f) of this section; and

(4) lodging paid by the agency to individuals tested in the subject case.

(b) The agency will not assess costs against a child's putative father under (a) of this section if

(1) the agency determines that the putative father is not the biological father of the child;

(2) the putative father is receiving public assistance when the agency issues the administrative decision finding paternity under 15 AAC 125.222; or

(3) the agency finds good cause not to assess costs against the putative father because the assessment of costs

(A) would not be in the best interests of the child;

(B) would cause undue hardship to the putative father or the putative father's family;

(D) are associated with the testing and travel of other putative fathers.

(c) If the nearest available facility for the collection of genetic testing samples is not located on a maintained road and within a 50-mile radius of the client residence, the agency will

(1) pay for the costs of transportation, as scheduled by the agency to get the client to the collection facility;

(2) pay the custodian and the putative father at a minimum, the lunch per diem meal allowance calculated under (f) of this section;

(3) using a reduced payment schedule for a child, pay the custodian of the child a minimum of the lunch per diem meal allowance calculated under (f) of this section, and modified for the child as follows:

(A) for a child younger than two years of age, the agency will pay the custodian 25 percent of the per diem;

(B) for a child at least two years of age and younger than six years of age, the agency will pay the custodian 50 percent of the per diem;

(4) pay not more than $60 for ground transportation in connection with an air flight.

(d) If (c) of this section applies and the agency is not able to arrange same-day travel to and from the nearest available facility and have a genetic testing sample collected on the same day, therefore requiring an overnight stay, the agency will

(1) pay for the costs of transportation, as scheduled by the agency to get the client to the collection facility;

(2) pay for lodging;

(3) pay the adult per diem for meal allowances calculated under (f) of this section;

(4) using a reduced payment schedule for a child, pay the custodian of the child per diem meal allowances calculated under (f) of this section, and modified for the child as follows:

(A) for a child younger than two years of age, the agency will pay the custodian 25 percent of the per diem;

(B) for a child at least two years of age and younger than six years of age, the agency will pay the custodian 50 percent of the per diem;

(5) pay not more than $120 for ground transportation in connection with transport to and from the airport, hotel, and testing facility.

(e) If the nearest available facility for the collection of genetic testing samples is located on a maintained road and within a 50-mile radius of the client's residence, the client is responsible for their own transportation costs to obtain the required genetic testing. The actual costs of the genetic test will be paid for by the agency and the costs will be assessed to the putative father in accordance with (a) of this section.

(f) A traveler will receive per diem only while that person is in travel status. The per diem rate is $60 per day. When calculating per diem, the agency will assign and use percentages for each meal allowance period, and will pay a meal allowance only after the traveler has been in the meal period for three hours or more, as follows:

(1) breakfast is 21 percent for travel between 12:01 a.m. and 10:00 a.m.;

(2) lunch is 26 percent for travel between 10:00 a.m. and 3:00 p.m.;

(3) dinner is 53 percent for travel between 3:00 p.m. and midnight.

(g) For purposes of this section, a person is in travel status during the time of a required trip. A required trip begins when the person leaves the person's residence or normal work location to travel to the collection facility, and ends when the person returns to the person's residence or normal work location. In this subsection, "required trip" means a trip that the agency requires in order for the person to reach the nearest available collection facility to have a genetic testing sample collected.

History

Authority: AS 25.20.050; AS 25.27.040; AS 25.27.166 AS 25.27.020; AS 25.27.165
Eff. 11/30/2002, Register 164; am 2/16/2013, Register 205

15 AAC 125.270 Contact when location not released

Repealed.

History

Eff. 3/31/82, Register 81; repealed 10/1/98, Register 147

Article 4 Review and Adjustment of Support Obligations

15 AAC 125.310 Administrative enforcement of support order or income withholding order issued in another state

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.311 Notice of right to review

The agency will provide notice once every three years to each parent subject to a support order informing the parent of the parent's right to request that the agency review and, if appropriate, take the necessary actions to adjust the support order. The agency will include this notice in the support order. However, if the support order was not issued or has not been modified within the past three years, the agency will give the notice required by this section separately by first class mail or by electronic means.

History

Authority: AS 25.27.020; AS 25.27.193
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.315 Registration of support order or income withholding order issued in another state

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.316 Initiation of review of support orders

(a) The agency may initiate a review of a support order at the request of a child support agency of another state if

(1) the support order was issued by or may be registered with a tribunal of this state under AS 25.25.609, 25.25.615, 25.25.616, or 25.25.702 - 25.25.714; and

(2) a tribunal of this state has jurisdiction to modify the order.

(b) The agency may initiate a review of a support order at its own discretion if

(1) the support order was issued by or may be registered with a tribunal of this state under AS 25.25.609, 25.25.615, 25.25.616, or 25.25.702 - 25.25.714;

(2) at least one of the following conditions is met:

(A) the support has been assigned to a state;

(B) a medical support order is not in effect as provided in AS 25.27.063 and 15 AAC 125.085;

(C) the existing support order does not contain a provision for post-majority support to continue under the circumstances described in AS 25.27.061;

(D) the agency has reason to believe that the parties to the relationship have an additional child of the relationship who is not covered by the existing support order;

(E) the agency has reason to believe that a court of competent jurisdiction has ordered a change in custody;

(F) other circumstances exist that may justify a modification of the support obligation; and

(3) a tribunal of this state has jurisdiction to modify the order.

(c) Upon initiation of a review under (a) or (b) of this section, the agency will send a notice of petition for modification and a request or an order for production of financial and medical information under 15 AAC 125.040 by first class mail or electronic means to each parent subject to the support order and, if appropriate, to a child support enforcement agency of another state, except as provided in 15 AAC 125.331.

(d) A review under this section of a support order based on sole or primary custody, for which support was calculated under Alaska Rule of Civil Procedure 90.3(a), is not necessary to adjust an obligation in a circumstance described in this subsection. In place of the review, the agency will reduce the support obligation to the next lower obligation amount under the guidelines of Alaska Rule of Civil Procedure 90.3 or will suspend or terminate the support obligation if only one child was covered by the order. Support may also be adjusted under the guidelines of Alaska Rule of Civil Procedure 90.3(b), based on shared custody if the percentage of custody remains unchanged, or for shared, divided, third-party, or hybrid custody if the obligation can be determined under the terms of the existing order. The provisions of this subsection apply to reduce a support obligation for a child

(1) who has reached legal age of majority or is considered under 15 AAC 125.873 to be emancipated;

(2) for whom paternity has been disestablished;

(3) who has been adopted; or

(4) who has died.

(e) In response to a request under (a) of this section, the agency may require the party that asks for the review to provide evidence that the child support award as calculated under 15 AAC 125.070 and the child support guidelines of Alaska Rule of Civil Procedure 90.3 is more than 15 percent greater or less than the support obligation that is set out in the current support order. The agency will not require the party to provide proof of a 15 percent change under this section if three years have elapsed since the support order was issued or modified. A case will be reviewed every three years, with or without evidence of a 15 percent change from the current support obligation, if cash public assistance is being paid on behalf of the child.

(f) If the agency receives a request for review under (a) of this section or seeks to initiate a review under (b) of this section and the agency determines that no tribunal within this state has jurisdiction to modify the order under AS 25.25.611 or 25.25.613, the agency will cease its review and will refer the request for review to a child support agency located within the state that the agency determines may have jurisdiction to modify the order.

History

Authority: AS 25.25.401; AS 25.27.045 AS 25.27.020; AS 25.27.193
Eff. 10/1/98, Register 147; am 11/30/2002, Register 164; am 4/1/2005, Register 173; am 2/16/2013, Register 205; am 3/20/2016, Register 217

15 AAC 125.320 Contesting registration of support order or income withholding order issued in another state

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.321 Modification of administrative support orders

(a) If the support order for which review has been initiated under 15 AAC 125.316 was issued by or registered with the agency for modification, the agency will review the order upon receipt of the required financial and medical information or upon the expiration of the period for providing the information under 15 AAC 125.040, whichever occurs first. Based on that review, the agency will issue a written review decision. The agency's written review decision must grant or deny the petition for modification. If the agency grants the petition for modification, the decision must also set out the modified support amount and the effective date of the modification. In addition, the agency's written review decision must include the findings that are required by 15 AAC 125.090.

(b) The agency

(1) will grant the petition for modification if, based on a review of all of the information available to the agency including, if appropriate, the data provided by the Department of Labor and Workforce Development, the agency determines that the child support award calculated under 15 AAC 125.070 and the child support guidelines of Alaska Rule of Civil Procedure 90.3 is more than 15 percent greater or less than the amount of the support obligation that is set out in the outstanding support order; or

(2) may grant the petition for modification if it determines that the child support award calculated under 15 AAC 125.070 and the child support guidelines of Alaska Rule of Civil Procedure 90.3 is not more than 15 percent greater or less than the amount of the support obligation that is set out in the outstanding support order if any of the following conditions is met:

(A) a medical support order is not in effect as provided under 15 AAC 125.085 and AS 25.27.063;

(B) other circumstances exist that justify a modification of the support obligation;

(c) When it has issued a written review decision granting or denying a petition of modification under (a) of this section, the agency will send a copy of the decision by first class mail or electronic means to each parent and, if appropriate, to a child support enforcement agency of another state. Upon receipt of the review decision, a parent may appeal by submitting a written request for a formal hearing. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals under this subsection to the extent those provisions are not inconsistent with a provision of this section.

(d) The effective date of a modification that is granted under (a) of this section is the first day of the month following the date on which the notice of petition for modification was served on the nonrequesting parent.

(e) The agency may commence enforcement of the modified support amount upon issuance of the review decision under (a) of this section. If a parent requests a formal hearing under (c) of this section, the agency will not stay enforcement of the current month's support amount. If the obligor posts security or a bond in an amount sufficient to secure payment of past support, the agency may stay collection action on the past due support. At the conclusion of the formal hearing, the agency may start collection actions on the past due support again. The collection and disbursement of the ongoing support obligation that is stated in the administrative review decision will continue regardless of posting of a bond or security under this section.

History

Authority: AS 25.27.020; AS 25.27.190; AS 25.27.193
Eff. 10/1/98, Register 147; am 11/30/2002, Register 164; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.325 Temporary support orders

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.326 Review of judicial support orders

(a) If the support order for which review has been initiated under 15 AAC 125.316 was issued by or registered in a court of this state, the agency will review the order upon receipt of the required financial and medical information or upon the expiration of the period for providing the information under 15 AAC 125.040, whichever occurs first. Based on that review, the agency will determine whether a modification of the support order is appropriate. The agency will determine that a modification is appropriate based on at least one of the following reasons:

(1) the child support award calculated under 15 AAC 125.070 and the child support guidelines of Alaska Rule of Civil Procedure 90.3 is more than 15 percent greater or less than the amount of the support obligation that is set out in the outstanding support order;

(2) a medical support order is not in effect as provided in AS 25.27.063 and 15 AAC 125.085;

(3) other circumstances exist that may justify a modification of the support obligation; or

(4) three years have elapsed since the support order was issued or modified.

(b) Repealed 4/1/2005.

(c) If the agency determines that a modification of the support order is appropriate under (a) of this section, it may forward the file to the Department of Law to present the determination in judicial proceedings for modification of the support order.

(d) If the agency determines that a modification of the support order is not appropriate, the agency will issue a notice of denial of review. The agency will send the notice of denial of review to the parents and the child support agency of another state by first class mail or by electronic means. An administrative appeal is not available from the notice, but the decision is final for the purpose of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.045; AS 25.27.193
Eff. 10/1/98, Register 147; am 11/30/2002, Register 164; am 4/1/2005, Register 173; am 2/16/2013, Register 205; am 3/20/2016, Register 217

15 AAC 125.327 Review of support orders at the request of a parent

(a) A parent who is subject to a support order can file a written request with the agency for a review of the order.

(b) If the current support is owed to the state because of an assignment to the state under AS 25.27.120 or a child subject to the support order is in the legal or physical custody of the state, the agency will proceed under 15 AAC 125.316.

(d) If the support order was issued by or registered in a court of this state, the agency will provide the parents with the address of the court with authority to modify the court order within 15 days.

(e) Repealed 9/15/2022.

(f) Repealed 9/15/2022.

History

Authority: AS 25.27.020; AS 25.27.190 AS 25.27.045; AS 25.27.193
Eff. 3/20/2016, Register 217; am 9/15/2022, Register 243

15 AAC 125.330 Procedures for certain administrative actions under AS 25.25

Repealed.

History

Eff. 11/28/96, Register 140; repealed 10/1/98, Register 147

15 AAC 125.331 Expedited procedure for modifications for medical support or post-majority support only

(a) If a review is initiated by the agency because a medical support order is not in effect, a medical support order does not comply with 15 AAC 125.085 or AS 25.27.063, or the existing support order does not contain a provision for post-majority support to continue under the circumstances described in AS 25.27.061, the agency may seek a modification of the support order only to include a medical support order, to modify the existing medical support order, or to add post-majority support without first issuing a notice of petition for modification or completing a full review of financial information. If the agency elects to proceed under this section, no other provision of the support order may be modified.

(b) If the support order was issued by or registered with the agency, the agency may add a medical support provision or a post-majority support provision to the order or modify an existing medical support provision under (a) of this section by sending a notice by first class mail or by electronic means to the parents subject to the support order and, if appropriate, to a child support agency of another state. The notice must state that a medical support order or a post-majority support provision is being included in the support order or that an existing medical support order is being modified. Either parent may appeal this decision by submitting a written request for a formal hearing. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to an appeal under this subsection.

History

Authority: AS 25.27.020; AS 25.27.060; AS 25.27.190 AS 25.27.045; AS 25.27.061
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173

15 AAC 125.335 Procedures for automated review and adjustment of support order

(a) The agency may review a support order, as provided under 15 AAC 125.316(a) and (b), through an automated method. The use of an automated method under this section includes the application of a cost-of-living adjustment or the use of other databases such as Department of Labor and Workforce Development information.

(b) If the support order for which review has been initiated through an automated method was issued by or registered with the agency, the agency will send a notice by first class mail or by electronic means to each parent subject to the order and, if appropriate, to a child support enforcement agency of another state. The notice must inform the recipients of the notice that the support order has been reviewed by automated methods and must give notice of the modified support amount and the effective date of the modification. Upon receipt of the notice, either parent may appeal by submitting a written request for a formal hearing. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to an appeal under this subsection.

(c) The agency may commence enforcement of the modified support amount upon issuance of a notice under (b) of this section. If a parent requests a formal hearing, the agency will not stay enforcement of the current month's support amount. If the obligor posts security or a bond in an amount sufficient to secure payment of past due support, the agency may stay action on the past due support. The agency will continue to collect and disburse the ongoing support obligation regardless of posting of a bond or security under this subsection.

(d) If the support order for which review has been initiated through an automated method was issued by or registered in a court of this state, the agency may forward the file to the Department of Law to present the determination in judicial proceedings for modification of the support order if

(1) the current support is owed to the state because of an assignment to the state under AS 25.27.120 or a child subject to the support order is in the legal or physical custody of the state; or

(2) requested by a child support agency of another state.

(e) If the agency does not forward the file to the Department of Law as provided in (d) of this section, the agency will proceed under 15 AAC 125.327(d).

History

Authority: AS 25.27.020; AS 25.27.190 AS 25.27.045; AS 25.27.193
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173; am 2/16/2013, Register 205; am 3/20/2016, Register 217; am 9/15/2022, Register 243

15 AAC 125.340 Adding children to an existing administrative support order

(a) If while enforcing an administrative support order for the child of a relationship, the agency obtains evidence that the parties to that relationship have an additional child for whom a support order is not currently in effect, the agency will establish paternity for the additional child as provided in (b) of this section, and will establish support for the additional child as provided in (c) of this section

(1) upon a request from the custodial parent, the obligor, or a child support enforcement agency of another state; or

(2) if the additional child is receiving public assistance or medical assistance or is in state-sponsored foster care or placement.

(b) If paternity is not already established for an additional child described in (a) of this section, the agency will serve a notice of paternity and financial responsibility under AS 25.27.165 and 15 AAC 125.217 and will establish paternity for the additional child under AS 25.27.165 and 15 AAC 125.212 - 15 AAC 125.226.

(c) If the paternity of the additional child is already established by the evidence described in (a) of this section, or after paternity is established under (b) of this section, the agency

(1) will send a notice under 15 AAC 125.316(c), and will include with that notice a request or an order for production of financial and medical information under 15 AAC 125.040 to each parent subject to the existing support order;

(2) after sending a notice under (1) of this subsection, will establish arrears under 15 AAC 125.105 and modify the existing support order under 15 AAC 125.321 to include the additional child; and

(3) will serve the modified support order on the noncustodial parent, in the manner specified in AS 25.27.160(a), and will send a copy of the modified order to the child's custodial parent, and, if appropriate, to the child support enforcement agency of another state.

(d) Arrears will be established under (c)(2) of this section up to the effective date of the modification of the existing support order to include the additional child. Modification under (c)(2) of this section is effective on the first day of the month following the service of notice under (c)(3) of this section.

(e) If all of the children of the relationship, including the additional child, are in the primary custody of one parent, the amount of arrears under (c)(2) of this section for the additional child will be calculated as follows:

(1) the arrears will be based on the incremental percentage increase in support related to the additional child, as set out in Alaska Rule of Civil Procedure 90.3(a), and the agency will apply that increase to the noncustodial parent's actual annual adjusted income for the periods for which arrears are established;

(2) if the agency determines that the noncustodial parent would have been entitled under Alaska Rule of Civil Procedure 90.3(c)(3) to a minimum $50-per-month order based on the parent's actual income during the period in question, the agency will

(A) determine that arrears are not required to be paid on behalf of the additional child if the support amount set in the existing support order is equal to or more than $50 per month; or

(B) base the arrears on the difference between $50 per month and the support amount in the existing support order if the support amount in the existing support order is less than $50 per month.

(f) If the children of the relationship, including the additional child, are not all in the primary custody of one parent, the amount of arrears under (c)(2) of this section will be calculated as follows:

(1) the arrears will be calculated by applying the appropriate formula under Alaska Rule of Civil Procedure 90.3(a) or (b) based on the custody of the additional child alone, or the additional children together if there is more than one additional child, but using the incremental percentage increase in support related to the additional child or children only, as set out in Alaska Rule of Civil Procedure 90.3(a), and applying that increase to each parents' actual annual adjusted income for the periods for which arrears are established;

(2) if the existing support order requires one parent to pay support and the agency determines that the same parent would be the obligor for the additional child but that parent would be entitled under Alaska Rule of Civil Procedure 90.3(c)(3) to a minimum $50-per-month order based on the parent's actual income during the period in question, the agency will

(A) determine that arrears are not required to be paid on behalf of the additional child if the support amount set in the existing support order is equal to or more than $50 per month; or

(B) base the arrears on the difference between $50 per month and the support amount set in the existing support order if the support amount in the existing support order is less than $50 per month.

(g) If the existing support order is a default order, the agency will notify the noncustodial parent of the right to request that the order be set aside under AS 25.27.195. If the noncustodial parent requests a review under AS 25.27.195, the agency will issue a new support order that includes an additional child identified under (a) of this section. If the noncustodial parent fails to request a review under AS 25.27.195, the agency will send notice under (c)(1) of this section, but will not establish arrears under this section for the additional child unless the default order is based on the Male and Female Average Annual Wage Income by Age Group statistics provided by the Department of Labor and Workforce Development, or on similar wage statistics. If the default order is based on those statistics, the agency will establish arrears under (e) of this section using the statistical wage figure as the noncustodial parent's income.

(h) When establishing arrears under (c) of this section, the agency will calculate the support obligation under 15 AAC 125.070 for the first year of the period for which arrears are being established. For each year afterwards, the agency will determine whether a material change of circumstances occurred justifying a modification of the support amount for that year. For each year in which a material change of circumstances occurred, the agency will set the support obligation at the amount required under 15 AAC 125.070. For each year in which a material change of circumstances did not occur, the agency will set the support obligation at the amount set for the preceding year.

History

Authority: AS 25.27.020; AS 25.27.170; AS 25.27.193 AS 25.27.160; AS 25.27.190
Eff. 6/15/2001, Register 158; am 4/1/2005, Register 173; am 4/15/2005, Register 174; am 2/16/2013, Register 205

Article 5 Administrative Enforcement — General

15 AAC 125.405 Initiation of administrative enforcement action

(a) Upon receipt of an application for services for a child under AS 25.27.100, notification that a child is receiving public assistance or is in state-sponsored foster care or custody, or a request for services for a child from a child support enforcement agency of another state under AS 25.25 (Uniform Interstate Family Support Act) or a similar law of another state, the agency will initiate an administrative enforcement action against the obligor if there is a valid child support order in effect with respect to the child.

(b) The agency will initiate an administrative enforcement action by sending a letter of introduction to the obligor and the custodial parent by first class mail or by electronic means, or, if public assistance is being paid on behalf of the child, by sending a notice of public assistance to the obligor and the custodial parent by certified mail. The agency will also send a copy of the letter of introduction or notice of public assistance to a child support enforcement agency another state, if appropriate. The agency will send the letter or notice within 30 days after the agency knows the identity and address of the obligor. The notice must identify the child support order being enforced, the amount of the ongoing child support obligation, and the amount of arrears, if any, that the obligor currently owes. Notice is considered to have been given when sent to the last known and verified address of the obligor.

(c) A party may contest a letter or notice under (b) of this section, including the amount of arrears, by submitting to the agency a written request for administrative review within 30 days after mailing of the letter or notice. The request must state the specific reasons for the review and be accompanied by all documents upon which the person contesting the review intends to rely. The agency may reject a request for administrative review if it does not comply with the requirements set out in this subsection. The agency will issue an administrative review decision as soon as practicable after receiving the request. If appropriate, the agency may request additional information from the person requesting the review or from any other source.

History

Authority: AS 25.27.020; AS 25.27.120; AS 25.27.140
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.410 Administrative attachment of property other than income

(a) Except as otherwise provided in AS 25.27 or in another section of this chapter, whenever the agency has reason to believe that a person, political subdivision, or department of the state possesses property that is due, owing, or belonging to an obligor, the agency may, at any time after the initiation of administrative enforcement under 15 AAC 125.405 or upon the request of a child support enforcement agency of another state under 42 U.S.C. 666(a)(14), issue and deliver to the person, political subdivision, or department an order to withhold and deliver any real or personal property, other than income, belonging to the obligor. An order to withhold and deliver issued under this section remains effective for the period stated in the order to withhold and deliver or until the support obligation, including arrears and any future support obligation, has been fully satisfied, whichever is earlier.

(b) Upon issuance of an order to withhold and deliver under (a) of this section, the agency will send a notice to the obligor by first class mail or by electronic means that the order to withhold and deliver has been issued and of the procedures to follow if the obligor wishes to contest the withholding on the grounds that the withholding is improper due to a mistake of fact. The notice must also include any other information provided to the person to whom the order to withhold and deliver was issued.

(c) The obligor may contest the withholding under the order to withhold and deliver by submitting to the agency a written request for administrative review within 15 days after mailing of the notice under (b) of this section. The sole basis for contesting the withholding is that the withholding is improper due to a mistake of fact. The request must state the specific reasons for the contest and be accompanied by all documents upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if the request does not comply with the requirements set out in this subsection. The agency will issue an administrative review decision as soon as practicable after receiving the request. If appropriate, the agency may request additional information from the person requesting the review or from any other source.

(d) An administrative appeal is not available from the administrative review decision issued under (c) of this section.

(e) The agency will continue the withholding under the order to withhold and deliver even if the obligor contests the withholding under (c) of this section. The agency may not stay the withholding for collection of arrears unless the obligor posts with the agency security or a bond in an amount sufficient to secure payment of past support conditioned upon final determination of the contest. The agency will continue to collect and disburse the ongoing support obligation regardless of posting of a bond or security under this subsection.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.250
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.411 Contest of administrative attachment by third party

(a) Except for accounts maintained with a bank, credit union, or other financial institution, if an obligor or another person claims that property that the agency has seized under 15 AAC 125.410 is owned either in whole or in part by a person other than the obligor, the obligor or the other interested person may request the release and return of the property. A request for administrative review under this section must be made in writing and must be accompanied by proof of the obligor's and other person's ownership interest in the property.

(b) Upon receipt of a request for administrative review under (a) of this section, the agency may stop disbursement of the property or proceeds of the property obtained under 15 AAC 125.410, to the extent that the property or proceeds have not already been disbursed before the agency's receipt of the request for administrative review.

(c) Upon receipt of a request for administrative review under (a) of this section, the agency will send a notice of the request for administrative review by first class mail to the obligor, the custodial parent, and the person claiming an interest in the property. Any party may respond to the notice. The response must be in writing and must be postmarked or received by the agency within 30 days after the notice of request for administrative review is mailed to the party.

(d) The agency will issue an administrative review decision granting or denying the request for administrative review as soon as practicable after the time for response under (c) of this section. In the administrative review decision, the agency will state the extent to which it finds that the property belongs to the obligor and is to be applied to the support obligation. An administrative appeal is not available from an administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(e) Unless the property or proceeds of the property have already been disbursed, the agency will release to the co-owner or other interested person, other than the obligor, the property or proceeds found to belong to that person.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.250
Eff. 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.412 Spousal support

The enforcement remedies available to the agency for collection of child support obligations are also available for the collection of spousal support if a spousal support obligation has been established for the custodial parent of a child for whom child support is being administered. The agency will terminate its collection of spousal support when the ongoing child support obligation has terminated and all child support arrears have been satisfied.

History

Authority: AS 25.27.020; AS 25.27.045
Eff. 10/1/98, Register 147

15 AAC 125.415 Voiding fraudulent property transfers

(a) When there is evidence to suggest that an obligor may have fraudulently transferred property in order to avoid paying child support, the agency will review the evidence and pursue further investigation, as the agency deems appropriate, to determine whether a prima facie case of fraud exists or whether there is otherwise sufficient evidence to establish a fraudulent transfer of property under AS 25.27.279.

(b) In determining under (a) of this section whether a prima facie case of fraud exists or there is otherwise sufficient evidence to establish a fraudulent transfer of property under AS 25.27.279, the agency may consider any of the following:

(1) direct or indirect evidence of the obligor's intent to hinder, delay, or avoid the payment of child support, including the obligor's payment history and other conduct of the obligor while the obligor owed child support;

(2) if property was transferred, the value of the consideration received by the obligor was not reasonably equivalent to the value of the property transferred;

(3) if property was transferred, the transfer was made to a family member or relative of the obligor or a person with whom the obligor has a personal relationship;

(4) if property was transferred, the obligor retained possession or control of the property after the property was transferred;

(5) if property was transferred, the transfer was concealed;

(6) if property was transferred, the obligor had been sued or threatened with suit or other enforcement action by the agency or another interested party before the transfer was made;

(7) if property was transferred, the transfer was of substantially all the obligor's assets;

(8) the obligor absconded;

(9) the obligor removed or concealed assets;

(10) if property was transferred, the obligor was insolvent or became insolvent shortly after the transfer was made; or

(11) if property was transferred, the transfer occurred shortly before or shortly after the establishment of paternity or issuance of a child support order.

(c) If, after considering the criteria set out in (b) of this section, the agency determines that there is a prima facie case of fraud or otherwise sufficient evidence to establish a fraudulent transfer of property by an obligor, the agency will refer the case to the Department of Law to take appropriate legal action to void the property transfer, unless the agency determines that a settlement of the claim is in the best interests of the child support obligee.

History

Authority: AS 25.27.020; AS 25.27.279
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.418 Reporting of arrears to credit bureaus and lending institutions

(a) If an obligor owes arrears of more than $1,000, the agency will report the name of the obligor and the amount of arrears owed by that obligor to a credit bureau or lending institution. The agency will make the report to a credit bureau or lending institution on a monthly basis.

(b) Before the agency initiates a report under (a) of this section, the agency will notify the obligor. The agency will provide notice in the manner described in AS 25.27.265(a). If the agency terminates its reporting under this section and thereafter reinitiates reporting under (a) of this section and the reinitiated reporting begins

(1) more than one year after the termination, the agency will again notify the obligor as required by this subsection;

(2) no more than one year after the termination, the agency is not obligated to again notify the obligor as required by this subsection before the agency reinitiates reporting under (a) of this section.

(c) The obligor has 15 days after the date of mailing of the notice provided in (b) of this section in which to make a written request for an administrative review. The request must state the specific reasons for the administrative review and be accompanied by the documentation upon which the obligor intends to rely. The agency may reject a request for administrative review if the request does not comply with the requirements of this subsection. The agency's administrative review is limited to the following issues:

(1) whether there is a support order under which arrears have accrued;

(2) whether the obligor requesting the review is the person who is covered by the support order;

(3) whether the obligor owes support arrears that are more than $1,000; and

(4) whether the amount of arrears that the agency intends to report to a credit bureau or lending institution is correct.

(d) Unless the request for administrative review is rejected under (c) of this section, the agency will conduct an administrative review within 10 days after the agency receives a request for administrative review. As soon as practicable after concluding an administrative review, the agency will issue a decision. An administrative appeal is not available from the administrative review decision issued under this section.

(e) If any change in the status or amount of the obligor's arrears occurs, the agency will report the change to the credit bureau or lending institution. If the obligor pays the arrears in full, the agency will report this fact to the credit bureau or lending institution and will terminate reporting under (a) of this section without further notice to the obligor.

History

Authority: AS 25.27.020; AS 25.27.273
Eff. 10/1/98, Register 147; am 12/8/99, Register 152; am 2/16/2013, Register 205

15 AAC 125.420 Denial, revocation, or limitation of passports

(a) If an obligor owes an amount in excess of $2,500 in support arrears under a support order, the agency will certify this fact to the Secretary of State for denial, revocation, or limitation of the obligor's passport.

(b) Before making the certification under (a) of this section, the agency will notify the obligor that the agency has determined that the obligor's support arrears under a support order exceed $2,500, that the agency intends to certify this fact to the Secretary of State, that the agency's certification to the Secretary of State may result in the denial, revocation, or limitation of the obligor's passport, and that the obligor may contest the agency's determination. The agency will provide the notice required by this subsection in the manner described in AS 25.27.265(a).

(c) An obligor to whom notice is given under (b) of the section may submit a written request for an administrative review to contest the agency's determination not more than 30 days after the date of mailing of the notice. The request must state the specific reasons for the review and be accompanied by all documents upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if the request does not comply with the requirements of this subsection. The agency's administrative review is limited to the following issues:

(1) whether there is a support order under which arrears have accrued;

(2) whether the obligor is the person who is covered by the support order; and

(3) whether the obligor owes support arrears in excess of $2,500.

(d) Unless the request for an administrative review is rejected under (c) of this section, the agency will conduct an administrative review within 10 days after the agency receives a request for an administrative review. The agency will issue a decision as soon as practicable after the completion of the administrative review. An administrative appeal is not available from the administrative review decision issued under this section.

(e) If, after the agency has provided a certification to the Secretary of State under (a) of this section, the obligor reduces the amount of the obligor's arrears to not more than $2,500, the agency will report that change in the amount of the obligor's arrears to the Secretary of State.

History

Authority: AS 25.27.020; AS 25.27.080; AS 25.27.140
Eff. 10/1/98, Register 147; am 9/12/2008, Register 187; am 2/16/2013, Register 205; am 12/22/2023, Register 248

15 AAC 125.425 Enforcement of medical support order

Repealed.

History

Eff. 10/1/98, Register 147; repealed 11/30/2002, Register 164

15 AAC 125.426 Notice to employer to withhold for health care coverage

(a) Except as provided in 15 AAC 125.428, if the agency is enforcing a support order that requires a parent to provide health care coverage for the children, the agency will send to the parent's employer a notice to withhold for health care coverage. The notice will be sent by first class mail or by electronic means, within two business days after the entry of the parent in the state directory of new hires under AS 25.27.075 or within 10 business days after the agency learns of the identity of the parent's employer through sources other than the state directory of new hires. Notice will not be sent under this section if the agency has made a finding of the existence and availability of alternative coverage under 15 AAC 125.427(f).

(b) If the support order requires a parent to provide health care coverage for the children but does not specify which parent is to provide the coverage, or if both parents have coverage available to them through an employment-related group health plan, the agency will send the notice under (a) of this section to the non-custodial parent's employer.

(c) To the extent required by federal law, the agency will use the standard forms promulgated under 42 U.S.C. 666(a)(19) for providing notice to the employer under (a) of this section.

(d) If health care coverage is available for the employee's children, the employer shall transfer the notice sent under (a) of this section to the appropriate group health plan within 20 business days after the date the notice is sent to the employer. Subject to the withholding priorities in 15 AAC 125.570 - 15 AAC 125.572, the employer shall withhold from the employee's income the employee contribution necessary for coverage of the children and send any amount withheld directly to the appropriate group health plan, as required by the plan. If health care coverage is not available, the employer shall notify the agency within 20 days after the notice was sent by completing and returning the forms provided by the agency.

(e) The agency will promptly notify the employer when the agency is no longer enforcing a medical support order for the children.

(f) An employer who has received a notice under (a) of this section shall provide the agency with the policy name and number of any group health plan that provides coverage for the children and the name of each individual covered by the policy. The employer shall provide this information to the agency by completing and returning the forms provided by the agency within 14 days after the notice is sent to the employer under (a) of this section.

(g) The employer shall notify the agency within 20 days after a change occurs in the required health care coverage or a change occurs in the parent's employment that may affect the health care coverage available for the children.

(h) A notice issued under (a) of this section remains effective until the

(1) support obligation has terminated as provided in 15 AAC 125.873;

(2) medical support order upon which the notice was based is terminated or modified by subsequent order issued by a tribunal of competent jurisdiction;

(3) agency sends the employer a notice terminating the notice issued under (a) of this section; or

(4) employer has terminated the obligor's employment and at least three years have elapsed since that termination without reemployment of the obligor.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.140 AS 25.27.060; AS 25.27.063
Eff. 11/30/2002, Register 164; am 4/1/2005, Register 173

15 AAC 125.427 Contesting medical support withholding

(a) The agency will notify the parents and a child support agency of another state, if appropriate, when a notice to withhold for health care coverage has been sent to a parent's employer under 15 AAC l25.426(a). The notice will be sent by first class mail or by electronic means. In the notice, the agency will describe the procedures that a party must follow if the party wishes to contest the withholding.

(b) A parent may contest the withholding for health care coverage by requesting an administrative review within 30 days after the date on which the notice was sent to the parent under (a) of this section or at any time after a material change in circumstances occurs that affects the need for or availability of coverage. The request must be in writing, state the specific reasons for the contest, and be accompanied by the documentation upon which the parent requesting the review intends to rely.

(c) The agency's administrative review under this section is limited to whether a mistake of fact has occurred, including whether

(1) the parent is required to provide health care coverage for the children through an employment-related group health plan;

(2) health care coverage through an employment-related group health plan is available to the parent at a reasonable cost;

(3) health care coverage is available at a reasonable cost to the other parent through an employment-related group health plan and that coverage better meets the needs of the children;

(4) the children are eligible for alternative health care coverage and the coverage is available for the children;

(5) unusual circumstances exist relating to health care coverage, including

(A) extraordinary medical or other needs of the children;

(B) unusual hardship to a parent or a parent's family;

(D) the effect of coverage or lack of coverage on the interests of the children; and

(E) any agreement by the parents on health care coverage; or

(6) health care coverage is accessible to the children.

(d) A request based on a claim that alternative health care coverage is available for the children must include proof of the alternative coverage. As proof of alternative coverage, the requester may include, for the agency's consideration under (f) of this section,

(1) health care coverage available through the employer of either parent's spouse, or of any other family member;

(2) health care coverage that is purchased by either parent and is not an employment-related group health plan; or

(3) privately or publicly funded health care services, including services available to tribal members and military personnel, but not including Medicaid benefits unless authorized as alternative coverage under federal law.

(e) The agency will conduct an administrative review within 20 days after it receives the written request under (b) of this section. An administrative appeal is not available from an administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(f) The agency will allow alternative coverage as a substitute for employment-related coverage under (c)(4) of this section only if

(1) the court or administrative support order stipulates to alternative coverage or the order does not specify the type of coverage to be provided; and

(2) after consultation with the parents and an assessment of which coverage would better meet the health care needs of the child at a reasonable cost and be accessible to the children, the agency makes a determination to allow alternative coverage as a substitute for a parent's employment-related coverage.

(g) Withholding by the employer for employee contributions for health care coverage under 15 AAC 125.426(d) must continue while an administrative review is pending under this section.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.140 AS 25.27.060; AS 25.27.063; AS 25.27.250
Eff. 11/30/2002, Register 164; am 10/15/2013, Register 208

15 AAC 125.428 Notice of medical support order; proof of health care coverage not related to employment

(a) If the agency is enforcing a support order that requires a parent to provide health care coverage for a child, other than coverage provided by a parent through an employment-related group health plan, the agency will notify the parents in writing of the requirement to provide health care coverage.

(b) If a support order under (a) of this section does not specify which parent is to provide the coverage and both parents have health care coverage available at a reasonable cost and accessible to the children, and if the rights to accrued and continuing child support have

(1) not been assigned to this or another state, the parents shall agree on who will purchase the coverage for the child; however, if the parents cannot agree, they shall inform the agency in writing and the agency will select the coverage that the agency determines will best meet the medical needs of the children at a reasonable cost and be accessible to the children; or

(2) been assigned to this or another state, the agency will require the non-custodial parent to provide the health care coverage for the children.

(c) If the agency selects coverage under (b) of this section, the agency will send a notice to the parents of the selection. A parent may contest the selection by requesting an administrative review within 30 days after the date on which the notice is sent to the parents. The request must be in writing, state the specific reasons for the contest, and be accompanied by the documentation upon which the parent requesting the review intends to rely. The agency will conduct an administrative review within 20 days after it receives the request. The agency's administrative review is limited to whether

(1) the coverage selected by the agency is available to the parent at a reasonable cost;

(2) coverage other than the one selected by the agency would better meet the medical needs of the children at a reasonable cost; or

(3) coverage is accessible to the children.

(d) An administrative appeal is not available from the administrative review decision issued under (c) of this section, but the decision is final for the purpose of appeal to the superior court.

(e) A parent who is required to provide health care coverage for a child, other than through an employment-related group health plan, shall provide to the agency proof of health care coverage and the cost of the coverage within 20 days after the agency sends the notice under (a) of this section. Proof of coverage must be made by filing with the agency a copy of the appropriate insurance form extending the coverage to the children, along with an affidavit that the form has been filed with the insurance company. Proof of coverage must include the name of the insurance provider, policy number, identification number, provider address, names of persons covered, cost of medical coverage for the children covered by the support order, and effective date of coverage for the children covered by the support order.

(f) After the parent has provided proof of coverage under (e) of this section, if a change occurs in the required health care coverage, the parent shall notify the agency in writing within 20 days after the change and provide any additional proof of coverage to the extent that the information provided under (e) of this section has changed.

History

Authority: AS 25.27.020; AS 25.27.063 AS 25.27.060; AS 25.27.140
Eff. 11/30/2002, Register 164; am 10/15/2013, Register 208

15 AAC 125.429 Selection of health care options

(a) If more than one coverage option is available through an employment-related group health plan, the employer shall provide the agency with information concerning the specific coverage provided by each option and the cost of the coverage for the children. Upon receipt of this information, the agency will contact both parents to determine which coverage option would be in the best interest of the children. The agency will select the coverage option that the agency determines will best meet the medical needs of the children at a reasonable cost and be accessible to the children. The agency will notify the employer of the coverage option selected.

(b) When the agency selects a coverage option under (a) of this section, the agency will send a notice to the parents of the selection. A parent may contest the selection by requesting an administrative review within 30 days after the date on which the notice is sent to the parents. The request must be in writing, state the specific reasons for the contest, and be accompanied by the documentation upon which the parent requesting the review intends to rely. The agency will conduct an administrative review within 20 days after it receives the request. The agency's administrative review is limited to whether

(1) the coverage option selected by the agency is available to the parent at a reasonable cost and accessible to the children; or

(2) a coverage option other than the one selected by the agency would better meet the medical needs of the children at a reasonable cost and be accessible to the children.

(c) An administrative appeal is not available from the administrative review decision issued under (b) of this section, but the decision is final for the purpose of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.063 AS 25.27.060; AS 25.27.140
Eff. 11/30/2002, Register 164; am 10/15/2013, Register 208

15 AAC 125.431 Collection of uncovered medical expenses

(a) The agency will collect uncovered medical expenses and any amounts paid directly by the insurer to a parent that were intended to reimburse the other parent for medical expenses incurred on behalf of the children, but only after the expenses or amounts have been reduced to judgment by a court of competent jurisdiction.

(b) A parent may request that amounts owed under (a) of this section be offset against child support arrears owed by or to that parent with respect to the children for whom the medical expenses were incurred. However, the agency will not offset money owed under this section against the ongoing support obligation for the children covered by the order or against arrears that have been assigned to the state as public assistance reimbursement.

History

Authority: AS 25.27.020; AS 25.27.063 AS 25.27.060; AS 25.27.140
Eff. 11/30/2002, Register 164

15 AAC 125.432 Adjustment for the cost of health care coverage

(a) If health care coverage is purchased for and is accessible to the children, the agency will grant a credit or debit against the child support obligation for amounts paid to provide health care coverage for the children in the amount or percentage stated in the support order. If the support order provides for a credit for health care coverage but does not specify the amount or percentage of credit to be given, the agency will allocate the cost of health care coverage equally between the parents.

(b) If the agency determines that a credit or debit is appropriate under this section, and if the

(1) obligor provides the coverage, the agency will decrease the obligor's support obligation by the amount or percentage stated in the support order or by one-half of the cost of coverage if the amount or percentage is not stated in the order; or

(2) custodial parent provides the coverage, the agency will increase the obligor's support obligation by the amount or percentage stated in the support order or by one-half of the cost of coverage if the amount or percentage is not stated in the order.

(c) The agency will grant a credit or debit under this section only if a parent has requested the credit and the parent or the parent's employer provides proof of coverage and proof of the cost of coverage for the children. Proof of coverage must be made by filing with the agency a copy of the appropriate insurance form extending the coverage to the children, a statement from the insurer or employer identifying the total number of individuals covered by the insurance policy, and a schedule or other statement from the employer or insurer showing the cost of coverage for the parent, the children, or other individuals.

(d) If the health care coverage includes coverage for the employee or individuals other than the children covered by the support order, the agency will credit only that portion of the cost of coverage paid to obtain coverage for the children covered by the order. In calculating the cost of coverage attributable to the children covered by the order, the agency will

(1) deduct from the total cost of health care coverage the cost of coverage for the parent alone if the parent is also covered by the health care coverage;

(2) allocate the cost of the coverage for individuals other than the parent equally among all individuals covered by the health care coverage other than the parent, if individuals other than the children covered by the order are included in the health care coverage; and

(3) apply the applicable amount or percentage stated in the support order to determine the credit or debit for health care coverage based on the amount of the cost of coverage allocated to the children covered by the support order under (2) of this subsection.

(e) The agency will grant a credit or debit prospectively from the date the parent purchases the health care coverage, the date the coverage was actually made available to the children, or the effective date of the order requiring the parent to provide health care coverage and allowing a credit or debit for the cost of the coverage, whichever date is later.

(f) if a parent must pay for health care coverage for the parent alone but can add the children to the coverage at no additional cost to the parent, the agency will not allow a credit or debit for the health care coverage provided for the children.

(g) The agency will send the parents a notice of the credit or debit allowed for health care coverage under this section. A parent may contest the notice by requesting an administrative review within 30 days after the date on which the notice was sent to the parent. The request must be in writing, state the specific reasons for the contest, and be accompanied by the documentation upon which the person requesting the review intends to rely. The agency's administrative review is limited to whether the agency correctly calculated the amount of the credit or debit. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.063 AS 25.27.060; AS 25.27.140
Eff. 11/30/2002, Register 164; am 4/1/2005, Register 173; am 10/15/2013, Register 208

15 AAC 125.435 Modification of administrative enforcement action based on evidence of unusual hardship

At any time after the initiation of an administrative enforcement action, an obligor may request that the administrative enforcement action be modified based on evidence of unusual hardship on the obligor or the obligor's family. The procedures set out in 15 AAC 125.550 apply to requests made under this section.

History

Authority: AS 25.27.020; AS 25.27.140
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173

15 AAC 125.440 Procedures for contesting administrative subpoena

(a) A person who is issued an administrative subpoena under AS 25.27.085 or AS 25.27.086 may request an administrative review in order to establish good cause for the person's refusal to comply with the subpoena. A request for administrative review under this subsection must be made in writing and be filed within the time provided for compliance with the subpoena. The request must state the specific reasons for the administrative review and must include any documentation upon which the person intends to rely to establish good cause for noncompliance. The agency will, in its discretion, reject a request for review that does not comply with the requirements of this subsection.

(b) Upon receipt of a request for an administrative review under (a) of this section, the agency will review the request and any supporting documentation and related information to determine whether there is good cause for the person's failure to comply with the subpoena. The agency's review is limited to the following issues:

(1) a mistake in the identity of the person served with the subpoena; or

(2) a prohibition under law on release of the information.

(c) The agency will issue a decision as soon as practicable after completion of the administrative review. An administrative appeal is not available from the administrative review decision issued under this subsection.

(d) If a person who is issued an administrative subpoena under AS 25.27.085 or AS 25.27.086 fails to comply with the subpoena or request an administrative review of the subpoena within the time provided, the agency will, in its discretion, issue an order imposing the civil penalty provided under AS 25.27.085(d). An administrative appeal is not available from an order imposing a civil penalty under this subsection. The civil penalty provided by this subsection is not exclusive and is in addition to any other remedies available for noncompliance with an administrative subpoena, including license revocation and enforcement action under Alaska Rule of Civil Procedure 45(g).

History

Authority: AS 25.27.020; AS 25.27.085; AS 25.27.086
Eff. 10/1/98, Register 147

15 AAC 125.450 Referral for judicial orders to participate in appropriate work activities

(a) The agency may review the circumstances of an obligor under an order of support to determine whether the matter is appropriate for referral to the Department of Law to request a court order under AS 25.27.020(d) requiring the obligor to participate in appropriate work activities. Except as provided in (b) of this section, the agency will refer a matter to the Department of Law to obtain an order under AS 25.27.020(d) if at least one of the following conditions is met:

(1) the obligor owes arrears in an amount that is equal to at least four times the monthly support obligation under the obligor's order of support; or

(2) if there is no longer an ongoing monthly support obligation, the obligor owes arrears greater than $1,000.

(b) The agency may refuse to refer a matter to the Department of Law under the conditions described in (a) of this section if there is evidence in the file that

(1) the obligor is incapacitated to a sufficient degree to prohibit the obligor from working; a medical doctor or other licensed or certified health care professional must verify an incapacity alleged under this paragraph and the fact that the incapacity is sufficient to prevent the obligor from being gainfully employed;

(2) the obligor is caring for a child under the age of two to whom the parents owe a joint legal responsibility;

(3) the obligor has made one or more voluntary payments in excess of the ongoing support obligation during the three months immediately preceding the agency's review under (a) of this section;

(4) the obligor has made one or more payments pursuant to an income withholding order issued by this or another state during the past three months immediately preceding the agency's review under (a) of this section;

(5) the obligor has entered into a payment agreement approved by the agency and is paying according to that agreement;

(6) the obligor has requested that the administrative enforcement action be suspended or modified based on evidence of unusual hardship under 15 AAC 125.435 and the agency has granted the request; or

(7) an order under AS 25.27.020(d) to participate in appropriate work activities would not be appropriate given the obligor's particular circumstances.

(c) If there is evidence of a condition described in (a) of this section and no evidence that meets a circumstance set out in (b) of this section, and the agency determines that the facts support a request for an order under AS 25.27.020(d), the agency will refer the matter to the Department of Law to take appropriate legal action to obtain an order under AS 25.27.020(d).

History

Authority: AS 25.27.020; AS 25.27.080
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.455 Offsetting child support arrears

(a) Upon the request of a party or upon order of a tribunal of competent jurisdiction, the agency will offset child support arrears owed by one parent against child support arrears owed by the other parent for the same child if the

(1) arrears for which an offset is requested are owed to the parent against whom an offset is sought; and

(2) agency determines that an offset is in the best interest of the child.

(b) The agency will not grant an offset of arrears under (a) of this section against

(1) arrears owed to the state or to another state as reimbursement for public assistance, medical assistance, or state-sponsored foster care or placement; or

(2) the ongoing support obligation owed by the other parent for the same child.

(c) A request for an offset under (a) of this section must be submitted to the agency in writing. If a tribunal of competent jurisdiction issued an order requiring the requested offset, the request must be accompanied by a copy of that order. Upon receipt of a request for an offset under this section, the agency will send a notice of the request by first class mail to the nonrequesting parent and, if appropriate, to the child support enforcement agency of another state. The nonrequesting parent may file a response to the request for an offset within 30 days after mailing of the notice under this subsection.

(d) The agency will issue an administrative review decision granting or denying the request for an offset under this section as soon as practicable after the time for response under (c) of this section. As necessary to determine whether an offset is permissible under (a) and (b) of this section, the agency may request additional information from the parents or from any other source. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.140
Eff. 6/15/2001, Register 158

15 AAC 125.460 Garnishment of accounts with financial institutions

(a) At any time after the initiation of administrative enforcement under 15 AAC 125.405 or upon the request of a child support enforcement agency of another state under 42 U.S.C. 666(a)(14), the agency may issue an order to withhold and deliver to a bank, credit union, or other financial institution with which a child support debtor has an account. Unless the agency finds good cause based on unusual circumstances to issue an order to withhold and deliver, the agency will not issue an order to withhold and deliver under this section if the

(1) obligor owes an amount that is less than $1,000 under the child support order;

(2) obligor owes an amount that is less than four times the monthly support obligation under the support order; or

(3) agency has received notice that the obligor has an active bankruptcy action pending.

(b) Upon issuance of an order to withhold and deliver under (a) of this section, the agency will send a notice to the obligor by first class mail or by electronic means that the order to withhold and deliver has been issued and of the procedures to follow if the obligor wishes to contest the withholding on the grounds that the withholding is improper due to a mistake of fact or that a criterion set out in (a)(1), (a)(2), or (a)(3) of this section is met. In the notice the agency will also include any other information provided to the financial institution.

(c) The obligor may contest the order to withhold and deliver by submitting to the agency a written request for administrative review within 15 days after the notice is sent under (b) of this section. An obligor may contest the order to withhold and deliver on the grounds that the withholding is improper due to a mistake of fact or that a criterion set out in (a)(1), (a)(2), or (a)(3) of this section is met. The request must state the specific reasons for the contest and be accompanied by all documents upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if it does not comply with the requirements set out in this subsection. The agency will issue an administrative review decision as soon as practicable after receiving the request. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.250
Eff. 6/15/2001, Register 158

15 AAC 125.463 Joint accounts with financial institutions

(a) If an obligor or another person claims that an account that the agency has seized under 15 AAC 125.460 is jointly owned or that another person has an interest in the account, the obligor or the other interested person may request the release and return of the money in the account. A request for administrative review under this section must be made in writing and must be accompanied by proof of the obligor's and other person's interests in the account, including copies of applications, signature cards, account statements, evidence of deposits and withdrawals, or other evidence establishing the extent of the obligor's interest in the account and the extent of the other person's interest in the account.

(b) Upon receipt of a request for administrative review under (a) of this section, the agency may stay disbursement of the money obtained from the account for which joint ownership or another person's interest is claimed, to the extent that the money has not already been disbursed before the agency's receipt of the request for administrative review.

(c) Upon receipt of a request for administrative review under (a) of this section, the agency will send a notice of the request for administrative review by first class mail to the obligor, the custodial parent, and the person claiming to be a joint owner or to have an interest in the account. Any party may respond to the notice. The response must be in writing and must be postmarked or received by the agency within 30 days after the notice of request for administrative review is mailed to the party.

(d) The agency will issue an administrative review decision granting or denying the request for administrative review as soon as practicable after the time for response under (c) of this section. In the administrative review decision, the agency will state the extent to which it finds that the money in the account belongs to the obligor and is to be applied to the support obligation. An administrative appeal is not available from an administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(e) Unless the money has already been disbursed, the agency will release to the joint owner or other interested person, other than the obligor, the money found to belong to that person.

(f) If joint ownership of an account is established, the agency will apportion money among the joint owners in accordance with AS 13.33.211.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.250
Eff. 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.465 Credit for direct payments

(a) The agency will give credit for direct payments against an obligor's child support obligation established by a support order if the obligor provides clear and convincing evidence that the payment was made to the custodial parent and that both parents intended the payment to be a direct payment of child support. Evidence of direct payments includes

(1) copies of the front and back of cancelled checks and money orders;

(2 bank statements indicating deposits or electronic funds transfers;

(3) receipts signed by the custodial parent; and

(4) signed, notarized statements by the custodial parent, the obligor, or a third party with personal knowledge of the direct payments.

(b) A request for credit for direct payments must be made in writing and must be accompanied by the evidence required under (a) of this section.

(c) Upon receipt of a request for credit under this section, the agency will mail a notice of the request to the nonrequesting party. The nonrequesting party may submit a response to the request for credit for direct payments. The response must be postmarked or received by the agency within 30 days after the date the notice under this subsection was mailed.

(d) The agency will issue an administrative review decision granting or denying the request for credit under this section as soon as practicable after the time for response under (c) of this section. As necessary to determine the existence of a direct payment, the intent of the parents, or the existence of extraordinary circumstances under (b) of this section, the agency may request additional information from the parents or from any other source. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(e) If the agency grants the request for credit for direct payments and subsequently determines that as a result of the credit for direct payments, the agency has collected more than the support amount owed by the obligor, and if the agency has not yet disbursed the amount, the agency will refund to the obligor the amount collected in excess of the support obligation.

(f) Direct payments made after the obligor has received notice, under AS 25.27.120(c) or a similar law of another state, that public assistance is being paid on behalf of the children will not be credited against arrears that have been assigned to this or another state as a public assistance reimbursement.

(g) When the agency enforces an order issued by another state, and is

(1) enforcing the order at the request of another state, the agency will forward the request to that state for determination of the credit; or

(2) not enforcing the order at the request of another state, the agency will apply the law of that state to determine any credit for direct payments.

History

Authority: AS 25.25.604; AS 25.27.020; AS 25.27.140
Eff. 6/15/2001, Register 158; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.470 Credit for in-kind payments and payments in lieu of child support

(a) The agency will give credit for in-kind contributions against an obligor's child support obligation if

(1) a tribunal of competent jurisdiction has ordered the in-kind contribution in lieu of the payment of child support; or

(2) the obligation is established by a support order, the parties agree in writing to allow credit for the in-kind contribution, and the parties agree in writing to the dollar value of the in-kind contribution.

(b) The agency will give credit for an in-kind contribution under (a)(2) of this section only once. After the first request and credit, the agency will inform the parents that additional credits will not be given for in-kind contributions under (a)(2) of this section. The agency will not give credit for an in-kind contribution under (a)(2) of this section for any period of time during which the child received public assistance or was in state-sponsored foster care or placement.

(c) To receive credit for an in-kind contribution under (a)(2) of this section, the obligor must provide clear and convincing evidence of the in-kind contribution and the dollar value of that contribution.

(d) A request for credit for an in-kind contribution must be made in writing and must be accompanied by the evidence required under (c) of this section. Upon receipt of a request for credit under this section, the agency will mail a notice of the request to the nonrequesting party. The nonrequesting party may submit a response to the request for credit. The response must be postmarked or received by the agency within 30 days after the date the notice under this subsection is mailed.

(e) The agency will issue an administrative review decision granting or denying the request for credit under this section as soon as practicable after the time for response under (d) of this section. As necessary to determine the existence and dollar value of an in-kind contribution, the agency may request additional information from the parents or from any other source. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(f) The agency will not include a provision for in-kind contributions in an administrative support order.

(g) If one of the parents identified in a support order described in (a)(1) of this section has applied for agency services or is receiving public assistance on behalf of the child, the agency will initiate a modification review under 15 AAC 125.316(b).

(h) When the agency enforces an order issued by another state, the agency will

(1) forward the request to that state for determination of the credit if the agency is enforcing the order at the request of another state; or

(2) apply the law of that state to determine any credit for in-kind contributions if the agency is not enforcing the order at the request of another state.

History

Authority: AS 25.25.604; AS 25.27.020; AS 25.27.140
Eff. 6/15/2001, Register 158; am 4/1/2005, Register 173

15 AAC 125.475 Credit for government benefits paid to child based on obligor's disability or retirement

(a) An obligor may request that the agency give credit against the obligor's child support obligation for government benefits paid to or on behalf of the obligor's child as a result of the obligor's disability or retirement. In order to qualify for a credit under this section,

(1) the obligor must provide proof of payment of the benefits, including a statement from the government agency that paid the benefits, listing each payment made for each child for whom a credit is sought;

(2) the benefits must be paid to the custodial parent, unless the custodial parent agrees in writing to an alternative payment arrangement;

(3) the benefits must be paid as a result of the obligor's disability or retirement or the benefits must be otherwise attributable to the obligor; and

(4) the benefits must be paid for the child for whom the support credit is requested.

(b) Upon receipt of a request that complies with (a) of this section, the agency will give credit for the benefits as follows:

(1) for benefits paid on a monthly basis,

(A) the agency will credit the benefits paid in any given month against the ongoing support obligation for the month in which the benefits are paid;

(B) if the benefits paid in a given month exceed the ongoing support obligation for the month in which the benefits are paid, the excess benefits will be applied to any arrears that accrued before the month in which the benefits are paid; however, the excess benefits will not be credited to arrears that accrued before the months that the benefits are intended to cover;

(2) for benefits paid in a lump sum,

(A) the agency will credit the lump sum payment against the ongoing support obligation for the months that the lump sum payment is intended to cover;

(B) if the lump sum payment exceeds the ongoing support obligation for the months that the lump sum payment is intended to cover, the excess benefits will not be applied to any arrears that accrued before the months that the lump sum payment is intended to cover; and

(C) if the lump sum payment exceeds the ongoing support obligation for the months that the lump sum payment is intended to cover and any arrears that accrued before the months that the lump sum payment is intended to cover, the excess benefits will be considered a voluntary payment, and the agency will not give credit for the excess benefits;

(3) if the agency has collected support from the obligor in addition to the benefits paid to the child, the agency will apply the benefits to the obligor's support obligation as provided in (1) and (2) of this subsection; after applying those benefits to the obligor's support obligation as provided in (1) and (2) of this subsection, the agency will apply the amounts collected by the agency to any remaining ongoing support obligation and arrears owed by the obligor;

(4) the agency will not credit the benefits to the obligor's future child support obligation.

(c) Credit will be given for benefits under this section regardless of whether public assistance has been paid on the child's behalf during the period for which credit is sought under (a) of this section. If public assistance is paid on behalf of a child for whom credit is sought, the agency will send a notice to the Department of Health and Social Services, division of public assistance alerting the division to the payment of the benefits.

(d) Upon receipt of a request under (a) of this section, the agency will initiate a modification review under 15 AAC 125.316(b).

(e) When the agency enforces an order issued by another state, and is

(1) enforcing the order at the request of another state, the agency will forward the request to that state for determination of the credit; or

(2) not enforcing the order at the request of another state, the agency will apply the law of that state to determine any credit for government benefits paid to the child.

History

Authority: AS 25.25.604; AS 25.27.020; AS 25.27.140
Eff. 6/15/2001, Register 158; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.480 Credit for extended visitation

(a) If the support order includes a provision allowing an extended visitation credit, the obligor may request that the agency give credit for periods in which the obligor exercises extended visitation with the child for more than 27 consecutive days.

(b) If the support order provides a specific visitation period and the requested credit is for the specific visitation period ordered, the agency will grant the extended visitation credit upon receipt of written notification that the extended visitation is being exercised, subject to administrative review and reversal of the credit as provided in (d) of this section. The notification must specify the dates on which the extended visitation will begin and end. The extended visitation credit may be granted under this subsection before the completion of the extended visitation period.

(c) If the support order does not specify a certain period of extended visitation or the request for extended visitation credit is for a period other than the period stated in the order, a request for extended visitation credit must be made in writing and must be accompanied by evidence that the visitation has been exercised. An obligor may include as evidence

(1) written verification from the custodial parent that the visitation was exercised;

(2) school records showing the child's enrollment;

(3) day care receipts during the visitation period;

(4) affidavits from neighbors or relatives of the obligor or other persons with personal knowledge of the child's residence; and

(5) copies of airline tickets or other proof of transportation if the visitation occurred outside of the child's normal residence area.

(d) Upon receipt of a request for an extended visitation credit under (b) or (c) of this section, the agency will mail a notice of the request to the nonrequesting parent. The nonrequesting parent may submit a response to the request for extended visitation credit. The response must be postmarked or received by the agency within 30 days after the date the notice under this subsection was mailed. The agency will issue an administrative review decision granting or denying the request for extended visitation credit as soon as practicable after the time for response under this subsection. As necessary to determine whether extended visitation has been exercised, the agency may request additional information from the parents or from any other source. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(e) In calculating the amount of the extended visitation credit, the agency will apply the percentage or dollar amount specified in the support order for the extended visitation credit.

(f) If the extended visitation includes an entire calendar month, the agency will apply the percentage or dollar amount provided in (e) of this section to the monthly support obligation specified in the support order. If the extended visitation includes a portion of a calendar month, the agency will prorate the credit by the number of days included in the extended visitation period for that month. If the extended visitation credit does not include all of the children, the agency will apply the credit only against the support obligation attributable to each child for whom extended visitation was exercised.

(g) Nominal time with the custodial parent during the visitation period, including occasional overnights, does not defeat the visitation credit.

History

Authority: AS 25.27.020; AS 25.27.200
Eff. 6/15/2001, Register 158; am 9/15/2022, Register 243

15 AAC 125.490 Recording or filing a lien

(a) The agency will record or file a lien under AS 25.27.230 upon an obligor's real or personal property or limited entry permit issued under AS 16.43 in the amount of the obligor's liability under a support order if

(1) a valid support order is in effect under which the obligor owes arrears;

(2) the obligor does not have an active bankruptcy action pending; and

(3) the obligor owes an amount that is more than 12 times the monthly support obligation under the support order or the obligor's arrears under the support order exceed $2,500, whichever is less.

(b) If the agency records or files a lien under (a) of this section, the agency will send a notice of the lien to the obligor, by first class mail, within 15 days after the agency receives the recorded lien or filing.

History

Authority: AS 25.25.507; AS 25.27.140 AS 25.27.020; AS 25.27.230
Eff. 11/30/2002, Register 164

15 AAC 125.495 Releasing a lien

(a) The agency will release a lien recorded or filed under AS 25.27.230 if the

(1) underlying support order is satisfied;

(2) agency closes the case because the obligor's location is unknown, and the agency has made diligent efforts to locate the obligor over a

(A) three-year period if information is sufficient to use an automated locate effort; or

(B) one-year period if information is insufficient to use an automated locate effort; or

(3) person to whom support is owed under the support order withdraws from agency services and all child support arrears under the order are owed to that person.

(b) If the agency releases a lien under this section, within 15 days after the agency receives the recorded release, the agency will notify the obligor by first class mail of the release.

History

Authority: AS 25.25.507; AS 25.27.140 AS 25.27.020; AS 25.27.230
Eff. 11/30/2002, Register 164

Article 6 Administrative Enforcement — Income Withholding

15 AAC 125.500 Order requiring immediate income withholding

If the agency receives a support order that requires immediate income withholding

(1) for an order that is being enforced by the agency, the agency will promptly take all reasonable steps to locate an employer of the obligor; within two business days after the agency receives information regarding the identity and location of the obligor's employer, the agency will issue to the employer an order to withhold and deliver under AS 25.27.250, without prior notice to the obligor;

(2) for an order that is not being enforced by the agency, the agency will provide payment services only if the obligor or the custodial parent requests immediate income withholding by the agency or obtains immediate income withholding through a tribunal of competent jurisdiction other than the agency; payment services consist of the issuance of orders to withhold and deliver under AS 25.27.250, the receipt and disbursement of payments, and the maintenance of records of those payments; under this paragraph,

(A) if the agency receives a request from the obligor or the custodial parent for immediate income withholding under this paragraph, the agency will issue to the obligor's employer an order to withhold and deliver under AS 25.27.250, without prior notice to the obligor, within two business days after the agency receives information regarding the identity and location of the obligor's employer;

(B) an individual subject to the order or a child support enforcement agency of another state may apply for full collection services under 15 AAC 125.800; a withdrawal from full collection services in matters subject to immediate income withholding under this section does not terminate payment services under the support order.

History

Authority: AS 25.27.020; AS 25.27.080 AS 25.27.062; AS 25.27.250
Eff. 10/1/98, Register 147

15 AAC 125.505 Initiated income withholding

(a) If the agency is enforcing a support order that does not include an immediate income withholding order, the agency will initiate income withholding under AS 25.27.150 if:

(1) the obligor's support payments are in arrears in an amount that is at least equal to the support payable for one month;

(2) the obligor requests income withholding; or

(3) the custodial parent requests income withholding and the agency approves the request because

(A) the obligor's payments have been more than 10 days overdue at least two times during the preceding 12 months; or

(B) the agency has reason to believe that the obligor might withdraw assets to avoid payment of support.

(b) If the agency receives a support order that does not include an immediate income withholding order and the order is not being enforced by the agency, the agency will initiate income withholding under AS 25.27.150 if

(1) the obligor requests income withholding; or

(2) the custodial parent requests income withholding and the agency approves the request because the obligor's payments have been more than 10 days overdue at least two times during the preceding 12 months.

(c) The agency will initiate income withholding under (a) or (b) of this section by sending the obligor a notice that income withholding has commenced. The notice must comply with the requirements of AS 25.27.150(c) and must be served in the manner required by AS 25.27.150(a). The notice must also state the basis for the agency's initiation of income withholding under (a) or (b) of this section.

(d) The obligor may contest income withholding initiated under this section by submitting to the agency a written request for administrative review within 15 days after mailing of the notice under (c) of this section. The sole basis for contesting the income withholding is that there is a mistake of fact that makes the income withholding improper for any of the following reasons:

(1) the amount of current or overdue support is incorrect;

(2) the identity of the obligor is inaccurate; or

(3) if income withholding was initiated under (a)(3) or (b)(2) of this section, the alleged facts regarding overdue payments or potential withdrawal of assets are incorrect.

(e) The agency will conduct an administrative review within 15 days after receipt of the request for administrative review. The agency will issue an administrative review decision as soon as practicable after the administrative review is completed. If appropriate, the agency may request additional information from the obligor or from any other party to the action.

(f) On receipt of the administrative review decision under (e) of this section, the obligor may request a formal hearing. The provisions of 15 AAC 05.010 and 15 AAC 05.025 - 15 AAC 05.040 regarding formal hearings apply to appeals under this subsection.

(g) The agency may issue an order to withhold and deliver income under AS 25.27.250 at the same time or at any time after service of the notice that income withholding has commenced. The agency will issue the order within two business days after the agency receives information regarding the identity and location of the obligor's employer.

History

Authority: AS 25.27.020; AS 25.27.080; AS 25.27.250 AS 25.27.062; AS 25.27.150
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.510 Procedures to contest income withholding

(a) Immediately upon issuance of an order to withhold and deliver under 15 AAC 125.500 or 15 AAC 125.505(g), the agency will send a notice that an order to withhold and deliver has been issued by first class mail or by electronic means to the obligor and, if appropriate, to a child support enforcement agency of another state. The notice must

(1) inform the parties that the agency has issued an order to withhold and deliver;

(2) describe the procedures that a party shall follow if the party wishes to contest withholding; and

(3) include the information from the order to withhold and deliver that the agency provided to the obligor's employer.

(b) A party may contest the withholding under the order to withhold and deliver by submitting to the agency a written request for administrative review within 15 days after mailing of the notice under (a) of this section. The request must state the specific reasons for the contest and be accompanied by the documentation upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if it does not comply with the requirements of this subsection. The sole basis for contesting the withholding under an order to withhold and deliver is that the amount withheld is improper due to a mistake of fact. The agency will issue an administrative review decision as soon as practicable after receiving the request. If appropriate, the agency may request additional information from the obligor or from any other source. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for purposes of appeal to the superior court.

(c) The agency will continue to require an employer to withhold income under the order to withhold and deliver even if a party contests the withholding under (b) of this section. The agency may not stay the withholding for collection of arrears unless the obligor posts with the agency security or a bond sufficient to secure payment of past support conditioned upon final determination of the contest. The agency will continue to collect and disburse the ongoing support obligation regardless of posting of a bond or security under this subsection.

History

Authority: AS 25.27.020; AS 25.27.140; AS 25.27.250
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205; am 12/22/2023, Register 248

15 AAC 125.515 Administrative exemption from immediate income withholding

An obligor may request an exemption from immediate income withholding under AS 25.27.062(m)(1) when the agency is enforcing the obligor's support order. To obtain the exemption described in this section, the obligor shall submit a written request to the agency. In order to qualify for the exemption, the obligor

(1) shall agree to inform the agency of

(A) the obligor's current employer; and

(B) the availability of employment-related health insurance coverage for the children; and

(2) shall establish:

(A) that

(i) the agency or a court has reviewed and approved a written agreement between both parents and, if support is assigned to the state, the agency; the agreement must provide an alternative arrangement for immediate income withholding; and

(ii) withholding has not been terminated previously and subsequently been re-initiated; or

(B) that there is good cause not to require immediate income withholding because it would not be in the best interests of the child or children for whom support is sought and, if the matter involves the modification of a support order, the obligor has made voluntary support payments under a court or administrative order and has not been in arrears in an amount that is at least equal to the support payable for one month; in this subparagraph, "in arrears" means failing to make a support payment within 30 days of the monthly due date specified in the support order.

History

Authority: AS 25.27.020; AS 25.27.062
Eff. 10/1/98, Register 147

15 AAC 125.520 Use of standard notices and forms

The agency will use the standard federal notices and forms promulgated under 42 U.S.C. 652(a)(11) and 42 U.S.C. 666(b)(6)(A)(ii) for its orders to withhold and deliver income. The standard federal form for withholding income is considered an order to withhold and deliver under AS 25.27.250 regardless of the title of the document.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250
Eff. 10/1/98, Register 147

15 AAC 125.525 Income withholding; employer's transmittal of money

(a) An employer who is served by the agency with an income withholding order or an order to withhold and deliver under AS 25.27.062, AS 25.27.250, or 15 AAC 125.500 or 15 AAC 125.505 shall send the amount ordered to be withheld to the agency within seven business days after the date the amount would have been paid or credited to the employee.

(b) When an employer is required to withhold and deliver payments for more than one employee, the employer may combine all withheld amounts into a single payment to the agency. If a single payment is made as permitted in this subsection, the employer shall separately designate the portion of the single payment that is attributable to each employee for whom money is withheld and delivered.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250
Eff. 10/1/98, Register 147

15 AAC 125.530 Notice to employer of income withholding

The provisions of AS 25.27.062(e) - (k) apply to an income withholding order based on a support order of another jurisdiction under AS 25.25.507, 25.25.603, or 15 AAC 125.700, an administrative establishment of support obligation under AS 25.27.160 - 25.27.220, and an administratively enforced support order under AS 25.27.250.

History

Authority: AS 25.25.507; AS 25.27.022; AS 25.27.220 AS 25.25.603; AS 25.27.062; AS 25.27.250 AS 25.27.020; AS 25.27.160
Eff. 10/1/98, Register 147

15 AAC 125.540 Calculation of monthly income withholding amount

(a) In determining the amount of a withholding order issued under AS 25.27.062 or AS 25.27.250, the agency will calculate the monthly withholding amount by adding the following amounts:

(1) the monthly ongoing support obligation;

(2) the monthly interest charge; and

(3) a monthly amount to be collected and applied to arrears, as determined using the applicable arrears amortization chart set out in 15 AAC 125.545.

(b) In calculating the amount to be withheld and delivered, the agency will give credit to the obligor for one-half of the cost to the obligor of medical and dental insurance premiums for the children and educational payments for the children to the extent that the health insurance coverage and educational payments are required by the applicable support order and are actually paid for by the obligor, unless the order provides for a different allocation of these costs.

(c) Unless state or federal law requires a lesser percentage, an order to withhold and deliver issued by the agency under AS 25.27.062 or AS 25.27.250 may not exceed 40 percent of an obligor's net disposable earnings, as defined in 15 U.S.C. 1672, unless the agency determines that there is good cause to increase the withholding amount. However, the withholding order may not exceed the percentages allowed under 15 U.S.C. 1673(b).

(d) In determining whether good cause exists to increase the withholding amount under (c) of this section, the agency will consider the following factors:

(1) the amount of the arrears owed by the obligor;

(2) the obligor's payment history, including the number of payments received in the past 12 months;

(3) whether payments have been received from the state for unemployment compensation owed to the obligor;

(4) the obligor's income and other assets available to satisfy the support obligation;

(5) whether the obligor has been eligible and has applied for a permanent fund dividend under AS 43.23;

(6) the existence of a pending court or administrative action that could significantly affect the amount of the arrears;

(7) evidence of bad faith or intentional evasion of the obligor's support obligation, such as evidence of fraudulent transfers or intentional concealment of assets or income;

(8) whether the obligor is seasonally employed;

(9) whether the monthly support amount includes spousal support;

(10) whether the monthly support obligation can be satisfied by withholding only 40 percent of the obligor's net disposable earnings;

(11) any other evidence that would tend to show the ability or willingness of the obligor to pay support voluntarily.

(e) The agency will find that good cause exists to increase the withholding amount under (c) of this section from 40 percent to 50 percent of the obligor's net disposable earnings if

(1) the obligor is ordered to provide health care coverage for a child;

(2) the health care coverage is enforced through a notice in the form required under 45 C.F.R. 303.32;

(3) the monthly support obligation is reduced by half the cost of the health care coverage; and

(4) the increase in the withholding amount is sufficient to cover the monthly support obligation and the cost of the health care coverage, not including arrears, interest, or fees.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250 AS 25.27.025; AS 25.27.063; AS 25.27.253
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 11/30/2002, Register 164

15 AAC 125.545 Amortization chart

(a) In determining the monthly withholding amount to be collected and applied to arrears under 15 AAC 125.540(a), the agency will use the following amortization chart if the obligor's adjusted annual income, as calculated under 15 AAC 125.065, exceeds $20,400;

AMOUNT DUEPYMT/MOAMOUNT DUEPYMT/MO25-3992519000-19999355400-4993020000-20999365500-5993521000-21999375600-6994022000-22999385700-7994523000-23999395800-8995024000-24999405900-9995525000-259994151000-10996026000-269994251100-11996527000-279994351200-12997028000-289994451300-13997529000-299994551400-14998030000-309994651500-15998531000-319994751600-16999032000-329994851700-17999533000-339994951800-189910034000-349995051900-199910535000-359995152000-224911536000-369995252250-249912537000-379995352500-274913538000-389995452750-299914539000-399995553000-324915540000-409995653250-349916541000-419995753500-374917542000-429995853750-399918543000-439995954000-449919544000-449996054500-499920545000-459996155000-599921546000-469996256000-699922547000-479996357000-799923548000-489996458000-899924549000-499996559000-999925550000-5099966510000-1099926551000-5199967511000-1199927552000-5299968512000-1299928553000-5399969513000-1399929554000-5499970514000-1499930555000-5599971515000-1599931556000-5699972516000-1699932557000-5799973517000-1799933558000-5899974518000-1899934559000-5999975560000-60999765104000-104999120561000-61999775105000-105999121562000-62999785106000-106999122563000-63999795107000-107999123564000-64999805108000-108999124565000-65999815109000-109999125566000-66999825110000-110999126567000-67999835111000-111999127568000-68999845112000-112999128569000-69999855113000-113999129570000-70999865114000-114999130571000-71999875115000-115999131572000-72999885116000-116999132573000-73999895117000-117999133574000-74999905118000-118999134575000-75999915119000-119999135576000-76999925120000-120999136577000-77999935121000-121999137578000-78999945122000-122999138579000-79999955123000-123999139580000-80999965124000-124999140581000-81999975125000-125999141582000-82999985126000-126999142583000-83999995127000-127999143584000-849991005128000-128999144585000-859991015128000-128999145586000-869991025130000-130999146587000-879991035131000-131999147588000-889991045132000-132999148589000-899991055133000-133999145590000-909991065134000-134999150591000-919991075135000-135999151592000-929991085136000-136999152593000-939991095137000-137999153594000-949991105138000-138999154595000-959991115139000-139999155596000-969991125140000-140999156597000-979991135141000-141999157598000-989991145142000-142999158599000-999991155143000-1439991595100000-1009991165144000-1449991605101000-1019991175145000-1459991615102000-1029991185146000-1469991625103000-1039991195147000-1479991635

(b) If the agency uses the amortization chart under (a) of this section and the amount owed by the obligor exceeds $147,999, the agency will collect and apply to arrears an amount per month equal to $1,645 plus $10 for each $1,000 owed in excess of $147,999.

(c) In determining the monthly withholding amount to be collected and applied to arrears under 15 AAC 125.540(a), the agency will use the following amortization chart if the obligor's adjusted annual income, as calculated under 15 AAC 125.605, is greater than $13,600 but less than or equal to $20,400;

AMOUNT DUEPYMT/MOAMOUNT DUEPYMT/MO0-5,0002017,501-20,000505,001-7,5002520,001-22,500557,501-10,0003022,501-25,0006010,001-12,5003525,001-30,0006512,501-15,0004030,001-32,5007015,001-17,5004532,501 and greater75

(d) In determining the monthly withholding amount to be collected and applied to arrears under 15 AAC 125.540(a), the agency will use the following amortization chart if the obligor's adjusted annual income, as calculated under 15 AAC 125.065, is less than or equal to $13,600.

AMOUNT DUEPYMT/MO0-5,000105,001-10,0001510,001-12,5002012,501-15,0002515,001-15,5003015,501 and greater40

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.550 Modification of income withholding amount based on hardship

(a) At any time after an order to withhold and deliver has been issued, an obligor may request that the order to withhold and deliver be modified based on evidence of hardship on the obligor or the obligor's family. In order to obtain a modification under this section, the obligor shall present clear and convincing evidence of the hardship that would result if the order to withhold and deliver were not modified.

(b) The agency may consider the following factors in determining whether, for purposes of this section, a hardship exists:

(1) significant illness or disability that prevents the obligor from working at any reasonable employment;

(2) exceptional medical expenses that are not reimbursed by insurance, Medicaid, or another government program, or through private litigation;

(3) an accident or other disaster that significantly affects the obligor or an immediate family member of the obligor;

(4) the obligor has physical custody of one or more of the children for whom support is sought under a valid custody order issued by a tribunal of competent jurisdiction; or

(5) the obligor lives a subsistence life style without any local opportunity for employment.

(6) the net monthly income of the obligor's household is 150 percent of the poverty guideline for this state, as set out in the Federal Register by the United States Department of Health and Human Services, and the agency has not determined the obligor to be voluntarily underemployed or unemployed under 15 AAC 125.060.

(c) In order to qualify for a modification based on hardship, the obligor must provide all information required by the agency to verify hardship or, if the information cannot be provided, must explain why the information is not reasonably available. The obligor must disclose the obligor's entire household assets, income, and expenses, including the assets, income, and expenses of each member of the obligor's household.

(d) In deciding whether to grant or deny a request under this section, the agency will consider the extent to which, in the agency's determination, the obligor has eliminated discretionary spending and has disposed of the obligor's non-essential assets. For purposes of making a determination under this subsection,

(1) discretionary spending

(A) includes an expenditure made for recreation, comfort, sport, investment, entertainment, private schools, travel, or rental or recreational property;

(B) does not include an expenditure necessary to feed, house, clothe, or ensure the health of the obligor and the obligor's immediate family members;

(2) the agency will consider each expenditure on a case-by-case basis;

(3) in determining whether the obligor must dispose of an asset under this subsection, the agency may consider the sentimental value of the asset to the obligor and may weigh the sentimental value of the asset to the obligor and the cost to the obligor of selling the asset against the asset's market value.

(e) The agency will grant or deny a modification requested under this section. If the agency grants a modification under this section, the agency

(1) will not reduce the monthly withholding amount calculated under 15 AAC 125.540(a) below the amount of the obligor's ongoing monthly support obligation or to an amount less than $50 per month, whichever is greater; and

(2) will grant the modification for the duration of the hardship, as determined by the agency, but for no more than two years.

(f) Repealed 6/15/2001.

(g) An obligor may apply to extend a modification granted under this section beyond the period set under (e)(2) of this section. The agency will review an extension request in the manner that the agency reviews an initial request under this section.

(h) In deciding whether to grant or deny a request under this section, the agency will consider the obligor's history of applying for a permanent fund dividend under AS 43.23. The agency will not deny a request under this section solely because an obligor failed to apply for a permanent fund dividend in the past. However, the agency will not grant a request under this section unless the obligor agrees to

(1) apply for permanent fund dividends in the future; or

(2) demonstrate to the agency's satisfaction that the obligor would not be eligible for a permanent fund dividend under AS 43.23 and 15 AAC 23.

(i) A decision under this section is final for purposes of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.250
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 2/16/2013, Register 205

15 AAC 125.560 Modification of income withholding amount for reasons other than hardship

(a) At any time after the agency has issued an order to withhold and deliver, the agency may review the order to determine whether the amount of the withholding should be modified to bring it into compliance with 15 AAC 125.540 and any other state or federal guidelines governing orders to withhold and deliver. Hardship is not a basis for review and modification under this section. The agency may modify the amount of withholding under this section if any of the following events has occurred since the order to withhold and deliver was issued:

(1) the ongoing support obligation has been modified or terminated;

(2) a judgment for medical support or unreimbursed medical expenses has been entered;

(3) the support obligation has been adjusted as the result of an audit or other action by the agency or by a child support enforcement agency of another state; or

(4) the amount calculated under 15 AAC 125.540 is at least 30 percent more or at least 30 percent less than the amount that is set out in the existing order to withhold and deliver.

(b) If the agency determines that the amount of the order to withhold and deliver should be modified under (a) of this section, the agency will issue a modified order to withhold and deliver. The agency will serve the modified order to withhold and deliver on the person, political subdivision, or department of the state possessing the income in the manner provided for service of a lien under AS 25.27.240. The agency will send a notice by first class mail or by electronic means to the obligor, the custodial parent, and, if appropriate, a child support agency of another state. The modified withholding amount is effective immediately upon service upon the person possessing the income to be withheld.

(c) Upon receipt of a notice served under (b) of this section, the obligor, the custodial parent, or a child support agency of another state may contest the amount of the modified order. A person seeking to contest the modified order to withhold and deliver shall file a written request for administrative review with the agency within 15 days after mailing of the amended withholding order. The request must state the specific reasons for the contest and be accompanied by all documents upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if it does not comply with the requirements of this subsection. The agency will issue an administrative review decision as soon as practicable after receiving a request for administrative review under this subsection. If appropriate, the agency may request additional information from the person requesting the review or from any other party to the action.

(d) An administrative appeal is not available from the administrative review decision issued under (c) of this section, but the decision is final for purposes of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.250
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.565 Termination of income withholding

(a) After income withholding has been initiated under 15 AAC 125.500 or 15 AAC 125.505, the agency will terminate income withholding only if at least one of the following conditions is met:

(1) the support obligation, including arrears and any future support obligation, has been fully satisfied; or

(2) the agency obtains proof that an exemption has been granted by court or agency order under AS 25.27.062(m).

(b) An order to withhold and deliver that has been served on a particular employer remains effective until

(1) the support obligation, including arrears and any future support obligation, has been fully satisfied; or

(2) the employer has terminated the obligor's employment and at least three years have elapsed since that termination without reemployment of the obligor.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250
Eff. 10/1/98, Register 147

15 AAC 125.570 Priorities for withholding for a single order

Except as provided in 15 AAC 125.572, if an employer is required to withhold income from an obligor's income under a single withholding order issued by the agency, the employer shall withhold amounts from the obligor's income in the following order of priority, but not to exceed an amount equal to the percentage of the obligor's disposable earnings set out in 15 AAC 125.540(c) unless the agency has found good cause under 15 AAC 125.540 to increase the percentage amount to be withheld:

(1) first, the monthly child support obligation for the month in which the withholding occurs;

(2) second, the monthly spousal support obligation for the month in which the withholding occurs;

(3) third, the monthly amount necessary to forward to any employment-related group health plan to assure coverage of the children under 15 AAC 125.426;

(4) fourth, an amount to be applied to the past-due child and spousal support obligations owed by the obligor, interest, and fees, as provided in the income withholding order.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250 AS 25.27.060; AS 25.27.063
Eff. 11/30/2002, Register 164

15 AAC 125.571 Priorities for withholding for multiple orders

(a) Except as provided in 15 AAC 125.572, if an employer receives multiple orders from the agency to withhold income for an employee who is the obligor under the multiple orders but for different obligees, the employer shall withhold from the obligor's income an amount determined by adding together the withholding amounts required by each of the orders, but not to exceed an amount equal to the percentage of the obligor's disposable earnings set out in 15 AAC 125.540(c) unless the agency has found good cause under 15 AAC 125.540 to increase the percentage amount to be withheld. If the amount to be withheld under the multiple orders exceeds the percentage amount required to be withheld by the agency under 15 AAC 125.540, the employer shall withhold and deliver, in the following order of priority:

(1) first, to the agency the amounts required to satisfy the monthly child support and spousal support obligation for the month in which the withholding occurs for each of the support orders subject to withholding;

(2) second, to the appropriate group health plan the amounts necessary to provide coverage for the children as required by each of the support orders subject to withholding for medical coverage; and

(3) third, to the agency the amounts required to satisfy the past-due child and spousal support obligations, interest, and fees, as provided in the income withholding orders.

(b) Except as provided in 15 AAC 125.572, if the orders to withhold and deliver have been issued by two or more tribunals, the employer shall apply the following formula to determine the amounts that the employer shall withhold and deliver under each order:

(1) the employer shall calculate the amount of the employee's total ongoing child support obligation by adding together the ongoing monthly child support amount required by each of the orders;

(2) the employer shall determine the employee's allowable withholding amount; to make the calculation, the employer shall multiply the employee's disposable earnings for the pay period in question by the applicable percentage in 15 AAC 125.540(c) unless the agency has found good cause under 15 AAC 125.540 to increase the amount to be withheld to an amount that exceeds the percentage under 15 AAC 125.540(c);

(3) if the amount of the employee's total ongoing child support obligation, as calculated under (1) of this subsection, is

(A) greater than the employee's allowable withholding amount, as calculated under (2) of this subsection, the employer shall allocate the amount withheld to each order based on the percentage that the employee's ongoing monthly child support amount under each order bears to the amount of the employee's total ongoing child support obligation, and shall deliver to the appropriate tribunal the amount of the allocation; and

(B) less than the employee's allowable withholding amount, as calculated under (2) of this subsection, the employer shall first satisfy the employee's ongoing child support obligation under each order for the month in which the withholding occurs; the employer shall next calculate the employee's total ongoing spousal support obligation by adding together the ongoing monthly spousal support amount required by each of the orders;

(4) if the amount of the employee's total ongoing spousal support obligation, as calculated under (3)(B) of this subsection, is

(A) greater than the remaining allowable withholding amount after satisfaction of child support obligations in accordance with (3)(B) of this subsection, the employer shall allocate the amount withheld to each order based on the percentage that the employee's ongoing monthly spousal support amount under each order bears to the amount of the employee's total ongoing spousal support obligation, and shall deliver to the appropriate tribunal the amount of the allocation; and

(B) less than the remaining allowable withholding amount after satisfaction of child support obligations in accordance with (3)(B) of this subsection, the employer shall first satisfy the employee's ongoing spousal support obligation under each order for the month in which the withholding occurs; the employer shall next calculate the amount necessary to provide medical coverage for the children as required by each of the support orders subject to withholding for medical coverage;

(5) if the medical coverage amount, as calculated under (4)(B) of this subsection, is

(A) less than the remaining allowable withholding amount after satisfaction of spousal support obligations in accordance with (4)(B) of this subsection, the employer shall withhold and deliver to the appropriate group health plan the medical coverage amount; after satisfaction of the medical coverage amount, the employer shall divide the remaining allowable withholding amount in accordance with (B) of this paragraph; and

(B) greater than the remaining allowable withholding amount after satisfaction of spousal support obligations in accordance with (4)(B) or this subsection, the employer may not withhold for medical coverage; the employer shall divide the remaining allowable withholding amount equally among all orders for payment of arrears, interest, and fees, but not to exceed the total withholding required by each withholding order; the employer will deliver to each tribunal the amount allocated to that tribunal's order under this subparagraph.

History

Authority: AS 25.25.502; AS 25.27.020; AS 25.27.063 AS 25.25.503; AS 25.27.062; AS 25.27.250
Eff. 11/30/2002, Register 164

15 AAC 125.572 Priorities for withholding; exception

(a) A parent may request an exception to the withholding priorities set out in 15 AAC 125.570 and 15 AAC 125.571 in order to give priority to the monthly amount necessary to ensure health care coverage for the children under 15 AAC 125.426. If an exception is granted under this section, an employer shall first withhold from the obligor's income the amount necessary to forward to the employment-related group health plan to ensure coverage of the children under 15 AAC 125.426. After withholding that amount, the employer shall follow the priorities established by 15 AAC 125.570 and 15 AAC 125.571.

(b) A request for an exception under this section must be in writing, state the specific reasons for the request, and be accompanied by the documentation upon which the parent intends to rely. The agency will conduct an administrative review within 20 days after it receives the written request. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(c) A request for an exception to the withholding priorities will be granted if the agency determines, based on all of the circumstances and after consultation with both parents, that the exception is in the best interests of the child. As a part of the administrative review, the agency will consider the medical needs of the child, the possibility that health care coverage will be intermittent if an exception is not granted, and any agreement of the parents relating to health care coverage.

(d) If an exception is granted under this section and an employer is required to withhold amounts from the obligor's income, the agency will promptly notify the employer that an exception has been granted and of the new priorities to be followed by the employer with respect to the withholding of income.

History

Authority: AS 25.27.020; AS 25.27.062; AS 25.27.250 AS 25.27.060; AS 25.27.063
Eff. 11/30/2002, Register 164

Article 7 Licensing Actions

15 AAC 125.605 Criteria for licensing actions

(a) The agency will include on the licensing lists required to be compiled under AS 25.27.244(a) and 25.27.246(a) the name of an obligor

(1) for whom

(A) a valid child support order is in effect;

(B) if the list is compiled under AS 25.27.244(a), a payment schedule is in effect; or

(C) if the list is compiled under AS 25.27.246(a), a payment schedule is in effect for which the obligor paid the monthly obligation for at least two years immediately after the schedule was negotiated;

(2) who owes an amount that is more than four times the monthly support obligation under the child support order or payment schedule; and

(3) whose arrears exceed $1,000.

(b) The agency may not include on the licensing lists required to be compiled under AS 25.27.244(a) and AS 25.27.246(a) the name of an obligor who would otherwise qualify for licensing action under (a) of this section if any of the following conditions is met:

(1) the obligor has an active bankruptcy action pending;

(2) the obligor is currently making payments under an income withholding order issued by the agency or a payment agreement with the agency;

(3) the obligor is currently receiving unemployment insurance benefits;

(4) the obligor is deceased; or

(5) the agency is not enforcing the child support order under which the arrears are owed.

History

Authority: AS 25.27.020; AS 25.27.244; AS 25.27.246
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173

15 AAC 125.610 Criteria for administrative review

(a) Upon receipt of a written request for administrative review under AS 25.27.244(g) or AS 25.27.246(f), the agency will review the obligor's child support file to determine whether the obligor is in substantial compliance with the support order or payment schedule. Based on that review, the agency will issue a written decision that includes a finding of whether the obligor is in substantial compliance with the support order or payment schedule.

(b) If, under (a) of this section, the agency determines that the obligor is not in substantial compliance with a support order or payment schedule, the agency may consider the following factors to determine whether licensing action against the obligor's occupational license or driver's license is appropriate despite the determination that the obligor is not in substantial compliance with the support order or payment schedule under AS 25.27.244(g) or 25.27.246(f):

(1) the amount of the arrears owed by the obligor;

(2) whether a tribunal in another state is pursuing enforcement action against the obligor;

(3) the obligor's payment history, including the number of payments received in the past 12 months;

(4) whether the obligor has an active bankruptcy action pending;

(5) whether, under a valid custody order issued by a tribunal of competent jurisdiction, the obligor has physical custody of one or more of the children for whom support is sought;

(6) whether payments have been received from the state for unemployment compensation owed to the obligor;

(7) the obligor's income and other assets available to satisfy the support obligation;

(8) whether the obligor is eligible and has applied for a permanent fund dividend;

(9) the existence of a pending court or administrative action that could significantly affect the amount of the arrears;

(10) evidence of bad faith or intentional evasion of the obligor's support obligation, such as evidence of fraudulent transfers or intentional concealment of assets or income; and

(11) any other evidence that would tend to show the ability or willingness of the obligor to pay support voluntarily without licensing action, including evidence that the obligor has made the obligor's best efforts, as defined in 15 AAC 125.615, to pay the child support arrears.

(c) If, based on its review of the criteria set out in (b) of this section, the agency determines that licensing action is not appropriate because of the particular facts of the matter, the agency may elect not to pursue further licensing action against the obligor.

History

Authority: AS 25.27.020; AS 25.27.244; AS 25.27.246
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.615 Definition of "best efforts"

As used in 15 AAC 125.610, the term "best efforts," as applied to the obligor, means that, during the period in which the child support order was in effect, the obligor has taken every reasonable step available to assure that support is paid as required by the support order, including, without limitation,

(1) keeping the agency informed of the obligor's address, employer, and medical coverage;

(2) applying for any benefits, such as a permanent fund dividend, unemployment compensation, or similar state and federal benefits, that could be attached for payment of support;

(3) actively seeking employment and pursuing other sources of income when appropriate; and

(4) eliminating discretionary spending; for purposes of this paragraph, discretionary spending

(A) includes any expenditure made for recreation, comfort, sport, investment, entertainment, private schools, travel, or rental or recreational property; and

(B) does not include any expenditures necessary to feed, house, clothe, or ensure the health of the obligor and the obligor's immediate family members.

History

Authority: AS 25.27.020; AS 25.27.244; AS 25.27.246
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173

15 AAC 125.620 Negotiated agreement for payment schedule on arrears; modification of agreement

(a) In negotiating an agreement for a payment schedule on arrears under AS 25.27.244(g)(1) or 25.27.246(f)(1), the agency will calculate the monthly amount by adding the following amounts:

(1) the monthly ongoing support obligation;

(2) the monthly interest charge; and

(3) a monthly amount to be collected and applied to arrears.

(b) If an obligor has previously entered into an agreement for a payment schedule with the agency under AS 25.27.244(g)(1) or AS 25.27.246(f)(1) and has failed to make the payments required by that agreement, the obligor shall first bring current all payments that are due under the previous agreement before the agency will enter into another agreement for a payment schedule under AS 25.27.244(g)(1) or AS 25.27.246(f)(1).

(c) The agency may not enter into an agreement under AS 25.27.244(g) or AS 25.27.246(f) until the obligor agrees to pay the amount calculated in (a) of this section, subject to the limitations of 15 U.S.C. 1673(b) and 15 AAC 125.540(c). The payments under the agreement must be made pursuant to an income withholding order or an order to withhold and deliver issued by the agency or by a tribunal of another state. The agency will consider the obligor to be in substantial compliance with a payment schedule if payments are received under an income withholding order or an order to withhold and deliver at the percentages stated in 15 U.S.C. 1673(b), or at a lower percentage if adopted by the agency, even if the payment is less than the amount calculated under (a) of this section.

(d) At the request of the obligor, the agency may make arrangements with an obligor to issue an order to withhold and deliver if the obligor is self-employed. An order to withhold and deliver issued under this subsection is subject to periodic review to determine whether payments are being made as required. As a part of a periodic review, the agency may request that the obligor provide business records to establish that the proper amounts are being withheld in accordance with the withholding order. If the agency determines that the obligor has failed to withhold and deliver the proper amounts, the agency may find that the obligor is not in substantial compliance with the payment schedule.

(e) At the request of the obligor or at the agency's discretion, the agency may modify a payment schedule agreed to under AS 25.27.244(g)(1) or 25.27.246(f)(1) if

(1) the ongoing support obligation is modified after the agency has signed an agreement for a payment schedule; or

(2) there is a substantial change in the amount of the arrears so that, applying the amortization chart or formula set out in 15 AAC 125.545, the amount required to be collected each month changes substantially; for purposes of this paragraph, the amount required to be collected changes substantially if the amount changes by at least 30 percent.

(f) If the agency determines that a modification of a payment schedule is appropriate under (e) of this section, the agency will give the obligor written notice of the proposed modification at least 10 days before the effective date of the modification. The agency will send the notice by first class mail or by electronic means to the obligor's last known address on file with the agency.

History

Authority: AS 25.27.020; AS 25.27.244; AS 25.27.246
Eff. 10/1/98, Register 147; am 6/15/2001, Register 158; am 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.625 Referral of case for modification or default order review

At any time during the administrative review process under AS 25.27.244(g) or 25.27.246(f), the agency may, at the request of the obligor or at its own discretion, refer a matter to the agency's review and adjustment section for possible modification of the ongoing support obligation or, if appropriate, for a default order review under AS 25.27.195. If the agency refers a matter under this section for modification or default order review, the agency

(1) will not automatically suspend the licensing action against the obligor;

(2) will consider the existence of the referral in determining whether licensing action against the obligor is appropriate under the criteria set out in 15 AAC 125.610(b).

History

Authority: AS 25.27.020; AS 25.27.193; AS 25.27.244 AS 25.27.190; AS 25.27.195; AS 25.27.246
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.630 Exception based on evidence of unusual circumstances

(a) At any time during the administrative review process under 15 AAC 125.610, an obligor may request that the payment agreement be modified or that the licensing action against the obligor be suspended based on evidence of unusual circumstances that the licensing action would have on the obligor or on the obligor's family. To obtain an exception that is based on evidence of unusual circumstances, the obligor must present clear and convincing evidence of

(1) unusual circumstances that prevent the obligor from either complying with the child support order or entering into a payment schedule agreement with the agency for the purpose of coming into compliance with the child support order; and

(2) the unusual hardship that would result if the licensing action continued.

(b) The agency may consider one or more of the following factors in determining whether unusual circumstances exist:

(1) a significant illness or disability that prevents the obligor from working at any reasonable employment;

(2) exceptional medical expenses that are not reimbursed by insurance, Medicaid, or another government program, or through private litigation;

(3) an accident or other disaster that significantly affects the obligor or an immediate family member of the obligor;

(4) physical custody by the obligor of one or more of the children for whom support is sought under a valid custody order issued by a tribunal of competent jurisdiction;

(5) the obligor lives a subsistence lifestyle without any local opportunity for employment.

(c) In order to qualify for an exception based on evidence of unusual circumstances, the obligor must complete a written request form provided by the agency. The obligor must provide all information requested on that form or explain why the information is not reasonably available. On or attached to the form, the obligor must disclose the obligor's entire household assets, income, and expenses, including assets, income, and expenses of each member of the obligor's household.

(d) The agency will not grant a request for an exception based on evidence of unusual circumstances unless the obligor has eliminated discretionary spending and has disposed of the obligor's non-essential assets. For purposes of making a determination under this subsection,

(1) discretionary spending

(A) includes an expenditure made for recreation, comfort, sport, investment, entertainment, private schools, travel, or rental or recreational property;

(B) does not include an expenditure necessary to feed, house, clothe, or ensure the health of the obligor and the obligor's immediate family members;

(2) the agency will consider each expenditure on a case-by-case basis;

(e) If, under (d) of this section, the agency grants a request for an exception based on evidence of unusual circumstances, the agency will elect to

(1) suspend the licensing action for a stated period of time; or

(2) modify the monthly payment amount calculated under 15 AAC 125.620(a).

(f) The agency will grant a request for an exception based on evidence of unusual circumstances only for a period not to exceed six months.

(g) An administrative review is not available from a decision granting or denying a request for an exception based on evidence of unusual circumstances under this section, but the decision is final for purposes of appeal to the superior court.

History

Authority: AS 25.27.020; AS 25.27.244; AS 25.27.246
Eff. 10/1/98, Register 147; am 2/16/2013, Register 205

15 AAC 125.635 Revocation of release of occupational license

(a) The agency will immediately revoke a release of license issued under AS 25.27.244(g) if at least one of the following conditions is met:

(1) the release was issued under AS 25.27.244(g)(1) or (4), and the agency subsequently determines that the obligor is no longer in substantial compliance with the obligor's support order or payment schedule;

(2) the release was issued under AS 25.27.244(g)(2) or (3) because the license review process could not be completed within 150 days, and upon subsequent completion of the review process, the agency determines that the obligor is not in substantial compliance with the obligor's support order or payment schedule.

(b) When the agency revokes the release of a license under (a) of this section, the agency will immediately place the obligor on the licensing list maintained under AS 25.27.244(a) if the requirements for placement on the licensing list are otherwise met.

History

Authority: AS 25.27.020; AS 25.27.244; AS 25.27.246
Eff. 10/1/98, Register 147; am 4/1/2005, Register 173

15 AAC 125.636 Revocation of release of driver's license

(a) The agency will immediately revoke a release of license issued under AS 25.27.246(f) if at least one of the following conditions is met:

(1) the release was issued under AS 25.27.246(f)(1) or (4) because the obligor was found by the agency or a court to be in substantial compliance with the obligor's support order and the agency subsequently determines that the obligor is no longer in substantial compliance with the obligor's support order;

(2) the release was issued under AS 25.27.246(f)(1) because the obligor negotiated a payment schedule with the agency and the agency subsequently determines that the obligor is no longer in substantial compliance with the payment schedule;

(3) the release was issued under AS 25.27.246(f)(2) or (3) because the license review process could not be completed within 150 days and, upon subsequent completion of the review process, the agency determines that the obligor is not in substantial compliance with the obligor's support order or payment schedule.

(b) When the agency revokes a release under (a)(1) of this section, the agency will immediately place the obligor on the licensing list maintained under AS 25.27.246(a) if the requirements for placement on the licensing list are otherwise met.

(1) place the obligor on the licensing list maintained under AS 25.27.246(a) if the 26 obligor made payments in accordance with the payment schedule for at least two years immediately after the payment schedule was negotiated and the requirements for placement on the licensing list are otherwise met; or

(2) send written notice of the revocation to the obligor in accordance with AS 25.27.246(h) if the obligor did not make payments in accordance with the payment schedule for at least two years immediately after the payment schedule was negotiated.

(d) When the agency revokes a release under (a)(3) of this section, the agency will send a written notice of the revocation to the obligor in accordance with AS 25.27.246(h).

(e) An administrative review is not available from a notice of revocation of release under (c)(2) or (d) of this section. An obligor who receives a notice under (c)(2) or (d) of this section may request judicial relief from the notice as provided in AS 25.27.246(i). The agency will not suspend the obligor's driver's license based on the revocation of the release until the time for requesting judicial relief has expired or, if judicial relief has been requested, the court has issued a decision affirming the revocation of the release.

History

Authority: AS 25.27.020; AS 25.27.246
Eff. 4/1/2005, Register 173

Article 8 Arrears Forgiveness Program

15 AAC 125.650 Eligibility to participate in arrears forgiveness program

(a) A parent is eligible to participate in the arrears forgiveness program if the parent

(1) owes a combined total state debt of at least $1,500 in one or more child support cases;

(2) owes

(A) an ongoing child support obligation to the custodial parent or the state; or

(B) child support arrears to the custodial parent;

(3) meets one of the following criteria:

(A) is referred to the program by a qualified community-based organization, as provided in 15 AAC 125.653;

(B) has been incarcerated for more than one year immediately before the parent's application to participate in the program and has no other means of paying support while incarcerated, as provided in 15 AAC 125.655;

(C) as provided in 15 AAC 125.658, has failed to make voluntary payments for at least 24 consecutive months immediately before the parent's application to participate in the program, and

(i) has not actively avoided paying support during those 24 consecutive months; or

(ii) does not currently have the ability to pay support at the amount previously ordered;

(4) submits an application under 15 AAC 125.660 and complies with all requirements for referral under 15 AAC 125.663;

(5) enters into a forgiveness agreement meeting the requirements of 15 AAC 125.665;

(6) has not been convicted of the crime of criminal nonsupport in this state or any other state; for purposes of this paragraph, notwithstanding the definition of "state" in 15 AAC 125.695, "state" has the meaning given in AS 01.10.060(a); and

(7) has not previously enrolled in the arrears forgiveness program under 15 AAC 125.650 - 15 AAC 125.695 and been disqualified from the program due to failure to comply with a forgiveness agreement unless the agency determines that the parent had good cause for the parent's noncompliance, as provided in 15 AAC 125.683.

(b) Except for the requirements of (a)(2) of this section, a parent's eligibility under (a) of this section is determined as of the date the agency reviews the parent's application for approval under 15 AAC 125.660. If at any time during a parent's participation in the program the parent no longer meets the requirements of (a)(2) of this section, the agency will immediately terminate the parent's participation in the program, as provided in 15 AAC 125.685.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.653 Eligibility based on referral by community-based organization

(a) For the purpose of eligibility under 15 AAC 125.650(a)(3)(A), a community-based organization is a private or nonprofit organization or government agency that operates a program designed to directly or indirectly address personal or economic factors that may reduce a parent's earning potential or ability to pay support.

(b) A community-based organization may refer parents to the arrears forgiveness program under 15 AAC 125.650(a)(3)(A) if the organization or a particular program offered by the organization is qualified by the agency for participation in the arrears forgiveness program. An organization may apply to the agency for qualification by submitting a written application on a form provided by the agency, together with all documentation requested by the agency. The agency will review the application to determine whether the organization's program is designed to directly or indirectly address personal or economic factors that may reduce a parent's earning potential or ability to pay support and whether a parent's participation in that program is otherwise consistent with the goals of the arrears forgiveness program. The agency will notify the organization in writing, either approving or denying qualification for the program.

(c) In order to refer a parent to the arrears forgiveness program, a community-based organization must certify to the agency that the parent is actively participating in a qualified program offered by the organization. The community-based organization must further agree to

(1) monitor and certify to the agency the parent's progress in and completion of the qualified program;

(2) inform the agency immediately if the parent is no longer participating in the qualified program; and

(3) provide assistance to the agency in obtaining the parent's cooperation and compliance with the requirements of the arrears forgiveness program.

(d) If a parent's participation in a program operated by a community-based organization is terminated by the community-based organization after the parent has been referred by that organization under (c) of this section, the agency may terminate the parent's participation in the arrears forgiveness program as provided in 15 AAC 125.685 unless the agency determines that the parent would have qualified for participation in the arrears forgiveness program under 15 AAC 125.650(a)(3)(B) or (C).

(e) If a parent's participation in a program operated by a community-based organization is terminated because the organization or program was terminated or the parent's participation in that program is otherwise terminated through no fault of the parent, the parent may continue to participate in the arrears forgiveness program if the parent was

(1) referred to and is in compliance with the requirements of a comparable community-based program; or

(2) in compliance with the requirements of the community-based organization or program when it was terminated and a comparable program does not exist to which the parent can be referred.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.655 Eligibility based on incarceration

A parent may qualify for participation in the arrears forgiveness program based on incarceration under 15 AAC 125.650(a)(3)(B) if

(1) the parent was

(A) incarcerated as of the date the parent applied for the arrears forgiveness program and is expected to be released from incarceration within 60 days after the date of application; or

(B) released from incarceration within six months immediately before the date the parent applied for the arrears forgiveness program;

(2) the parent was incarcerated for more than one year without interruption during the parent's most recent incarceration before the date the parent applied for the arrears forgiveness program; and

(3) the parent had no other means of paying support while incarcerated.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.658 Eligibility based on failure to make voluntary payments

(a) For the purpose of determining whether a parent has failed to make voluntary payments under 15 AAC 125.650(a)(3)(C), voluntary payments include

(1) payments by cash, check, money order, or other negotiable instrument submitted directly to the agency by or on behalf of the parent;

(2) payments by a parent's employer through income withholding; and

(3) payments through the garnishment of unemployment benefits.

(b) The agency will consider the following factors when determining whether a parent has actively avoided paying support under 15 AAC 125.650(a)(3)(C):

(1) the parent has changed jobs shortly after a withholding order was served on the parent's employer;

(2) the parent has frequently changed residence or mailing addresses without notifying the agency of the change;

(3) the parent has transferred assets to a family member or friend for less than the fair market value of those assets;

(4) the parent has worked for cash or other forms of unreported income without making support payments;

(5) the parent has purchased high-priced consumer items, such as jewelry, computer or electronic equipment, snow machines, boats, airplanes, all-terrain vehicles, and recreational vehicles, unless those items are essential to the parent's business or production of income;

(6) the parent's lifestyle exceeds the parent's reported income;

(7) the parent is employed by businesses owned by the parent's friends or relatives and for which no or only minimal income is reported;

(8) the parent is not actively seeking employment or pursuing other sources of income that could be used to pay child support;

(9) the parent has not applied for benefits that could be used to pay support, including permanent fund dividends under AS 43.23, unemployment insurance, disability benefits, or other state or federal benefits for which the parent might be eligible;

(10) the parent has intentionally concealed assets or income.

(c) For the purpose of determining eligibility under 15 AAC 125.650(a)(3)(C), a parent does not currently have the ability to pay support as ordered if the parent can show that

(1) the support order includes

(A) pre-order arrears;

(B) arrears that accrued under a default order;

(C) arrears that accrued after the parent failed through excusable neglect to timely request a modification of the support order when a material change of circumstances occurred justifying a reduction in the support obligation; or

(2) the parent's earning ability or ability to pay has been substantially reduced after the issuance of the support order as a result of

(A) a significant illness or disability that prevents the parent from working at any reasonable employment;

(B) exceptional medical expenses that are not reimbursed by insurance, Medicaid, or another government program, or through private litigation;

(D) the parent living a subsistence lifestyle without any local opportunity for employment.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.660 Application for participation in arrears forgiveness program

(a) In order to be considered for the arrears forgiveness program, a parent must submit a written application to the agency. The application must be on a form prescribed by the agency and must be accompanied by all documentation or other information requested by the agency to support the application.

(b) If a parent fails to submit all of the information needed by the agency to process the application or if the agency determines that the case should be referred for modification or other review under 15 AAC 125.663, the agency will notify the parent that the application is insufficient or that a referral for modification or other review is being made. The agency will identify any additional information that the agency needs in order to review the parent's application or to refer the case for modification or other review. If the parent was referred to the agency by a community-based organization under 15 AAC 125.650(a)(3)(A), the agency will notify the referring organization of the request for additional information and will request the organization's assistance in obtaining the necessary information. If the parent fails to provide the additional information within 30 days after the agency sent its notice and request for additional information, the agency will deny the parent's application based on the failure to provide information.

(c) Upon receipt of all necessary information and after completion of any referral under 15 AAC 125.663, the agency will review a parent's application to determine whether the parent meets the eligibility requirements of 15 AAC 125.650. If the agency determines that the parent

(1) meets the eligibility requirements, the agency will prepare and send to the parent a forgiveness agreement under 15 AAC 125.665; or

(2) does not meet the eligibility requirements, the agency will send the parent a notice of denial.

(d) If a parent's application is denied under (b) or (c) of this section, the parent may contest the denial by submitting to the agency a written request for administrative review within 30 days after the notice was sent to the parent. The request must state the specific reasons for the contest and be accompanied by all documents upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if it does not comply with the requirements set out in this subsection. The administrative review is limited to whether a parent has complied with the application and eligibility requirements for participation in the arrears forgiveness program. As necessary to determine whether a parent is eligible for the arrears forgiveness program, the agency may request additional information from the parents or from any other source. The agency will issue an administrative review decision as soon as practicable after receiving the request. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

(e) If the agency determines at any time after an application has been approved for participation in the arrears forgiveness program that the parent knowingly provided false or incomplete information with the parent's application, the agency may terminate the parent's participation in the program as provided in 15 AAC 125.685.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.663 Referral of case for modification or other review

(a) Upon receipt of an application under 15 AAC 125.660, the agency will review the case to determine whether

(1) the case may qualify for a modification of the ongoing support obligation;

(2) the parent may be entitled to relief from the support order because the order was based on a default amount; or

(3) there are other defects in the support order or the arrears calculation that should be resolved before the agency considers the parent for the arrears forgiveness program.

(b) If the agency determines that one of the conditions in (a) of this section have been met, the agency will immediately refer the case to the appropriate caseworker within the agency or to the Department of Law for further action to resolve the issue, including referral for

(1) modification review under 15 AAC 125.316;

(2) default order review under 15 AAC 125.121;

(3) relief or reconsideration under 15 AAC 125.125;

(4) genetic testing; or

(5) judicial action to set aside or correct a paternity judgment or support order.

(c) The agency will not determine whether a parent is eligible under 15 AAC 125.660 to participate in the arrears forgiveness program until any referrals under this section have been completed.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.665 Requirements for forgiveness agreement

(a) Upon approval of the parent's application by the agency, the agency will send to the parent a forgiveness agreement. The parent must sign and return the forgiveness agreement to the agency within 30 days after it is mailed to the parent. If the parent fails to sign and return the forgiveness agreement to the agency within the required time, the agency will rescind its approval of the parent's application and will deny the application based on the failure to return the agreement. If a parent's application is denied under this section, the parent may contest the denial as provided in 15 AAC 125.660(d).

(b) As part of a forgiveness agreement under this section, the parent must agree to

(1) make monthly payments, as calculated under 15 AAC 125.668, through income withholding unless the agency agrees under AS 25.27.020(f)(1)(C) and 15 AAC 125.670 to an alternative payment arrangement; monthly payments that are made

(A) through income withholding must begin within 60 days after the parent is approved for the program unless the parent is enrolled in an employment training program in accordance with AS 25.27.020(f)(1)(B), in which case the monthly payments through income withholding must begin within 30 days after the parent completes the employment training program; or

(B) under an alternative payment arrangement must begin within 30 days after the parent is approved for the arrears forgiveness program;

(2) promptly inform the agency of any changes in the parent's employment or income and provide the name and address of any employer for whom the parent works;

(3) promptly inform the agency of any changes in the parent's residence or mailing address;

(4) apply for a permanent fund dividend under AS 43.23 for each year in which the parent is or may be eligible to receive the dividend or provide the agency with information indicating that the parent is not eligible for the dividend; and

(5) if the parent was referred by a community-based organization under 15 AAC 125.650(a)(3)(A), comply with all requirements established by that organization for continuing participation in the organization's program until the parent has successfully completed the organization's program.

(1) to forgive the applicable percentage of the certified state debt as provided in 15 AAC 125.678, upon confirmation by the agency that the parent has complied with all requirements of the forgiveness agreement for the relevant reporting period;

(2) to suspend any action under AS 25.27.244 or 25.27.246 against the parent's driver's or occupational licenses as long as the parent remains in compliance with the forgiveness agreement and will release any license that it has already suspended upon receipt of the signed forgiveness agreement and the parent's first payment under that agreement;

(3) except as provided in 15 AAC 125.673, to suspend any enforcement actions to garnish or seize the parent's assets and property as long as the parent remains in compliance with the forgiveness agreement; and

(4) not to pursue any action for criminal nonsupport or civil or criminal contempt against the parent as long as the parent remains in compliance with the forgiveness agreement.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.668 Calculation of monthly payment amount

(a) Unless the agency finds good cause to require a different amount, the agency will calculate the amount of the monthly payment required by the forgiveness agreement by adding the following amounts:

(1) the monthly ongoing support obligation;

(2) the monthly interest charge on any arrears owed to the custodial parent; and

(3) a monthly amount to be collected and applied to any arrears owed to the custodial parent, as determined using the applicable arrears amortization chart set out in 15 AAC 125.545.

(b) In calculating the amount to be paid under the forgiveness agreement, the agency will give credit to the parent for one-half of the cost to the parent of medical and dental insurance premiums for the children and educational payments for the children to the extent that the health insurance coverage and educational payments are required by the applicable support order and are actually paid for by the parent, unless the order provides for a different allocation of these costs.

(c) If payments are made in accordance with an income withholding order under AS 25.27.062 or 25.27.250 but those payments are not sufficient to cover the monthly payment amount set under (a) of this section, the parent must pay the difference between the amount withheld and the monthly payment amount set under (a) of this section by submitting direct payments to the agency in the form of cash, a personal, cashier's, or certified check, a money order, an electronic funds transfer, or payment by wire service.

(d) Good cause for varying the monthly payment amount under (a) of this section will be determined under 15 AAC 125.540(d).

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.670 Alternative payment arrangements

(a) Unless the agency has agreed under AS 25.27.020(f)(1)(C) and this section to an alternative payment arrangement, a forgiveness agreement must require the parent to pay in accordance with an income withholding order issued under AS 25.27.062 or 25.27.250 to the parent's employer, insurer, or financial institution, or to a state or federal agency paying periodic benefits to a parent.

(b) An alternative payment arrangement may include

(1) regular electronic fund transfers;

(2) payments by cash, a certified or cashier's check, or a money order;

(3) payments by wire service; and

(4) lump sum payments in advance.

(1) parent's employment is seasonal and employment in the parent's off-season is unlikely or is not economically feasible;

(2) parent is self-employed;

(3) parent relies on sources of income that are not subject to garnishment under state or federal law; or

(4) agency determines that an alternative payment arrangement is likely to be as effective as income withholding and is in the best interests of the state and of the children.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.673 Continued enforcement actions and application of payments

(a) While a parent is participating in the arrears forgiveness program, the agency will

(1) report the parent's arrears, including the certified state debt, to the federal government for attachment, to the extent required by federal law, of any refund of amounts withheld under 26 U.S.C. (Internal Revenue Code) for federal income tax;

(2) attach the parent's permanent fund dividend under AS 43.23;

(3) leave in place all liens previously asserted against property belonging to the parent; however, the parent may negotiate with the agency for release of the lien against specific property; and

(4) continue to report all arrears, including any portion of the certified state debt that has not yet been forgiven under 15 AAC 125.678, to credit bureaus as required under 15 AAC 125.418.

(b) Repealed 2/16/2013.

(c) Amounts collected through continued enforcement under (a) of this section will not be considered monthly payments under the parent's forgiveness agreement. Amounts collected through continued enforcement under (a) of this section are in addition to the monthly payments required by the forgiveness agreement.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173; am 2/16/2013, Register 205

15 AAC 125.675 Certification of state debt

(a) After the agency has approved a parent for participation in the arrears forgiveness program, the agency will calculate and certify the total state debt owed as of the date the parent was approved for the program. The agency will include in the certified state debt

(1) the principal amount of any arrears that are permanently assigned to the state as of the date the parent was approved for the program; and

(2) any interest that has accrued on the permanently assigned arrears as of the date the parent was approved for the program.

(b) The agency will prepare a written certification stating the amount of the certified state debt subject to forgiveness. The agency will send the parent a copy of the certification with the forgiveness agreement under 15 AAC 125.665.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.678 Forgiveness of certified state debt upon compliance with forgiveness agreement

(a) The agency will monitor the parent's compliance with the forgiveness agreement on a monthly basis and will notify the parent of any noncompliance as provided in 15 AAC 125.680. However, the agency will forgive certified state debt on a yearly basis. The first yearly reporting period commences as of the date the parent was approved for participation in the arrears forgiveness program. Each subsequent yearly reporting period commences on the anniversary of the date the parent was approved for participation in the arrears forgiveness program.

(b) The agency will forgive a portion of the certified state debt at the conclusion of each yearly reporting period at the following rates:

(1) for the first year: 10 percent of the certified state debt, plus the waiver of all interest that accrued on the certified state debt during the first yearly reporting period;

(2) for the second year: 15 percent of the certified state debt, plus the waiver of all interest that accrued on the certified state debt during the second yearly reporting period;

(3) for the third year: 15 percent of the certified state debt, plus the waiver of all interest that accrued on the certified state debt during the third yearly reporting period;

(4) for the fourth year: 20 percent of the certified state debt, plus the waiver of all interest that accrued on the certified state debt during the fourth yearly reporting period;

(5) for the fifth year: 20 percent of the certified state debt, plus the waiver of all interest that accrued on the certified state debt during the fifth yearly reporting period;

(6) for the sixth year: 20 percent of the certified state debt, plus the waiver of all interest that accrued on the certified state debt during the sixth yearly reporting period.

(c) When determining the amount of the certified state debt subject to forgiveness each yearly reporting period, the agency will first apply any payments received from continued enforcement actions, as provided in 15 AAC 125.673. Only the applicable percentage of the certified state debt, after deducting payments under 15 AAC 125.673, will be forgiven. The agency will not forgive an amount that, after the application of any payments under 15 AAC 125.673, results in an overpayment or otherwise reduce the balance owed by the parent below zero.

(d) If a parent's participation in the program is terminated in the middle of a yearly reporting period because the parent no longer meets the requirements of 15 AAC 125.650(a)(2), the agency will forgive a prorated percentage of the certified state debt based on the percentage of the year during which the parent fully complied with the forgiveness agreement. If the parent's participation in the program is terminated in the middle of a yearly reporting period for any reason other than failure to meet the requirements of 15 AAC 125.650(a)(2), the agency will not forgive any percentage of the certified state debt for that yearly reporting period.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.680 Notice of noncompliance with forgiveness agreement and opportunity to cure

(a) If a parent fails to make two payments within a yearly reporting period, the agency will promptly notify the parent after the second missed payment that the parent is in default and that if the parent misses one more payment during the yearly reporting period, the parent's participation in the arrears forgiveness program will be terminated.

(b) If a parent fails to comply with a nonmonetary requirement of the forgiveness agreement, the agency will notify the parent of the noncompliance and will give the parent 30 days after the date the notification is sent in which to cure the noncompliance or to show good cause for the noncompliance. If the parent fails to cure the noncompliance by the end of the 30 days, the agency will terminate the parent's participation in the program as of the date of the termination notice.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.683 Good cause for failure to comply with forgiveness agreement

(a) A parent may establish good cause for failure to make payments or comply with other requirements of a forgiveness agreement by presenting clear and convincing evidence that the parent was unable to make the payment or comply with other requirements of the agreement as a result of substantial hardship or other unusual circumstances. The agency will consider the following factors in determining whether a parent has established good cause for failing to make payments under a forgiveness agreement:

(1) a significant illness or disability prevents the parent from working at any reasonable employment;

(2) the parent has incurred exceptional medical expenses that are not reimbursed by insurance, Medicaid, or another government program, or through private litigation;

(3) an accident or other disaster significantly affects the parent or an immediate family member of the parent;

(4) the parent has physical custody of one or more of the children for whom support is sought under a valid custody order issued by a tribunal of competent jurisdiction;

(5) the parent lives a subsistence lifestyle without any local opportunity for employment;

(6) the net monthly income of the parent's household is below the poverty guideline for this state, as set out in the Federal Register by the United States Department of Health and Human Services, and the agency has not determined the parent to be voluntarily underemployed or unemployed under 15 AAC 125.060.

(b) A request for a good cause determination under (a) of this section must be submitted in writing on a form prescribed by the agency and must be accompanied by all documentation required by the agency and any other documentation on which the parent intends to rely to support the request. As necessary to determine whether a good cause determination is appropriate, the agency may request additional information from the parents or from any other source. The agency will issue an administrative review decision granting or denying the request for a good cause determination as soon as practicable. An administrative appeal is not available from the administrative review decision, but the decision is final for the purpose of appeal to the superior court.

(c) In deciding whether to find good cause for a parent's failure to comply with a forgiveness agreement, the agency will consider the extent to which the parent has eliminated discretionary spending and has disposed of the parent's non-essential assets. For purposes of making a determination under this subsection,

(1) discretionary spending

(A) includes an expenditure made for recreation, comfort, sport, investment, entertainment, private schools, travel, or rental or recreational property; and

(B) does not include an expenditure necessary to feed, house, clothe, or ensure the health of the parent and the parent's immediate family members;

(2) the agency will consider each expenditure on a case-by-case basis; and

(3) in determining whether the parent must dispose of an asset under this subsection, the agency may consider the sentimental value of the asset to the parent and may weigh the sentimental value of the asset to the parent and the cost to the parent of selling the asset against the asset's market value.

(d) If the agency determines that good cause exists for a parent's failure to comply with a forgiveness agreement, the agency will, as appropriate, determine the likely duration of the hardship or other unusual circumstances that form the basis for the good cause finding. The agency may grant a good cause exception under this section only for the duration of the hardship or other unusual circumstances that form the basis for the good cause finding, but in any event for no more than six months. A parent may apply to extend a good cause exception granted under this section beyond the period originally set. The agency will review an extension request in the same manner that the agency reviews an initial request under this section.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.685 Termination of parent's participation in the arrears forgiveness program

(a) The agency will terminate a parent's participation in the arrears forgiveness program if the agency determines that the parent

(1) has failed to make more than two payments required by the forgiveness agreement within the yearly reporting period without good cause;

(2) has failed without good cause to comply with other requirements of the forgiveness agreement and the noncompliance has substantially prejudiced the agency's ability to collect support from the parent;

(3) no longer owes

(A) an ongoing child support obligation to the custodial parent or the state; or

(B) child support arrears to the custodial parent; or

(4) knowingly provided false or incomplete information on the parent's application, and the agency would not have approved the parent's application if the agency had received the correct or complete information at the time of the application.

(b) If the agency determines that termination is appropriate under (a) of this section, the agency will send a written notice of termination to the parent. The parent may contest the termination by submitting to the agency a written request for administrative review within 30 days after the notice was sent to the parent. The request must state the specific reasons for the contest and be accompanied by all documents upon which the person requesting the review intends to rely. The agency may reject a request for administrative review if it does not comply with the requirements set out in this subsection. The administrative review is limited to whether

(1) the parent has complied with the forgiveness agreement;

(2) good cause existed for the parent's noncompliance, as provided in 15 AAC 125.683;

(3) the parent continues to owe an ongoing support obligation or child support arrears as required under 15 AAC 125.650(a)(2); and

(4) the parent knowingly provided false or incomplete information with the parent's application for participation in the program and whether receipt of correct or complete information would have affected the parent's eligibility for the program.

(c) The agency will issue an administrative review decision as soon as practicable after receiving a request under (b) of this section. As necessary to determine whether termination is appropriate, the agency may request additional information from the parents or from any other source. An administrative appeal is not available from the administrative review decision issued under this subsection, but the decision is final for the purpose of appeal to the superior court.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

15 AAC 125.695 Child Support Enforcement

15 AAC 125.695. Definitions for 15 AAC 125.650 - 15 AAC 125.695. In 15 AAC 125.650 - 15 AAC 125.695, unless the context requires otherwise, (1) "arrears forgiveness program" means the program established under AS 25.27.020(f) - (h) and 15 AAC 125.650 - 15 AAC 125.695; (2) "child support arrears" means a debt for support that is owed and past due under a support order for the support and maintenance of a child or a parent of a child for whom the agency is also collecting support; "child support arrears" includes (A) monetary support; (B) payment of health care costs or maintenance of health insurance; (C) reimbursement of related costs; (D) payment of attorney fees and legal costs and other fees; and (E) any penalty, interest, and other relief as required by the support order; (3) "incarceration" includes placement in a state or federal correctional facility, jail, halfway house, or work-release program; (4) "other means of paying support" includes (A) receipt of state or federal benefits, including social security, disability, retirement, and veteran's benefits; (B) rental income from property and other assets; (C) income from trusts, pensions, insurance policies, and litigation; (D) income from interests in partnerships and other business entities; (E) income from self-employment and other business activities; (F) lottery winnings; and (G) dividends from corporations, including dividends from corporations organized under 43 U.S.C. 1601 - 1629h (Alaska Native Claims Settlement Act); (5) "state" means this state or any other state that has requested and been granted approval by the agency to participate in the arrears forgiveness program; (6) "state debt" means child support arrears that are owed a state for reimbursement of public assistance or state-sponsored placement of the parent's children.

History

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173

Authority: AS 25.25.207; AS 25.25.209; AS 25.27.020(a)
Eff. 10/1/98, Register 147

Authority: AS 25.27.020
Eff. 4/1/2005, Register 173; am 2/16/2013, Register 205; am 12/22/2023, Register 248

Article 11 General Provisions

15 AAC 125.900 Child Support Enforcement

15 AAC 125.900. Definitions. (a) Unless the context indicates otherwise, when used in this chapter, (1) "AFDC" means public assistance granted under the program of Aid to Families with Dependent Children; (2) "agency" means the Alaska child support services agency; (3) "application" means a signed request for child support enforcement services; (4) "child support enforcement services" include, but are not limited to, (A) location of absent parents; (B) establishment of support obligations; (C) enforcement of support obligations; (D) collection and distribution of child support payments; (E) establishing paternity; (F) responding to and initiating actions under the Uniform Interstate Family Support Act (AS 25.25.101 - 25.25.903); (5) "periodic payments" means the amount to be paid in regularly scheduled installments in satisfaction of the support obligation; when applicable, it also refers to regularly scheduled payments to satisfy past-due obligations; (6) "credit bureau" means any person who, for monetary fees, dues, or on a cooperative non-profit basis, regularly engages in whole, or in part, in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and who uses any means or facility or interstate commerce for the purpose of preparing or furnishing consumer reports; (7) "lending institution" means a person who, for monetary fees, dues, or on a cooperative non-profit basis, regularly engages in the business of lending money; (8) "person" means an individual, partnership, corporation, trust, firm, estate, cooperative, association, organization, government, governmental subdivision, governmental agency, or other entity; (9) "ATAP" means the Alaska Temporary Assistance Program, codified as AS 47.27.005 - 47.27.900; (10) "business day" means a day on which state offices are open for regular business; (11) "income" means any periodic form of payment due to an individual, regardless of source; the term includes wages, salaries, commissions, bonuses, worker's compensation, disability, payments under a pension or retirement program, and interest; (12) "parent" means the natural or adoptive parent, a person who has the legal status of the parent as a result of the person's marriage to the child's mother or the legitimation of the child under AS 25.20.050, a legal guardian, or a caretaker relative having custody of or responsibility for the child or children; (13) "support order" means a judgment, decree, or order, whether temporary, final, or subject to modification, issued by a court or administrative agency of competent jurisdiction for the support and maintenance of a child, including a child who has attained the age of majority under the law of the issuing state, or for the support and maintenance of a child and the parent with whom the child is living; a judgment, decree, or order is a "support order" if it provides for monetary support, health care, arrearages, or reimbursement, and a judgment, decree, or order that is a "support order" may include related costs and fees, interest and penalties, income withholding, attorneys' fees, and other relief; (14) "tribunal" means a court, administrative agency, or quasi-judicial entity authorized to establish, enforce, or modify support orders or to determine parentage; (15) "administrative support order" means a support order that the agency establishes under AS 25.27.160; (16) "director" means the director of the agency; (17) "direct payment" means a child support payment made by or on behalf of the obligor directly to the custodial parent in the form of cash, a money order, a check made payable to the custodial parent, or a deposit or electronic funds transfer to a bank or equivalent financial account held by the custodial parent; (18) "domestic violence" has the meaning given in AS 18.66.990; (19) "in-kind contribution" (A) means a benefit that is (i) provided by the obligor; (ii) received by the custodial parent, the minor child, or a third party on behalf of the custodial parent or minor child; (iii) intended for the benefit of the minor child; and (iv) not a direct payment or a payment to the agency; and (B) includes services, clothing, food, school supplies, other goods, and payments to third parties. (20) "child support agency of another state" means a child support agency of another state within the meaning given in AS 25.25.101 or a foreign country within the meaning given in AS 25.25.101. (b) For the purposes of AS 25.27.275, "location" is limited to the information contained in the agency file concerning payment, mailing, or actual address of the children at the time the request for release of location is made to the agency.

History

Authority: AS 25.27.020; AS 25.27.110; AS 25.27.275
Eff. 8/23/80, Register 75; am 3/31/82, Register 81; am 10/1/85, Register 95; am 11/28/96, Register 140; am 10/1/98, Register 147; am 6/15/2001, Register 158; am 3/20/2016, Register 217

Chapter 137 Receipt, Custody, Investment, and Management of State Funds

Article 1 Alaska Permanent Fund Corporation

15 AAC 137.010 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.010. Scope of 15 AAC 137.010 - 15 AAC 137.200. Repealed.

History

Eff. 2/5/81, Register 77; am 8/5/82, Register 83; am 7/12/92, Register 123; repealed 9/15/94, Register 131

15 AAC 137.020 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.020. Federally guaranteed loans and mortgages. Repealed 8/5/82.

15 AAC 137.030 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.030. Conventional residential mortgages. Repealed 7/12/92.

15 AAC 137.040 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.040. General terms and conditions for loans and mortgages. Repealed 7/12/92.

15 AAC 137.050 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.050. General terms and conditions for certificates of deposit. Repealed.

History

Eff. 2/5/81, Register 77; repealed 9/15/94, Register 131

15 AAC 137.060 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.060. Accounting practices. Repealed 7/12/92.

15 AAC 137.200 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.200. Definitions. Repealed.

History

Eff. 2/5/81, Register 77; am 5/31/81, Register 78; am 5/20/82, Register 82; am 8/5/82, Register 83; am 7/12/92, Register 123; repealed 9/15/94, Register 131

Authority: AS 37.13.120; AS 37.13.206
Eff. 1/1/2006, Register 177

Article 4 Alaska Permanent Fund Corporation Operational Activities

15 AAC 137.610 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.610. Confidential records. Repealed.

History

Eff. 11/15/2005, Register 177; repealed 12/6/2016, Register 221

Article 5 General Provisions

15 AAC 137.990 Receipt, Custody, Investment, and Management of State Funds

15 AAC 137.990. Definitions. Unless the context requires otherwise, in 15 AAC 137.610 - 15 AAC 137.990, (1) "APFC" means the Alaska Permanent Fund Corporation established in AS 37.13.040; (2) "chief investment officer" means the chief investment officer of the APFC; (3) "co-investment" means a direct investment of permanent fund assets in an entity at the same time and on the same or better economic terms as an investment of permanent fund assets in that entity made through a private equity or hedge fund permitted under 15 AAC 137.460; (4) "collective or commingled investment fund" means an entity whose purpose is to direct the collective investment of assets, including a common trust fund, a collective trust fund, a unit investment trust, an open-end or closed-end mutual fund, an open-end or closed-end registered investment company, or any other collective or commingled investment vehicle that is engaged primarily in the purchase and sale of securities or other assets; (5) "commodities" means (A) materials, such as gold, copper, silver, and petroleum; (B) timber and other agricultural crops; (C) foods; (D) other natural resources; and (E) products of the items identified in (A) - (D) of this paragraph; (6) "derivative" means an instrument whose value, usefulness, and marketability is dependent upon or derives from an underlying asset; classes of derivatives include futures contracts, options, forward contracts, including currency forward contracts, swaps, and options on futures; (7) "derivative based strategy" means an investment strategy used by investors that invest in markets typically dominated by derivative instruments; (8) "executive director" means the executive director of the APFC; (9) "hybrid investment or strategy" means a multi-part investment that may include any investment otherwise allowable, including private equity funds, hedge funds, arbitrage funds, derivative-based strategies, strategic block investment funds, or crossover funds where the underlying investments consist of both public and private investments, including both debt and equity instruments; (10) "includes" or "including" has the same meaning given in AS 01.10.040; (11) "investment grade" means a Standard & Poor's Corporation rating BBB or better, or Moody's Investors Service, Inc., rating of Baa or better, including a rating with a "+" or "-" designation or other variations that occur within these ratings, or a comparable rating by another nationally recognized rating organization or by a recognized rating service in the jurisdiction of the issuer; (12) "leverage" means the use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment; (13) "manager of permanent fund assets" means an individual, firm, or other entity that, either by contract or employment with the APFC, has responsibility for the investment and management of a portion of the assets of the permanent fund; (14) "permanent fund" has the meaning given "fund" in AS 37.13.900. (15) "security" means an instrument that signifies an ownership position in a corporation or other private entity, a creditor relationship with a corporation, other private entity, or governmental body or entity, or rights to ownership such as those represented by an option, future or forward contract, subscription right, or subscription warrant; "security" includes (A) stocks, bonds, convertible bonds, bills, notes, debentures, bankers acceptances, commercial paper, certificates of deposit, and shares of a real estate investment trust or real estate operating company; (B) the types of securities identified under (A) of this paragraph purchased on a when issued basis; and (C) combinations of the types of securities identified under (A) and (B) of this paragraph issued as a single instrument; (16) "short-selling" means (A) the selling of a security that the seller does not own; or (B) any sale that is completed by the delivery of a security borrowed by the seller.

History

Authority: AS 37.13.120; AS 37.13.206
Eff. 11/15/2005, Register 177; am 1/1/2006, Register 177; am 12/10/2014, Register 213

Chapter 139 (Repealed)

Expired.

History

Eff. 6/16/88, Register 106; expired 1/1/90

15 AAC 140.020 Carryforward election

Expired.

History

Eff. 6/16/88, Register 106; expired 1/1/90

15 AAC 140.030 Continued allocation

Expired.

History

Eff. 6/16/88, Register 106; expired 1/1/90

15 AAC 140.040 Lapse of allocation

Expired.

History

Eff. 6/16/88, Register 106; expired 1/1/90

15 AAC 140.050 Definitions

Expired.

History

Eff. 6/16/88, Register 106; expired 1/1/90

Chapter 144 Municipal Bond Bank Authority

15 AAC 144.010 Scope of regulations

This chapter applies to all applications by a municipality for a loan from the Alaska Municipal Bond Bank Authority through the purchase by the authority of municipal bonds of the municipality under AS 44.85.

History

Authority: AS 44.85.080; AS 44.85.095
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.020 Eligibility

(a) The authority will, in its discretion, approve a loan to a municipality only if the loan meets the following criteria:

(1) the authority determines the municipality to be creditworthy after evaluating the municipality's loan application and any other information the authority considers relevant; and

(2) the authority determines, on the basis of the completed application and other information, that the municipality would have to pay unnecessarily high borrowing costs in an offering of its municipal bonds to investors because of one or more of the following factors:

(A) the municipality has not issued municipal bonds or the municipality has little outstanding debt;

(B) investors are unfamiliar with the municipality because it has been newly incorporated or has experienced recent rapid growth;

(C) the distance of the state from capital markets makes the municipality's bonds less attractive than bonds of a comparable municipality elsewhere in the United States; or

(D) investors consider the municipality's bonds to have an element of risk because of apprehension of possible temporary economic dislocation due to the loss or prospective loss of a major employer in the municipality.

(b) The authority will, in its discretion, approve a loan not eligible under (a) of this section if the authority determines that the loan will improve the marketability of authority bonds issued to make loans under (a) of this section.

History

Authority: AS 44.85.005; AS 44.85.080; AS 44.85.095
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.030 Preferred purposes

The authority will consider the following capital improvements, listed in order of preference, as preferred purposes for loans to municipalities:

(1) school facilities;

(2) waste water treatment facilities;

(3) fire protection and public safety facilities;

(4) deleted;

(5) public health facilities;

(6) public transportation facilities;

(7) other capital improvements.

History

Authority: AS 44.85.080; AS 44.85.095; AS 44.85.180
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.040 Application

Each application by a municipality for a loan from the authority shall be in a form approved by the authority, and must include:

(1) evidence of the municipality's eligibility under 15 AAC 144.020;

(2) a complete description of the purposes of the loan;

(3) unless waived by the authority based upon a finding that a substantially reliable financial statement has been prepared, a financial statement certified by an independent certified public accountant for the last fiscal year of the municipality;

(4) identification of the amount and sources of all financing required to complete the project; and

(5) any additional information or documentation requested by the executive director to determine the municipality's eligibility under this chapter or AS 44.85.

History

Authority: AS 44.85.080; AS 44.85.095
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.050 Acceptance of completed applications

When the information required by 15 AAC 144.040 is received by the executive director, the application is completed. The completed application will be evaluated by the executive director to determine whether the eligibility criteria set out in 15 AAC 144.020 have been met.

History

Authority: AS 44.85.080; AS 44.85.095
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.060 Board review

(a) The completed application along with the recommendation of the executive director and any other relevant information shall be transmitted to the board of directors for its review.

(b) The board will, in its discretion, request that the executive director obtain additional information and postpone immediate action on the application.

(c) The authority will approve a loan application for a project whose completion requires financing in addition to the loan from the authority, only upon the condition that before the authority issues bonds or disburses funds for the loan, the municipality demonstrates to the authority's satisfaction that all financing required to complete the project has been committed.

(d) The authority may not approve a loan application from a municipality with an obligation in default unless

(1) the municipality has undertaken to cure the default in a manner approved by all parties to the obligation; and

(2) the authority finds that approval of the loan application will not have an adverse effect on the authority's credit rating.

(e) If the board approves an application, the board will instruct the executive director to enter into a loan agreement to purchase the municipal bonds of the municipality at the time or times the authority is able to sell its own bonds in amounts, at rates of interest, and on other terms and conditions that would enable the authority to purchase the municipal bonds. The loan agreement must require, as a condition of closing the loan, evidence satisfactory to the authority that the municipality has authorized the borrowing.

History

Authority: AS 44.85.080; AS 44.85.095
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.070 Effect of letter of commitment

Repealed.

History

Eff. 4/1/76, Register 58; repealed 10/19/94, Register 132

15 AAC 144.075 Method of bond sale

The board of directors of the authority shall determine the method of sale for each bond issue. In its report on each loan application, the authority's financial advisor shall recommend, based on the factors set out in (1) - (7) of this section, the method by which the authority should sell bonds to finance the loan. The authority will sell bonds at competitive sale unless the board determines that a negotiated sale is in the interest of the authority and the borrowing municipalities. In determining the method of sale, the board shall consider the following factors:

(1) size of the authority's bond issue;

(2) schedule for issuance of the authority's bonds;

(3) market conditions, including interest rate volatility;

(4) market familiarity with bond structure;

(5) whether the issue is a new money or a refunding issue;

(6) expected credit rating of the issue; and

(7) preference of a borrowing municipality for a particular method of sale, and the municipality's reasons for that preference, as stated in its loan application.

History

Authority: AS 44.85.080; AS 44.85.095; AS 44.85.200
Eff. 10/19/94, Register 132

15 AAC 144.080 Conditions

(a) A municipality that submits a loan application shall make its books and records available for inspection by the authority or its agents upon the receipt of a reasonable request to inspect them.

(b) The authority will, in its discretion, request that the municipality pay in advance for the direct cost of evaluating its application and no application will be considered until the requested payment has been made.

(c) The authority will, in its discretion, require that the applicant agree that in the event of a postponement of the date of purchase of municipal bonds, the applicant will hold the authority harmless from any liability arising out of reliance by the applicant or any third party upon approval of the loan application.

(d) The authority will, in its discretion, require that the loan agreement to be entered into provide terms, conditions and limitations with respect to the amount of bonds that the municipality may issue after execution of the agreement, the pledging of municipal revenues to the municipal bonds purchased by the authority, and otherwise as in the opinion of the authority are proper for the purposes and security of the authority and the holders of its bonds and notes.

History

Authority: AS 44.85.080; AS 44.85.095; AS 44.85.170
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

15 AAC 144.090 Definitions

In this chapter

(1) "authority" means the Alaska Municipal Bond Bank Authority created by AS 44.85;

(2) "executive director" means the executive secretary for the authority appointed under AS 44.85.070;

(3) "creditworthy" means that, in the opinion of the authority, the current financial position of a municipality is such that the municipality will be able to service its authorized and outstanding municipal bonds without expectation of subsidy from state money not currently available under state law and without imposing financial burdens upon its residents that would create the expectation that its ability to service its municipal bonds in the future will be impaired, and that there is no other reason to expect that in the future the municipality will not be able to meet its debt service obligations as they become due;

(4) "municipal bond" means municipal bond as that term is defined in AS 44.85.410;

(5) "facilities" means capital improvements, including both real and personal property.

History

Authority: AS 44.85.010; AS 44.85.095 AS 44.85.080; AS 44.85.410
Eff. 4/1/76, Register 58; am 10/19/94, Register 132

Eff. 2/17/85, Register 93; repealed 2/20/2022, Register 241

15 AAC 145.080 Forest Products Business Loan Guarantee

Reserved.

15 AAC 145.090 Definitions

Repealed.

History

Eff. 2/17/85, Register 93; repealed 2/20/2022, Register 241

Chapter 150 Alaska Housing Finance Corporation

Article 1 General Provisions

15 AAC 150.010 General provisions

Except as otherwise provided, the provisions of 15 AAC 150 apply to all programs of the Corporation, including the programs established in 15 AAC 151 - 15 AAC 155. The provisions of 15 AAC 150.030 - 15 AAC 150.110 constitute a part of the regulations of the Corporation for each program of the Corporation described in 15 AAC 151 - 15 AAC 155 that involves the making, participating in the making, purchasing, or participating in the purchase of a loan by the Corporation and do not independently authorize or obligate the Corporation to make, participate in the making, purchase, or participate in the purchase of a loan.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.015 Availability of funds

Whenever in 15 AAC 150 - 15 AAC 155 a regulation of the Corporation refers to making, participating in the making, purchasing, or participating in the purchasing of loans or to the making or awarding of grants, the regulation is subject to the availability of funds to the Corporation for that purpose.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.020 Public notice of meeting

(a) Except in the case of a meeting of the board at which the issuance of Corporation bonds is authorized, not more than fifteen days and not less than seven days before each meeting, the Corporation will give public notice of the time, place, and subject of the meeting. In the case of a meeting of the board at which the issuance of Corporation bonds is authorized, the Corporation will give public notice of the time, place, and subject of the meeting at least 24 hours before the meeting. The Corporation will give the notice by advertisement in a newspaper of statewide circulation.

(b) The Corporation will, in its discretion, establish additional procedures to insure that the public has a reasonable opportunity to be heard and that business at meetings will be conducted in an orderly process.

History

Authority: AS 18.56.040(d)AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.030 Minimum construction standards

(a) The corporation will not make, participate in the making of, purchase, or participate in the purchase of a loan for the acquisition, construction, or improvement of residential housing the construction of which began after June 30, 1992, unless the residential housing is in compliance with the state building code adopted by the Department of Public Safety under 13 AAC 50.020 or by the corporation under 15 AAC 150.035, or is subject to an approved municipal building code. For purposes of this section, the construction of a residential unit will be considered to have been begun by June 30, 1992, if the pilings, footings, or foundation was started by that date.

(b) Each application for the purchase of a loan which is to be secured by a residential unit the construction of which began after June 30, 1992, must be accompanied by a release as described in 15 AAC 150.045 and by either proof of the issuance of a certificate of final approval by an authorized inspector certifying that the residential unit complies with the state building code or proof of the issuance of a certificate of occupancy issued by a municipality with an approved municipal building code. In issuing a certificate of final approval, an authorized inspector may rely on inspections conducted by other authorized inspectors at earlier stages of construction. The inspector must certify that the residential unit was inspected and determined to be in compliance with the state building code at each of the following five stages of construction:

(1) plan approval;

(2) completion of footings and foundations;

(3) completion of electrical installation, plumbing, mechanical, and framing;

(4) completion of installation of insulation; and

(5) final approval.

(c) With respect to a loan which is to be secured by a residential unit which is a prefabricated unit or a mobile home on a permanent foundation, an authorized inspector may rely on the following for purposes of certifying compliance with 15 AAC 150.030(b)(3) and (4):

(1) for a prefabricated unit manufactured outside the state, either (A) a certification issued by any governmental entity in the state where the unit is being or was manufactured which is responsible for inspecting such units or (B) an approved inspectors report on a Corporation approved inspection form. The inspections by either a governmental entity or approved inspector must, at a minimum, certify that the prefabricated unit has been inspected for compliance with the approved plans provided by the manufacturer; the unit meets all requirements of the state building code; any preassembled wall panels are approved by and listed with the International Code Council or other federally recognized agencies with quality control measures conducted by a qualified third party; and the seal or insignia has been affixed to the unit by the appropriate governmental inspector or by an approved inspector who has affixed the manufacturer's seal or insignia to the unit in a permanent manner;

(2) for a prefabricated unit manufactured in the state, a certification issued by an authorized inspector which certifies that the prefabricated unit has been inspected for compliance with the approved plans provided to the manufacturer and that the unit meets all requirements of the state building code; and

(3) for a mobile home placed on a permanent foundation, a certification label attesting to compliance with 24 CFR 3280 and 24 CFR 3282.

(d) With regard to loans secured by residential construction in rural areas, the inspector may rely on methods of inspection other than personal on-site inspections, including video tape, representative stationary photos or other methods if prior approval has been obtained in writing from the Corporation.

(e) The executive director shall annually review the construction codes of the various municipalities and determine which municipalities have adopted and are enforcing construction codes each of which meet or exceed the comparable standards established for residential housing by the state building code. The executive director shall prepare a list of municipalities having an approved municipal building code for purposes of compliance with AS 18.56.300. The Corporation will consider compliance with an approved municipal building code to be compliance with the requirements of AS 18.56.300 even though the standards of the municipal code may differ in some respects from the standards of the state building code. A municipality may appeal the decision of the executive director regarding its construction codes pursuant to 15 AAC 150.210.

(f) The Corporation will develop an inspection form to be used by authorized inspectors. A completed inspection form certifying final approval must be recorded in the recording district where the property is located, and the Corporation must receive a copy of the recorded inspection form.

(g) The Corporation will, in its discretion, accept a certificate of final approval or a certificate of occupancy for a residential unit that has been conditioned on the later completion of certain items which cannot be completed due to weather or other extraordinary conditions as determined by the Corporation. The Corporation will accept a conditional certificate under this subsection only if:

(1) the items to be completed are adequately described in the conditional certificate;

(2) the Corporation receives a guarantee that all unfinished items will be completed; and

(3) in the sole determination of the Corporation, the guarantee is acceptable to the Corporation. The Corporation will not make or purchase a loan secured by a residential unit for which the Corporation has previously accepted a conditional certificate under this subsection unless the Corporation has received proof satisfactory to it of completion of the unfinished items described in the conditional certificate.

(h) This section does not apply to a housing loan made under AS 18.56.106.

History

Authority: AS 18.56.088; AS 18.56.300
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 4/2/97, Register 142; am 5/14/97, Register 145; am 5/3/2001, Register 159; am 6/23/2004, Register 178; am 3/9/2011, Register 204

15 AAC 150.035 Adoption of residential building code and amendments

(a) The International Residential Code of 2018, with Alaska-specific amendments dated November 28, 2018, which are adopted by reference, shall constitute the residential building code for buildings used for residential purposes containing four or fewer dwelling units. This residential building code is applicable to buildings whose construction began on or after January 1, 2019, and to a residential unit that is not located within a municipality that has an approved municipal building code as described in 15 AAC 150.030.

(b) The version of the International Residential Code, with Alaska-specific amendments, applicable as the residential building code for buildings used for residential purposes containing four or fewer dwelling units shall be determined by the date construction began, as determined by the date the foundation began installation.

(i) Repealed 11/28/2018.

(ii) Repealed 11/28/2018.

(iii) Repealed 11/28/2018.

History

Authority: AS 18.56.088; AS 18.56.300
Eff. 3/9/2011, Register 204; am 4/1/2016, Register 218; am 7/26/2017, Register 224; am 11/28/2018, Register 229

15 AAC 150.040 Compliance with building energy efficiency standard

(a) Except as provided in (b) of this section, the Corporation will not make, participate in the making of, purchase, or participate in the purchase of a loan for a residential building, the construction of which begins after December 31, 1991, unless the building complies with the building energy efficiency standard adopted by the Corporation in 15 AAC 155.010.

(b) The Corporation will make, participate in the making of, purchase, or participate in the purchase of a loan for a residential building the construction of which began after December 31, 1991, that does not comply with 15 AAC 155.010 only if the loan applicant agrees, in writing, to bring the building into compliance with 15 AAC 155.010 within one year of the date of the loan. The Corporation will, in its discretion, require the applicant to agree to any other terms it considers necessary to assure compliance with this section or to protect its investment in the loan.

(c) A residential building meets the energy efficiency standard for purposes of this section if it is in compliance with the energy efficiency standards as determined by any of the methods set forth by the Corporation under 15 AAC 155.030.

(d) Repealed 1/31/2018.

History

Authority: AS 18.56.088; AS 18.56.096(c) AS 18.56.090; AS 18.56.300
Eff. 5/7/93, Register 130; am 1/3/18, Register 226

15 AAC 150.045 Release of corporation

The Corporation will require as a condition of making, participating in the making of, purchasing, or participating in the purchase of a mortgage loan, a waiver and release from each borrower releasing the Corporation from any liability for any failure of the residential unit to meet either the construction standards set forth at 15 AAC 150.030 or 15 AAC 155.010, for any threat to health or safety contained in the residence, and for every other matter and thing relating to the construction or physical condition of the unit regardless of cause. Neither the making or purchase of a loan by the Corporation nor the participation by the Corporation in the making or purchase of a loan is a representation or warranty by the Corporation that a residence complies with 15 AAC 155.010, the standards established in 15 AAC 150.030 or 15 AAC 150.100, or any other construction standard. The Corporation will prepare a form of release to be executed by each borrower prior to making, participating in the making, purchasing, or participating in the purchase of a mortgage loan and will incorporate the release into those loan documents the Corporation considers appropriate.

History

Authority: AS 18.56.088; AS 18.56.096(c)AS 46.11.040
Eff. 5/7/93, Register 130

15 AAC 150.050 Past due child support

The Corporation will not make, participate in the making, purchase, or participate in the purchase of a loan to an individual who has a past due child support obligation established by court order or by the child support services agency under AS 47.23.160 - 47.23.220.

History

Authority: AS 18.56.088; AS 18.56.096(a)(7)
Eff. 5/7/93, Register 130

15 AAC 150.060 Determination of interest rates

(a) The Corporation will establish and, in its discretion, from time to time revise rates of interest applicable to loans. The Corporation will not make, participate in the making of, purchase, or participate in the purchase of a loan unless the loan bears interest at the rate established under this section at the time of the making, purchasing, or participating by the Corporation. The rate of interest established and revised under this section will:

(1) not exceed the legal rate of interest in the state applicable to the type of loan involved;

(2) be adequate to insure the financial viability of the Corporation's bond and note financing programs and comply with the requirements of contracts entered into with holders of the Corporation's bonds and notes;

(3) comply with all provisions of law, including United States Treasury regulations, applicable to the Corporation and its loans; and

(4) be designed to promote the use of the programs by qualifying residents of the state.

(b) The board of directors may delegate the power to revise interest rates on mortgage loans to the executive director.

History

Authority: AS 18.56.050; AS 18.56.090(13) AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 150.070 Contractor prerequisites for loans

(a) The Corporation will not make, participate in the making of, purchase, or participate in the purchase of a loan to finance the purchase of new housing or the improvement or rehabilitation of existing housing, unless the construction, improvement, or rehabilitation work has been performed by a contractor who is registered to work as a contractor under AS 08.18.

(b) This section does not apply if the construction, improvement, or rehabilitation work:

(1) has been totally or substantially performed by the borrower;

(2) has been performed by a borrower who acts as the contractor for the construction, improvement, or rehabilitation work; or

(3) has been performed in an area designated by the Corporation as exempt from the requirements of this section because of the unavailability of registered contractors in that area.

History

Authority: AS 18.56.096(a)(3)AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.080 Seller requirements; sellers' guide

(a) The corporation may purchase loans from originating lenders pursuant to the applicable program of the corporation under 15 AAC 151 - 15 AAC 155 only under the following terms and conditions:

(1) the seller must be

(A) approved by the applicable government agency if the seller intends to originate governmentally insured mortgages;

(B) approved by either FNMA or FHLMC if the seller intends to originate conventional mortgages, or is otherwise approved by the corporation as having the capability and experience necessary to originate conventional mortgage loans; or

(2) the seller must provide a bond, or other form of insurance acceptable to the corporation, which in either case the corporation considers sufficient to protect the corporation against errors, omissions, and fraud;

(3) unless the seller is approved under the provisions of 15 AAC 151.920, the corporation will purchase a mortgage loan from a seller only after the seller has completed and submitted to the corporation a loan application with supporting documents as described in the sellers' guide;

(4) the seller must provide for the servicing of the loan either by entering into a servicing agreement with the corporation pursuant to 15 AAC 150.090 or by identifying another institution that qualifies as a servicer for the loan; and

(5) the lender must enter into a selling agreement with the corporation.

(b) The Corporation will prepare a sellers' guide which the Corporation will distribute to sellers. The sellers' guide shall:

(1) be prepared and revised as the executive director considers appropriate;

(2) establish criteria for the timeliness of reports and remittance of funds, appraisal procedures, documents necessary for credit determination, and other procedures customarily required by prudent mortgage lenders;

(3) establish the form of all applications for mortgage loans;

(4) contain a list of completed documents and materials that must accompany an application, including proof of borrower eligibility and financial capacity and other documentation customarily required by prudent mortgage lenders;

(5) provide a form of a contract of commitment or approval form; and

(6) require submission of other documents and materials as the executive director considers desirable.

(c) The executive director is authorized to (1) make, participate in the making, purchase, or participate in the purchase of mortgage loans, (2) enter into and terminate agreements with sellers, (3) administer the terms and provisions of agreements with sellers, and (4) administer the terms and provisions of the sellers' guide.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.098
Eff. 5/7/93, Register 130; am 7/25/2012, Register 205

15 AAC 150.090 Servicer requirements; servicers' guide

(a) An institution that proposes to service a loan owned by the Corporation must have financial viability, in-state servicing capabilities, and general capacity to act as a servicer sufficient, in the sole judgment of the Corporation, to demonstrate full capacity and ability to provide complete servicing for the loan.

(b) Before the Corporation will permit an institution to service a loan owned by the Corporation, the institution must enter into a servicing agreement with the Corporation. The servicing agreement or the servicers' guide will:

(1) provide acceptable methods for delinquent collections and foreclosures by the servicer;

(2) provide for periodic reports to be provided to the Corporation by the servicer;

(3) require the servicer to service mortgages in accordance with acceptable mortgage practices of prudent lending, including, but not limited to, the exercising of diligence in collecting amounts due under mortgages;

(4) contain a provision for liquidated damages to be offset against the service fee whenever a loan servicer fails to make timely remittance to the Corporation of loan payments from a borrower;

(5) contain a provision requiring the servicer to do all things necessary to foreclose liens and to manage the subject property, when required by the Corporation;

(6) contain a provision requiring the servicer to report the cessation of owner-occupancy, if such information becomes known to the servicer;

(7) contain a provision granting the Corporation the discretion to suspend, terminate, or rescind the servicing agreement if any remittance is more than 30 days late and for other reasons as may be stated in the servicing agreement; and

(8) contain a provision granting the Corporation the discretion to suspend or to rescind the servicing agreement if the servicer's delinquency rate becomes excessive, as determined by the executive director.

(c) In addition to the provisions in 15 AAC 150.090(b), a servicing agreement may include a provision allowing the servicer to charge the borrower an origination fee.

(d) The servicers' guide shall:

(1) be prepared and revised as the executive director considers appropriate;

(2) establish criteria for the format, timeliness, and remittance of reports and funds due the Corporation; and

(3) require submission of other documents and materials as the executive director considers desirable.

(e) In this section:

(1) "timely remittance" means a remittance received by the Corporation according to the required procedures as noted in the servicers' guide; and

(2) "liquidated damages" means the penalty and fees as outlined in the servicing agreement described in 15 AAC 150.090(b) and the servicers' guide.

History

Authority: AS 15.56.088(c)(4)AS 18.56.400 AS 18.56.090; AS 18.56.510
Eff. 5/7/93, Register 130

15 AAC 150.100 Minimum health and safety standards

The Corporation will not originate or purchase a loan for any property which presents a threat to health or safety known by the Corporation, unless the threat will be eliminated through the application of the proceeds of the loan. The Corporation will not undertake to independently discover any threat to health or safety with respect to the property, and the Corporation does not warrant the safety of any property as a result of the provisions of this section.

History

Authority: AS 18.56.400
Eff. 5/7/93, Register 130

15 AAC 150.110 Regions

Repealed.

History

Eff. 5/7/93, Register 130; repealed 08/13/04, Register 178

15 AAC 150.120 Waiver of regulations

The board may waive all or part of the regulations of the Corporation if the board finds that such a waiver is in the best interest of the Corporation and that there is good cause for the waiver.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.130 Contract formation and modifications

(a) The Corporation, in consultation with the Department of Law, will, in its discretion, establish standard contract clauses and forms for all Corporation contracts and agreements.

(b) A Corporation contract or agreement may not be transferred or otherwise assigned without the prior, written consent of the Corporation. If the Corporation determines that it is in its best interest, the Corporation will recognize a successor in interest in a novation agreement in which the transferor and the transferee agree that:

(1) the transferee assumes all of the transferor's rights and obligations under the contract; and

(2) the transferor waives all rights it has under the contract as against the Corporation.

(c) If a contractor requests to change the name in which it holds a contract with the Corporation, the Corporation will, in its discretion and if it is in the best interest of the Corporation, enter into an agreement with the requesting contractor to effect the change of name. The agreement changing the name must indicate specifically that no other terms of the contract are changed.

History

Authority: AS 18.56.088; AS 36.30.015(f)
Eff. 5/7/93, Register 130

Article 2 Appeals

15 AAC 150.200 General provisions

(a) Unless otherwise required by federal or state law or regulations, provisions of contracts to which the Corporation is a party or is otherwise bound, or the conditions of a grant, gift, bequest, cooperative agreement, or federal assistance agreement, 15 AAC 150.200 - 15 AAC 150.230 govern the administrative appeal of decisions of the Corporation.

(b) The Corporation will, in its discretion, adopt internal policies relating to the management of appeal procedures.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.210 Appeal for reconsideration

(a) Appeals permitted by the following sections are subject to the provisions of this section: 15 AAC 150.030, 15 AAC 151.920, 15 AAC 151.930, 15 AAC 152.900, 15 AAC 155.020, 15 AAC 155.030, and 15 AAC 155.630.

(b) An appeal under this section will be heard and decided by the executive director, the designee, or an appeals committee appointed by the executive director or the designee.

(1) If an appeal involves a decision made by the executive director, or if the executive director has a conflict of interest, the executive director shall appoint as the designee, a person who was not directly involved in making the decision, to hear and decide the appeal, or to appoint an appeals committee.

(2) Upon receiving an appeal under of this section, the executive director or the designee may appoint an appeals committee. The executive director, the designee, or the appointed appeals committee shall review the appeal, relevant information from agency staff, including any decision by staff, and other relevant information, and shall

(i) prepare a final decision; or

(ii) request additional information from the appellant.

(1) a decision by the Corporation relating to purchasing, participating in the purchase, making, or participating in the making of a mortgage loan may be appealed by the seller of the mortgage loan;

(2) a decision by the Corporation relating to the denial of approval for a housing project may be appealed by the seller sponsoring the project;

(3) a decision by the Corporation relating to the recertification of approval for a housing project may be appealed by the project homeowner association applying for recertification;

(4) a decision by the Corporation relating to a direct loan by the Corporation may be appealed by the borrower or his or her designee;

(5) a decision by the executive director under 15 AAC 150.030(d) relating to a municipality's construction code may be appealed by the municipality affected by the decision;

(6) a decision by the Corporation under 15 AAC 151.920 relating to a delegated underwriter application may be appealed by the applicant; and

(7) a decision by the Corporation under 15 AAC 155.020 or 15 AAC 155.030 relating to the energy efficiency standard that is subject to appeal under the terms of those sections may be appealed by the requester referred to in those sections.

(d) Repealed 5/31/2017.

(e) No member of the appeals committee may serve on an appeal in which he or she has a conflict of interest. The remaining members of the committee will determine whether a conflict of interest exists. If a conflict of interest is found, the executive director or the designee will appoint a new member to the appeals committee.

(f) If the executive director, the designee, or an appeals committee reaches a decision that is adverse to the appellant, the decision must:

(1) be in writing and dated;

(2) specifically set forth the reasons relied upon to reach the decision;

(3) be signed by the executive director or the designee for the appeal; and

(4) be mailed or delivered to the appellant.

(g) An appeal under this section must be in writing and dated, must be received by the Corporation within 10 working days after the date of the Corporation's decision being appealed, and must include at least the following information:

(1) the name, address, and telephone number of the appellant or appellant's designated representative;

(2) the signature of the appellant or appellant's designated representative;

(3) specific reasons supporting the appeal; and

(4) a detailed statement of the factual grounds of the appeal, including copies of relevant documentation.

(h) In the case of an appeal from a decision relating to the recertification of a housing project, the project homeowner association may make an oral presentation to the executive director, the designee, or the appeals committee. A request to make an oral presentation must be included in the written notice of appeal. The Corporation's project reviewer may attend the presentation and provide comments.

(i) The executive director, the designee, or the appeals committee shall issue a written appeal decision within 30 calendar days after the later of the date when the Corporation receives the notice of appeal, or the date when the appellant responds to a request for more information under (b)(2)(ii) of this section. If the written decision is not issued by this deadline, the appeal shall be deemed denied.

(j) The Corporation will consider no further appeal from a decision of the executive director, the designee, or the appeals committee.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130; am 9/19/2001, Register 160; am 6/14/2010, Register 204; am 7/14/2010, Register 204; am 5/31/2017, Register 223

15 AAC 150.220 Protests, controversies

(a) Appeals permitted by the following sections are subject to the provisions of this section: 15 AAC 150.320(p), 15 AAC 150.330(k), 15 AAC 150.380, 15 AAC 150.740, and 15 AAC 154.060.

(b) An interested party may protest the award of a contract or grant, or low-income housing tax credit, the proposed award of a contract or grant, or low-income housing tax credit, or a solicitation for supplies, services, construction, space leases, or professional services by the Corporation. The protest must be in writing and must include at least the following information:

(1) the name, address, and telephone number of the protester;

(2) the signature of the protester or the protester's designated representative;

(3) identification of the solicitation, contract, or grant agreement at issue;

(4) a detailed statement of the legal and factual grounds of the protest, including copies of relevant documents; and

(5) the form of relief requested.

(c) A protest based on alleged improprieties in an award of a contract or grant, or a proposed award of a contract or grant, must be filed within ten calendar days after a notice of intent to award is issued by the chief procurement officer. If the protester shows good cause, the chief procurement officer will, in his or her discretion, consider a filed protest that is not submitted in a timely manner.

(d) The appropriate Corporation officer will immediately give notice of a protest to the contractor if a contract has been awarded, or the apparently successful grantee if a grant has been awarded, or, if no award has been made, to all interested parties.

(e) Within 14 calendar days after a protest is filed, the appropriate Corporation officer will issue a written decision containing the basis of the decision concerning the protest and will furnish a copy of the decision to the protester by certified mail or by other means that provide evidence of delivery.

(f) An appeal from a protest decision may be filed by the protester with the chief procurement officer within five calendar days after the decision is received and must include the following information:

(1) a copy of the decision being appealed; and

(2) identification of the factual or legal errors in the decision that form the basis for appeal.

(g) The chief procurement officer will, within 15 calendar days after receipt of an appeal, notify the appellant of the acceptance or rejection of the appeal and, if it is rejected, the reasons for the rejection.

(h) The chief procurement officer will issue a final decision on an appeal without an oral hearing.

(i) A contractor may file with the Corporation a claim concerning a contract controversy. The contractor shall certify that the claim is made in good faith, the supporting data is accurate and complete, and the amount requested as a result of the controversy accurately reflects the amount for which the contractor believes the Corporation is liable.

(j) If a controversy cannot be resolved by agreement, the chief procurement officer will issue a written decision. The decision will be made no more than 90 calendar days after receipt by the Corporation of all necessary information from the contractor. A copy of the decision will be forwarded to the contractor. Before issuing the decision, the Corporation will review the facts relating to the controversy and obtain necessary assistance from legal, fiscal, and other essential advisers. The decision will include:

(1) a description of the controversy;

(2) reference to the pertinent contract provisions; and

(3) a statement of the reasons supporting the decision.

(k) The Corporation will consider no further appeal from a written decision of the chief procurement officer.

(l) In this section, "interested party" means:

(1) with respect to the award of a grant or contract, a person who applied for the grant or contract but was not selected by the Corporation, and

(2) with respect to a solicitation for supplies, services, construction, space leases, or professional services, a person who is capable of providing the supplies, services, construction, space leases, or professional services and who did not receive the solicitation.

History

Authority: AS 18.56.088; AS 36.30.015
Eff. 5/7/93, Register 130; am 9/23/97, Register 145; am 9/19/2001, Register 160

15 AAC 150.225 Appeals related to energy rater authorization

(a) Appeals permitted by the following sections are subject to the provisions of this section: 15 AAC 155.530, 15 AAC 155.540, and 15 AAC 155.560.

(b) An interested party may appeal the following decisions by the Corporation under this section:

(1) a decision to deny an application from a person seeking to be authorized to perform energy ratings for use in Corporation programs under 15 AAC 155.530;

(2) a decision to decline to renew an energy rater agreement under 15 AAC 155.540;

(3) a decision to terminate or suspend an energy rater agreement under 15 AAC 155.560; and

(4) a decision to discipline, censor, withhold payment, or take any other administrative action as provided under the terms and provisions of the energy rater agreement.

(c) The appeal must be submitted within 30 days after receipt of notification of the decision to the Corporation's chief procurement officer. The appeal must be in writing and must include the following information:

(1) the name, address, and telephone number of the appellant;

(2) the signature of the appellant or the appellant's designated representative;

(3) identification of the decision, or administrative action at issue;

(4) the factual grounds upon which the appeal is based;

(5) relevant exhibits or affidavits;

(6) reference to any laws, regulations, provisions of the energy rater agreement, or Corporation policies or procedures upon which the appellant relies; and

(7) the form of relief requested.

(d) Upon receipt of an appeal, the chief procurement officer shall direct the energy program manager to submit a written response to the appeal within 30 days. The response must include the following information:

(1) the name, job title, and telephone number of the person preparing the response;

(2) the signature of the person preparing the response;

(3) a statement of the reasons supporting the decision or administrative action;

(4) the factual grounds upon which the decision or administrative action is based;

(5) relevant exhibits or affidavits; and

(6) reference to any laws, regulations, provisions of the energy rater agreement, or Corporation policies or procedures upon which the Corporation relies.

(e) The appellant has the burden to prove by a preponderance of the evidence that the appellant is entitled to the requested relief under the statutes and regulations governing energy rater authorization.

(f) After receipt of the Corporation's response, the chief procurement officer shall issue a decision within 45 days stating the reasons for the decision. If the chief procurement officer determines that additional information is necessary to reach a decision, the chief procurement officer may provide for additional written or oral presentations. If the chief procurement officer requests additional presentations, the time within which the chief procurement officer must issue a decision will be extended by 15 days.

(g) The Corporation will not consider a further appeal from a written decision of the chief procurement officer.

History

Authority: AS 18.56.088; AS 18.56.096; AS 18.56.850
Eff. 6/14/2010, Register 204

15 AAC 150.230 Other appeals

Except as expressly permitted by 15 AAC 150.200 - 15 AAC 150.220 or by applicable federal or state regulations and provisions, the Corporation will not permit administrative appeals of its decisions.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 150.240 Exemptions to appeal procedures

The appeals provisions described in 15 AAC 150.200 - 15 AAC 150.230 do not apply to, and the Corporation will not permit an appeal with respect to, any of the following matters:

(1) contacts for professional witnesses to provide professional services or testimony relating to existing or probable lawsuits to which the Corporation is or might become a party;

(2) acquisitions or dispositions of real property or an interest in real estate;

(3) purchase of income-producing assets by the Corporation and expenditures associated with the acquisition and holding of those assets;

(4) purchase of books, newspapers, periodicals, audiovisual material, network information services including financial informational electronic services, all media advertising, professional memberships, archival materials, objects of art, or archival acquisitions;

(5) contracts for supplies or services for research projects funded by the federal government or private grants;

(6) guest speakers, professional instructors, or performers for management and educational training forums, conferences, or associated programs;

(7) expenditures, not to include services of bond counsel or financial advisers, associated with the issuance of Corporation debt obligations;

(8) premium expenditures for all required Corporation insurance coverage;

(9) expenditures for valuation appraisals for real estate owned by the Corporation; and

(10) compliance with the terms and conditions of a grant, gift, bequest, cooperative agreement, or federal assistance agreement.

History

Authority: AS 18.56.088; AS 36.30.015(f)
Eff. 5/7/93, Register 130

Article 3 Procurement

15 AAC 150.300 Procurement

(a) The provisions of 15 AAC 150.300 - 15 AAC 150.490 establish policies, authority, and guidelines relating to the procurement, management, and control of supplies, equipment, services, construction, office or other space leases, personal property, and professional services by the Corporation, and are intended to achieve maximum uniformity of procurement practices throughout the Corporation.

(b) In procuring the items described in (a) of this section, the Corporation will not discriminate on the basis of race, religion, color, national origin, sex, age, marital status, pregnancy, parenthood, disability, or political affiliation.

(c) The corporation may fulfill purchasing requirements by procuring supplies produced or services performed by industries of Alaska correctional institutions if the procurement does not unreasonably compete with the private sector. The corporation will determine whether the supplies or services meet the corporation's requirements and whether the price represents a reasonable cost for the supplies and services.

(d) The corporation may maintain a list of employment programs that are defined under AS 36.30.990. The corporation may procure items under this section from an employment program defined under AS 36.30.990 or other HUD-sponsored employment programs without soliciting other providers of those items.

(e) Repealed 12/5/2014.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.310 Bid specifications

(a) The purpose of a bid specification is to serve as a basis for obtaining, in a cost-effective manner, supplies, equipment, services, construction, office or other space leases, personal property, or professional services suitable for the Corporation's needs.

(b) As part of its bid specifications, the Corporation will use its best efforts to describe the requirements to be met without having the effect of exclusively requiring a proprietary supply, service, or procurement from a sole source, unless no other manner of description will suffice.

(c) The Corporation will use a bid specification that limits the procurement of an item to a specific manufacturer's name or model number only if the appropriate Corporation officer determines, in writing, that only the identified item will satisfy the Corporation's needs and no substitute is acceptable. If a bid specification expressly limits the procurement to only one source, the chief procurement officer must approve the bid specifications in writing before distributing any invitation to bid or request for quotation.

(d) The corporation may develop a qualified products list if the corporation determines that testing or examination of the supplies to be purchased is desirable or necessary before issuance of the solicitation in order to best satisfy the corporation's requirements.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.320 Competitive sealed bidding

(a) Except as otherwise provided in 15 AAC 150.300 - 15 AAC 150.490, and except as provided in 15 AAC 150.330 for professional services contracts, the corporation will award contracts under 15 AAC 150.300 - 15 AAC 150.490 by competitive sealed bidding.

(b) The Corporation will include in an invitation for competitive sealed bids the following:

(1) instructions and information to bidders concerning the bid submission requirements, time and date set for receipt of bids, address of the office to which bids are to be delivered, maximum time for bid acceptance by the Corporation, and any other special information.

(2) a purchase or project description, evaluation factors, delivery or performance schedule, and the acceptance or inspection requirements that are not included in the purchase or project description;

(3) a description of all applicable contract terms, including warranty, insurance, and bonding requirements;

(4) a requirement for certification by the bidder that it complies with the applicable portion of 42 U.S.C. 2000, as amended, AS 18.80, and regulations adopted under those laws by the federal or state government, as applicable;

(5) a requirement for certification by the bidder that, by submitting a bid, the bidder certifies that the price submitted was independently arrived at without collusion; and

(6) provisions to eliminate discrimination in Corporation contracting based on race, religion, color, national origin, sex, age, marital status, pregnancy, parenthood, disability, or political affiliation.

(1) incorporate other documents by reference;

(2) require receipt of all amendments issued by the Corporation to be acknowledged by bidders; and

(3) require submission of bid samples, descriptive literature, technical data, or other material.

(d) The corporation will publish notice of an invitation to bid by at least one of the following methods:

(1) publication in a newspaper of general circulation;

(2) publication in a newspaper of local circulation in the area pertinent to the procurement;

(3) publication through other appropriate media.

(e) Nothing in this section is meant to limit additional forms of public notice that might be used by the Corporation.

(f) A bidder shall submit its bid in a sealed envelope that indicates the invitation to bid number on the outside of the envelope. Upon receipt, the Corporation will store all bids in a secure place until the time and date set for bid opening.

(g) A bidder may correct or withdraw its bid by written request received in the office designated in the invitation for bids before the time and date set for bid opening. A request under this subsection should be delivered in a sealed envelope with the invitation to bid number printed on the outside of the envelope and must be accompanied by written authorization by the bidder for the correction or withdrawal. The Corporation will include all documents relating to the correction or withdrawal of a bid in the appropriate procurement file.

(h) The Corporation will not accept bids after the time and date set for receipt of bids, and will not accept bid corrections or withdrawals after the time and date set for bid opening, unless the appropriate Corporation officer determines that the delay was attributable to an error by the Corporation.

(i) The Corporation will open bids and bid corrections at the time, date, and place designated in the invitation to bid. The Corporation will tabulate the name of each bidder, the bid price, and other pertinent information.

(j) After the bid opening by the Corporation, the Corporation will permit a bidder to correct or withdraw its bid by reason of a non-judgmental mistake only to the extent the correction or withdrawal is not contrary to the best interest of the Corporation. If a bid mistake is attributable to an error in judgment, the bidder may not correct the bid.

(k) A bidder may not correct an inadvertent error, other than a minor informality, discovered in a bid after opening but before award. If a bidder submits proof to the corporation clearly demonstrating that an inadvertent error other than a minor informality was made, the corporation may permit the bidder to withdraw the bid.

(l) Unless otherwise prohibited by federal regulation, contractual or grant agreements, or other governing authority, the Corporation will not base the award of a bid on discrimination due to race, religion, color, national origin, sex, age, marital status, parenthood, pregnancy, disability, or political affiliation of the bidder.

(m) Unless otherwise prohibited by federal regulation, contractual or grant agreements, or other governing authority, the corporation will award a contract based on solicited bids to the lowest responsive and responsible bidder after applying a five percent preference for each Alaska bidder.

(n) If the corporation receives only one responsive and responsible bid in response to an invitation to bid, the corporation will award the contract to the single bidder if the corporation determines that the price submitted is fair and reasonable and if the corporation also determines that either other potential bidders had adequate opportunity to respond or there is not ample time for resolicitation. Otherwise, the corporation may reject the bid and

(1) solicit new bids or offers;

(2) cancel the proposed procurement; or

(3) conduct another procurement for the supply or service as a sole source procurement under 15 AAC 150.350, limited competition procurement under 15 AAC 150.360, or emergency procurement under 15 AAC 150.370, as appropriate; another procurement will be conducted under this paragraph only if the appropriate Corporation officer determines, in writing, that

(A) the need for the supply or service continues;

(B) the price of the one bid received is not fair and reasonable; and

(o) The corporation may cancel an invitation to bid, reject any or all bids in whole or in part, or delay the date for opening bids if the corporation determines that it is in the corporation's best interest to do so. The corporation will make the reasons for the cancellation, rejection, or delay a part of the procurement file.

(p) A notice of intent to award a contract does not constitute notice to proceed with a contract. A notice of intent to award will include

(1) the pertinent solicitation number;

(2) a statement of the proposed contract amount;

(3) the name of the apparently successful bidder; and

(4) a brief description of the supplies, equipment, services, construction, office or other space leases, or personal property that will be the subject of the contract.

(q) If the corporation determines that it is impractical initially to prepare a definite purchase description to support an award based on price, the corporation may use a multi-step sealed bidding process in which it issues an invitation to bid requesting the submission of unpriced technical offers, to be followed by an invitation to bid limited to bidders whose unpriced technical offers the corporation determines to be technically qualified under criteria set out in the first solicitation.

(r) Nothing in this section prevents posting in electronic media to satisfy the competitive solicitations and notice of award requirements. The procurement officer may issue and receive competitive sealed bids through an electronic bidding system, if the system is able to receive electronic bid documents and corrections to bid documents, document the date and time of receipt of bid documents, and secure the electronic bid submissions from being reviewed until after the date and time of bid opening.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.330 Competitive sealed proposals

(a) Except as provided in 15 AAC 150.341 - 15 AAC 150.370, the corporation will award contracts for professional services on the basis of competitive sealed proposals as described in this section. A request for competitive sealed proposals will contain the date, time, and place for delivering proposals; a specific description of the professional services to be provided under the contract; the terms under which the professional services are to be provided; evaluation factors, which will include cost; and the weighing factor or numerical rating system that will be used in evaluation. The corporation will give public notice of its request for competitive sealed proposals by publishing the request for proposals in the manner described in 15 AAC 150.320(d).

(b) A person that submits a proposal may correct, modify, or withdraw its proposal before the time and date set for receipt of proposals in the manner described in 15 AAC 150.320(g).

(c) Upon receipt of a proposal, modification, or correction, the Corporation will note the date and time of receipt upon the envelope and will hold the proposal, modification, or correction in a secure place. After the date set for receipt of proposals, the Corporation will prepare a register of proposals received. The register will include:

(1) the name of each offeror; and

(2) a description of the services, supplies, or items offered.

(d) Unless otherwise noted in the request for proposals, the Corporation will not accept a proposal, correction, modification, or withdrawal received after the date set for receipt of proposals unless the Corporation determines that the delay was attributable to an error by the Corporation.

(e) The corporation may cancel a request for proposals, reject any or all proposals in whole or in part, or delay the date for opening proposals if the corporation determines it to be in the best interest of the corporation to do so. The corporation will make the reasons for the cancellation, rejection, or delay a part of the procurement file.

(f) The appropriate corporation officer may designate an evaluation committee to evaluate proposals received in response to a request for proposals. The evaluation committee may consist of the appropriate corporation officer and at least two employees of the corporation or subject matter experts selected by the appropriate corporation officer. The evaluation committee may not consist of a majority of subject matter experts that are not also employees of the corporation. The evaluation committee will evaluate the proposals as follows:

(1) the evaluation committee will base its evaluations only on the evaluation factors set out in the request for proposals;

(2) cost will be an evaluation factor, as set out in the request for proposals under (a) of this section;

(3) the evaluation committee may use a numerical or other rating system;

(4) if the evaluation committee uses a numerical rating system, the evaluation committee will award the contract to the offeror receiving the highest final score;

(5) if the evaluation committee does not use a numerical rating system, the appropriate corporation officer, or each member of the evaluation committee, as applicable, shall justify or explain the ranking determination in writing; and

(6) the evaluation committee will use the weighing factor or numerical rating system set out in the request for proposals.

(g) If the corporation receives only one responsive and responsible proposal in response to a request for proposals, the corporation may accept the proposal, reject the proposal, or resolicit proposals.

(h) Offerors shall fully comply with all terms of the request for proposals and with 15 AAC 150.300 - 15 AAC 150.490. The corporation will consider an offeror that does not comply to be nonresponsive and will reject the offeror's proposal.

(i) If the evaluation committee determines, as part of an evaluation conducted under (f) of this section, that a proposal is reasonably susceptible for award, the appropriate corporation officer may offer the offeror of the proposal the opportunity to discuss the proposal with either the appropriate corporation officer or the evaluation committee. The evaluation committee may adjust or alter the evaluation of a proposal as a result of the discussion. During a discussion under this subsection,

(1) the corporation may limit discussion to specific sections of the request for proposals;

(2) if there is a need for substantial clarification or change in the request for proposals, the corporation will amend the request for proposals to incorporate the changes; and

(3) the corporation will not use auction techniques that reveal one offeror's cost to another offeror and will not disclose any information derived from competing proposals.

(j) Following any discussions under (i) of this section, the corporation will set a date and time for submission of best and final proposals. An offeror may submit a best and final proposal only once. However, the corporation may make a written determination that it is in the corporation's best interest to conduct additional discussions or to change the requirements and require another submission of best and final proposals.

(k) When the Corporation identifies the apparently successful proposal, it will issue a notice of intent to award the contract. The notice of intent to award the contract will contain the information set out in 15 AAC 150.320(p)(1) - (p)(4). The notice of intent to award the contract does not constitute a notice to proceed.

(l) If the corporation considers it impractical initially to prepare a definitive purchase description to support an award based on listed selection criteria, the corporation may use a multi-step sealed proposal process in which it issues an expression of interest requesting the submission of unpriced technical offers, to be followed by a request for proposals limited to the offerors whose offers are determined to be technically qualified under the criteria set out in the expression of interest.

(m) Notwithstanding (f)(2) of this section, for architectural, engineering, or land surveying services, the corporation may negotiate a contract with the most qualified and suitable firm or person of demonstrated competence. The corporation will award a contract for those services at fair and reasonable compensation as determined by the appropriate corporation officer after consideration of the estimated value of the services to be rendered and the scope, complexity, and professional nature of the services. Unless otherwise prohibited by federal regulation, contractual or grant agreements, or other governing authority, when determining the most qualified and suitable firm or person, the corporation will consider the proximity to the project site of the office of the firm or person.

(n) The procurement officer may conduct a design-build procurement process if the corporation determines that the process is advantageous to the corporation. If a design-build procurement process is used, the request for proposals must solicit a single price for both design and construction services. Nothing in this subsection prohibits a multi-step award process.

(o) Nothing in this section prevents posting in electronic media to satisfy the competitive solicitation and notice of award requirements. The procurement officer may issue and receive competitive sealed proposals through an electronic solicitation system, if the system is able to receive electronic proposal documents and corrections to proposal documents, document the date and time of receipt of proposal documents, and secure the electronic submissions from being reviewed until after the date and time for receipt of proposals.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.340 Small procurements

Repealed.

History

Eff. 6/28/96, Register 138; repealed 12/5/2014, Register 212

15 AAC 150.341 Informal procurements

(a) A procurement that costs not more than $2,000 may be made with a corporation purchasing card designated by the chief procurement officer, after receiving only one quotation or informal proposal from a qualified firm or person.

(b) The corporation will use reasonable and adequate procedures and make records that facilitate auditing of the corporation, when procuring supplies, services, professional services, or construction estimated to cost more than $2,000 but not more than $5,000.

(c) The corporation will use the following procedures in the procurement of supplies, services, professional services, or construction estimated to cost more than $5,000 but not more than $25,000:

(1) for the solicitation,

(A) at least three firms or persons shall be contacted for a quotation or informal proposal and the procurement officer shall designate whether the response may be made in writing or verbally; and

(B) the solicitation may be made verbally or in writing and must include the specifications, the award criteria, and the date and time responses are due;

(2) for the award, the corporation will make the award

(A) in accordance with the specifications and award criteria in the solicitation; and

(B) to the responsive and responsible firm or person that submitted the lowest quotation or the informal proposal that is the most advantageous to the corporation;

(3) as part of the file on the procurement, the procurement officer shall include the

(A) name of the person who made the solicitation and the date of the solicitation;

(B) information provided by the corporation under (1)(B) of this subsection; and

(C) names of the firms or persons contacted, a summary of any verbal responses, and copies of all quotations or informal proposals received.

(d) The corporation will use the following procedures for the procurement of supplies, services, or professional services estimated to cost more than $25,000 but not more than $100,000 or for construction estimated to cost more than $25,000 but not more than $200,000:

(1) for the solicitation,

(A) at least three firms or persons shall be contacted for a quotation or informal proposal and the procurement officer shall require the response to be made in writing; and

(B) the solicitation shall be made in writing and must include the specifications, the award criteria, and the date and time responses are due;

(2) for the award, the corporation will

(A) make the award

(i) in accordance with the specifications and award criteria in the solicitation; and

(ii) to the responsive and responsible firm or person that submitted the lowest quotation or the informal proposal that is the most advantageous to the corporation; and

(B) provide written notice of the award, including the name of the successful offeror, to each firm or person providing a quotation or informal proposal, and will describe protest rights under 15 AAC 150.220 and the time limitations within which a protest must be received by the corporation;

(3) as part of the file on the procurement, the procurement officer shall include

(A) a copy of the solicitation made under (I)(B) of this subsection;

(B) the names of the firms or persons contacted and copies of all written quotations or informal proposals received; and

(e) Nothing in this section prevents posting in electronic media to satisfy the competitive solicitation and notice of award requirements. Quotes and informal proposals may be submitted in electronic media if permitted by the procurement officer.

History

Authority: AS 36.30.015
Eff. 12/5/2014, Register 212

15 AAC 150.350 Sole source procurements

(a) A request by a corporation department that a procurement be restricted to one potential contractor must be accompanied by written explanation as to why no other source is suitable or acceptable to meet the need.

(b) A written finding and determination that there is only one source for the required procurement will be prepared and signed by the appropriate Corporation officer responsible for the acquisition. Final approval for the sole source procurement will be obtained from the chief procurement officer before proceeding with the sole source procurement under this section.

(c) The Corporation will conduct negotiations as to price, delivery schedules, and terms of a sole source procurement. The appropriate Corporation officer will make a written determination of fairness and reasonableness of price, for inclusion in the procurement file, before award of a sole source procurement.

(d) The following are examples of circumstances in which sole source procurements might be appropriate:

(1) the compatibility of equipment, accessories, or replacement parts is the main consideration;

(2) a specific item is needed for trial use or testing, including testing of a prototype item;

(3) there exists a sole source of expertise required to perform a specific professional service;

(4) patents exist that restrict availability of the product or process to only one source; or

(5) the procurement is for maintenance or repair service available only from the manufacturer or the manufacturer's authorized service center.

(e) The Corporation will include in the procurement file for each sole source procurement the written finding and determination, and the chief procurement officer's final approval, described in (b) of this section. The Corporation will maintain for each sole source procurement a record that includes at least the following information:

(1) the contractor's name;

(2) the amount and type of the procurement;

(3) a listing of the supplies, equipment, services, construction, office or other space leases, personal property, and professional services procured under the contract; and

(4) the assigned identification number of the procurement file.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.360 Limited competition

(a) A request from a Corporation department that a procurement be restricted to several potential contractors will be accompanied by a written explanation as to why other sources are not either suitable or acceptable and why the competitive sealed bid or proposal process is impractical or contrary to the public interest.

(b) Approval to use limited competition procurement procedures will be obtained from the chief procurement officer before proceeding with the procurement.

(c) The Corporation will conduct negotiations, as appropriate, as to price, delivery schedules, and terms equally with each potential contractor for a limited competition procurement under this section.

(d) The corporation may advertise its intent to make a limited competition procurement for the purpose of determining whether there are other potentially available sources for the procurement.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.370 Emergency procurement

(a) The corporation may make a procurement under emergency conditions

(1) when there exists a threat to public health, safety, or welfare;

(2) when a situation exists that makes a procurement through competitive sealed bidding impractical or contrary to the public interest; or

(3) to protect private or public property.

(b) Reasons for finding that emergency conditions exist include the following:

(1) economic considerations that preclude routine solicitation;

(2) delays inherent in the normal procurement process;

(3) extreme weather conditions; and

(4) equipment failure when the need for timely repair is essential.

(c) The Corporation will make a written determination that emergency conditions exist. The written determination will state in detail the factual basis for the determination that emergency conditions exist and for the selection of the particular contractor. The Corporation will maintain the determination in the procurement file.

(d) The appropriate Corporation officer also will make and promptly forward to the chief procurement officer a record of an emergency procurement. The record will plainly set out

(1) the contractor's name;

(2) the amount spent and the type of contract;

(3) a list of the supplies, equipment, services, construction, office or other space leases, personal property, or professional services procured under the contract;

(4) a brief summary of the emergency determination; and

(5) the assigned identification number of the procurement file.

(e) For a procurement under this section, the Corporation will procure supplies and services by any method the Corporation considers reasonable under the circumstances.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.375 Contract formation and modifications

The provisions of 15 AAC 150.130, regarding contract formation and modifications, apply to Corporation procurements under 15 AAC 150.300 - 15 AAC 150.490.

History

Authority: AS 36.30.015(f)
Eff. 6/28/96, Register 138

15 AAC 150.379 Protests of informal procurements

(a) For procurements under 15 AAC 150.341(b), an interested party shall attempt to informally resolve a dispute with the procurement officer.

(b) For procurements under 15 AAC 15.341(c), an interested party shall attempt to informally resolve a dispute with the procurement officer. If the attempt is unsuccessful, the interested party may protest the solicitation or the award by filing a written protest with the procurement officer, The protest must be filed before the date and time the quotations or informal proposals are due to the corporation. The procedures and requirements set out in 15 AAC 150.220(b) - (h) apply to a protest under this subsection.

History

Authority: AS 36.30.015
Eff. 12/5/2014, Register 212

15 AAC 150.380 Protests, controversies, and appeals

(a) Except for protests under 15 AAC 150.379, an interested party may protest the award of a contract, the proposed award of a contract, or a solicitation for supplies, equipment, services, construction, office or other space leases, personal property, or professional services by the corporation under 15 AAC 150.300 - 15 AAC 150.490 and may appeal a protest decision in accordance with the procedures and requirements set out in 15 AAC 150.220(b) - (h).

(b) A contractor may file with the Corporation a claim concerning a contract controversy under 15 AAC 150.300 - 15 AAC 150.490 in accordance with the procedures and requirements set out in 15 AAC 150.220(i) - (k).

(c) The written decision of the chief procurement officer regarding a protest under 15 AAC 150.220(h) or regarding a contract controversy under 15 AAC 150.220(j) is a final administrative decision. Each such decision will notify the interested party that judicial review of the administrative decision may be had by filing a notice of appeal in accordance with applicable rules of court governing appeals in civil matters.

History

Authority: AS 36.30.015
Eff. 6/28/96, Register 138; am 12/5/2014, Register 212

15 AAC 150.390 Exemptions to procurement regulations

(a) The provisions of 15 AAC 150.300 - 15 AAC 150.380 do not apply to

(1) contracts for professional witnesses to provide professional services or testimony relating to existing or probable lawsuits to which the Corporation is or might become a party;

(2) acquisitions or dispositions of real property or an interest in real estate;

(3) purchase of income-producing assets by the Corporation and expenditures associated with the acquisition and holding of those assets;

(4) purchase of books, newspapers, periodicals, audiovisual materials, network information services, including financial informational electronic services, all media advertising, professional memberships, archival materials, objects of art, or archival acquisitions;

(5) contracts for supplies or services for research projects funded by the federal government or private grants;

(6) guest speakers, professional instructors, or performers for management and educational training forums, conferences, or associated programs;

(7) expenditures, not to include services of bond counsel or financial advisors, associated with the issuance of Corporation debt obligations;

(8) expenditures for valuation appraisals for real estate owned by the Corporation;

(9) premium expenditures for all required insurance coverage.

(b) Nothing in 15 AAC 150.300 - 15 AAC 150.490 prevents the Corporation from complying with the terms and conditions of a grant, gift, bequest, cooperative agreement, or federal assistance agreement.

History

Authority: AS 36.30.015(f)
Eff. 6/28/96, Register 138

15 AAC 150.395 Supply management

The provisions of 15 AAC 150.510 that relate to supply management apply to Corporation procurements under 15 AAC 150.300 - 15 AAC 150.490.

History

Authority: AS 36.30.015(f)
Eff. 6/28/96, Register 138

15 AAC 150.400 Purchases through State Department of Administration

The provisions of 15 AAC 150.300 - 15 AAC 150.490 do not prevent Corporation procurement through the division of general services in the Department of Administration.

History

Authority: AS 36.30.015(f)
Eff. 6/28/96, Register 138

15 AAC 150.420 Authority to delegate; exercise of delegated authority

(a) The chief procurement officer may delegate that officer's authority with respect to procurements under 15 AAC 150.300 - 15 AAC 150.490 to an employee of the Corporation. Authority delegated under this subsection to the head of a procurement department may be delegated by that officer to an employee in that procurement department. A delegation of authority must be in writing.

(b) The chief procurement officer or head of a procurement department may revoke any authority delegated by that person under this section.

(c) An employee delegated authority under this section may exercise that authority only in accordance with the delegation.

History

Authority: AS 36.30.015(f)
Eff. 6/28/96, Register 138

15 AAC 150.430 Federal assistance

If federal money or other federal assistance is involved in a procurement by the Corporation, this chapter will govern except to the extent that it is superseded by federal regulations and provisions. In case of conflict, the federal regulations and provisions control.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 36.30.015(f) AS 18.55.110; AS 18.55.520(10)
Eff. 6/28/96, Register 138

15 AAC 150.490 Alaska Housing Finance Corporation

15 AAC 150.490. Definitions for 15 AAC 150.300 - 15 AAC 150.490. The definitions set out in 15 AAC 150.900(6), (12), (13), (19), and (25) and in 15 AAC 150.910(b) apply to terms used in 15 AAC 150.300 - 15 AAC 150.490.

History

Authority: AS 36.30.015(f)
Eff. 6/28/96, Register 138

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

Authority: AS 18.55.100(a)AS 18.55.410; AS 18.55.520 AS 18.55.320; AS 18.55.420
Eff. 5/7/93, Register 130

Article 6 Definitions

15 AAC 150.900 Alaska Housing Finance Corporation

15 AAC 150.900. Definitions for Chapters 150 - 155. In addition to the definitions contained in AS 18.55 and AS 18.56, the following terms have the following meanings for purposes of 15 AAC 150 - 15 AAC 155, unless the context requires otherwise: (1) "act" means AS 18.55 and AS 18.56; (2) "appraisal" means an estimation of value using the Uniform Standard of Professional Appraisal Practice or other standards required in 15 AAC 151 - 15 AAC 155; (3) "appraised value" means the market value of the property securing the mortgage as estimated by an appraiser acceptable to the Corporation; (4) "appraiser" means a person holding a current state general or residential real estate appraiser certification; (5) "appropriate Corporation officer" has the meaning provided in 15 AAC 150.910(b); (6) "board" or "board of directors" means the board of directors of the Corporation; (7) "certificate of occupancy" means a document issued by a municipality that indicates that the construction of a building has been completed and the building is ready for occupancy; (8) "CFR" means the Code of Federal Regulations; (9) "chairperson" means the chairperson of the board of directors or his or her designee; (10) "common elements" means those things which are maintained by, but not owned by, the owner's association of a condominium project; the common elements typically include, among other things, the land, roofs, floors, lobbies, and community space and facilities; (11) "common interest community" means real estate with respect to which a person, by virtue of ownership of a unit, is obligated to pay for real estate taxes, insurance premiums, maintenance, or improvement of other real estate described in a declaration; (12) "condominium" means a form of ownership of real property characterized by title created by statute to a unit in a project together with an undivided real estate interest in the common elements which are a part of that project in accordance with state law; (13) "Corporation" means the Alaska Housing Finance Corporation; (14) "education professional" means an individual who is currently employed full time by a public elementary or secondary school district or regional educational attendance area and is certified under AS 14.20 and holds a position as a: (A) teacher; (B) counselor; (C) principal; (D) vice or assistant principal; or (E) provider of special education or related services; (15) "executive director" means the chief executive officer/executive director of the Corporation or his or her designee; (16) "FHA" means the Federal Housing Administration or its legal successors; (17) "FNMA" means the Federal National Mortgage Association or its legal successors; (18) "FHLMC" means the Federal Home Loan Mortgage Corporation or its legal successors; (19) "full time" means working the customary number of hours in a given period as determined by an individual's employer; (20) "GNMA" means the Government National Mortgage Association or its legal successors; (21) "health care professional" means an individual who: (A) holds a certificate or license under AS 08. Business and Professions, to practice the prevention, treatment, or management of illness and the preservation of mental and physical well-being as further defined in the sellers' guide; and (B) is employed full time; (22) "HUD" means the United States Department of Housing and Urban Development or its legal successors; (23) "home mortgage" or "residential mortgage" means a mortgage which is secured by real property: (A) upon which is located a dwelling unit designed for residential use; and (B) with respect to which the mortgagor either owns the real property in fee simple or possesses a leasehold estate; (24) "Internal Revenue Code of 1986" means Title 26 of the United States Code as amended from and after the Tax Reform Act of 1986 (P.L. 99-514); (25) "Internal Revenue Code of 1954" means Title 26 of the United States Code as amended to, but not including, the Tax Reform Act of 1986 (P.L. 99-514); (26) "leasehold estate" means an interest in real property held pursuant to a lease which: (A) meets the criteria as to assignability, ground rent, terms, and renewal options established in the selling guide; and (B) relates to real property that is acceptable to the Corporation; (27) "loan-to-value ratio" means the ratio between the principal amount of a loan and the lesser of the appraised fair market value or the purchase price of the property securing the loan; (28) "member of the board" or "member" means a member of the board of directors or his or her designee; (29) "mobile home" means manufactured housing with a certification label required by the 24 CFR Part 3282.362(c)(2)(C), or a certification label permitted by 24 CFR Part 3282.18, and attesting that the mobile home is in conformance with federal standards for Zone III construction, as set out in 24 CFR Part 3280, Subpart F; (30) "mortgage" means the mortgage deed, deed of trust, or other security instrument, the obligation secured thereby, the title evidence, and all other documents and other papers pertaining to a mortgage loan; (31) "owner-occupied" means occupied by a borrower as the primary place of residence after completion of construction or purchase; (32) "permitted encumbrances" means liens, encumbrances, reservations, and other imperfections of title that do not materially impair the use or value of the premises or as to which appropriate steps have been taken to secure the interest of the Corporation; (33) "RD" means the United States Department of Agriculture (USDA) Rural Development or its legal successors. (Previously known as Farmers Home Administration - FmHA.); (34) "regional educational attendance area" means an educational attendance area established under AS 14.08.031; (35) "regional housing authority" means a housing authority established by AS 18.55.996(a)(1) - (12); (36) "seller" means an originating mortgage lender that meets the criteria set forth at 15 AAC 150.080; (37) "selling guide" means the selling guide prepared pursuant to 15 AAC 150.080 which contains policies and procedures of the Corporation relating to the conduct of sellers; (38) "servicer" means an institution qualified to service a loan purchased by the Corporation pursuant to 15 AAC 150.090; (39) "servicing guide" means the servicing guide prepared pursuant to 15 AAC 150.090 which contains policies and procedures of the Corporation relating to the conduct of servicers; (40) "single-family residence" includes a single unit within a condominium or planned unit development project; (41) "state" means the State of Alaska; (42) "Type I mobile home" means a mobile home that (A) is permanently affixed to a foundation which is suitable for the soil conditions of the site and which has footings located below the frost line; (B) is anchored to the lot using certified anchors underpinned on all sides of the unit with a compatible exterior covering material extending from the bottom of the unit to the ground; (C) has its wheels, axles, and hitch removed; and (D) otherwise complies with requirements set forth in the selling guide; (43) "Type II mobile home" means a mobile home that does not meet the criteria for a Type I mobile home; (44) "VA" means the Veterans Administration or its legal successors.

History

Authority: AS 18.56.088; AS 18.56.109; AS 18.56.580
Eff. 5/7/93, Register 130; am 6/11/96, Register 139; am 8/20/2003, Register 169; am 6/18/2008, Register 187

15 AAC 150.910 Alaska Housing Finance Corporation

15 AAC 150.910. Definitions for Chapter 150. (a) In addition to the definitions provided in 15 AAC 150.900, the following terms have the following meanings for purposes of 15 AAC 150.030 - 15 AAC 150.045: (1) "approved municipal building code" means the construction codes adopted and enforced by a municipality which the executive director has determined meet or exceed the standards established for residential housing by the state building code; (2) "authorized inspector" means a person who is not hired by, and has no relationship to, the Corporation; has no relationship to the builder, developer, owner, or realtor that is a party to the transaction and who is: (A) an individual who is registered under AS 08.18 to perform home inspections for new construction; (B) an architect licensed under AS 08.48, an engineer licensed under AS 08.48, or such other person acceptable to the Corporation and who has received prior approval in writing from the Corporation; or (C) an inspector from any governmental agency outside the state whose function is the inspection of prefabricated units which may be transported to the state and who inspects prefabricated units for compliance with the state building code. (3) "completion of electrical installation, plumbing, and framing" means completion to the rough-in stage of the building's framing prior to covering so that the mechanical, electrical, heating, ventilation, and air conditioning systems are sufficiently exposed for inspection to determine compliance with the state building code; (4) "completion of footings and foundations" means: (A) for footings, the state of construction at which footing forms have been erected and all reinforcing steel is in place; (B) for poured concrete wall foundations, the stage of construction at which foundation forms have been erected and all reinforcing steel is in place; (C) for concrete masonry unit foundations, the stage of construction at which all units have been laid and reinforcing steel is in place; (D) for all-weather wood foundations, the stage of construction at which foundation walls have been sheathed and bolted to footings and before dampproofing and backfill is done; and (E) for pile foundations, before placement to inspect for size, grade and condition and then after the piles are in place. (5) "completion of installation of insulation" means the stage of construction at which insulation and vapor retarders have been installed in the walls and ceilings and there is adequate access for inspection to determine compliance with the state building code; (6) "construction codes" means, with reference to a municipality, the building, mechanical, plumbing, and electrical codes that have been adopted and are enforced by the municipality; (7) "energy efficiency standard" means the building energy efficiency standard adopted by the Corporation in 15 AAC 155.010; (8) "final approval" means certification by an authorized inspector after a residential unit is complete that it complies with the provisions of the state building code; (9) "inspection" means an on-site inspection or inspections of the construction project. In the case of a project located in a rural area of the state, the inspection may be conducted by video tape, representative stationary photos, or other acceptable methods, if prior approval in writing has been obtained from the Corporation; (10) "plan approval" means a review of drawings by an authorized inspector and the inspector's written acknowledgement that the drawings comply with the provisions of the state building code; (11) "prefabricated unit" means a structural unit the integral parts of which have been built or assembled in manufacturing facilities on or off the building site for installation or incorporation on the building site; (12) "residential housing" and "residential unit" have the meaning given to the term "residential housing" at AS 18.56.390(11), except they do not include mobile homes which have been placed on an impermanent foundation; (13) "rural area" means a community with a population of 5,500 or less that is not connected by road or rail to Anchorage or Fairbanks; (14) "state building code" means: (A) for building standards, the code for all residential buildings, including those for buildings with fewer than four dwellings, set out in the version of the International Building Code adopted by the Department of Public Safety under AS 18.70.080, even though the Department of Public Safety does not apply that code to buildings with fewer than four dwellings; (B) for mechanical standards, the code for all residential buildings, including those for buildings with fewer than four dwellings, set out in the version of the International Mechanical Code adopted by the Department of Public Safety under AS 18.70.080, even though the Department of Public Safety does not apply that code to buildings with fewer than four dwellings; (C) for plumbing standards, the code adopted by the Department of Labor and Workforce Development under AS 18.60.705 except where such code conflicts with requirements for residential wastewater disposal established by the Department of Environmental Conservation in which case the requirements of the Department of Environmental Conservation shall be the standard; and (D) for electrical standards, the minimum electrical code prescribed by AS 18.60.580. (b) In addition to the definitions provided in 15 AAC 150.900, the following terms have the following meanings for purposes of 15 AAC 150.220 and 15 AAC 150.300 - 15 AAC 150.490: (1) "Alaska bidder" has the meaning given in AS 36.30.990; (2) "appropriate Corporation officer" means an officer or employee of the Corporation who has received a specific delegation of procurement authority, in writing, from the chief procurement officer; (3) "chief procurement officer" means the executive director; (4) "contract" means all types of Corporation agreements, regardless of what they might be called, for the procurement of supplies, equipment, services, construction, office or other space leases, personal property, or professional services; (5) "days" means calendar days unless otherwise specified; (6) "interested party" means an actual or prospective bidder or offeror whose economic interest might be affected substantially and directly by the issuance of a contract solicitation, the award of a contract, or the failure to award a contract; (7) "minor informality" means a matter of form rather than substance that is evident from the bid document, or is an insignificant matter that has a negligible effect on price, quantity, quality, delivery, or contractual conditions and can be waived or corrected without prejudice to other bidders; (8) "non-responsive" means a bid or proposal that does not conform in all material respects to the solicitation; (9) "procurement" means, unless the context requires otherwise, procurement, management, and control of supplies, equipment, services, construction, office or other space leases, personal property, and professional services; (10) "procurement department" means a central purchasing office established within the Corporation by the chief procurement officer; (11) "professional services" means professional, technical, or consultant's services that are predominantly intellectual in character, result in the production of a report or the completion of a task, and include analysis, evaluation, prediction, planning, or recommendation; (12) "protester" means an actual or prospective bidder, offeror, or contractor who is aggrieved in connection with the solicitation or the award of a contract and who files a protest; (13) "responsive bidder" means a firm or person who has submitted a bid that conforms in all material respects to the solicitation; (14) "solicitation" means a request for proposals, request for quotations, invitation to bid, or any other means used by the Corporation for the purpose of soliciting bids or proposals to perform a Corporation contract. (c) In addition to the definitions provided in 15 AAC 150.900, the following terms have the following meanings for purposes of 15 AAC 150.600 - 15 AAC 150.780, unless the context indicates otherwise: (1) "bid" means the information, including a proposal, submitted to the Corporation in response to an invitation to bid; (2) "bidder" means a party that submits a sealed bid or a proposal; (3) "construction plans" means those plans as defined and required under the disposal agreement, Part II Agreement, and any supplemental agreement imposed by HUD; (4) "disposal agreement" means the agreement or contract executed by and between the purchaser and the Corporation for the purchase and sale of real property pursuant to 15 AAC 150.600 - 15 AAC 150.780; the disposal agreement is also known as the "Part I of the Contract for the Sale of Land for Private Redevelopment" and is a part of and is supplemented by a Part II Agreement; (5) "division" means the public housing division of the Corporation; (6) "fair market value" means the value established by the highest appraisal, provided that such value does not exceed by more than 15 percent the value established by any other appraisal; (7) "good-faith deposit" means the monetary value in United States dollars that must be submitted by the successful bidder at public auction or all bidders who submit a sealed bid; (8) "HUD Urban Renewal Handbook" means the collection of written regulations and provisions that have been promulgated and published by HUD that governs the disposition of real property and that is formally entitled, Land Marketing and Redevelopment; (9) "municipality" means the political subdivision of the state that is recognized as the governing local body in which the real property is situated; (10) "Part II Agreement" means the document formally entitled "Terms and Conditions, Part II of the Contract for Sale of Land for Private Redevelopment" which the Corporation incorporates in each disposal agreement; (11) "redeveloper" means the person that executes the disposal agreement; and (12) "substantial development" means any construction and development that would have a total construction cost of $500,000, excluding the value of the real property.

History

Authority: AS 18.55.100; AS 18.55.420; AS 18.56.300 AS 18.55.320; AS 18.55.540; AS 36.30.015 AS 18.55.410; AS 18.56.088
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 1/20/95, Register 133; am 10/29/97, Register 145; am 6/23/2004, Register 178; am 12/14/2005, Register 179; am 12/5/2014, Register 212

Chapter 151 AHFC General Programs

Article 1 Special Mortgage Loan Program

15 AAC 151.010 Special mortgage loan purchase program scope

The provisions of 15 AAC 151.010 - 15 AAC 151.340 implement the special mortgage loan purchase program established by AS 18.56.098. The special mortgage loan purchase program includes the purchase of loans with qualified mortgage bonds as described in 15 AAC 151.100 - 15 AAC 151.150 and the purchase of loans with qualified veterans mortgage bonds as described in 15 AAC 151.200 - 15 AAC 151.250.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.015 Borrower eligibility

(a) Under the program and subject to the provisions of 15 AAC 151.100 - 15 AAC 151.340 and 15 AAC 151.600 - 15 AAC 151.660, the Corporation will purchase loans made to finance the purchase of residences. Each loan must be secured by a single-family residence, duplex, triplex, or four-plex. Eligibility is without regard to location of the dwelling within the state or another eligible location. The dwelling to be purchased with the loan must be designed for residential use and intended for use and used as the principal residence of the borrower pursuant to AS 18.56. A person is not eligible for a loan to be purchased by the Corporation under 15 AAC 151.100 - 15 AAC 151.340, 15 AAC 151.600, 15 AAC 151.620 - 15 AAC 151.630, and 15 AAC 151.650 - 15 AAC 151.660, if the person is an owner of a dwelling financed by an outstanding first lien mortgage loan purchased by the Corporation under 15 AAC 151.010 - 15 AAC 151.250 unless the new loan will retire the outstanding loan. For purposes of the first sentence of this subsection, a loan to finance the purchase of a residence includes:

(1) a loan to an owner/builder only if the loan constitutes the first permanent financing of a residence which has been newly constructed by the owner/builder; and

(2) a loan to a purchaser only if the loan is the initial permanent financing obtained for the residence by the purchaser and the loan is submitted to the Corporation as soon as practicable, but in no event more than one year from date of purchase. The determination of whether the dwelling is "newly constructed" or whether a loan is the first "permanent financing" by the purchaser on a dwelling or whether the loan is submitted to the Corporation as soon as practicable shall be made by the Corporation based upon information submitted to the Corporation.

(b) The Corporation will, in its discretion, release a co-mortgagor from liability on a loan owned by the Corporation under the program if the co-mortgagor retaining ownership at the time of release qualifies for the mortgage loan. Qualification for the mortgage loan will be determined by the mortgage servicer and the Corporation and will be based on a full credit package underwritten and approved by the servicer. To qualify for a release under this subsection, a co-mortgagor approved for the release must relinquish all ownership interest in the residence.

(1) "owner" includes a person who is liable on a mortgage or note with respect to a loan; and

(2) "owner/builder" means a person who will build and own the residence or which a loan is sought.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.020 Loan terms

(a) Each loan purchased by the Corporation as part of the special mortgage loan purchase program, except as otherwise provided in (f) of this section for loans to members of the Alaska delegation to Congress, must:

(1) be serviced by a servicer approved by the Corporation;

(2) constitute a first or second lien on real estate in fee simple or on a leasehold estate and (A) if a first lien, be subject only to permitted encumbrances, or (B) if a second lien, be subject only to permitted encumbrances including a first lien mortgage loan;

(3) if the loan is a first lien and if the loan-to-value ratio of the property exceeds 80 percent, be the subject of private mortgage insurance, federal insurance, federal guarantee, or insurance described in AS 18.56.093, with benefits in each case payable to the Corporation;

(4) Repealed 8/27/2014.

(5) be for the purchase or refinancing of completed, owner-occupied residential housing, the improvement or rehabilitation of owner-occupied residential housing, or the purchase or refinancing of owner-occupied residential housing together with improvement or rehabilitation of the housing, which in any case is eligible for purchase by the Corporation under the program; and

(6) be insured by a mortgagee's policy of title insurance, issued by a title insurance company qualified to do business in the area in which the residence is located and acceptable to the Corporation, insuring the enforceable mortgage, subject only to permitted encumbrances or in the case of a second lien mortgage, subject only to permitted encumbrances and the first lien mortgage.

(b) The provisions of this section apply to first lien mortgage loans and to second lien mortgage loans. The Corporation will compute the maximum amount of a second lien mortgage loan so that the outstanding amount of the first lien mortgage loan plus the maximum amount of the second lien mortgage loan does not exceed the applicable loan-to-value ratio. Notwithstanding any of the other provisions of this section to the contrary, all loan-to-value ratios and maximum loan amounts shall be reduced if and to the extent that any applicable GNMA, FNMA, FHLMC, VA, FHA, HUD, or RD loan-to-value ratio or maximum loan limits are reduced for Alaska.

(c) The loan-to-value ratio and the loan amounts on first lien mortgage loans purchased by the Corporation under the program shall be as follows:

(1) other than as provided in (3), (5), (6), and (7) of this subsection, the loan-to-value ratio on a mortgage loan for the purchase of a single family residence shall not exceed the Federal National Mortgage Association limits; a duplex residence shall not exceed 95 percent and the loan-to-value ratio on a mortgage loan for the purchase of a triplex or four-plex residence shall not exceed 90 percent;

(2) the loan amount on a mortgage loan for a residence shall not exceed the applicable FNMA or FHLMC maximum loan amount for the same type of property by more than 10 percent;

(3) the amount of the guarantee plus the down payment on a mortgage loan guaranteed by the Veterans Administration must equal 25 percent of the value of the residence based on the lesser of sales price or appraisal; and the VA guarantee must equal the maximum guarantee possible under the VA program;

(4) the loan amount on a mortgage loan insured or guaranteed by FHA, HUD, or RD for a residence shall not exceed the applicable limits established by FHA, HUD, or RD;

(5) the down payment and loan-to-value ratios of mortgage loans insured or guaranteed by FHA, HUD, or RD shall be as required by FHA, HUD, or RD;

(6) the loan-to-value ratio of a mortgage loan made to an education professional or a health care professional for owner occupied, single family housing, shall not exceed 100 percent; and

(7) the loan-to-value ratio on a refinancing loan shall not exceed limits established by FNMA, FHLMC, FHA, HUD, VA, or RD for similar refinance loans.

(d) Repealed 9/28/95.

(e) A residential mortgage loan purchased by the Corporation under the program to finance a unit in a condominium project or in a planned community (PC) project shall be subject to the following terms and conditions:

(1) the living units of the condominium or PC project must be within the same structure or a reasonably contiguous structure, and the common elements of the project must have been completed before the purchase of the loan by the Corporation; and

(2) prior acceptance procedures, warranties, and provisions relating to the sale and occupancy of units which are reasonable and customary in mortgage lending shall apply as prescribed in the Common Interest Communities guide.

(f) The Corporation will purchase a loan under the program to finance a residence for members of the Alaska delegation to Congress only if the residence is located in the District of Columbia or within 50 miles of the District of Columbia.

History

Authority: AS 18.56.088; AS 18.56.096; AS 18.56.098
Eff. 5/7/93, Register 125; am 12/16/93, Register 130; am 9/28/95, Register 136; am 6/11/96, Register 139; am 4/2/97, Register 142; am 5/3/2001, Register 159; am 8/20/2003, Register 169; am 11/9/2004, Register 179; am 6/18/2008, Register 187; am 8/27/2014, Register 212; am 1/29/2025, Register 254

Article 2 Qualified Mortgage Bonds

15 AAC 151.100 Qualified mortgage bond program

The provisions of 15 AAC 151.100 - 15 AAC 151.150 relate to the issuance by the Corporation of qualified mortgage bonds as described in Section 103A(c)(1) and (c)(2) of the Internal Revenue Code of 1954, as amended, and Section 143(a) of the Internal Revenue Code of 1986, as amended, and define and describe mortgages eligible to be financed with the proceeds of qualified mortgage bonds as part of the program. These sections are intended to establish procedures to ensure compliance with the mortgage eligibility provisions contained in the Code.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.105 Eligibility

A person may finance the purchase of an owner-occupied residence with proceeds of qualified mortgage bonds issued by the Corporation pursuant to the Code and 15 AAC 151.100 - 15 AAC 151.150 if the purchase is eligible for financing with proceeds of those bonds.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.110 Single-family residence

A person is eligible under the program for a residential mortgage loan which is eligible for purchase by the Corporation under the act to finance the purchase of a residence. As used in 15 AAC 151.100 - 15 AAC 151.250, "residence" includes a duplex only if one unit of the duplex is occupied by the owner of the duplex and the duplex was first occupied as a residence at least five years before the mortgage is executed. The residence must be a single-family residence which, at the time the mortgage is executed by the mortgagor, can reasonably be expected by the Corporation to become the principal residence of the mortgagor within a reasonable time after the financing is provided. The residence must be located within the state or otherwise be described in 15 AAC 151.020(f). The Corporation will prescribe the form of an affidavit to be signed by each mortgagor of his or her intent to use the residence as his or her principal residence within a reasonable time, not exceeding 60 days, after the financing is provided and will establish other procedures to ensure that the requirement is met. Whether a residence is used as a principal residence will depend on all the facts and circumstances of each case, including the good faith of the mortgagor. Except for duplexes, a residence which can reasonably be expected to be used in a trade or business, as an investment property, or as a recreational home, will not be considered a principal residence. The term "residence" does not include property, such as an appliance, a piece of furniture, or a radio, which under Alaska law is not a fixture. The Corporation will consider land appurtenant to a residence as part of the residence only if the land reasonably maintains the basic livability of the residence and does not provide, other than incidentally, a source of income to the mortgagor. Land appurtenant to a residence is not included in the definition of "residence" if the land may be further subdivided under zoning or platting regulations in effect at the time of the making of the mortgage loan.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.115 Ownership requirements

(a) Except as provided in (d) of this section, each of the mortgagors to whom financing to acquire a residence under 15 AAC 151.110 is provided must meet the requirements of this subsection. A mortgagor meets the requirements of this subsection only if the mortgagor had no present ownership interest in a principal residence located anywhere at any time during the three-year period prior to the date on which the mortgage is executed. For purposes of the preceding sentence, the Corporation will not take into account the mortgagor's interest in the residence with respect to which the financing is being provided. In the event there is more than one mortgagor with respect to a particular residence, each of the mortgagors must meet the three-year requirement. A person who is liable under a note secured by a mortgage, but who does not have a present ownership interest in a residence subject to the mortgage, need not meet the three-year requirement. For example, where a parent takes no interest in the residence, it is not necessary that the parent meet the three-year requirement since the parent is not a mortgagor of the residence. Examples of interests which constitute a present ownership interest are the following:

(1) a fee simple interest;

(2) a joint tenancy, a tenancy in common, or a tenancy by the entirety;

(3) a life estate;

(4) a land contract (.i.e., a contract pursuant to which possession and the benefits and burdens of ownership are transferred although legal title is not transferred until some time later); and

(5) an interest held in trust for the mortgagor (whether or not created by the mortgagor) that would constitute a present ownership interest if held directly by the mortgagor.

(b) Examples of interests which do not constitute present ownership interests for purposes of 15 AAC 151.115(a) are the following:

(1) a remainder interest;

(2) a lease with or without an option to purchase;

(3) a mere expectancy to inherit an interest in a principal residence;

(4) the interest that a purchaser of a residence acquires on execution of a purchase contract; and

(5) an interest in other than a principal residence during the previous three years.

(c) The Corporation will require proof by affidavit of mortgagors of eligibility and compliance with the requirements of this section and will establish other procedures to ascertain eligibility and compliance with the requirements.

(d) The Corporation will not use proceeds of qualified mortgage bonds to purchase a loan made to a mortgagor who does not meet the qualifications described in 15 AAC 151.115(a) except to the extent permitted under the applicable provisions of the Code.

History

Authority: AS 18.56.098; AS 18.56.099
Eff. 5/7/93, Register 130

15 AAC 151.120 Income limits

(a) Each mortgagor to whom financing to acquire a residence under 15 AAC 151.110 or assistance under 15 AAC 151.300 - 15 AAC 151.340 is provided must meet the requirements of this subsection. The mortgagor meets the requirement of this subsection if:

(1) for assistance under 15 AAC 151.300 - 15 AAC 151.340, the mortgagor's family income as determined by the executive director is not greater than 80 percent of the median family income; or

(2) for a mortgage loan under 15 AAC 151.110, the mortgagor's family income as determined by the executive director is in accordance with Section 143(f) of the Internal Revenue Code of 1986, as amended, or any successor thereto, including the adjustment made for family size. For purposes of this subsection, "median family income" means the greater of:

(A) the area median gross income for the area in which the residence is located as established annually by HUD; or

(B) the area median gross income for the state as established annually by HUD.

The Corporation will include the statewide median gross income and area median gross income in the sellers' guide.

(b) For purposes of applying income requirements for the purchase of a loan under 15 AAC 151.110, the "family income" of a mortgagor or mortgagors is the mortgagor's or mortgagors' gross monthly income multiplied by twelve, and "gross monthly income" is the sum of the monthly income items set forth in the sellers' guide.

(c) For purposes of applying the income requirements for providing assistance under 15 AAC 151.300 - 15 AAC 151.340, the "family income" is the gross monthly income of the mortgagor or mortgagors, family members over the age of 21, who occupy the dwelling on a permanent basis, other individuals over the age of 18 who occupy the dwelling on a permanent basis, and the mortgagor's spouse multiplied by twelve, and "gross monthly income" is the sum of monthly income items set forth in the seller's guide.

History

Authority: AS 18.56.091
Eff. 5/7/93, Register 130; am 2/24/99, Register 149; am 9/22/99, Register 152

15 AAC 151.125 Purchase price requirements

(a) The acquisition cost of each residence may not exceed the "specified percent" of the average area purchase price of the statistical area in which the residence being financed is located as determined by the executive director in accordance with the Code. The executive director shall determine the average area purchase price separately with respect to (i) residences which have not been previously occupied, (ii) residences which have been previously occupied, (iii) one-family residences, and (iv) two-family residences. The executive director may adopt the average area purchase price limitations published by the United States Department of Treasury for the statistical area in which a residence is located which are referred to in the Code as the "Safe Harbor Limitations." For purposes of this subsection, "acquisition cost" means the cost of acquiring a residence from the seller as a completed residential unit. The determination whether a particular residence meets the purchase-price requirements shall be made as of the date on which the commitment to provide the financing is made, or if earlier, the date of purchase of the residence. The term "acquisition cost" includes the following:

(1) all amounts paid, either in cash or in kind, by the purchaser (or related party or for the benefit of the purchaser) to the seller (or related party or for the benefit of the seller) as consideration for the residence;

(2) if a residence is incomplete, the reasonable cost of completing the residence whether or not the cost of completing construction is to be financed with bond proceeds; for example, where a mortgagor purchases a building which is so incomplete that occupancy of the building is not permitted under local law, the acquisition cost includes the cost of completing the building so that occupancy of the building is permitted; and

(3) if a residence is purchased subject to a ground rent, the capitalized value of the ground rent, which shall be calculated using a discount rate equal to the yield on the issue of bonds as defined in the Code.

(b) In this section, the following terms have the following meanings:

(1) "acquisition cost" has the meaning provided in 15 AAC 151.125(a) but does not include the following:

(A) the usual and reasonable settlement or financing costs;

(B) the value of services performed by the mortgagor or members of the mortgagor's family in completing the residence; for example, if the mortgagor builds a home alone or with the help of family members, the acquisition cost includes the cost of materials provided and work performed by subcontractors (whether or not related to the mortgagor) but does not include the imputed cost of any labor actually performed by the mortgagor or a member of the mortgagor's family in constructing the residence, and if the mortgagor purchases an incomplete residence, the acquisition cost includes the cost of material and labor paid by the mortgagor to complete the residence but does not include the imputed value of the mortgagor's labor or the labor of the mortgagor's family in completing the residence; and

(C) the cost of land which has been owned by the mortgagor for at least two years prior to the date on which construction of the residence begins;

(2) "family" means, with respect to an individual, that individual's brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants;

(3) "financing costs" includes credit reference fees, legal fees, appraisal expenses, "points" which are paid by the buyer (but not the seller, even though borne by the mortgagor or through a higher purchase price) or other costs of financing the residence; however, such amounts will be excluded in determining acquisition cost only to the extent that the amounts do not exceed the usual and reasonable costs which would be paid by the buyer where financing is not provided through a qualified mortgage bond issue; for example, if the purchaser agrees to pay to the seller more than a pro rata share of property taxes, such excess shall be treated as part of the acquisition cost of a residence;

(4) "settlement costs" includes titling and transfer costs, title insurance, survey fees, or other similar costs; and

(5) "specified percent" means the percentage fixed by the Internal Revenue Code of 1986, as amended, and applied to the average area purchase price calculations as a requirement for the use of proceeds of qualified mortgage bonds.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.130 Assumption requirements

Section 103A(j) of the Internal Revenue Code of 1954, as amended, and Section 143(i)(2) of the Internal Revenue Code of 1986, as amended, provide that a mortgage loan financed under either of these sections of the Code may only be assumed by a borrower that meets the income (with respect to Section 143 only) and non-prior ownership requirements of Sections 103A or 143, as applicable, and the property meets the residence and purchase price requirements of Sections 103A or 143, as applicable, at the time of assumption as if the property were being purchased for the first time under Sections 103A or 143, as applicable.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.135 Qualified home improvement loans

Repealed.

History

Eff. 5/7/93, Register 130; repealed 5/25/2011, Register 204

15 AAC 151.140 Qualified rehabilitation loan

Repealed.

History

Eff. 5/7/93, Register 130; repealed 5/25/2011, Register 204

15 AAC 151.145 Qualified mortgage loans

(a) First lien mortgage loans may be purchased under 15 AAC 151.100 - 15 AAC 151.150 only if made to persons who did not have a mortgage (whether or not paid off) on the residence securing the mortgage note at any time prior to the execution of the mortgage. For purposes of this section, the replacement of:

(1) construction period loans;

(2) bridge loans or similar temporary initial financing; and

(3) in the case of a qualified rehabilitation, an existing mortgage, shall not be treated as the acquisition or replacement of an existing mortgage. Generally, temporary initial financing is any financing which has a term of 24 months or less.

(b) Second lien mortgage loans may be purchased under 15 AAC 151.100 - 15 AAC 151.150 to the extent such loans are allowable under applicable Federal law.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

Article 3 Veterans’ Mortgage Program

15 AAC 151.200 Qualified veterans' mortgage bond program

(a) The provisions of 15 AAC 151.200 - 15 AAC 151.250 relate to the issuance by the Corporation of qualified mortgage bonds as described in Section 143(b) of the Internal Revenue Code of 1986, as amended, and define and describe mortgages eligible to be financed with the proceeds of qualified veterans' mortgage bonds as part of the special mortgage loan purchase program of the Corporation. These sections are intended to establish procedures to ensure compliance with the mortgage eligibility provisions referred to in the Internal Revenue Code.

(b) A person is eligible under the program for a residential mortgage loan which is eligible for purchase by the Corporation if:

(1) the person is a qualified veteran as described in 15 AAC 151.215 - 15 AAC 151.250; and

(2) the residential mortgage loan will finance a single-family, owner-occupied residence and the term "single-family, owner-occupied residence" includes (i) a one-unit dwelling or (ii) a two-to-four unit dwelling first occupied as a residence at least five years before the mortgage is executed, one unit of which is occupied by the owner.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.205 Qualified veterans' mortgage loans

(a) First lien mortgage loans may be purchased under 15 AAC 151.200 - 15 AAC 151.250 only if made to persons who did not have a mortgage (whether or not paid off) on the residence securing the mortgage note at any time prior to the execution of the mortgage. For purposes of this section, the replacement of:

(1) construction period loans;

(2) bridge loans or similar temporary initial financing; and

(3) in the case of a qualified rehabilitation, an existing mortgage, shall not be treated as the acquisition or replacement of an existing mortgage. Generally temporary initial financing is any financing which has a term of 24 months or less.

(b) Second lien mortgage loans may be purchased under 15 AAC 151.200 - 15 AAC 151.250 to the extent such loans are allowable under applicable federal law.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.215 Veterans

As provided in Section 143(e)(4) of the Internal Revenue Code of 1986, as amended, and AS 18.56.098(j), "qualifying veteran," for the purposes of the veterans' mortgage program, has the meaning provided for the term "qualified veteran" under the Mortgage Subsidy Bond Tax Act of 1980 (94 Stat. 2660 - 2680). Temporary regulations of the Internal Revenue Service (Sec. 6a. 103A-3(c), as published in the Federal Register, Vol. 46, no. 126, Wednesday, July 1, 1981, page 34324) have implemented the Mortgage Subsidy Bond Tax Act by defining "veteran" to have the meaning provided in 38 U.S.C. 101(2). The Corporation will accept as a "qualified veteran" a person who meets the definition of "veteran" as established in the temporary regulations of the Internal Revenue Service described above and as interpreted and clarified by 15 AAC 151.215 - 15 AAC 151.250. To the extent the temporary regulations of the Internal Revenue Service referred to above are amended or replaced by other regulation, or to the extent the Mortgage Subsidy Bond Tax Act is amended, the provision of the later amendments or replacements prevail over contrary provisions in 15 AAC 151.220 - 15 AAC 151.250.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.220 Duty in armed forces

(a) A person is a qualified veteran for purposes of the veterans' mortgage program if the person satisfies the requirements of (b) of this section and if the person has served on full-time duty, other than for training, in the United States Army, Navy, Marine Corps, Air Force, or Coast Guard or in a reserve component of the United States Army, Navy, Marine Corps, Air Force, or Coast Guard.

(b) In addition to the requirements of (a) of this section, a person is a qualified veteran for purposes of the state guaranteed veterans' home mortgage program if the person:

(1) was not discharged from active duty more than 25 years prior to the date of closing;

(2) if retired, discharged, or released from the duty described in (a) of this section, separation must have been under conditions other than dishonorable; and

(3) if not retired, discharged, or released from the duty described in (a) of this section:

(A) has completed his or her initial period of duty; and

(B) would have been entitled to a discharge or release under conditions other than dishonorable at the end of his or her initial period of duty.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.225 Duty in public health service

(a) A person is a qualified veteran for purposes of the veterans' mortgage program if the person satisfies the requirements of 15 AAC 151.220(b) with regard to the duty described in this section and if the person has served on full-time duty, other than for training purposes, as a commissioned officer of the Public Health Service, or of the Reserve Corps of the Public Health Service, after July 28, 1945, or, if the duty occurred before July 29, 1945, under circumstances affording entitlement to full military benefits.

(b) For the purposes of (a) of this section, the Corporation will, in its discretion, seek the assistance of the Veterans Administration in determining whether an individual's service before July 29, 1945, in the Public Health Service was under circumstances affording entitlement to full military benefits.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.230 Duty in national oceanic and atmospheric administration or in coast and geodetic survey

A person is a qualified veteran for purposes of the veterans' mortgage program if:

(1) the person has served on full-time duty as a commissioned officer of the National Oceanic and Atmospheric Administration or of the Coast and Geodetic Survey:

(A) after July 28, 1945; or

(B) before July 29, 1945, if:

(i) the person was on transfer to the United States Army, Navy, Marine Corps, Air Force, or Coast Guard;

(ii) during time of war or national emergency declared by the President, the person was assigned to duty on a project for the United States Army, Navy, Marine Corps, Air Force, or Coast Guard in an area determined by the Secretary of Defense to be of immediate military hazard; or

(iii) the person served continuously in the Philippine Islands from December 7, 1941 to July 28, 1945; and

(2) the person satisfies the requirements of 15 AAC 151.220(b) with respect to the duty described in (1) of this section.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.235 Duty in United States Military, Air Force, Coast Guard, or Naval Academy

A person is a qualified veteran for purposes of the veterans' mortgage program if:

(1) the person has served as a cadet at the United States Military, Air Force, or Coast Guard Academy or as a midshipman at the United States Naval Academy; and

(2) the person satisfies the requirements of 15 AAC 151.220(b) with respect to the duty described in (1) of this section.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.240 Travel to or from duty

For the purposes of 15 AAC 151.220 - 15 AAC 151.235, "duty" or "service" includes authorized travel to and from the duty or service.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130

15 AAC 151.245 Spouses

A spouse of a qualified veteran is not a qualified veteran for purposes of the veterans' mortgage program unless the spouse also qualifies under 15 AAC 151.220 - 15 AAC 151.250. However, if the residence for which a loan is sought is to be owned by a husband and wife as joint tenants and one spouse is a qualified veteran for purposes of the veterans' mortgage program, the Corporation will consider both spouses as qualified veterans with regard to that loan.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

15 AAC 151.250 Evidence of qualifications

(a) The Corporation will, in its discretion, accept, as evidence of the satisfactory fulfillment of the requirements of 15 AAC 151.220(b)(1), an official document of the appropriate federal agency indicating that the individual has received an honorable or general discharge. If the individual has received a discharge or release other than honorable or general, the Corporation may require additional evidence to demonstrate that the discharge or release was under conditions other than dishonorable.

(b) The Corporation may seek assistance from the United States Veterans Administration as the Corporation considers necessary or appropriate to determine whether an individual qualifies as a veteran under 15 AAC 151.215 - 15 AAC 151.250. The Corporation may accept a certification from the Veterans Administration as evidence of an individual's qualification as a veteran for the purposes of the veterans' mortgage program. However, a certification or other determination of the Veterans Administration is not binding upon the Corporation.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/9/2006, Register 179

Article 4 Home Ownership Fund

15 AAC 151.300 Payment assistance

The home ownership fund program provides assistance on the first $50,000 of a loan made to persons of lower and moderate income for homes financed with a mortgage loan purchased by the Corporation under 15 AAC 151.010 - 15 AAC 151.250 or 15 AAC 151.600 - 15 AAC 151.660. The assistance may be in the form of an interest rate subsidy only or a combination of the interest rate and payment subsidy. The method of assistance calculation will be determined by the Corporation as set forth in the sellers' guide. Except as provided in this section, the limitations and conditions otherwise applicable under 15 AAC 151.010 - 15 AAC 151.250 and 15 AAC 151.600 - 15 AAC 151.660 to a mortgage loan continue to apply if a borrower receives assistance from the home ownership fund under this section.

History

Authority: AS 18.56.091
Eff. 5/7/93, Register 130

15 AAC 151.310 Eligibility

(a) A person is eligible to participate in the home ownership fund program for the purchase of a single-family residence, including Type I and Type II mobile home units, after having met general borrower loan qualifications of the Corporation and those of 15 AAC 151.300 - 15 AAC 151.340. Owner/builder refinances are not eligible under 15 AAC 151.300 - 15 AAC 151.340.

(b) To be eligible to receive an interest rate subsidy only, the applicant must establish that the family income does not exceed the limit established under 15 AAC 151.120 and set forth in the sellers' guide.

(1) the family income does not exceed the limit established under 15 AAC 151.120 and set forth in the sellers' guide;

(2) a minimum of 28 percent of the family income is contributed toward the applicant's monthly payments of principal and interest on the loan, together with applicable taxes, reasonable fire and other perils insurance, mortgage insurance, private credit insurance, space rent, and home owner association fees (less any utility expenses included in those fees);

(3) the family does not own assets of value (A) exceeding $50,000 for a one-member family and an additional $5,000 for each family member beyond one or (B) if a member of the family is 65 years old or over, one and one-half times the applicable limit for the family size set forth in (A) of this paragraph; and

(4) the purchase price of the property does not exceed the value listed below, nor does the appraised value exceed 115% of the sales price:

(A) $80,000 for a family of one and two adults;

(B) $85,000 for a family of one adult and one dependent or two adults and one dependent;

(D) $100,000 for a family of one adult and three or more dependents or two adults and three or more dependents.

History

Authority: AS 18.56.091
Eff. 5/7/93, Register 130

15 AAC 151.320 Terms

The terms for the interest rate and payment subsidy under the home ownership fund program are as follows:

(1) mortgage payments may be partially subsidized by the home ownership fund in an amount not to exceed the lesser of the following amounts:

(A) for loans where the borrowers first executed a home ownership assistance agreement prior to February 1, 1983:

(i) the sum necessary to reduce the borrower's monthly payments of principal and interest on the mortgage loan to the amounts payable as if the mortgage loan were a level debt service loan bearing interest at the rate of six percent a year; or

(ii) the sum necessary to reduce the borrower's monthly payments of principal and interest on the mortgage, together with taxes, hazard insurance, mortgage insurance and homeowner association fees (less any utility expenses included in those fees) if any with respect to the property, to 25 percent of gross family income;

(B) for loans where the borrowers first executed a home ownership assistance agreement between February 1, 1983, and June 30, 1992:

(i) the sum necessary to reduce the monthly payments of principal and interest on the mortgage loan to the amounts payable as if the mortgage loan were a level debt service loan bearing interest at the rate of six percent a year; or

(ii) the sum necessary to reduce the monthly payments of principal and interest on the mortgage loan, together with taxes, hazard insurance, mortgage insurance, credit insurance, space rent, and any homeowner association fees (less any utility expenses included in those fees) with respect to the property, to 28 percent of gross family income;

(i) the sum necessary to reduce the monthly payments of principal and interest on the first $50,000 of the mortgage loan to the amounts payable as if the first $50,000 of the mortgage loan were a level debt service loan bearing interest at the rate of six percent a year; or

(ii) the sum necessary to reduce the monthly payments of principal and interest of the mortgage loan, together with taxes, hazard insurance, mortgage insurance, credit insurance, space rent, and any homeowner association fees (less any utility expenses included in those fees) with respect to the property, to 28 percent of gross family income.

(D) for a refinance loan, the subsidy may not exceed that currently being paid by the Corporation.

(2) the term for a mortgage loan with respect to which there is a home ownership assistance agreement must be the maximum term allowed under the Corporation's program providing financing for the home on the remaining economic life of the property, whichever is less; and

(3) the loan-to-value ratio for a mortgage loan with respect to which there is a home ownership assistance agreement shall not exceed the maximum percent allowable by statute.

History

Authority: AS 18.56.091
Eff. 5/7/93, Register 130

15 AAC 151.330 Home ownership assistance agreement

(a) The borrower receiving monthly payment assistance shall be required to enter into a home ownership assistance agreement with the Corporation which shall expire December 31 of each year and contain periodic income-review requirements in the form required by the Corporation including, without limitation, provisions reducing or eliminating assistance depending on:

(1) application of the assistance formula of 15 AAC 151.320; and

(2) a formula or other method based on the amount available for assistance from income or revenues of the home ownership fund.

(b) When the term of a home ownership assistance agreement expires as provided in 15 AAC 151.330(a), a new home ownership assistance agreement may be entered pursuant to the terms of 15 AAC 151.320 and this section, but the assistance amount under a new agreement may not exceed the assistance amount allowed under the immediately prior agreement, unless the borrower qualifies under 15 AAC 151.340 or the original agreement was dated before October 1, 1981.

(c) For loans originated after February 1, 1983, the Corporation will not enter into a home ownership assistance agreement with a borrower who has not previously obtained a loan prior to that date under the home ownership assistance program if the amount of assistance is determined to be less than $50 per month for a loan secured by a site-built home or type I mobile home; or less than $20 per month for a loan secured by a Type II mobile home.

(d) A home ownership assistance agreement is personal to the borrower and may not be assigned.

(e) No secondary financing of a mortgage loan with respect to which there is a home ownership assistance agreement is permitted.

History

Authority: AS 18.56.091
Eff. 5/7/93, Register 130

15 AAC 151.340 Adjustment to assistance amount

For borrowers who have received payment assistance under 15 AAC 151.300 - 15 AAC 151.330 within the preceding 12 months, the assistance amount may be increased to an amount not exceeding the highest assistance allowed under any previous assistance agreement between the borrower and the Corporation during the 12 month period subsequent to the occurrence of one of the following events:

(1) death of an individual executing the note and security instrument;

(2) an individual executing the note and security instrument becoming severely and permanently disabled; or

(3) the divorce of two individuals executing the note and security instrument with only one of the individuals continuing to reside in the residence with a dependent.

History

Authority: AS 18.56.091
Eff. 5/7/93, Register 130

Article 5 Senior Housing Program

15 AAC 151.400 Senior housing loan program

The Corporation will, in its discretion, make, participate in the making, purchase, or participate in the purchase of loans for the acquisition, construction, improvement, or rehabilitation of senior housing, including operational apparatus.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.730
Eff. 5/7/93, Register 130

15 AAC 151.405 Borrower eligibility

The corporation will make, participate in the making, purchase, or participate in the purchase of a loan under 15 AAC 151.400 - 15 AAC 151.440 to individuals, partnerships, joint ventures, for-profit corporations, limited liability companies, limited liability partnerships, regional housing authorities, non-profit corporations, corporations organized under 43 U.S.C. 1601 - 1629h (Alaska Native Claims Settlement Act), as amended, including a listed native village, or any wholly owned subsidiary of those corporations, school districts, regional educational attendance areas, agencies of the state, and municipalities.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.730
Eff. 5/7/93, Register 130; am 5/16/2012, Register 204

15 AAC 151.410 Senior housing characteristics

Repealed.

History

Eff. 5/7/93, Register 130; repealed 5/16/2012, Register 204

15 AAC 151.412 Security

(a) A loan under 15 AAC 151.400 - 15 AAC 151.440 shall be secured by residential real estate occupied by an individual meeting the definition of "housing for older persons" contained in 24 C.F.R. 100.300 - 100.308, as amended.

(b) The corporation may condition a loan under 15 AAC 151.400 - 15 AAC 151.440 on an agreement that a covenant will encumber the real estate securing the loan which meets the requirements established in 15 AAC 151.435(c).

History

Authority: AS 18.56.088; AS 18.86.099 AS 18.56.090; AS 18.56.730
Eff. 5/16/2012, Register 204

15 AAC 151.415 Maximum loan amounts; loan terms

(a) The total principal amount of a loan under 15 AAC 151.400 - 15 AAC 151.440 for a senior housing project, combined with other acceptable superior or subordinate encumbrances on the senior housing, if any, may not exceed an amount which is an acceptable risk to the corporation as determined by an analysis of the project's current and forecasted cash flows in relationship to covering the project's expenses, reserves, and debt service.

(b) For mortgage loans secured by single-family, duplex, triplex, and four-plex senior housing, the provisions of 15 AAC 151.020 relating to loan terms shall apply to a loan under 15 AAC 151.400 - 15 AAC 151.440.

(c) For the assumption of a mortgage loan under 15 AAC 151.400 - 15 AAC 151.440, the provisions of 15 AAC 151.910 relating to assumptions of mortgage loans shall apply.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.730
Eff. 5/7/93; am 4/22/94, Register 130; am 5/16/2012, Register 204

15 AAC 151.419 Construction loans

(a) The Corporation will consider involvement in construction lending for multi-family, special needs, and congregate housing only as a last alternative and if, in its opinion, the risk to the Corporation has been mitigated to the greatest degree possible.

(b) In determining the feasibility of a construction loan under this section, the Corporation will review the following:

(1) mitigating project characteristics, such as:

(A) limited land development. The Corporation will not participate in a construction loan, if in its opinion, extensive land development is involved, such as, but not limited to, installing or constructing nonresidential improvements, including water, sewer, and other utilities, roads, streets, curbs, gutters, sidewalks, storm drainage facilities, and other installations or works that are necessary to prepare the land primarily for residential housing construction;

(B) suitable land characteristics - minimal unknowns that could affect construction, such as water table depths, permafrost and wetlands;

(D) mainstream type of construction which is not on the edge of construction technology.

(2) the financial capacity of the borrower, developer, contractor and other parties, if applicable; and

(3) the experience of the borrower, developer, contractor, architect, engineer and other parties, if applicable.

(c) If the Corporation determines that involvement in a construction loan is feasible, then the extent of the Corporation's participation will be based on the following:

(1) there must be a lead lender which is acceptable to the Corporation. In determining the acceptability of the lead lender, the Corporation will consider, at a minimum, the following:

(A) its financial capacity;

(B) its experience in construction lending;

(D) its construction policies and procedures; and

(E) its regulatory limitations;

(2) the Corporation's maximum participation shall not exceed the lesser of 33% of the loan amount or $5,000,000;

(3) the Corporation's participation is either on a pro-rata basis or the last in; and

(4) lead lender's justification as to why the Corporation's participation is required and as a last alternative to assure construction of the project.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.730
Eff. 10/21/98, Register 148

15 AAC 151.420 Term of loans

Repealed.

History

Eff. 5/7/93; am 4/22/94, Register 130; repealed 5/16/2012, Register 204

15 AAC 151.425 Interest rate

A loan under 15 AAC 151.400 - 15 AAC 151.440 shall bear interest at the rate established by the Corporation. The Corporation shall establish the interest rate for a loan based on factors the Corporation considers relevant, including, but not limited to, the source of money to the Corporation to provide funding for the loan, the length of the commitment period, and other considerations.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.730
Eff. 5/7/93, Register 130; am 10/21/98, Register 248

15 AAC 151.430 Fee schedule and commitment period

(a) Private financial institutions and regional Native housing authorities may not charge a borrower an origination fee that exceeds one percent.

(b) For loans secured by a senior housing project under 15 AAC 151.415(a), the following apply:

(1) the commitment period for a term loan is 24 months;

(2) a loan commitment fee will be required, as follows:

(A) if the corporation expects to issue bonds before funding a loan, a commitment fee equal to one and a half percent of the approved loan amount is required at the time of commitment acceptance by the borrower;

(B) if the corporation does not expect to issue bonds before funding the loan, a loan commitment fee equal to 50 percent of the loan fee, which will be credited towards the loan fee at the time of closing, is required at the time of commitment acceptance by the borrower;

(3) the corporation may grant an extension of the firm commitment for up to 180 days for good cause upon payment of a fee equal to

(A) half of one percent of the loan amount for non-profit corporations, local governments, and regional housing authorities; and

(B) one percent of the loan amount for individuals, partnerships, joint ventures, and for-profit corporations;

(4) loan fees will be required as follows:

(A) for a term loan to a non-profit corporation, an agency of the state, a municipality, a regional housing authority, or a corporation organized under 43 U.S.C. 1601 - 1629h, as amended, or any wholly-owned subsidiary of that corporation:

the first $1,000,000 .50 percent

the next $ 4,000,000 .375 percent

the next $10,000,000 .25 percent

the next $15,000,000 .125 percent

(B) for a term loan to an individual, partnership, joint venture, or for-profit corporation:

the first $1,000,000 1.0 percent

the next $ 4,000,000 .75 percent

the next $10,000,000 .50 percent

the next $15,000,000 .25 percent

History

Authority: AS 18.56.088; AS 18.56.099; AS 18.56.750 AS 18.56.090; AS 18.56.730
Eff. 5/7/93, Register 130; am 4/22/94, Register 130; am 5/16/2012, Register 204

15 AAC 151.435 Loan guidelines

(a) The corporation will not make, participate in the making, purchase, or participate in the purchasing of a loan under 15 AAC 151.400 - 15 AAC 151.440 unless the corporation determines that the following conditions have been met:

(1) the loan meets the requirements of 15 AAC 150.080 or (3) of this subsection;

(2) the loan meets the requirements of 15 AAC 151.500 - 15 AAC 151.542 and (3) of this subsection; or

(3) the loan does not meet the requirements of (1) or (2) of this subsection but the loan proceeds will be used to finance amenities above the value of the real estate, and

(A) a covenant encumbers the real estate securing the loan that complies with the requirements of (c) of this section; and

(B) the application for a loan under this program is made by directly contacting the corporation.

(b) Repealed 5/16/2012.

(1) for a senior housing project, the covenant must remain in effect, at a minimum, for 30 years or for the term of the senior housing loan, whichever is greater; and

(2) unless the covenant is waived by the Corporation, for single-family, duplex, triplex, or four-plex senior housing, the covenant must remain in effect for the term of the senior housing loan.

(d) If the borrower is under economic hardship that is tied directly to the borrower's inability to repay the loan, the borrower may request that the Corporation agree to modify the covenant described in 15 AAC 151.435(c). In consideration of the information provided, the Corporation will make a decision that is in the best interest of the Corporation. A request under this subsection must:

(1) be in writing and specifically describe the economic hardship requiring the modification;

(2) be accompanied by specific financial and market information supporting the borrower's request;

(3) provide any other information and reasons in support of the request; and

(4) provide proposed solutions to alleviate the economic hardship of the borrower.

(e) The corporation may modify the requirements set out in this section for any specific loan if it determines additional credit enhancements have been added which more than offset any potential increased risk to the corporation.

(f) The corporation may not require an appraisal report for a loan under (a)(3) of this section.

History

Authority: AS 18.56.088; AS 18.56.099; AS 18.56.760 AS 18.56.090; AS 18.56.730
Eff. 5/7/93, Register 130; am 5/16/2012, Register 204

15 AAC 151.440 Board approval

Any loan application submitted under 15 AAC 151.400 that staff of the corporation determines substantially meets the program criteria of 15 AAC 151.400 - 15 AAC 151.435 but that exceeds $2,500,000 must be presented to the board of directors for review and specific direction regarding loan approval or rejection.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.730
Eff. 5/7/93, Register 130; am 5/16/2012, Register 204; am 12/3/2025, Register 257

Article 6 Multi-Family, Special Needs, and Congregate Housing Program

15 AAC 151.500 Multi-family, special needs, and congregate housing loans

The Corporation will, in its discretion and in accordance with and subject to provisions of 15 AAC 151.505 - 15 AAC 151.545, make, participate in the making, purchase, or participate in the purchasing of loans to acquire, construct, rehabilitate, improve, or refinance multi-family, special needs, and congregate housing, including operational apparatus, for persons of lower to moderate income or in remote, underdeveloped, or blighted areas.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 9/28/95, Register 136

15 AAC 151.501 Federally insured multi-family loans

(a) The Corporation will, in its discretion, purchase loans made for the purpose of acquiring, rehabilitating, or refinancing multi-family housing, if 90% or more of the principal amount of the loan is insured by the Federal Housing Administration or another agency of the federal government. Loans purchased under this section shall be subject to the requirements of 15 AAC 151.505 and 15 AAC 151.525 and must be secured by housing with five or more living units.

(b) The Corporation will, in its discretion, make, participate in the making, or participate in the purchasing of loans made for the purpose of acquiring, rehabilitating, or refinancing multi-family housing, if 90% or more of the principal amount of the loan is insured by the Federal Housing Administration or another agency of the federal government. Loans purchased under this section shall not be subject to the requirements of 15 AAC 151.520 and 15 AAC 151.542(b)(1) - (5).

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 9/28/95, Register 136; am 4/2/97, Register 142; am 12/14/2005, Register 179

15 AAC 151.505 Borrower eligibility

(a) A loan under 15 AAC 151.500 may be made to an individual, partnership, joint-venture, for-profit corporation, non-profit corporation, limited liability company, limited liability partnership, trust, regional housing authority, corporation organized under 43 U.S.C. 1601 - 1629E, as amended, including a listed native village, or any wholly owned subsidiary of such corporation, school district, rural education attendance area, agency of the state, or municipality.

(b) For purposes of this section "trust" means a trust established exclusively for the benefit of persons who satisfy the requirements set forth at 15 AAC 151.950(d)(11)(B) and (C).

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 1/28/98, Register 145; am 4/23/2009, Register 190

15 AAC 151.510 Housing characteristics

(a) A loan under 15 AAC 151.500 must be used to provide housing for

(1) persons of lower to moderate income as that term is defined at AS 18.56.390(9);

(2) if the housing is financed with bonds with respect to which the interest is exempt from federal income taxation pursuant to 26 U.S.C. 103, persons meeting the income requirements in connection with such bonds;

(3) if the housing has an allocation of a low income housing tax credit, persons as necessary under 26 U.S.C. 42; or

(4) persons in remote, underdeveloped, or blighted areas of the state.

(b) A congregate housing project to be financed with a loan under 15 AAC 151.500 must provide at least one congregate service to the residents for the term of the loan. The service must be provided on a fixed schedule based on tenant needs and must be approved by the Corporation.

(c) A loan under 15 AAC 151.500 may be used to finance housing that contains commercial uses. The amount of the square footage for the commercial uses shall be determined by the corporation.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.230
Eff. 5/7/93, Register 130; am 9/25/2013, Register 208

15 AAC 151.515 Maximum loan amounts

(a) Except as provided in 15 AAC 151.515(b), the total principal amount of a loan under 15 AAC 151.500 combined with other acceptable superior or subordinate encumbrances on the housing, if any, may not exceed an amount which is an acceptable risk to the Corporation as determined by an analysis of the housing's current and forecasted cash flows in relationship to covering the housing's expenses, reserves, and debt service.

(b) The total principal amount of a loan under 15 AAC 151.500 for refinancing made to an individual, partnership, joint venture, or a for-profit corporation may not exceed the amount necessary to pay the outstanding principal amount of the debt being refinanced and any cost approved by the Corporation associated with the refinancing or improvement of the property.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 4/2/97, Register 142

15 AAC 151.519 Construction loans

(b) In determining the feasibility of a construction loan under this section, the Corporation will review the following:

(1) mitigating project characteristics, such as:

(A) limited land development. The Corporation will not participate in a construction loan, if in its opinion, extensive land development is involved, such as but not limited to, installing or constructing non-residential improvements, including water, sewer, and other utilities, roads, streets, curbs, gutters, sidewalks, storm drainage facilities, and other installations or works that are necessary to prepare the land primarily for residential housing construction;

(B) suitable land characteristics - minimal unknowns that could affect construction, such as water table depths, permafrost, and wetlands;

(D) mainstream type of construction which is not on the edge of construction technology.

(2) the financial capacity of the borrower, developer, contractor and other parties, if applicable; and

(3) the experience of the borrower, developer, contractor, architect, engineer and other parties, if applicable.

(c) If the Corporation determines that involvement in a construction loan is feasible, then the extent of the Corporation's participation will be based on the following:

(1) there must be a lead lender which is acceptable to the Corporation. In determining the acceptability of the lead lender, the Corporation will consider, at a minimum, the following:

(A) its financial capacity;

(B) its experience in construction lending;

(D) its construction policies and procedures; and

(E) its regulatory limitations.

(2) the Corporation's maximum participation shall not exceed the lesser of 33 percent of the loan amount or $5,000,000;

(3) the Corporation's participation is either on a pro-rata basis or the last in; and

(4) lead lender's justification as to why the Corporation's participation is required and as a last alternative to assure construction of the project.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 8/3/94, Register 132

15 AAC 151.520 Term of loans

The term of a loan under 15 AAC 151.500 may not exceed 30 years or the estimated useful life expectancy of the housing as determined by the Corporation, whichever is less. If a loan is directly funding the allowable costs of the construction, rehabilitation, or improvement of the housing, the term may not exceed 24 months.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 8/3/94, Register 132

15 AAC 151.525 Interest rate

A loan under 15 AAC 151.500 or 15 AAC 151.542 shall bear interest at the rate established by the Corporation. The Corporation will establish the interest rate for a loan based on factors the Corporation considers relevant, including, but not limited to, the source of money to the Corporation to provide funding for the loan, the length of the commitment period, and other considerations.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 9/22/94, Register 132

15 AAC 151.530 Housing assistance

(a) Subject to the conditions contained in this subsection, the Corporation will, in its discretion, provide an interest rate subsidy to a borrower for a loan described in 15 AAC 151.500 for congregate, special needs, and multi-family housing. If the loan is for multi-family housing, the borrower must be:

(1) a private non-profit corporation;

(2) an agency of the state;

(3) a municipality; or

(4) a regional housing authority.

The Corporation will determine the amount of the subsidy by considering the merits of the housing; the applicant and application; the community need for the housing; the financial feasibility of the housing; the availability and utilization of alternate forms of assistance; the ability of the Corporation to fund the subsidy; and other pertinent considerations. The Corporation will not provide a subsidy under this subsection unless the board of directors identifies in the Corporation's proposed operating budget the money available to the Corporation, including the Corporation's own assets, for the subsidy. If a borrower receives an interest subsidy under this subsection and the borrower's housing project that was financed with the loan to which the interest subsidy applies ceases to be used for the purpose for which the loan was made, the Corporation will adjust the interest rate payable on the unpaid balance of the loan to the prevailing rate of interest charged by the Corporation on loans made for other residential purposes but will not reduce the interest rate payable below the subsidized rate. The Corporation will establish further conditions relating to interest rate subsidies under this subsection in a program guide.

(b) Subject to the other conditions contained in this subsection, the Corporation will, in its discretion, award grants for housing assistance under 15 AAC 151.500 for congregate, special needs, and multi-family housing. If the loan is for multi-family housing, the borrower must be:

(1) a private non-profit corporation;

(2) an agency of the state;

(3) a municipality; or

(4) a regional housing authority.

The Corporation will determine the size of a grant based on the merits of the housing; the merits of the applicant and application; the community need for the housing; the financial feasibility of the housing; the availability and utilization of alternate forms of assistance; the ability of the Corporation to fund the grant; and other pertinent considerations. The Corporation will not award a grant under this subsection unless the board of directors identifies in the Corporation's proposed operating budget the money available to the Corporation, including the Corporation's own assets, for the grant. The Corporation will establish further conditions relating to grants under this subsection in a program guide.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130

15 AAC 151.535 Fee schedule and commitment periods

(a) The Corporation will enter into a commitment agreement to make, participate in the making, purchase, or participate in purchasing a loan under 15 AAC 151.500. The maximum commitment period that the Corporation will permit is a commitment agreement under this section as follows:

(1) for a term loan, 24 months; and

(2) for a construction, rehabilitation, or improvement loan, 12 months.

(b) Subject to refunding and crediting as provided in 15 AAC 151.535(c), and unless the Corporation determines, in its sole discretion, that another amount is appropriate, the Corporation will charge the following fees in connection with making, participating in the making, purchasing, or participating in the purchase of a loan under 15 AAC 151.500:

(1) loan commitment fee - if the Corporation expects to issue bonds before funding a loan, a commitment fee equal to 1.5% of the approved loan amount is required at the time of commitment acceptance by the borrower;

(2) loan fee - if the Corporation does not expect to issue bonds before funding the loan, the following loan fees are required at the time of loan closing by the borrower:

(A) for a term loan to a non-profit corporation, an agency of the state, a municipality, a regional housing authority, or a corporation organized under 43 U.S.C. 1601 - 1629e, as amended, or any wholly-owned subsidiary of such corporation:

(i) for a commitment period not to exceed 12 months:

the first $1,000,000 .50%

the next $ 4,000,000 .375%

the next $10,000,000 .25%

the next $15,000,000 .125%

(ii) for a commitment period exceeding 12 months but not to exceed 24 months:

the first $1,000,000 1.0%

the next $ 4,000,000 .75%

the next $10,000,000 .5%

the next $15,000,000 .25%

(B) for a term loan to an individual, partnership, joint-venture, or for-profit corporation:

(i) for a commitment period not to exceed 12 months:

the first $1,000,000 1.0%

the next $ 4,000,000 .75%

the next $10,000,000 .50%

the next $15,000,000 .25%

(ii) for a commitment period exceeding 12 months but not to exceed 24 months:

the first $1,000,000 2.0%

the next $ 4,000,000 1.5%

the next $10,000,000 1.0%

the next $15,000,000 .5%

(C) for a construction, rehabilitation, or improvement loan to a non-profit corporation, an agency of the state, a municipality, a regional housing authority, or a corporation organized under 43 U.S.C. 1061 - 1629e, as amended, or any wholly-owned subsidiary of such corporation: .75 percent of the loan amount; and

(D) for a construction, rehabilitation, or improvement loan to an individual, partnership, joint-venture, or for-profit corporation, 1.5 percent of the loan amount.

(3) secondary mortgage purchase fee - if the Corporation expects to sell the mortgage to a secondary investor such as FNMA or FHLMC, the applicant must pay all costs associated with the sale to the secondary investor;

(4) extension of commitment - the Corporation may permit an extension of the firm commitment for up to 180 days for good cause upon receipt of a fee equal to

(A) one-half of one percent of the loan amount for

(i) a non-profit corporation;

(ii) an agency of the state;

(iii) a municipality;

(iv) a regional housing authority; or

(v) a corporation organized under 43 U.S.C. 1601 - 1629e, as amended, or any wholly-owned subsidiary of that corporation; and

(B) one percent of the loan amount for any other borrower under 15 AAC 151.500.

(c) Subject to the requirements of this subsection, the Corporation will refund a portion of the loan commitment fee described in 15 AAC 151.535(b)(1) or, at the option of the borrower, credit it towards closing costs, if applicable. The portion of the loan commitment fee that the Corporation will refund or credit pursuant to the preceding sentence is the amount calculated by the Corporation that, when deducted from the loan commitment fee that was initially collected from the borrower, will leave the amount that would have been charged to the borrower under 15 AAC 151.535(b)(2). A refund or crediting under this subsection is available only if the loan closes to the satisfaction of the Corporation and within the firm commitment period and under the terms specified in the Corporation's commitment relating to the loan.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 7/14/2010, Register 204; am 10/26/2016, Register 220

15 AAC 151.540 Loan guidelines

(a) The Corporation will not make, participate in the making, purchase, or participate in the purchase of a loan under 15 AAC 151.500, unless it determines that the following conditions have been met:

(1) a loan is not otherwise available from other sources upon reasonably equivalent terms and conditions;

(2) the loan is secured by property which is acceptable to the Corporation which may include a mortgage which is in a first or subordinate lien position on real property in fee simple or an acceptable leasehold estate under (5) of this subsection;

(3) diligence has been exercised in minimizing administrative and regulatory-related expenses of the housing to allow for the maximizing of the availability of the housing for its intended occupants;

(4) the operational apparatus necessary for the operation of the housing is secured by a valid Uniform Commercial Code financing statement, which must name, or be assigned to, the Corporation as a secured party and be recorded in all places necessary to perfect a valid lien;

(5) if a land lease secures the loan, the terms are acceptable to the Corporation;

(6) the applicant will obtain and maintain fire, extended coverage, vandalism, and optional perils insurance in an amount acceptable to the Corporation;

(7) the applicant will obtain title insurance in a form acceptable to the Corporation, unless waived by the Corporation.

(b) Before it makes, participates in the making, purchases, or participates in the purchase of a loan under 15 AAC 151.500, the corporation may require

(1) that the application include:

(A) a loan summary;

(B) a signed loan application;

(D) financial statements, which may be audited, including a profit and loss statement, for the current and three preceding years, with the financial statement and profit and loss statement for the current year dated four months or less from date of application;

(E) resumes of key personnel;

(F) copies of the earnest money receipt and agreement, option to purchase, contract to purchase, invoice for purchase of land or land and improvements related to the housing or lease of the land or land and improvements under a long-term lease;

(G) preliminary plans and specifications for construction of the housing and a detailed description of the housing and a detailed description of real or tangible property to be acquired for the housing;

(H) a detailed estimate of the cost of construction;

(I) an appraisal report ordered by the Corporation;

(J) an environmental assessment acceptable to the Corporation; and

(K) any other information considered necessary by the Corporation to evaluate the application or to comply with conditions of underwriters, rating agencies, credit enhancers, loan guarantors or insurers, or any party to the related financing;

(2) an escrow for taxes, assessments, and other charges that may, if not paid on a timely basis, become liens on the housing securing the loan;

(3) the establishment of housing replacement reserves for fixtures, equipment, appliances, and personal property and the manner in which the replacement reserves are to be maintained;

(4) the establishment of repair and maintenance reserves and the manner in which the repair and maintenance reserves are to be maintained;

(5) in the case of subordinate financing:

(A) a subordinate deed of trust as security;

(B) that the term of the subordinate loan not exceed 30 years;

(D) that the loan bear interest at a rate as established by the Corporation;

(E) that the repayment, as determined by the Corporation, of the interest and the principal of the loan, be based on the excess cash flow above that required for allowances for administrative and operating expenses; reserves for repair, maintenance, and replacements; real estate taxes; other expenses as approved by the Corporation; and debt service on all encumbrances on the housing superior to the subordinate loan, as determined by the Corporation;

(F) that the combined sum of all encumbrances including the subordinate loan on the housing be an acceptable risk to the Corporation; and

(G) that the combined sum of all encumbrances, including the subordinate loans on the housing, in relation to the housing's value present an acceptable risk to the Corporation, taking into consideration and placing emphasis on the analysis of the housing's current and forecasted cash flows in relationship to covering the housing's expenses, reserves, and debt service on all encumbrances including the subordinate loans over their life;

(6) where there has been construction, rehabilitation, or improvement, a statement from an appraiser stating that the housing was substantially completed according to the plans and specifications relied on by the appraiser making the appraisal;

(7) where there has been construction, rehabilitation, or improvement, a statement from an architect certifying that the housing was substantially completed according to the plans and specifications and any approved changes;

(8) a statement from an authorized official that the buildings and structures may be occupied and that the occupancy, buildings, and structures conform to all requirements, of federal, state, and municipal law; or, if there is no authorized official or if requested by the Corporation, a registered architect, professional engineer, or other person acceptable to the Corporation that the housing offered as security for the loan is structurally sound and that the buildings or structures conform to applicable building standards;

(9) for recently completed, newly constructed housing, a soils test acceptable to the Corporation;

(10) the imposition of restrictions and requirements which it considers necessary to comply with the lending conditions of any potential loan purchaser, insurer, or guarantor;

(11) insurance or a guaranty by another entity such as the Federal Housing Administration, an approved private mortgage insurance company, or an insurance entity of the Corporation;

(12) annual audited financial statements of the borrower or borrowers;

(13) any other terms or conditions that are considered prudent by the corporation;

(14) a regulatory agreement or loan agreement designed to assure compliance with any provisions of these regulations or of the program guide with such remedies for non-compliance as it considers necessary or desirable including, without limitation, acceleration of the principal of the loan or increase in the rate of interest; and

(15) natural hazard insurance, including coverage for flood, earthquake, and mudslide, as well as rent loss insurance;

(16) when considering commercial uses, the primary purpose of the loan is for residential housing.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.230
Eff. 5/7/93, Register 130; am 9/22/94, Register 132; am 9/25/2013, Register 208

15 AAC 151.542 Multi-family loan purchase program

(a) The Corporation will, in its discretion, purchase or participate in the purchasing of loans to acquire, rehabilitate or refinance multi-family housing. Loans purchased, in whole or in part, under this section must be originated and serviced by multi-family lenders approved by the Corporation. Loans under this section shall satisfy the requirements of 15 AAC 151.500 - 15 AAC 151.545 except as otherwise provided in this section. Loans made under this section are not subject to the requirements of 15 AAC 151.510(a)(1), (a)(4) and 15 AAC 151.530. Any loan application made under this section that is $2,500,000 or less is not subject to 15 AAC 151.545.

(b) A multi-family lender may participate in a loan, subject to (c)(6) of this section, in an amount as it determines. The term and interest rate of the participation lender's share of the loan may vary from that of the Corporation's share at the discretion of the Corporation.

(c) The total principal amount of a participation loan may not exceed the lesser of 80% of the appraised value of the property or:

(1) for an acquisition: 80% of the acquisition price;

(2) for an acquisition with rehabilitation: the total of 80% of the acquisition price, 100% of the allowable costs to rehabilitate and 100% of other transaction costs approved by the Corporation;

(3) for an existing debt refinancing: 100% of the amount necessary to pay the outstanding principal amount of the debt being refinanced and any refinancing costs approved by the Corporation;

(4) for an existing debt refinancing with rehabilitation: the total of 100% of the allowable costs to rehabilitate, the amount of the debt being refinanced and any other refinancing costs approved by the Corporation;

(5) for a construction loan refinancing: 100% of the allowable developmental costs to construct; and

(6) for a refinancing with cash-out to the borrower: 80% of the appraised value of the property; however, the lender must participate in the loan in an amount at least equal to the amount of the cash-out to the borrower. However, if any of the cash-out is used for the acquisition and/or improvement of another multi-family property, or to pay down the balance of a loan on a property to be refinanced under 15 AAC 151.500 or 15 AAC 152, the lender is not required to participate for that amount, provided the cash-out is disbursed in accordance with requirements imposed by the Corporation.

(d) The Corporation will, in its discretion, enter into a commitment agreement to participate in a loan for a maximum commitment period of one year. The Corporation shall have the option to extend such commitment periods as it determines necessary.

(e) A loan made under this section must be in a first lien position of real property in fee simple or on an acceptable leasehold estate which must run a minimum of ten years beyond the expiration of the loan. Any subordinate financing must be approved by the Corporation.

(f) Loans made under this section shall be for housing consisting of buildings with at least five dwelling units. Buildings need not be located on contiguous property. Loans made under this section that contain commercial uses must have the commercial uses located within the building.

(g) The Corporation shall charge a fee of $1,000 for review of a participation loan application which shall be credited towards the commitment fee if a commitment is issued. The commitment fee shall be .5% of the committed loan amount for commitment terms up to three months; .625% of the committed loan amount for commitment terms up to six months; .75% of the committed loan amount for commitment terms up to nine months; and 1.0% of the committed loan amount for commitment terms up to one year. An extension fee of .5% shall be charged for each 90-day extension of the commitment period.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.230
Eff. 9/22/94, Register 132; am 8/21/96, Register 139; am 9/16/98, Register 148; am 2/24/99, Register 149; am 9/25/2013, Register 208; am 1/31/18, Register 226; am 12/3/2025, Register 257

15 AAC 151.545 Board approval

Any loan application submitted under 15 AAC 151.500 that staff of the Corporation determines substantially meets the program criteria of 15 AAC 151.500 and exceeds $2,500,000 must be presented to the Board of Directors for review and specific direction regarding loan approval or rejection.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 12/3/2025, Register 257

Article 7 Miscellaneous Loan Programs

15 AAC 151.600 Nonconforming housing program

(a) The Corporation may make, participate in the making, or purchase mortgage loans to finance the acquisition of nonconforming owner-occupied residences. Each loan must be secured by a single-family residence, duplex, triplex, or four-plex.

(b) The mortgage loan interest rate shall be at a rate determined by the corporation and published by the corporation from time to time.

(1) housing that exhibits one or more characteristics, with respect to design, construction practices, materials, foundation systems, utilities, minimum space requirements, dwelling located on land to which a borrower has agricultural rights, which are not common in the community in which the property is located and would ordinarily preclude financing by private financial institutions; or

(2) housing that

(A) was constructed after June 30, 1992 for which there is no evidence that it was constructed in compliance with the construction standards set out in AS 18.56.300; and,

(B) was constructed after December 31, 1991 that is two years or older with an energy rating of two stars or greater, subject to an acceptable home inspection.

(d) The provisions of 15 AAC 151.015 relating to borrower eligibility, except for the first sentence of 15 AAC 151.015(a), apply to mortgage loans under this section.

(e) The provisions of 15 AAC 151.020 relating to loan terms apply to mortgage loans under this section.

(f) The provisions of 15 AAC 151.910 relating to assumptions of mortgage loans apply to mortgage loans under this section.

(g) The provisions of 15 AAC 155.030(a)(5) relating to energy standards apply to mortgage loans under this section.

History

Authority: AS 18.56.088; AS 46.11.040 AS 18.56.106; AS 46.11.900
Eff. 5/7/93, Register 130; am 9/28/2011, Register 204; am 5/31/2017, Register 223

15 AAC 151.610 Mortgage purchase program

(a) The corporation may purchase VA or RD guaranteed and FHA insured loans at market yields, provided the seller and the servicer are each approved by the corporation under 15 AAC 150.080 and 15 AAC 150.090.

(b) The executive director shall establish and may from time to time revise the agreements with sellers and servicers consistent with the provisions of these regulations to:

(1) provide a form of a commitment contract;

(2) provide a list of completed documents and materials required to accompany the commitment;

(3) establish procedures to set mandatory loan delivery dates; the failure of a seller to deliver a loan by 4:30 p.m. on the mandatory delivery date may result in suspension of the agreement with that seller;

(4) establish rules for the timeliness of reports and remittance of funds; and

(5) list acceptable VA, RD, and FHA loan programs.

History

Authority: AS 18.56.088; AS 18.56.099
Eff. 5/7/93, Register 130; am 6/11/96, Register 139; am 5/3/2001, Register 159; am 5/14/2014, Register 212

15 AAC 151.620 Refinance program

(a) The Corporation will, in its discretion and in accordance with procedures outlined in the sellers' guide and the servicers' guide, refinance any loan owned by the Corporation that the Corporation originally made or purchased under a program described in this chapter if:

(1) all loans are current and the borrower's payment record has been satisfactory;

(2) the mortgage loan owned by the Corporation is secured by a first or second lien of the residence for which it was made, and the refinance loan will be in the same or in a higher lien position as the existing loan and any other liens previously attached to the property will be subordinated or paid in full; and

(3) the residence securing the refinance mortgage loan is a single-family dwelling, a duplex, a triplex, a four-plex, or a Type I or Type II mobile home.

(b) A refinance mortgage loan under 15 AAC 151.620(a) or (e) is also subject to the following terms and conditions:

(1) the principal amount of the refinance mortgage loan may not exceed the sum of:

(A) the principal amount of the mortgage loan or loans being refinanced;

(B) the amount of the closing costs borne by the borrower and approved by the Corporation; and

(C) excess subsidy owned to the Corporation by the borrower pursuant to the Home Ownership Fund program described in 15 AAC 151.300 - 15 AAC 151.340 if the refinance loan will not be subsidized under that program;

(2) the mortgage loan must be insured or guaranteed as provided in 15 AAC 151.020(a)(3) and (a)(4);

(3) if the monthly payment on the loan owned by the Corporation is subsidized under the Home Ownership Fund program described in 15 AAC 151.300 - 15 AAC 151.340, the amount of the monthly subsidy may continue to be paid by the Corporation to subsidize payments for the refinanced loan; however, the monthly subsidy may not exceed the subsidy amount as established in 15 AAC 151.330 or the amount of the subsidy currently being paid by the Corporation, whichever is less;

(4) the loan-to-value ratio on a refinance loan shall not exceed limits established by FNMA or FHLMC for similar refinance loans;

(5) if the property is also encumbered by a subordinate FNMA or FHLMC loan, the combined balances of all encumbrances may not exceed the Corporation's loan limits for conventional first mortgages;

(6) the maximum term of the loan will be 30 years for first lien loans; 15 years for second lien loans; and the remaining term on the existing loan or the terms outlined in the sellers' guide for Type II mobile homes, whichever is longer, if acceptable to the insurer/guarantor.

(1) the loan amount may not exceed the balance on the existing loan owned by the Corporation plus the cost of improvements and allowable closing costs;

(2) loans for which the Corporation then provides Home Ownership Fund assistance under 15 AAC 151.300 - 15 AAC 151.340 and Type II mobile home loans are not eligible under the home improvement refinance option;

(3) the improvements to the mortgaged premises may be for energy conservation, solar installation, rehabilitation, modernization and addition and must either enhance the structural integrity of the building, add to its square footage, increase its appraised value, or constitute a fixture.

(d) The Corporation will, in its discretion, refinance more than one loan held by the Corporation which are secured by the same property if each loan being refinanced satisfies the requirements of this section.

(e) The Corporation will, in its discretion, refinance one or more loans held by the Corporation and one or more loans not held by the Corporation which are secured by the same property if the refinance mortgage loan satisfies the requirements of 15 AAC 151.625.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 6/11/96, Register 139; am 5/3/2001, Register 159

15 AAC 151.625 Refinance program of non-corporation loans

(a) The Corporation will, in its discretion and in accordance with procedures outlined in the sellers' guide and the servicers' guide, refinance eligible loans not owned by the Corporation if:

(1) all loans are current and the borrower's payment record has been satisfactory;

(2) the refinance mortgage loan is secured by a first lien of the residence for which it is made, and any previous financing or lien relating to that property not included in the refinance subordinated to the lien of the refinance mortgage loan made by the Corporation; and

(3) the residence securing the refinance mortgage loan is a single-family dwelling, a duplex, a triplex, a four-plex, or a Type I mobile home.

(b) A refinance mortgage loan under this section is also subject to the following terms and conditions:

(1) the principal amount of the refinance mortgage loan will not exceed the sum of:

(A) the principal amount of the mortgage loan or loans being refinanced; and

(B) the amount of the closing costs borne by the borrower and approved by the Corporation.

(2) the mortgage loan must be insured or guaranteed as provided in 15 AAC 151.020(a)(3) and (a)(4);

(3) the mortgage loan will bear interest at a rate determined by the Corporation to compensate the Corporation for the cost of funds used by the Corporation to purchase the mortgage loan without state Veteran or HOF options;

(4) the loan-to-value ratio on a refinance loan shall not exceed limits established by FNMA or FHLMC for similar refinance loans;

(5) if the property is also encumbered by a subordinate FNMA or FHLMC loan, the combined balances of all encumbrances may not exceed the Corporation's loan limits for conventional first mortgages; and

(6) the maximum term of the loan will be 30 years.

(1) the loan amount may not exceed the balance on the existing loan or loans being refinanced plus the cost of improvements and allowable closing costs; and

(2) the improvements to the mortgaged premises may be for energy conservation, solar installation, rehabilitation, modernization, and addition and must either enhance the structural integrity of the building, add to its square footage, increase its appraised value, or constitute a fixture.

History

Authority: AS 18.56.088; AS 18.56.098
Eff. 5/7/93, Register 130; am 6/11/96, Register 139; am 5/3/2001, Register 159

15 AAC 151.630 Streamlined refinance

(a) The Corporation will, in its discretion and in accordance with procedures established under this section, refinance eligible mortgage loans owned by the Corporation if the Corporation determines that the requirements established in this section have been satisfied. The Corporation will not refinance under this section mortgage loans that it made or purchased

(1) pursuant to a rental refinance program, unless the borrower meets the qualifications set out in 15 AAC 151.015(a);

(2) pursuant to the REO financing program described in 15 AAC 151.650, except that the Corporation will, in its discretion, refinance a mortgage loan described in this clause if the loan contains a call or balloon payment provision; or

(3) pursuant to a rural, non-owner occupied loan program.

(b) To qualify for the refinance of a mortgage loan owned by the Corporation, the borrower of the mortgage loan must demonstrate to the Corporation that:

(1) the mortgage loan owned by the Corporation is secured by a first or second priority lien on the residence for which it was made; and

(2) the residence for which the mortgage loan was made is a single-family dwelling, duplex, type I mobile home, type II mobile home, tri-plex, or four-plex.

(1) the principal amount of the loan will not exceed the sum of:

(A) the outstanding balance of the mortgage loan owned by the Corporation which is being refinanced;

(B) up to 30 days interest on the existing loan;

(C) for an FHA insured loan, the amount of the upfront mortgage insurance premium; or for a VA guaranteed loan, the VA funding fee; and

(D) up to $5,000 in closing costs.

(2) if the existing loan is subject to mortgage insurance or guaranty, the Corporation may determine that coverage must be continued by all insurers or guarantors of the loan;

(3) the priority of the lien securing the loan must not be changed for the refinance;

(4) the maximum term of the loan will be:

(A) 30 years for first lien loans;

(B) 15 years for second lien loans; or

(5) if the monthly payment on the loan owned by the Corporation is subsidized under the Home Ownership Fund program under 15 AAC 151.300 - 15 AAC 151.340, the amount of the monthly subsidy may continue to be paid by the Corporation to subsidize payments for the refinanced loan; however, the monthly subsidy may not exceed the subsidy amount as established in 15 AAC 151.330 or the amount of subsidy currently being paid by the Corporation whichever is less; and

(6) the loan must be current at closing.

(d) A state veteran rate is not available for a refinancing loan purchased under this section. The Corporation will establish the interest rate on a refinancing loan purchased under this section as follows:

(1) the interest rate shall be two percent less than the cost to the Corporation of the money used to purchase the refinancing mortgage loan, except that if the cost of money;

(A) is 10 percent or less, the interest rate is equal to the cost of money; or

(B) is more than 10 percent, the interest rate may not be less than 10 percent;

(2) the Corporation will, in its discretion, determine the cost of money applicable to a refinancing mortgage loan by taking into consideration one or more actual or proposed taxable or tax-exempt financings, the proceeds of which are expected to be used for purposes of funding the acquisition of refinancing mortgage loans; in considering proposed financings, the Corporation will, in its discretion, estimate the cost of money;

(3) if refinancing mortgage loans are, or are expected to be, purchased other than from the proceeds of taxable or tax-exempt bonds, the Corporation will, in its discretion, determine the cost of money from time to time based upon estimates and references to credit market levels; and

(4) cost of money may include the actual or estimated interest rate on debt, costs of issuing the debt, original issue discounts applicable to the debt, and ongoing program operation costs such as loan servicing fees, debt trustee fees, credit enhancement fees, loan guarantee or insurance fees, and other direct or allocable administrative costs of the Corporation.

(e) The Corporation will establish procedures for application for refinance of a mortgage loan under this section and for other matters pertaining to this section in the sellers' guide.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.108
Eff. 5/7/93, Register 130; am 5/5/98, Register 147

15 AAC 151.635 Second mortgage program for health and safety repairs

Repealed.

History

Eff. 5/7/93, Register 130; repealed 5/25/2011, Register 204

15 AAC 151.640 Second mortgage program

(a) The Corporation may, in accordance with procedures outlined in the sellers' guide, purchase mortgage loans made to finance

(1) the purchase of a residence that is subject to an existing mortgage held by the corporation; or

(2) permanent improvements to the mortgaged premises including energy conservation, solar installation, rehabilitation, modernization, and addition.

(b) The proceeds of a loan purchased under this section may be used to pay reasonable and customary closing costs associated with the improvements financed by the loan.

(1) the mortgaged premises is or will be occupied as the borrower's primary residence;

(2) the loan is secured by a single-family residence, duplex, triplex, four-plex, or Type I mobile home;

(3) if the loan is for improvements to a unit in a condominium project, the proceeds of the loan will be used only to finance improvements to that unit that are allowable within the project's constituent documents and will not be used to improve common elements or areas; and

(4) the borrower does not have an outstanding loan made under this section.

(d) The loans purchased by the corporation under this section shall have a term not to exceed 30 years.

(e) The maximum loan-to-value ratio, when the second mortgage loan is combined with a first mortgage loan, if any, will not exceed

(1) for loans made under (a)(1) of this section,

(A) 90 percent for single-family residences and duplexes; and

(B) 80 percent for all triplexes and four-plexes; or

(2) for loans made under (a)(2) of this section,

(A) 90 percent for single-family residences and duplexes;

(B) 80 percent for all triplexes and four-plexes; and

(f) The maximum loan amount will not exceed the lowest of

(1) 50 percent of FNMA's conventional first mortgage limit for a single-family dwelling in Alaska;

(2) for loans made under (a)(1) of this section, if the corporation owns an interest in the first mortgage, the corporation's limit for a conventional first mortgage reduced by the original balance of the first mortgage; or

(3) $100,000 for loans made under (a)(2) of this section when value is determined by any method other than an appraisal as defined in 15 AAC 150.900(a).

(g) The loan must be subject only to permitted encumbrances and a first lien mortgage loan. Any other liens must be subordinated to this loan.

(h) The interest rate shall be determined by the corporation.

History

Authority: AS 18.56.088; AS 18.56.096
Eff. 5/7/93, Register 130; am 2/24/99, Register 149; am 5/25/2011, Register 204; am 6/28/2023, Register 247

15 AAC 151.642 Second mortgage program for energy conservation

Repealed.

History

Eff. 4/30/2008, Register 186; repealed 5/25/2011, Register 204

15 AAC 151.645 Second mortgage program for purchase

Repealed.

History

Eff. 5/7/93, Register 130; am 2/24/99, Register 149; repealed 5/25/2011, Register 204

15 AAC 151.650 REO financing program

(a) The Corporation will, in its discretion and in accordance with the provisions of this section, purchase a loan to provide financing for properties owned by the Corporation or, at the Corporation's sole discretion, mortgage insured properties that do not meet property requirements for other financing by the Corporation, including the non-conforming program, provided that:

(1) the borrower has the financial ability to pay all of the borrower's debts;

(2) the loan may be a second home loan or non-owner occupied;

(3) the loan-to-value ratio does not exceed the Federal National Mortgage Association limits on single-family property, 95 percent on duplex property, 90 percent on triplex and four-plex properties, or 90 percent on non-owner occupied or second home properties;

(4) the maximum term does not exceed five years less than the remaining economic life of the property or 20 years, whichever is less; and

(5) the borrower is not obligated on any other loan financed by the Corporation.

(b) The loan interest rate under this section shall be at a rate determined by the Corporation (state veterans preference interest rate is not available under this program).

(d) The Corporation will establish procedures for application for a loan under this section and for other matters pertaining to this section in the sellers' guide.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.096
Eff. 5/7/93, Register 125; am 1/29/2025, Register 254

15 AAC 151.655 Mobile home loan program

(a) The Corporation will, in its discretion and in accordance with and subject to the provisions of this section, purchase a loan to finance:

(1) the purchase of a mobile home;

(2) the purchase of a mobile home and the real property on which the mobile home is or will be located;

(3) the purchase of a mobile home and the refinancing of real property which is owned by the borrower and on which the mobile home is or will be located;

(4) the refinance of a mobile home and the purchase of real property on which the mobile home is or will be located; or

(5) the refinance of a mobile home currently owned by the borrower and financed by the Corporation.

(b) A loan under this section will be eligible for purchase by the Corporation if it meets the following criteria:

(1) the amount of the loan may not exceed the following:

(A) for a Type I mobile home loan, the limits for single-family residences in accordance with 15 AAC 151.020(c)(2); and

(B) for a Type II mobile home loan, $175,000 for loans secured by a mobile home located on fee simple land and $100,000 on all other Type II mobile home loans;

(2) in addition to the limitations contained in paragraph (1) of this subsection, the loan amount may not exceed the following:

(A) for a Type I mobile home loan the limits may not exceed those for a single-family residence in accordance with 15 AAC 151.020(c)(1), (4), (6), or (7);

(B) for a Type II mobile home loan, the loan amount may not exceed the lowest of:

(i) 85% of the sales price;

(ii) 85% of the value as described in paragraph (14) of this subsection; or

(iii) 95% of the lesser of the sales price or the value, as described in paragraph (14) of this subsection, if the loan is guaranteed by the VA, provided that the down payment plus the VA guaranty equals at least 25 percent of the lesser of the sales price or value as defined in paragraph (14) of this subsection;

(C) for a Type II mobile home loan secured by a new mobile home, the loan amount may not exceed 125 percent of the sum of the wholesale (base) price of the home and any affixed itemized options and affixed itemized specialty items as detailed by the dealer in a dealer's cost statement plus the charges for freight as evidenced in the freight bill of lading; the cost of set-up, skirting, and tie-downs may be included in the principal obligation in addition to the 125 percent sum;

(3) for a Type I mobile home loan, the term of the loan may not exceed 30 years; for each of the following types of loans, the term of the loan may not exceed the lesser of 70 percent of the estimated remaining economic life of the mobile home or the following:

(A) for a Type II mobile home loan secured by a new mobile home, a 10-year maximum term on single-wide units, and a 14-year maximum term on double-wide units;

(B) for a Type II mobile home loan secured by mobile home other than a new mobile home, a 7-year maximum term on single-wide units and a 10-year term on double-wide units; or

(C) for a loan described in 15 AAC 151.655(a)(5), the remaining term of the outstanding loan for the borrower's mobile home;

(4) the borrower must establish to the satisfaction of the Corporation in the loan application that he or she will occupy the mobile home as their primary residence;

(5) if the borrower owns another residence in the state, the borrower shall establish in the loan application that the other residence is not located in the same general area of the state as the borrower's mobile home;

(6) the value of personal property to be purchased with a Type II mobile home loan, if any, may not exceed $1,500;

(7) the loan must be secured by a security agreement on the borrower's mobile home and all other personal property and improvements on the premises, including but not limited to lean-to's, wanigans, and storage buildings and by a first deed of trust on the real property described in 15 AAC 151.655(a)(2) - (4);

(8) any first deed of trust securing a mobile home loan must be insured by a mortgagee's American Land Title Association policy of title insurance conforming to the provisions of 15 AAC 151.020(a)(6);

(9) for Type I mobile home loans mortgage insurance as required for single-family residences in the sellers' guide;

(10) for a loan described in 15 AAC 151.655(a)(2) - (4), the real property must be appropriate for the value of the mobile home and acceptable under applicable zoning ordinances and other laws for the placement of a mobile home;

(11) for a loan described in 15 AAC 151.655(a)(2) - (4), the instruments evidencing the loan shall provide that the loan for the mobile home and the loan for the real property constitute a single loan;

(12) for a Type II mobile home loan described in 15 AAC 151.655(a)(4):

(A) the loan amount must not exceed the sum of:

(i) 75 percent of the fair market value of the real property, or cost, whichever is less, as improved with access and water and sewage disposal systems;

(ii) 75 percent of the amount of reasonable relocation and closing costs; and

(iii) the amount outstanding on the mobile home loan (not to exceed 75 percent of appraised value, if not already financed by the Corporation);

(B) the mobile home must be fully set up on the lot and occupied as a principal residence by the borrower prior to purchase of the loan by the Corporation; and

(C) notwithstanding (A) of this paragraph, the loan amount may not exceed the limitations set forth in (1) and (2) of this subsection;

(13) for a Type II mobile home loan to purchase a mobile home located on rented land:

(A) if the rented land consists of a lot located in a mobile home park, the mobile home park must be acceptable to the Corporation, the mobile home and the borrower must not be in violation of the rules of the mobile home park, and the borrower must:

(i) if the mobile home was located in Alaska on or before December 31, 1984, submit an agreement, on a form prescribed by the Corporation, which establishes that the owner or lessor will provide at least one year's eviction notice to the tenant or borrower and to the Corporation before implementing a change in the land use of the property; or

(ii) if the mobile home was transported into Alaska on or after January 1, 1985, submit an agreement, on a form prescribed by the Corporation which guarantees a five-year continuous availability of the mobile home lot; however, the agreement will permit the owner/lessor to terminate the five-year space guaranty if the owner/lessor bears the full cost of relocating the mobile home to a site which the Corporation determines, in writing, provides a reasonable alternative site in terms of location, neighborhood and park quality in which to locate the mobile home;

(B) if the rented land is not a lot in a mobile home park, the borrower has a rental agreement which:

(i) is fully assignable to the Corporation without consent of the owner/lessor of the rented land;

(ii) restricts the ground rent to annual increases of no more than 10 percent per annum;

(iii) has a term no less than that of the loan; and

(iv) is recordable in the appropriate district recording office;

(14) the value of the collateral securing the loan will be established by the most recently published N.A.D.A. Mobile Home Guide Book, Manufacturer's Invoice VA Certificate of Reasonable Value, or other similar system as defined in the sellers' guide;

(15) the collateral securing the loan must have been inspected no more than three months before the loan application is submitted to the Corporation. The inspection shall have been:

(A) performed by an independent fee appraiser and completed on a form approved by the Corporation;

(B) completed after improvements to the property have been completed for existing units; and

(16) the mobile home securing the loan must have been inspected for, and have affixed to it, a United States Department of Housing and Urban Development seal for Zone 3 if the mobile home arrived in the state after January 1, 1985.

(c) For the purpose of determining the maximum financing allowed under 15 AAC 151.655(b), the cost of real property is limited to the purchase price or amount refinanced and the direct costs paid to a party other than the borrower for providing permanent improvements including, but not limited to water, sewer, and access improvement.

(d) In this section:

(1) "borrower's mobile home" means:

(A) the mobile home the borrower will purchase with the loan if the loan is one described in 15 AAC 151.655(a)(1), (2), and (3); or

(B) the mobile home already owned by the borrower if the loan is described in 15 AAC 151.655(a)(4) or (5);

(2) "mobile home" means a mobile home which has at least 600 square feet of living area determined by measuring the exterior of the unit at the base but excluding the tongue of the unit and any lean-to's, wanigans, and the like;

(3) "new mobile home" means a mobile home that is purchased by the borrower within 24 months after the date of manufacture and has neither been titled or occupied for any purpose nor covered under a manufacturer's warranty; and

(4) "other than new double-wide" means a factory manufactured multi-unit module which excludes modified single-wides.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 5/7/93, Register 130; am 5/9/2007, Register 183

15 AAC 151.660 Condominium stabilization program

(a) The Corporation will, in its discretion, take action under this section to help stabilize mortgage investments in specified types of residential housing, if the Corporation determines that applicable requirements and procedures established in 15 AAC 151.660(b) - (e) are satisfied. To accomplish the purposes of this section, the Corporation will, in its discretion:

(1) purchase a loan to provide low interest rate retail sales financing for Corporation-owned condominium and PUD units as provided for in 15 AAC 151.660(b);

(2) make, participate in the making, purchase, or participate in the purchasing of loans made to a homeowners association to finance common area improvements as provided for in 15 AAC 151.660(d); and

(3) take other actions necessary, convenient or desirable to accomplish the purposes of this section that are consistent with authority granted to the Corporation in AS 18.56.210.

(b) The Corporation will, in its discretion and in accordance with the provisions of this subsection, purchase a loan to provide low interest rate retail sales financing for condominium and PUD units owned by the Corporation. To qualify for purchase under this subsection, the loan must meet the following criteria:

(1) the loan is secured by a condominium or PUD unit in a project designated by the Corporation that is presently owned by the Corporation or other institutional participant; the program described in this section is not available for units in other projects;

(2) the unit is owner occupied;

(3) the borrower has the financial ability to pay all of the borrower's debts;

(4) the borrower is not obligated on a mortgage loan financed by the Corporation, including any loans originally financed by the Department of Commerce, Community, and Economic Development and held by the Corporation;

(5) the loan-to-value ratio does not exceed the Federal National Mortgage Association limits on conventional or VA-guaranteed loans or FHA requirements on FHA insured loans; and

(6) the maximum term of the loan does not exceed 30 years.

(c) In addition to the requirements listed in 15 AAC 151.660(b), the following provisions apply to a loan purchased under 15 AAC 151.660(b):

(1) the mortgage loan interest rate shall be at a rate determined by the Corporation; the state veterans preference interest rate is not available for a loan under 15 AAC 151.660(b);

(2) the loan is assumable to a qualified borrower under 15 AAC 151.910; and

(3) the project minimum owner-occupancy requirements under 15 AAC 151.020(e)(2) are waived.

(d) The Corporation will, in its discretion and in accordance with the provisions of this subsection, make, participate in the making, purchase, or participate in the purchasing of loans made to a homeowners association to finance improvements to the common elements of a condominium or PUD. To qualify for purchase under this subsection, the loan must meet the following criteria:

(1) the loan may be made for repairs, rehabilitation, and deferred maintenance;

(2) the association must demonstrate sound fiscal management practices;

(3) the loan may not exceed what is considered an acceptable risk to the Corporation as determined by an analysis of the Association's current and anticipated revenues, and the debt payment on the loan;

(4) the loan shall bear interest at the rate established by the Corporation. The Corporation will establish the interest rate for the loan based on factors the Corporation considers relevant, including, but not limited to, the source of money to the Corporation to provide funding for the loan and other considerations; and

(5) the term of the loan may not exceed 15 years.

(e) The Corporation will establish procedures for application for a loan under this section and for other matters pertaining to this section in the sellers' guide.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.096
Eff. 5/7/93, Register 130; am 9/23/97, Register 145; am 1/29/2025, Register 254

15 AAC 151.670 Loans-to-sponsors program

(a) The Corporation will, in its discretion and in accordance with and subject to the provisions of this section, make loans to sponsors as described in this section. A sponsor may use the proceeds of a loan made under this section only for the purpose of:

(1) providing housing loans, and loans to improve the quality of housing, for persons of lower and moderate income or in remote, underdeveloped, or blighted areas of the state; and

(2) paying the sponsor's program administration costs. The Corporation will make a loan to a sponsor under this section only if:

(A) the sponsor is not able to obtain a loan for the same purposes from other sources upon reasonably equivalent terms and conditions; and

(B) the sponsor demonstrates to the satisfaction of the Corporation that the sponsor has minimized the administrative and regulatory expenses of the sponsor's program and maximized the amount of money that will be available from the loan proceeds to be used to make loans for the purposes described in this subsection.

(b) The Corporation will make a loan under 15 AAC 151.670(a) only to a non-profit corporation, a regional housing authority, an agency of the state or of a municipality in the state, or a municipality in the state.

(c) Before making a loan to a sponsor under this section, the Corporation will review the sponsor's application, proposed program, collateral, and other factors the Corporation considers relevant. The principal amount of a loan under this section will not exceed the amount the Corporation considers to represent an acceptable risk taking into consideration the factors mentioned in the preceding sentence.

(d) The Corporation will establish the term of a loan made under this section to a sponsor after discussing the loan with the sponsor and after taking into consideration the factors described in 15 AAC 151.670(c), but in no event will the Corporation permit the term to exceed 35 years.

(e) The Corporation will establish the interest rate applicable to a loan made under this section to a sponsor based on factors the Corporation considers relevant, including, but not limited to, the source of money to the Corporation to provide funding for the loan and the size of the loan.

(f) the Corporation will establish collateral requirements with respect to a loan made under this section to a sponsor and will, in its discretion, require the sponsor to obtain collateral in connection with loans made by the sponsor using proceeds of the loan made by the Corporation to the sponsor, taking into consideration the factors described in 15 AAC 151.670(c) and taking into consideration the size of the loan to the sponsor and the size of the loans to be made by the sponsor pursuant to its program. If and to the extent that the Corporation requires collateral as described in this subsection, the Corporation will, in its discretion, require a deed of trust with respect to real property, an assignment of the deeds of trust obtained by the sponsor in connection with loans made by the sponsor under its program, an assignment of other security documents obtained by the sponsor in connection with loans made by the sponsor under its program, a guarantee of the sponsor, an assignment of guarantees obtained by the sponsor in connection with loans made by the sponsor, or other forms of collateral which the corporation considers appropriate under the circumstances. If the Corporation requires collateral as described in this subsection, before the Corporation makes a loan under this section to the sponsor, the sponsor must, at the discretion of the Corporation, have available evidence satisfactory to the Corporation of title, fire, extended coverage, vandalism, optional perils, and other forms of insurance relating to the collateral as required by the Corporation in amounts acceptable to the Corporation or evidence satisfactory to the Corporation that the sponsor's program adequately provides for obtaining insurance as described in this sentence.

(g) The Corporation will not make a loan to a sponsor under this section unless the sponsor demonstrates to the satisfaction of the Corporation that:

(1) the sponsor has the ability to manage and operate the sponsor's program;

(2) the sponsor's program includes provisions satisfactory to the Corporation relating to the purposes for which loans will be made under the sponsor's program, and

(3) the sponsor has adopted valid and enforceable regulations or other terms describing the operation of the sponsor's program that are satisfactory to the Corporation, including regulations and other terms relating to the following: underwriting standards to be applied in reviewing loan applications under the sponsor's program; the maturities, interest rates, security, and other terms of loans made under the sponsor's program; the method of servicing loans made under the sponsor's program; the rights of the Corporation to review the operation of the sponsor's program; the security interests of the Corporation with respect to loans made under the sponsor's program; reports to be made to the Corporation from time to time; and other matters the Corporation considers relevant under the circumstances.

(h) To obtain a loan under this section, a sponsor must submit an application to the Corporation. The application must be in writing signed by an authorized officer of the sponsor and must include a loan summary; financial statements of the sponsor and, if applicable, of any guarantor of the loan, including a statement of revenues and expenditures or a similar statement, for the then current and three preceding years, with the financial statements and statement of revenues and expenditures or similar statement for the then current year dated four months or less from the date of application; resumes of key personnel; evidence satisfactory to the Corporation of the sponsor's legal ability to enter into the necessary loan documents and to provide the necessary collateral in connection with a loan under this section, including, as appropriate, but not limited to, a copy of the charter or articles of incorporation of the sponsor, a copy of applicable ordinances, regulations, or bylaws of the sponsor, and an opinion of counsel of the sponsor to the effect that entering into the proposed loan transaction is within the power of the sponsor and will not conflict with or violate any laws or outstanding contracts to which the sponsor is a party; and other information considered necessary by the Corporation to evaluate the application.

(i) The sponsor, upon approval of the Corporation, may be reimbursed for its justifiable reasonable costs of administering its program through a servicing fee approved by the Corporation and paid by the sponsor's borrowers.

(j) The Corporation will, in its discretion, enter into a commitment agreement to make a loan under this section. The maximum commitment period that the Corporation will permit is 18 months. The Corporation will, in its discretion, permit an extension of its commitment for up to 120 days to make a loan if it receives an application showing good cause and receipt of a fee as described in 15 AAC 151.670(k)(4).

(k) The Corporation will charge fees under this section as follows:

(1) loan application fee - upon submission of an application for program approval and conditional commitment, a $2,500 non-refundable loan application fee, unless the Corporation determines in its sole discretion that another amount is appropriate, must accompany the application; in the event a loan to the sponsor is made, the Corporation will credit the loan application fee towards the loan fee described in (3) of this subsection;

(2) commitment fee - if the Corporation expects to issue bonds before funding a loan, a commitment fee equal to 1.5% of the approved loan amount is required at the time of commitment acceptance by the sponsor, unless the Corporation determines in its sole discretion that another amount is appropriate; upon the closing of the loan, the Corporation will apply the commitment fee toward any amount due under (3) of this subsection and will, in accordance with the request of the sponsor, refund all or part of the remainder to the sponsor and apply any unrefunded part of the remainder to the payment of any other closing costs;

(3) loan fee - the following loan fees are required at the time of closing by the sponsor, unless the Corporation determines in its sole discretion that another amount is appropriate:

for the first $1,000,000 .50%

the next $ 4,000,000 .375%

the next $10,000,000 .25%

amount over $15,000,000 .125%

(4) extension of commitment fee - if the Corporation elects to extend its commitment as described in 15 AAC 151.670(j), a fee of one-half of one percent of the loan amount will be required, unless the Corporation determines in its sole discretion that another amount is appropriate.

(l) All loans made under this program require approval of the board of directors.

(m) In this section, "persons of lower and moderate income" means persons earning 100% or less of area median income as established annually by HUD and as adjusted for family size. Sponsors may dispute HUD's income determination by providing area census or other reliable studies to substantiate a higher median income for the area.

History

Authority: AS 18.56.088; AS 18.56.090(b)(1)
Eff. 5/7/93, Register 130

15 AAC 151.675 Emergency reconstruction loan program

(a) The Corporation will, in its discretion and in accordance with procedures set forth in the sellers' guide, originate or purchase mortgage loans for the purpose of reconstruction or renovation to property damaged as a result of a state or federal declared disaster.

(b) To qualify for a loan under this section, the borrower must demonstrate to the satisfaction of the Corporation that:

(1) the residence was occupied as the borrower's primary residence immediately preceding the state or federal declaration;

(2) the loan is secured by a single-family residence, duplex, triplex, four-plex, or Type I mobile home; and

(3) the borrower is not obligated to the Corporation on another loan on a different property.

(1) the principal amount of the loan will not exceed the cost of the renovation plus required inspection fees and closing costs, or $25,000, whichever is less;

(2) the maximum term of the loan will be 15 years;

(3) the loan will not be subject to a maximum loan-to-value.

History

Authority: AS 18.56.088; AS 18.56.090(a)
Eff. 6/11/96, Register 139

15 AAC 151.680 Interest rate reduction for low-income borrowers

(a) The Corporation will, in its discretion, reduce the interest rate on a first deed of trust under any Corporation loan program which finances the purchase or construction of a single-family residence, including units in Corporation approved condominium projects and planned unit developments, if the borrower meets the requirements of this section.

(b) To qualify for an interest rate reduction under this section, the borrower:

(1) must comply with all income, credit and property underwriting standards for the applicable program under which the loan is made;

(2) must complete a pre-purchase homebuyer counseling class approved by the Corporation;

(3) may not have a family income which exceeds 80% of the median income based on family size as determined by the Corporation and set forth in the Seller's Guide; and

(4) may not have had an ownership interest in a primary residence at any time during the three-year period prior to the date the mortgage is executed unless:

(A) the borrower is at least 60 years of age and will have disposed of that primary residence before the loan closing;

(B) the borrower has suffered a significant reduction in income due to the death or permanent disability of a family wage earner and the borrower has disposed of, or will dispose of, that primary residence to reduce housing expenses or to accommodate the needs of the disabled family member; or

(C) the borrower lost any ownership interest in that primary residence as the result of a divorce or dissolution of marriage and, at the time of closing, is not obligated on any debt related to the prior residence;

(c) The interest rate on a loan which qualifies for an interest rate reduction under this section shall be the interest rate in effect for the applicable loan program reduced by a percentage based on family income as determined by the Corporation.

(d) If a loan that has received an interest rate reduction under this section is assumable under the provisions of the applicable loan program, the loan may be assumed at a reduced interest rate if the assuming borrower meets the eligibility requirements of this section at the time the loan is assumed. The interest rate of the assuming borrower shall be the interest rate of the applicable loan program at the time of loan origination reduced by the amount of the percentage reduction for which the assuming borrower qualifies under (c) of this section. If the assuming borrower does not meet the eligibility requirements of this section, the interest rate on the loan shall be modified at the time of assumption to the rate of interest that would have been in effect at the time of origination without the interest rate reduction provided to the original borrower.

(e) In this section:

(1) "Family" means, with respect to an individual, that individual's brothers and sisters (whether by whole or half blood), spouse, ancestors, and lineal descendants;

(2) "Family Income" is defined as the gross monthly income of the mortgagor or mortgagors, family members over the ages of 21 who occupy the dwelling on a permanent basis, and other individuals over the age of 18 who occupy the dwelling on a permanent basis, multiplied by twelve, and "gross monthly income" is the sum of monthly income items set forth in the Seller's Guide.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 4/2/97, Register 142; am 5/14/97; am 6/25/97, 9/23/97, Register 145; am 9/16/98, Register 148; am 2/24/99, Register 149; am 9/22/99, Register 152; am 5/3/2001, Register 159

Article 8 Low-Income Housing Tax Credit

15 AAC 151.710 Scope, goal, and objective

The regulations in 15 AAC 151.710 - 15 AAC 151.840 apply to the allocation of low-income housing tax credits by the Corporation under the code for the acquisition, construction, and rehabilitation of low-income housing.

History

Authority: AS 18.55.010; AS 18.55.110; AS 18.55.420 AS 18.55.100(a)AS 18.55.240; AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 151.720 Qualified projects

A qualified low-income building in a qualified low-income housing project as defined in 26 U.S.C. Section 42 (c)(2) and (g) is eligible for a tax credit under 15 AAC 151.710 - 15 AAC 151.840.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.730 Allocation of tax credit

(a) The executive director will administer the procedures for allocation of the low-income housing tax credit and will determine allocations on behalf of the Corporation. All actions to be taken by the Corporation under 15 AAC 151.710 - 15 AAC 151.840 may be taken by the executive director's designee.

(b) The Corporation will allocate the state's annual housing credit ceiling amount based on a qualified allocation plan, developed by the Corporation, under the requirements specified in the code.

(c) The Corporation will rank applications requesting an allocation of tax credits based on the priorities set forth in the qualified allocation plan referred to in 15 AAC 151.730(b).

(d) In allocating tax credits to qualified projects the low-income housing credit dollar amount allocated to a project shall not exceed the amount the Corporation determines is necessary for the financial feasibility of the project and its viability as a qualified low-income housing project throughout the compliance period.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.740 Public notice

The Corporation will give public notice of any application period or change in method of allocation at least seven days before any tax credit allocation made under the notice.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.750 Application for low-income housing tax credit

A person interested in applying for an allocation of low-income housing tax credit must submit an application to the Corporation on forms prescribed by the Corporation. The information required by the Corporation will be stated in the application and will cover characteristics of the project, the project sponsor, the geographic location of the project, and any other information the Corporation, in its discretion, feels is necessary to insure that the project is qualified under the code to receive an allocation of low-income housing tax credit.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.760 Application and processing fees

(a) A nonrefundable application fee must accompany an application for low-income housing tax credit.

(b) In addition to the application fee, a nonrefundable processing fee must be paid to the Corporation before a low-income housing tax credit allocation certification (IRS Form 8609) will be issued by the Corporation.

(c) An annual, nonrefundable compliance monitoring fee shall be paid to the Corporation by the owner of the development receiving an allocation of low-income housing tax credit.

(d) The Corporation will establish the fees referenced in this section and will review them annually to insure that they adequately cover the administrative cost of the management of the low-income housing tax credit program.

(e) The Corporation will, in its discretion, establish fee schedules based on whether a project has participation from a qualified non-profit agency or from a for-profit agency or based on the number of residential rental units contained within the project.

(f) The Corporation will, in its discretion, waive or modify the fee schedule as long as there is just cause and the Corporation considers it to be in the best interest of the Corporation or the administration of the low-income housing tax credit program.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.770 Acceptance or rejection of application

(a) The Corporation will perform an initial review of an application for completeness, including the application fee, based on a format prescribed by the Corporation. The Corporation will notify the applicant in writing that the application is accepted for processing or that the application is rejected.

(b) If accepted, the Corporation will perform a second review of an application to insure that it meets the threshold ranking for acceptance as specified in the qualified allocation plan. The Corporation will notify the applicant in writing that the application has met the threshold for acceptance or that the application is rejected.

(d) When an application is rejected, the Corporation will state in writing the reasons for the rejection and the items necessary to make the application acceptable for processing.

(e) An applicant may appeal the rejection of an application as provided in 15 AAC 151.830.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.780 Corporation review

(a) The Corporation will review an application to determine the applicant's eligibility to receive a tax credit allocation. The Corporation will consider, among other things, the criteria specified in 15 AAC 151.750 and the priorities set forth in the qualified allocation plan referred to in 15 AAC 151.730(b).

(b) The Corporation will review each application, at a minimum, three times to assess the financial feasibility and viability of the proposed project.

(c) The Corporation will establish an evaluation review committee to rank applications based on the priorities determined by the qualified allocation plan referred to in 15 AAC 151.730(b). The executive director will appoint the committee members.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.790 Conditional allocation of tax credit

(a) When the Corporation determines that a project is eligible for an allocation of low-income housing tax credit and the Corporation has credit remaining within its housing credit ceiling for the tax year, it will issue a letter conditionally allocating tax credit to the project.

(b) The letter of allocation will set out the amount of tax credit conditionally allocated and the terms for final allocation.

(c) If no conditional allocation of credit is made, the Corporation will notify the applicant in writing stating the reasons that no allocation was made.

(d) If an applicant is otherwise eligible for a conditional allocation but there remains no unallocated credit for the calendar year, the applicant will be placed on a waiting list for credit previously allocated that may be returned to the Corporation.

(e) An applicant may appeal the amount or denial of a conditional allocation as provided in 15 AAC 151.830.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.800 Revocation of conditional allocation

(a) The Corporation will, in its discretion, revoke a conditional allocation of low-income housing tax credit if an applicant will be unable to place a project in service within the tax credit year, if a project does not comply with the code and regulations adopted under the code and with other applicable sections of 26 U.S.C. and regulations under 26 U.S.C. or if completion of the project does not proceed in accordance with the project structure and financing plans set out in the application.

(b) An applicant may appeal the revocation of a conditional allocation as provided in 15 AAC 151.830.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 151.810 Project-placed-in-service certification

When the project is placed in service, the applicant must:

(1) certify to the Corporation that the applicant and the project are in full compliance with the code and regulations adopted under the code and with other applicable sections of 26 U.S.C. and regulations adopted under 26 U.S.C.;

(2) certify to the Corporation that the project has been completed in accordance with the project structure and financing plans set out in the application; and

(3) prepare and submit any other documentation that may be requested by the Corporation to establish project qualification to the satisfaction of the Corporation.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130; am 5/29/2002, Register 164

15 AAC 151.820 Issuance of tax credit certification

When the Corporation has received and accepted all requested documentation and required fees and determined to its satisfaction that the applicant and the project comply with all requirements of the code and regulations adopted under the code and with other applicable section of 26 U.S.C. and regulations adopted under 26 U.S.C., the Corporation will issue low-income housing tax credit allocation certification signed by the executive director and send a copy of the certification to the applicant for its federal tax return.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

15 AAC 151.830 Appeals

(a) Appeals permitted under 15 AAC 151.770, 15 AAC 151.790, or 15 AAC 151.800 must be filed with the executive director in writing and within ten days after notice of the decision forming the basis of the appeal and must include the following information:

(1) the name, address, and telephone number of the applicant making the appeal;

(2) the project for which the tax credit allocation is being sought;

(3) the factual basis and an explanation of the appeal, including copies of relevant documents; and

(4) a statement of the relief requested.

(b) An appeal described in this section is subject to the provisions of 15 AAC 150.220.

History

Authority: AS 18.55.100; AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130; am 9/19/2001, Register 160

15 AAC 151.840 Compliance monitoring by the corporation

(a) Pursuant to 26 U.S.C. 42(m)(1)(B)(iii), the Corporation is responsible for monitoring projects receiving an allocation under 15 AAC 151.710 - 15 AAC 151.840 for non-compliance with the provisions of the code and in notifying the Internal Revenue Service of such non-compliance of which the Corporation becomes aware.

(b) The Corporation will, in its discretion, delegate its responsibility for monitoring for non-compliance referenced in 15 AAC 151.840(a) to an agent of the Corporation or other private contractor.

History

Authority: AS 18.55.100(a)AS 18.55.240; AS 18.56.088 AS 18.55.110; AS 18.55.420
Eff. 5/7/93, Register 130

Article 9 Closing Cost Assistance Program

15 AAC 151.850 Closing cost assistance program

The corporation may facilitate the making of mortgage loans for the purpose of the acquisition of housing under the following conditions:

(1) any funds provided by the corporation for transactional costs associated with the acquisition of the housing is used only for

(A) closing cost assistance;

(B) minimum cash investment; and

(2) the loan is for the purchase of a completed, owner-occupied primary residence;

(3) the loan is secured by a single-family, duplex, tri-plex, or four-plex residential housing; and

(4) the residence meets the minimum construction standards set out in 15 AAC 150.030 and the building energy efficiency standards set out in 15 AAC 150.040.

History

Authority: AS 18.56.088; AS 18.56.099 AS 18.56.090; AS 18.56.300
Eff. 1/9/2013, Register 213

15 AAC 151.855 Borrower eligibility

(a) A person is eligible to participate in the closing cost assistance program if the person

(1) is a resident of the state; and

(2) does not owe past due child support.

(b) For purposes of this section, "resident of the state" means a person who maintains a primary residence in Alaska with the intention of continuing that residency indefinitely.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 1/9/2013, Register 213

15 AAC 151.860 Loan terms

(a) Each loan facilitated by the corporation under 15 AAC 151.850 - 15 AAC 151.865 must

(1) be initially serviced by a servicer approved by the corporation;

(2) constitute a first lien on real estate in fee simple or on a leasehold estate and be subject only to permitted encumbrances;

(3) if the loan to value ratio exceeds 80 percent, be the subject of private mortgage insurance, federal insurance, or a federal guarantee; and

(4) be insured by a mortgagee's policy of title insurance, issued by a title insurance company qualified to do business in the state and acceptable to the corporation, insuring the enforceable mortgage, subject only to permitted encumbrances.

(b) The loan-to-value ratio and the loan amounts on loans under 15 AAC 151.850 - 15 AAC 151.865 shall be as follows:

(1) other than as provided in paragraphs (2), (3), and (4) of this subsection, the loan-to-value ratio on a mortgage loan for the purchase of

(A) a single family residence shall not exceed 95 percent;

(B) a duplex residence shall not exceed 90 percent; and

(2) the amount of the guarantee plus the down payment on a mortgage loan guaranteed by the Veterans Administration must equal 25 percent of the value of the residence based on the lesser of the sales price or appraisal; and the VA guarantee must equal the maximum guarantee possible under the VA program;

(3) the down payment and loan-to-value ratios of mortgage loans insured or guaranteed by FHA, HUD, or RD shall be as required by FHA, HUD, or RD;

(4) the loan-to-value ratio of a mortgage loan made under 15 AAC 151.850 - 15 AAC 151.865 to an education professional or a health care professional for owner occupied, single family housing, shall not exceed 100 percent;

(5) the loan amount on a mortgage loan made under 15 AAC 151.850 - 15 AAC 151.865 for a residence shall not exceed the applicable FNMA or FHLMC maximum loan amount for the same type of property by more than 10 percent;

(6) the loan amount on a mortgage loan insured or guaranteed by FHA, HUD, or RD for a residence shall not exceed the applicable limits established by FHA, HUD, or RD;

(c) A residential mortgage loan under 15 AAC 151.850 - 15 AAC 151.865 to finance a unit in a condominium project or in a planned community project shall be subject to the following terms and conditions:

(1) the living units of the condominium or planned community project must be within the same structure or a reasonably contiguous structure, and the common elements of the project must have been completed before the loan is purchased; and

(d) The corporation will facilitate a loan under 15 AAC 151.850 - 15 AAC 151.865 to finance a residence for members of the Alaska delegation to Congress only if the residence is located in the District of Columbia or within 50 miles of the District of Columbia.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 1/9/2013, Register 213

15 AAC 151.865 Interest rate

A loan under 15 AAC 151.850 - 15 AAC 151.870 shall bear interest at the rate established by the corporation.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 1/9/2013, Register 213

15 AAC 151.870 Commitment periods

The corporation will enter into a commitment agreement to facilitate the making of a loan under 15 AAC 151.850 - 15 AAC 151.865. The maximum commitment period, including any extensions that the corporation will permit in a commitment agreement under this section will be 180 days. The corporation will not charge a commitment fee.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.099
Eff. 1/9/2013, Register 213

Article 10 General Provisions

15 AAC 151.900 Purchases of loans from sellers and servicers

Repealed.

History

Eff. 5/7/93, Register 130; repealed 7/25/2012, Register 205

15 AAC 151.910 Assumptions of mortgage loans

(a) Unless prohibited by financing agreements, federal law or by mortgage insurance requirements, the Corporation will, in its discretion, allow qualified persons other than the mortgagor to assume or provide for the payment of mortgage loans purchased by the Corporation. If a mortgage is assumable by a qualified person, the deed of trust shall include, at the option of the Corporation, a clause which establishes the terms and conditions of a qualified assumption. For purposes of this section, a person is "qualified" to assume a mortgage loan if the person satisfies all underwriting and program criteria applicable to a borrower seeking a new loan under a comparable program and, in the case of a tax-exempt financing, the applicable requirements of federal tax law. All assumptions of a mortgage loan must be approved in writing by the Corporation. The Corporation will establish criteria for approval of assumptions in the sellers' guide. The Corporation will, in its discretion, establish in the sellers' guide the maximum fee that a financial institution may charge to process and close an assumed loan. Among other terms and conditions, a clause in the deed of trust shall require, at the option of the lender, the immediate payment of all sums secured by the deed if the borrower conveys all or part of the property, unless the Corporation or its designee provides written approval of the assumption of the mortgage loan.

(b) The executive director will, in his or her discretion, modify the clause in the deed of trust required under 15 AAC 151.910(a) to prohibit or further restrict assumptions if a clause permitting the assumption of a mortgage loan would jeopardize the financing programs of the Corporation.

(c) The executive director may also formulate a clause for the Corporation's deed of trust for mortgage loans to be financed with the proceeds of qualified mortgage bonds pursuant to Section 103A of the Internal Revenue Code of 1954, as amended, or Section 143 of the Internal Revenue Code of 1986, as amended, as applicable, providing for acceleration of or increase in the loan rate on such mortgages and otherwise as may be necessary in his or her view to cause such mortgage loan to comply with the provision of said applicable section.

History

Authority: AS 18.56.088; AS 18.56.090(13)
Eff. 5/7/93, Register 130

15 AAC 151.920 Delegated underwriting program

(a) The Corporation will, in its discretion, purchase loans originated and closed by financial institutions which have been approved by the Corporation to participate in the delegated underwriting program. The Corporation will, in its discretion, allow loans that are assumed to be underwritten and modified by those financial institutions approved as delegated underwriters. The Corporation will establish criteria for participation in the delegated underwriting program and will publish the criteria in the sellers' guide. The Corporation will, in its discretion, prescribe an application form for participation in the delegated underwriting program and request that an applicant submit information as is necessary to review the application.

(b) The Corporation will respond in writing within 30 days upon receipt of a delegated underwriting application or, if later, upon receipt of supplemental information submitted by the applicant. If an application is denied, the notice must state the reasons for denial.

(c) An aggrieved applicant may request reconsideration of the decision of the Corporation. A request for reconsideration must:

(1) be in writing;

(2) state the basis of the request;

(3) provide any supplemental information which the applicant believes supports the application; and

(4) be postmarked or delivered to the Corporation within 30 days of receipt of rejection of the Corporation provided under (b) of this section.

(d) The Corporation will respond in writing to a request for reconsideration within 10 working days.

(e) If the Corporation denies the request for reconsideration, the applicant may appeal under 15 AAC 150.210.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/7/93, Register 130

15 AAC 151.930 Appeals

In addition to the appeals permitted under 15 AAC 151.830 and 15 AAC 151.920, the decisions of the Corporation under this chapter are subject to appeal as provided, and subject to the procedures established, in 15 AAC 150.210.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 151.940 Commitment fees and procedures

(a) Unless otherwise provided in the regulations of the Corporation, the Corporation will charge a commitment fee based on:

(1) a percentage of the initial principal amount of the loan (including the cost of mortgage insurance financed by the loan) for a loan that the Corporation will purchase equal to:

(A) one-half percent for a 180 day commitment (for new construction only);

(B) three-eighths percent for a 120 day commitment; or

(2) one half the applicable percentages in (a)(1) of the initial principal amount of the loan for a loan that the Corporation will purchase pursuant to the delegated underwriting program described in 15 AAC 151.920.

(b) Unless otherwise provided in the regulations of the Corporation, the Corporation will charge an extension fee which the seller must pay before the Corporation will agree to a 30-day extension of the Corporation's commitment to purchase a loan under this chapter. The extension fee is equal to one-fourth percent of the initial principal amount of the loan. The Corporation will charge a separate extension fee under this subsection for each 30-day extension but will not permit more than three extensions for a loan.

(c) The Corporation will, in its discretion, waive the commitment fee or extension fee required by this section for a loan made to refinance a prior loan.

(d) The Corporation will provide for a procedure of commitment by sellers to deliver qualifying mortgages for purchase by the Corporation at an interest rate fixed in the commitment; except as otherwise provided in the regulations of the Corporation, the commitment procedure will provide for commitments to purchase mortgages by the Corporation for an initial maximum period of 180 days from the date the commitment is signed by the Corporation and will provide for payment of the fees described in this section; the procedures shall further provide

(1) that upon cancellation of a commitment, a request for a future commitment for a mortgage at a rate lower than that previously committed to will not be accepted for a period of 90 days after the date of cancellation of the prior commitment; provided, however, that if a rate reduction becomes available because the application has been made under a different program of the Corporation the rate for the refiled application shall be the rate established for that program at the time the original commitment was made by the Corporation; and

(2) for other details necessary for the operation of the commitment procedure.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.098
Eff. 5/7/93, Register 130; am 4/2/97, Register 142; am 5/29/2002, Register 164

15 AAC 151.945 Interest rate lock-in agreements

(a) The Corporation will, in its discretion, offer interest rate lock-in agreements to approved mortgage sellers. The Corporation will issue an interest rate lock-in agreement to a seller upon its approval of the seller's request on behalf of a borrower. The request must include an agreement by the seller to pay a fee of $250 to the Corporation if the seller fails to submit an application for a loan commitment on behalf of the borrower during the term of the interest rate lock-in. The interest rate lock-in request form shall include the borrower's name and social security number.

(b) An interest rate lock-in agreement will have a term of 30 days. The Corporation may not extend the term of an interest rate lock-in nor may the seller terminate the lock-in prior to its expiration. No borrower may have more than one interest rate lock-in agreement in effect at any time. A borrower may obtain a new interest rate lock-in agreement upon the expiration of a prior lock-in agreement only if all outstanding fees applicable to the borrower's expired lock-in are paid to the lender.

(c) The interest rate lock-in agreement shall establish the date on which the interest rate lock-in application is received by the Corporation. If the seller submits an application for a loan commitment during the term of the lock-in which is approved for purchase by the Corporation, the Corporation will purchase the borrower's loan at the interest rate effective for the applicable loan program on the date set forth in the lock-in agreement, less any Corporation approved rate reductions applicable to the borrower's loan.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.098
Eff. 9/16/98, Register 148; am 5/3/2001, Register 159

15 AAC 151.950 Definitions

(a) In addition to the definitions provided at 15 AAC 150.900, the following terms have the following meanings for purposes of 15 AAC 151.010 - 15 AAC 151.250:

(1) "Code" means section 103A of the Internal Revenue Code of 1954, as amended, Section 143 of the Internal Revenue Code of 1986, as amended, and the regulations (including temporary, final, and proposed regulations) of the United States Department of Treasury or of the Internal Revenue Service published in the Federal Register with respect to either of those sections;

(2) "program" or "special mortgage loan purchase program" means the special mortgage loan purchase program established in AS 18.56.098;

(3) "qualified mortgage bond" means a bond the interest on which is excludible from gross income for federal income tax purposes pursuant to the Code; and

(4) "residence" means an owner-occupied single-family residence or duplex as described in, and subject to the conditions of, 15 AAC 151.110.

(b) In addition to the definitions provided at 15 AAC 150.900 and at (a) of this section, the following terms have the following meanings for purposes of 15 AAC 151.300 - 15 AAC 151.340:

(1) "dependent" means a person who:

(A) resides with the borrower for more than six months of the year, is under the age of 18, and is in the legal custody of the borrower; or

(B) the borrower declares as a dependent for federal income tax purposes except:

(i) the borrower's spouse; or

(ii) a child of the borrower who is in the custody of, and resides away from the borrower for a majority of each year, with another parent or legal guardian;

(2) "family" means, with respect to an individual, that individual's brothers and sisters (whether by whole or half blood), spouse, ancestors and lineal descendents;

(3) "family income" is defined as the gross monthly income of the mortgagor or mortgagors, family members over the age of 21 who occupy the dwelling on a permanent basis, and other individuals over the age of 18 who occupy the dwelling on a permanent basis, multiplied by twelve, and "gross monthly income" is the sum of monthly income items set forth in the Seller's Guide;

(4) "interest rate subsidy" means the assistance provided an applicant in the form of a subsidized interest rate on the first $50,000 of a mortgage loan. The subsidized interest rate is established in accordance with AS 18.56.098(g). No assistance agreement or annual recertification is needed if only an interest rate subsidy has been granted;

(5) "payment subsidy" means the assistance provided an applicant in the form of a reduced principal and interest payment in accordance with 15 AAC 154.020(c);

(6) "severely and permanently disabled" means a borrower who:

(A) has provided a written statement from a physician stating that the nature of the individual's disability is permanent;

(B) has established that the disability caused a decrease in family income exceeding 25 percent; and

(i) proof of eligibility as a blind or disabled person under the federal supplemental security income program (42 U.S.C. 1381 - 1385) or the federal disability insurance benefits program (42 U.S.C. 423); or

(ii) a statement of eligibility from the Board of Vocational Rehabilitation.

(c) In addition to the definitions provided at 15 AAC 150.900 and at (a) of this section, the following terms have the following meanings for purposes of 15 AAC 151.400 - 15 AAC 151.440:

(1) "allowable costs" means all costs for land acquisition and for the construction of senior housing but excluding, developer's profit, fee and overhead;

(2) "allowable developmental costs" means all costs for land acquisition and for the construction of senior housing including developer's profit, fee and overhead acceptable to the Corporation;

(3) "commercial use facility" means an establishment that is primarily engaged in providing to the general public, products or services that are not directly related to the day-to-day needs of seniors;

(4) "duplex senior housing" means housing with two living units;

(5) "four-plex senior housing" means housing with four living units;

(6) "improvement" means the repair, remodeling, or expansion of the senior housing, including, on-site water and sewer installations, and other on-site utility installations;

(7) "operational apparatus" means the fixtures, furnishings, equipment and machinery and the like required to operate the senior housing;

(8) "project" means senior housing project;

(9) "rehabilitation" means the restoration of damaged or deteriorated housing to meet both the present and future needs of seniors;

(10) "senior housing" means construction or improvement undertaken primarily to provide dwelling accommodations with related services and support facilities for older individuals of senior households, including conventional housing, housing for frail elderly, group homes, congregate housing, residential horizontal property regimes organized under AS 34.07, residential cooperatives organized under AS 10.15 or AS 34.08, residential condominiums organized under AS 34.08, and other housing that meets special needs of the elderly; "senior housing" includes acquisition, construction, or rehabilitation of land, buildings, improvements, and other non-housing facilities that are incidental or appurtenant to the housing;

(11) "senior households" means senior citizen housing meeting the definition of "housing for older persons" contained in 24 C.F.R. 100.300 - 308, as amended;

(12) "senior housing project" means senior housing with five or more living units;

(13) "single-family senior housing" means housing with one living unit that might or might not be attached to another living unit; and

(14) "triplex senior housing" means housing with three living units.

(d) In addition to the definitions provided at 15 AAC 150.900 and at (a) of this section, the following terms have the following meanings for the purposes of 15 AAC 151.500 - 15 AAC 151.550:

(1) "allowable costs" means all costs for land acquisition and for the construction, rehabilitation or improvement of multi-family, congregate and special needs housing as well as other costs approved by the Corporation but excluding, developer's profit, fee and overhead;

(2) "allowable developmental costs" means all costs for land acquisition and for the construction rehabilitation or improvement of multi-family, congregate and special needs housing as well as other costs approved by the Corporation including developer's profit, fee and overhead acceptable to the Corporation;

(3) "congregate housing" means multi-family housing that has service(s) integrated into the housing and in which there may be some sharing of common facilities such as kitchen and sanitation;

(4) "congregate service" means a service or activity that is common (available) to all residents of the housing which may include, but is not limited to, general housekeeping, meal service, counseling, job training, medical care, or child care;

(5) "housing for the elderly" means construction or improvement undertaken primarily to provide dwelling accommodation with related services and support facilities for senior households, including conventional housing, housing for the frail elderly, group homes, congregate housing, residential horizontal property regimes organized under AS 34.07, residential housing organized under the Uniform Common Interest Ownership Act, AS 34.08, residential cooperatives organized under AS 10.15 or other housing that meets the special needs of the elderly; "housing for the elderly" includes acquisition, construction, or rehabilitation of land, buildings, improvements, and other non-housing facilities that are incidental or appurtenant to the housing;

(6) "senior households" means senior citizen housing meeting the definition of "housing for older persons" contained in 24 C.F.R. 100.300 - 308, as amended;

(7) "improvement" means the repair, remodeling, or expansion of the housing, including, on-site water and sewer installations, and other on-site utility installations;

(8) "multi-family housing" means a building or a group of buildings, improvements or structures, including land, used or useful for housing persons and which may have related facilities, including without limitations, day care and other support facilities. "Multi-family housing" may be on contiguous, non-contiguous or scattered sites and may include operational apparatus;

(9) "operational apparatus" means the fixtures, furnishings, equipment, machinery and the like required to operate the housing and congregate services;

(10) "rehabilitation" means the restoration of damaged or deteriorated housing to meet both the present and future needs of it residents;

(11) "special needs housing" means residential housing, including operational apparatus, designed to meet the needs of persons with specific and special housing needs, including supportive services. Special needs housing includes:

(A) housing for the elderly;

(B) individuals with a disability;

(D) emergency shelter for the homeless; and

(E) transitional housing.

"Special needs housing" may be on contiguous, non-contiguous or scattered sites and may include operational apparatus;

(12) "subordinate financing" means a loan made by the corporation that is either subordinate in lien position to another loan the Corporation has made and/or subordinate to other acceptable superior liens on the housing;

(13) "commercial uses" means retail, office, or hospitality uses but precludes those uses set out in AS 18.56.230(b) including medical, industrial, and correctional uses as further described in guidelines.

(e) In addition to the definitions provided at 15 AAC 150.900 and at (a) of this section, the following terms have the following meanings for purposes of 15 AAC 151.710 - 15 AAC 151.840:

(1) "code" means 26 U.S.C. section 42, as amended;

(2) "housing credit ceiling amount" means the annual amount established for allocation in the state under 26 U.S.C. section 42(h)(3)(C);

(3) "housing tax credit" or "low-income housing tax credit" means the tax credit which may be allocated by the Corporation to a qualified building from the Corporation's annual housing credit ceiling amount under the code and regulations adopted under applicable federal law;

(4) "qualified nonprofit organization" means an organization described in 26 U.S.C. section 501(c)(3) and (4) and exempt from tax under 26 U.S.C. section 501(a) and that meets the requirements of 26 U.S.C. section 42(h)(5)(B), (C), and (D);

(5) "tax credit year" means the calendar year in which a project will be placed in service and for which an allocation of low-income housing tax credit is made;

(6) "compliance period" means the period beginning on the first day of the first taxable year of the credit period of a building and ending fifteen (15) years from such date or as provided in an agreement made pursuant to 26 U.S.C. section 42 (h)(6);

(7) "qualified allocation plan" means a plan developed by the Corporation under the guidelines referred to in 26 U.S.C. section 42(m)(B)(i);

(8) "eligible basis" means properly capitalized and depreciable costs, including furnishings and other personal property, not including land and other separately capitalized costs;

(9) "qualified basis" is equal to the applicable fraction multiplied by the eligible basis; and

(10) "applicable fraction" means the fraction of a project's eligible basis attributable to the acquisition and rehabilitation or construction of the low-income units in the project; the fraction is equal to the lesser of the percentage of low-income units in the project or the percentage of floor space attributable to the low-income units in the project.

History

Authority: AS 18.55.100; AS 18.56.088; AS 18.56.230 AS 18.55.110; AS 18.56.090; AS 18.56.730 AS 18.55.240; AS 18.56.099 AS 18.55.420; AS 18.56.100
Eff. 5/7/93; am 4/22/94, Register 130; am 9/23/97, Register 145; am 10/21/98, Register 148; am 2/24/99, Register 149; am 9/22/99, Register 152; am 4/4/2007, Register 182; am 9/25/2013, Register 208; am 1/9/2013, Register 213

Chapter 152 AHFC Rural Housing

Article 1 Housing Assistance Loan Program

15 AAC 152.010 Borrower eligibility

The Corporation will, in its discretion, originate or purchase all or part of a loan under AS 18.56.420 if the requirements of AS 18.56.400 - 18.56.600 and 15 AAC 152.010(b) - 15 AAC 152.170 are met, and if the borrower:

(1) is either an Alaska resident who is at least 18 years of age or emancipated or is a business or local governmental entity, or a regional educational attendance area; and

(2) can demonstrate, to the satisfaction of the Corporation, the ability to repay the loan. A borrower is eligible to have only one first lien mortgage loan at a time for owner-occupied housing.

History

Authority: AS 18.56.088; AS 18.56.420; AS 18.56.580 AS 18.56.400; AS 18.56.440
Eff. 5/7/93, Register 130; am 9/28/95, Register 136; am 9/25/2002, Register 164; am 8/20/2003, Register 169; am 08/13/2004, Register 178

15 AAC 152.020 Loan programs

(a) The Corporation will, in its discretion, originate or purchase loans related to real property in Alaska under 15 AAC 152.010 - 15 AAC 152.100 for housing located in small communities. Loans may be applied to:

(1) the purchase of housing;

(2) the purchase of building materials for renovations or improvements of existing housing;

(3) the renovation or improvement, including the cost of labor and services, of existing housing;

(4) new construction of housing; and

(5) the refinancing of housing.

(b) The Corporation may originate and purchase a building materials loan under 15 AAC 152.010 - 15 AAC 152.100 for housing in small communities, if

(1) the loan amount does not exceed $100,000;

(2) the collateral for the loan is acceptable to the Corporation; and

(3) the proceeds of the loan are used to improve the structural integrity, energy efficiency, safety to the residents, or basic livability of the housing.

History

Authority: AS 18.56.088; AS 18.56.420 AS 18.56.400; AS 18.56.580
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 9/28/95, Register 136; am 4/2/97, Register 142; am 9/25/2002, Register 164; am 8/13/2004, Register 178; am 5/25/2011, Register 204

15 AAC 152.025 Turnkey III home purchase program

(a) A pilot program to provide financing for the purchase of Turnkey III homes is established. In this section, "Turnkey III homes" means those dwellings developed under the HUD Homeownership Opportunities Program for Low-Income Families (24 C.F.R. 804.101 - 804.121).

(b) In any fiscal year, the Corporation will not finance more than 30 Turnkey III homes.

(c) The executive director may allow a purchaser of a Turnkey III home to apply the assets of a reserve account established by the borrower under the Turnkey III program, such as the Earned Home Payment Account (24 C.F.R. 804.110) or the Nonroutine Maintenance Reserve (24 C.F.R. 804.111), toward satisfaction of the principal amounts or loan-to-value ratio requirements established under AS 18.56.440 or toward payment of other costs in the transaction. However, the executive director shall require each purchaser of a Turnkey III home to demonstrate, to the satisfaction of the executive director, an ability to repay the loan.

(d) If the Corporation originates or purchases a loan for the purchase or renovation of a Turnkey III home, any security interest of a regional housing authority, as established under the terms of the promissory note required by 24 C.F.R. 804.114, must be subordinate to the security interest of the Corporation.

(e) The Corporation may not finance the same property more than one time within the first five-year period of a loan made under this section.

History

Authority: AS 18.56.088; AS 18.56.400
Eff. 5/7/93, Register 130

15 AAC 152.030 Indirect and direct loans

Repealed.

History

Eff. 5/7/93, Register 130; am 8/3/94, Register 132; repealed 9/25/2002, Register 164

15 AAC 152.040 Loan amount restrictions

Repealed.

History

Eff. 5/7/93, Register 130; repealed 9/25/2002, Register 164

15 AAC 152.045 Interest rates

The interest rate on a mortgage originated or purchased in whole or in part under 15 AAC 152.010 - 15 AAC 152.100 is one percent less than the interest rate, as determined under 15 AAC 150.060. However, the interest rate on that portion of a loan that exceeds $250,000 is the same as the interest rate determined under 15 AAC 150.060.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.470 AS 18.56.098; AS 18.56.420
Eff. 9/25/2002, Register 164; am 8/13/2004, Register 178

15 AAC 152.050 Loan term

The Corporation will establish the maximum period for repayment of loans under 15 AAC 152.010 - 15 AAC 152.100. The maximum periods will not exceed the following:

(1) for a building materials loan, the lesser of:

(A) the remaining economic life of the housing structure, as determined by the Corporation; or

(B) 15 years.

(2) for a loan other than a loan described in paragraph (1) of this section, the lesser of (A) the remaining economic life of the housing structure, as determined by the Corporation or (B) 30 years.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.440(2)
Eff. 5/7/93, Register 130

15 AAC 152.060 Security

(a) Security for the repayment of loans under this chapter will be considered acceptable if:

(1) the Corporation obtains a satisfactory deed of trust, subject to permitted encumbrances, on the subject property, and, when necessary, other legal documents;

(2) the borrower shows marketable title to the subject property in accordance with AS 18.56.480(b) and (c) or in any other manner acceptable to the executive director; and

(3) the borrower purchases insurance that complies with the requirements of the sellers' guide.

(b) The Corporation may accept the assignment in trust of a leasehold estate as security.

(c) The Corporation may accept other security than that described in this section if the executive director determines that the other security will adequately protect the Corporation.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.500
Eff. 5/7/93, Register 130; am 9/25/2002, Register 164

15 AAC 152.065 Determination of small community

(a) For purposes of determining whether a community is a "small community" under AS 18.56.600(2), the Corporation shall use the population established for a community by the Department of Commerce, Community, and Economic Development under AS 29.60.150.

(b) In the case of a merged or consolidate borough formed under AS 29.06.090 - 29.06.170, unified municipality organized under AS 29.06.190 - 29.06.420, or organized borough in which a city has dissolved under AS 29.06.450 - 29.06.530 which contains areas of a distinctly rural character within the municipality, the Corporation will, in its discretion, determine separate populations for the various communities within the borough or unified municipality. The Corporation may use municipal service areas, census place designations, village or unincorporated community status under other state programs, or any other method the corporation determines appropriate to determine the boundaries and populations of communities within a borough or unified municipality.

History

Authority: AS 18.56.088; AS 18.56.400
Eff. 5/3/2001, Register 159

15 AAC 152.070 Regional housing authorities

To the extent applicable, regional housing authorities originating loans under AS 18.55.997 or servicing loans under AS 18.56.510 shall adhere to the requirements of 15 AAC 152.010 - 15 AAC 152.100.

History

Authority: AS 18.55.997; AS 18.56.400; AS 18.56.570 AS 18.56.088; AS 18.56.510
Eff. 5/7/93, Register 130

15 AAC 152.075 Public service rental housing

Repealed.

History

Eff. 1/20/95, Register 133; am 4/22/98, Register 146; repealed 9/25/2002, Register 164

15 AAC 152.080 Teacher housing

Repealed.

History

Eff. 5/7/93, Register 130; am 9/25/2002, Register 164; repealed 8/13/2004, Register 178

15 AAC 152.090 Multi-family housing; conditions

(a) All loans for multi-family housing are subject to the following conditions:

(1) the Corporation will not originate or purchase a loan for a property which:

(A) is financed in a principal amount in excess of $2,500,000, unless approved by the board;

(B) has a loan-to-value ratio in excess of

(i) 80 percent for all dwellings which consist of three or more living units and non-owner occupied duplexes; or

(ii) 90 percent for owner occupied duplexes;

(2) the borrower must demonstrate the need for the project and its economic feasibility; and

(3) in the absence of a municipal code which imposes water and sewer system standards for the project, the project must comply with applicable Department of Environmental Conservation regulations with respect to water and sewer systems; if the project is located within a municipality whose building code imposes water and sewer standards, the project must comply with the applicable municipal code.

(b) Assumptions of loans under this section may be permitted with the written approval of the Corporation.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.580
Eff. 5/7/93, Register 130; am 9/25/2002, Register 164; am 8/13/2004, Register 178; am 12/3/2025, Register 257

15 AAC 152.100 Discrimination clause

The statement of nondiscrimination, required in AS 18.56.440(5), must be included in the deed of trust required by 15 AAC 152.060(a)(1).

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.440(5)
Eff. 5/7/93, Register 130

Article 2 Home Ownership Assistance Program

15 AAC 152.210 Home ownership assistance fund

(a) The Corporation will, in its discretion, provide assistance to persons of lower and moderate income, as defined in 15 AAC 152.220, to purchase or construct single-family, owner-occupied dwellings if the mortgage loan on the dwelling is originated or purchased by the Corporation.

(b) The Corporation will, in its discretion, provide a subsidy in the form of a reduced interest rate by the means of an adjustable rate mortgage, with the interest rate being no lower than six percent per annum as adjusted by the Corporation on an annual basis, to qualified applicants who have an outstanding mortgage loan with the Corporation, or to applicants who are applying for a mortgage loan with the Corporation. The executive director may determine the percentage of each appropriation to the home ownership assistance fund that will be allocated to applicants who are applying for a mortgage loan with the Corporation. The executive director may determine the percentage of each appropriation to the home ownership assistance fund that will be allocated to applicants with an outstanding loan with the Corporation who have not previously received a subsidy payment.

(c) For the purpose of a direct construction loan, the home ownership assistance subsidy is not available during the interim construction period.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.430
Eff. 5/7/93, Register 130; am 8/3/94, Register 132

15 AAC 152.220 Eligibility

(a) A person is eligible for home ownership assistance for the purchase or construction of a single-family residence after having met general borrower loan qualifications of the Corporation under 15 AAC 152, and other borrower and home qualifications set out in 15 AAC 152.210 - 15 AAC 152.260.

(b) For the borrower to be eligible under 15 AAC 152.210 - 15 AAC 152.260:

(1) the borrower must be a person of lower or moderate income; and

(2) the borrower's household may not have assets that exceed three times the applicable income limit for the household size as calculated under (1) of this subsection.

(1) the loan amount purchased or originated by the Corporation may not exceed the following:

(A) $105,000 for a one to two member family;

(B) $110,000 for a three member family; and

(2) the appraised value of the home may not exceed the following:

(A) $130,000 for a one to two member family;

(B) $140,000 for a three member family; and

(d) In this section:

(1) "assets" do not include:

(A) permits held for a business opportunity;

(B) Native allotments which were conveyed by restricted trust deed; or

(C) land acquired through the Alaska Native Claims Settlement Act (ANCSA) or Alaska National Interest Land Conservation Act (ANILCA);

(2) "family" means, with respect to an individual, that individual's brothers and sisters (whether by whole or half blood), spouse, ancestors, and lineal descendants;

(3) "family income":

(A) for purposes of applying income requirements for the purchase of a loan under 15 AAC 152.210, is the mortgagor's or mortgagors' gross monthly income multiplied by twelve; and

(B) for purposes of applying the income requirements for providing assistance under 15 AAC 152.210, is the gross monthly income of the mortgagor or mortgagors, family members over the age of 21 who occupy the dwelling on a permanent basis, and other individuals over the age of 18 who occupy the dwelling on a permanent basis, multiplied by twelve;

(4) "gross monthly income" is the sum of the monthly income items set forth in the sellers' guide;

(5) "lower or moderate income" means income that is not greater than:

(A) $30,000 per year for households comprised of one or two adults; or

(B) the base income limit of $30,000 per year plus the following yearly amounts for additional members of the household:

(i) $5,000 for one child;

(ii) $1,500 for each additional child; but

(iii) the maximum gross income limit is $39,500 per year per household.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.430
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 10/29/97, Register 145; am 2/24/99, Register 149; am 9/22/99, Register 152

15 AAC 152.230 Qualified mortgage loans

Only mortgage loans for which the repayment period is the maximum allowed under 15 AAC 152.050(b) are eligible under 15 AAC 152.210 - 15 AAC 152.260.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.430
Eff. 5/7/93, Register 130

15 AAC 152.240 Amount of subsidy

(a) Mortgage payments may be partially subsidized by the home ownership assistance fund in an amount not to exceed the lesser of:

(1) the amount necessary to reduce the monthly payment of principal and interest on the loan to 20 percent of the household's gross monthly income;

(2) the amount necessary to reduce the total monthly mortgage payment comprised of principal, interest, taxes, and insurance to 28 percent of the household's gross monthly income; or

(3) the amount necessary to reduce monthly payments of principal and interest on the loan to the amount that would be payable if the mortgage loan were bearing an interest rate of six percent a year.

(b) The Corporation may not enter into a home ownership assistance agreement with a borrower under the home ownership assistance program if the amount of assistance is determined to be less than $50 per month.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.430
Eff. 5/7/93, Register 130

15 AAC 152.250 Annual review

The Corporation will make a preliminary determination of the subsidy level based upon the borrower's application and supporting materials. The agreement required under 15 AAC 152.260 will require that the borrower submit information required by the Corporation to complete an annual income-review of the borrower. Assistance payments may be adjusted or eliminated based upon the Corporation's income-review.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.430
Eff. 5/7/93, Register 130

15 AAC 152.260 Home ownership assistance agreement

(a) The Corporation will not provide an adjustable interest rate until the borrower executes a home ownership assistance agreement with the Corporation. The agreement establishes the terms and conditions for participation in the home ownership assistance program, including the borrower's obligation to occupy the dwelling, to report all income, and to repay excess subsidy payments. A home ownership assistance agreement may not exceed one year in length.

(b) A home ownership assistance agreement is personal to the borrower and may not be assigned.

(c) The home ownership assistance agreement will provide that the borrower may not obtain secondary financing of a mortgage loan for which there is a home ownership assistance agreement without the written approval of the Corporation.

History

Authority: AS 18.56.088; AS 18.56.400; AS 18.56.430
Eff. 5/7/93, Register 130; am 8/3/94, Register 132

Article 3 Federally Guaranteed and Insured Rural Housing Loan Programs

15 AAC 152.300 Federally guaranteed and insured loan program

The Corporation will, in its discretion, purchase VA, FHA, HUD and RD guaranteed or insured loans in the rural loan program, provided that:

(a) the loan amounts, terms, and downpayment are consistent with loans acceptable to FNMA, and

(b) the interest rate is the rate established for the Rural Owner Occupied Loan Program, as published by the Corporation from time to time in writing to financial institutions in Alaska.

History

Authority: AS 18.56.088; AS 18.56.400 - 18.56.600
Eff. 5/7/93, Register 130; am 1/20/95, Register 133; am 6/11/96, Register 139; am 5/3/2001, Register 159

15 AAC 152.310 Borrower eligibility

To qualify for a loan under this section a borrower must meet the qualifications set by either FHA, HUD, RD, or VA as they pertain to income and other specific program requirements and all general borrower loan qualifications of the Corporation.

History

Authority: AS 18.56.088; AS 18.56.400 - 18.56.600
Eff. 5/7/93, Register 130; am 1/20/95, Register 133; am 6/11/96, Register 139

15 AAC 152.320 Eligible properties

Properties securing loans under the program described in 15 AAC 152.300 must meet property requirements set by either FHA, HUD, RD, or VA, and must be located within eligible rural areas meeting the definition of small community under AS 18.56.600(2).

History

Authority: AS 18.56.088; AS 18.56.400 - 18.56.600
Eff. 5/7/93, Register 130; am 1/20/95, Register 133; am 6/11/96, Register 139; am 8/13/2004, Register 178

15 AAC 152.330 Loan terms and restrictions

(a) No loan may exceed the limits established by RD, FHA, HUD, and VA for the specific program in which the applicant is applying for or the limit established by the Rural Housing Loan Program, whichever is the lower amount.

(b) The loan-to-value ratio and loan amounts on first lien federally guaranteed or insured loans shall be as follows:

(1) the guarantee plus the down payment on a mortgage loan guaranteed by the Veterans Administration must equal 25% of the value of the residence, and the VA guarantee must equal the maximum guarantee possible under the VA Program; and

(2) the down payment and loan-to-value ratios of mortgage loans insured or guaranteed by FHA, HUD, or RD shall be as required by FHA, HUD, and RD.

(c) The term for federally guaranteed and insured loans shall be determined by the program in which the applicant is applying. The Corporation will, in its discretion, reject an application submitted at a 30-year term if it is determined that the property does not have the physical or economic remaining life of 30 years.

History

Authority: AS 18.56.088; AS 18.56.400 - 18.56.600
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 1/20/95, Register 133; am 9/28/95, Register 136; am 6/11/96, Register 139; am 4/2/97, Register 142; am 5/3/2001, Register 159

15 AAC 152.340 Assumability

Loans under the program described in 15 AAC 152.300 are assumable to qualified applicants upon written approval by the Corporation and in accordance with applicable requirements of FHA, HUD, RD, or VA.

History

Authority: AS 18.56.088; AS 18.56.400 - 18.56.600
Eff. 5/7/93, Register 130; am 1/20/95, Register 133; am 6/11/96, Register 139; am 4/2/97, Register 142

Article 9 General Provisions; Appeals

15 AAC 152.900 Appeals

The decisions of the Corporation under this chapter are subject to appeal as provided, and subject to the procedures established, in 15 AAC 150.210.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 152.910 Fees and procedures

(a) Unless otherwise provided in the regulations of the Corporation, the Corporation will charge a commitment fee with respect to a loan under this chapter as follows:

(1) for a loan secured by property with one to four units, one-eighth percent of the initial principal amount of the loan including the cost of mortgage insurance financed by the loan;

(2) for a loan secured by property with five or more units, the Corporation shall charge a fee of $1,000 for review of the loan application which shall be credited towards the commitment fee if a commitment is issued. The commitment fee shall be .5% of the committed loan amount.

(b) The Corporation will enter into a commitment to purchase, participate in the purchase, make, or participate in making a loan under this chapter for the following period of time and subject to the following conditions:

(1) for a loan to acquire an existing dwelling with one to four units, the commitment period is 120 days, and the Corporation will permit 30-day extensions upon receipt of a fee equal to one eighth of one percent of the loan amount for each extension, but the commitment period including the extensions may not exceed 210 days;

(2) for a loan to construct or renovate a dwelling with one to four units, the commitment period is 180 days, and the Corporation will permit up to two 90-day extensions, upon receipt of a fee equal to one eighth of one percent of the loan amount for each extension;

(3) for a loan to acquire, construct, or renovate a dwelling with five or more units, the Corporation will, in its discretion, enter into a commitment period up to a maximum of one year. The Corporation shall have the option to extend such commitment periods as it determines necessary. An extension fee of .5% shall be charged for each 90-day extension of the commitment period.

History

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.098
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 4/2/97, Register 142; am 10/29/97, Register 145; am 5/29/2002, Register 164; am 8/13/2004, Register 178

15 AAC 152.990 Definitions

In addition to the terms provided at 15 AAC 150.900, the following terms have the following meanings for purposes of this chapter:

(1) "economic life" means the estimated period over which any improvements on the property contribute to the value of the property;

(2) "family" means those individuals executing the mortgage note and deed of trust and their dependents who occupy the residence on a permanent basis;

(3) "household" means all persons, regardless of whether they are members of the family, who occupy the residence on a permanent basis as full- or part-time residents;

(4) "local governmental entity" means a borough or city incorporated under state law which has jurisdiction over the area in which the subject housing is located or is to be located; in the absence of a municipality incorporated under state law, "local government entity" also means the Native village government or corporation recognized by the people of the Native village in which the subject housing is located or is to be located;

(5) "mobile home" means manufactured housing with a certification label required by 24 C.F.R. Part 3282.362(c)(2)(C), or a certification label permitted by 24 C.F.R. Part 3282.18, and attesting that the mobile home is in conformance with federal standards for Zone III construction, as set out in 24 C.F.R. Part 3280, Subpart F;

(6) "multi-family" means housing which consists of two or more living units;

(7) "nonconforming housing" means housing which exhibits one or more characteristics, with respect to design, construction practices, materials, foundation systems, utilities, and minimum space requirements, which are not common to the community in which the property is located and which would ordinarily preclude financing by private financial institutions;

(8) "renovation or improvement" means the repair, remodeling, rehabilitation, expansion, renovation, or improvement of the housing structure, on-site water and sewer installations, and other on-site utility installations acceptable to the Corporation;

(9) "resident of Alaska" means a person who maintains a primary place of residency in Alaska with the intention of continuing that residence indefinitely;

(10) "small community" means a community with a population of 6,500 or less that is not connected by road or rail to Anchorage or Fairbanks; or with a population of 1,600 or less that is connected by road or rail to Anchorage or Fairbanks and at least fifty statute miles outside of Anchorage or twenty-five statute miles outside of Fairbanks; in this paragraph "connected by road" does not include a connection by the Alaska Marine Highway system or roads outside the boundary of the State of Alaska;

(11) "very small community" means a community with a population of 1400 or less, not connected to Anchorage or Fairbanks by road or rails; in this paragraph "connected by road" does not include a connection by the Alaska Marine Highway system or roads outside the boundary of the State of Alaska.

History

Authority: AS 18.55.998; AS 18.56.109; AS 18.56.430 AS 18.56.088; AS 18.56.400
Eff. 5/7/93, Register 130; am 8/3/94, Register 132; am 4/2/97, Register 142; am 4/22/98, Register 146; am 9/16/98, Register 149; am 5/29/2002, Register 164; am 8/20/2003, Register 169; am 8/13/2004, Register 178

Chapter 153 AHFC Public Housing

Article 1 General

15 AAC 153.010 General

The Corporation will implement and administer the section 8 low rent housing program and other housing programs that obtain assistance from the federal government through HUD in accordance with the regulations of HUD.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

Chapter 154 Grant Programs

Article 1 Provisions Applicable to All Grant Programs

15 AAC 154.010 Public notice of availability of funds

At least seven days before awarding a grant under this chapter or under a program described in 15 AAC 154.900, the Corporation will publish notice of the availability of money for the grant.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130; am 5/14/97, Register 142

15 AAC 154.020 Cessation of grants

The Corporation has the ability to temporarily or permanently, in its discretion, cease making grants and grant payments under any of the programs established in this chapter or described in 15 AAC 154.900 and the ability to temporarily or permanently suspend grants to particular grant recipients under any of those programs. The Corporation will, in its discretion, include a provision to the effect stated in this section in the grant agreement or other document it enters into in connection with a grant program.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.030 Misstatements

If the Corporation determines that a grant recipient under any of the programs established in this chapter or described in 15 AAC 154.900 has made a material misstatement relating to that grant recipient's application for or administration of a grant, the Corporation will, in its discretion, require the grant recipient to repay the grant to the Corporation, together with accrued interest on the amount of the grant calculated at the highest permissible rate allowed by law from the date of issuance of the grant check by the Corporation, and determine that the grant recipient is ineligible for further grants from the Corporation. The Corporation will, in its discretion, include a provision to the effect stated in this section in the grant contract or other document it enters into in connection with a grant program.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.040 Grant agreements

Before awarding a grant under this chapter or under a program described in 15 AAC 154.900, the Corporation will enter into a grant agreement with the recipient of the grant. The grant agreement will include, but is not limited to, the following:

(1) a statement of the intended use of the grant funds, specifying how the funds will be used in connection with the purposes of the particular grant program;

(2) a budget description in detail appropriate to the scope of the project;

(3) a timetable listing the steps considered necessary for the timely completion of the project and listing the schedule for the payment of grant funding;

(4) a provision for the administration of the grant money according to generally accepted financial accounting procedures, for regular periodic reporting to the Corporation of grant-sponsored activities, and for the disposition of funds in accordance with intended use;

(5) a provision for the cessation of grant payments if the Corporation determines that the applicant is not using grant money for its intended purposes or is not proceeding satisfactorily with the development of the project;

(6) a provision acknowledging that all interest earned on grant funds remains the property of the Corporation and that all such interest will be remitted to the Corporation upon completion of the final project audit;

(7) a statement acknowledging that the applicant and its architect, and not the Corporation, are responsible for obtaining necessary licenses and permits, if any, for ensuring that all aspects of the project comply with all applicable laws, regulations, ordinances, and codes, and for all costs of the project in excess of the amount of approved grants; and

(8) a promise to defend and hold harmless, and to require all contractors and subcontractors to hold harmless, the Corporation from any action arising from its alleged failure to award a grant under the applicable program.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.050 Application

(a) The executive director will establish selection criteria and a selection procedure which will be detailed in the instructions to a grant application.

(b) A grant application shall be on forms prescribed by the Corporation and shall include:

(1) a resolution of the applicant's governing body authorizing the grant request, or if the applicant is a municipality, the signature of a municipal official with authority to apply for the grant;

(2) documentation of need for the grant project in the area being served;

(3) a statement identifying all other money sources, amounts, and anticipated commitment dates for each source;

(4) a management and operation plan;

(5) a budget and schedule to accomplish the purposes of the grant; and

(6) other information required by the Corporation.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130; am 6/11/96, Register 139

15 AAC 154.060 Appeals

The Corporation will send a notice of tentative award for all grants to all grant applicants. An applicant may protest the tentative award selections under 15 AAC 150.220 and may appeal the decision of the Corporation as provided in 15 AAC 150.220.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.070 Title to project

In connection with a grant under this chapter or under a program described in 15 AAC 154.900, the Corporation will require that a deed restriction on the title to the land benefited by the grant be recorded requiring approval from the Corporation for sale or transfer of the title to the land and requiring that the property be used for the purposes of the grant. The Corporation may restrict sale or transfer of title to an entity eligible for the grant.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.080 Compliance with federal grant requirements

If the Corporation awards a grant under this chapter or under a program described in 15 AAC 154.900 and all or part of the funding for the grant is derived from the federal government, the Corporation will comply with applicable regulations, law, or other guidelines related to the federal grant program. To the extent that the applicable regulations, laws, or other guidelines related to the federal grant program conflict the Corporation's regulations relating to the grant, the federal regulations, laws, or other guidelines shall control.

History

Authority: AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.090 Applicability of Building Energy Efficiency Standard and Minimum Construction Standards to Grant Programs

Any grant award for new construction of residential housing, funded from programs administered under 15 AAC 154.010 - 15 AAC 154.910, shall comply with 15 AAC 150.040 and 15 AAC 150.030, as applicable. For projects of 5 units or more, an inspection in accordance with 15 AAC 150.030 shall be performed by an individual that is certified to inspect a building of 5 or more units by the International Code Council or is an engineer or architect, licensed under AS 08.48.

History

Authority: AS 18.56.088
Eff. 6/18/2008, Register 187

Article 2 Senior Citizens Housing Development Grants

15 AAC 154.100 Purpose

When adequate funding is not available from other sources and the Corporation determines there is a critical need, the Corporation will award grants with money in the Senior Citizen Housing Development Fund to applicants meeting the requirements of AS 18.56.810(a) for developing senior citizen housing, including:

(1) purchase of a building site;

(2) site preparation;

(3) preparation of plans and specifications;

(4) purchase of materials and construction of senior citizen housing and appurtenant facilities; and

(5) rehabilitation, improvement, or conversion of an existing building for use as senior citizen housing or appurtenant facilities.

History

Authority: AS 18.56.088; AS 18.56.810
Eff. 5/7/93, Register 130

15 AAC 154.110 Repair and replacement fund

In addition to the requirements established at 15 AAC 154.040, a grant agreement for a grant made under 15 AAC 154.100 - 15 AAC 154.110 will include a provision requiring the establishment of a repair and replacement fund to be used for such items as carpet replacement, painting, roof repair, and other major maintenance and repair costs. The grant agreement will establish specific terms for the size and funding requirements of the repair and replacement fund.

History

Authority: AS 18.56.088; AS 18.56.810
Eff. 5/7/93, Register 130

15 AAC 154.120 Definition of senior citizen housing

Senior citizen housing is housing meeting the definition of "housing for older persons" contained in 24 C.F.R. 100.300 - 308, as amended.

History

Authority: AS 18.56.088; AS 18.56.810
Eff. 5/29/2002, Register 164; am 4/4/2007, Register 182

15 AAC 154.130 Period of use as senior housing

Any housing development assisted with grant funds under this section, shall record a covenant to run with the land that binds the use of the property as senior housing for a minimum of 30 years or the length of time required by an accompanying loan or grant program, whichever is the longest.

History

Authority: AS 18.56.088; AS 18.56.810
Eff. 5/29/2002, Register 164

Article 3 Multifamily Affordable Housing Development Grant

15 AAC 154.200 Purpose

(a) When adequate funding is not available from other sources and the Corporation determines there is a need for affordable housing, the multifamily affordable housing development fund provides grants to applicants meeting the requirement of AS 18.56.650(a) for developing affordable multifamily housing, and other non-housing facilities that are incidental or appurtenant to the housing, for low-income households, including:

(1) purchase of a building site;

(2) site preparation;

(3) preparation of plans and specifications, including project feasibility studies;

(4) purchase of materials;

(5) construction; and

(6) rehabilitation, improvement, or conversion of an existing building for use as low-income housing.

(b) In 15 AAC 154.200 - 15 AAC 154.210, "multi-family housing" has the meaning provided in 15 AAC 151.950(d).

History

Authority: AS 18.56.088; AS 18.56.650
Eff. 5/7/93, Register 130

15 AAC 154.210 Reporting requirements

A grant recipient shall submit a monthly report of expenditures and activities to the Corporation. After project completion, the project owner shall annually submit to the Corporation a copy of the five-year maintenance plan, a current audit of the project indicating the financial status of the entity owning the project, and a copy of the annual operations and maintenance budget for the forthcoming year.

History

Authority: AS 18.56.088; AS 18.56.650
Eff. 5/7/93, Register 130

Article 4 Supplemental Housing Development Grants

15 AAC 154.300 Purpose

The Corporation will, in its discretion, make grants with money in the supplemental housing development fund for projects described in AS 18.55.998(b) to regional housing authorities for the costs of:

(1) onsite sewer and water facilities;

(2) road construction to project sites;

(3) energy efficient design features in homes; and

(4) extension of electrical distribution facilities to individual residences.

History

Authority: AS 18.55.998; AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.310 Grants

The Corporation will, in its discretion, make a grant under 15 AAC 154.300 upon proof from a regional housing authority that it has:

(1) obtained a federal loan or grant from HUD for a project described in AS 18.55.998(b); and

(2) an audit required by AS 18.55.996(i) which indicates:

(A) that its accounting records are in conformity with generally accepted accounting principles;

(B) it is financially solvent; and

History

Authority: AS 18.55.998; AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.320 Grant payments

(a) The Corporation will pay 95% of the grant funds for each eligible category described in 15 AAC 154.300 upon execution of the grant agreement and approval by the Corporation of the project work plan budget for that eligible category. The remaining five percent of the grant will be paid upon submittal to and approval by the Corporation of a certified final cost report and payment to the Corporation of all interest earned on grant money. The grant will not be closed until HUD's annual audit reflecting total project costs is approved by the Corporation. If there are any discrepancies between the certified final cost report and the official HUD audit, the housing authority shall remit to the Corporation any disallowed expenditures of grant money. The certified final cost report shall be signed by the housing authority's executive director or an authorized representative and is binding upon the housing authority as representing the true and complete expenditure of grant money for the project.

(b) In this section, "certified final cost report" means a certified report of all expenditures, costs, sources, and disposition of all project money; a statement of interest earned on grant money; and a certification that grant money was used in accordance with the grant agreement and that no money was used for administration or overhead costs of the regional housing authority.

History

Authority: AS 18.55.998; AS 18.56.088
Eff. 5/7/93, Register 130

Article 5 Homeless Assistance Grants

15 AAC 154.400 Homeless assistance program (HAP)

(a) The Corporation may assist municipalities, regional housing authorities, non-profit corporations and partnerships or joint ventures of any of the foregoing to meet the housing and supportive service needs of homeless and near-homeless persons.

(b) Repealed 10/20/2009.

(c) The Corporation may participate in the development of buildings or units that, by their use, address homelessness but that, by their operation, appear nonresidential in nature.

(d) The Corporation may provide financial assistance to prevent homelessness, including but not limited to prevention of foreclosures and evictions.

(e) The Corporation may provide financial assistance to support housing retention services or facilitate transition from dependency on low-cost housing.

(f) The Corporation may participate with appropriate sponsoring agencies or groups in demonstration housing projects that address homelessness.

(g) The Corporation may support planning, coordination and evaluation activities that improve the delivery of homeless services and programs.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/14/97, Register 142; am 10/20/2009, Register 193

15 AAC 154.410 Applications

An application for a homeless assistance program grant must include:

(1) documentation of need for the project proposed;

(2) a description of the applicant's experience in providing the proposed services;

(3) a narrative plan describing the services the applicant intends to provide, including time lines for completion of the grant;

(4) a proposed budget including a statement identifying all other funding sources by amount, source and anticipated commitment date;

(5) a resolution of the applicant's governing body authorizing the application, or if the applicant is a municipality, the signature of a municipal official with authority to apply for the grant; and

(6) a description and supporting evidence of coordination with local governments or other local service providers.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/14/97, Register 142; am 10/20/2009, Register 193

15 AAC 154.420 Evaluation criteria

The Corporation will evaluate applications based on the following criteria:

(1) the applicant's experience and qualifications;

(2) the extent to which the applicant's proposal meets a legitimate housing or service need;

(3) the extent to which the applicant's proposal coordinates the efforts of other social service and housing providers; and

(4) other criteria considered appropriate by the Corporation.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/14/97, Register 142; am 10/20/2009, Register 193

15 AAC 154.430 Evaluation and grant award

Staff of the Corporation shall evaluate applications received under 15 AAC 154.410 and make a recommendation to the Executive Director. Whenever practicable, staff will establish a review committee to rate the applications and make a recommendation to the Executive Director/CEO. The Executive Director will make a final determination on the application. Each year during the annual budget review, the Executive Director/CEO shall submit to the Board of Directors a summary of awards made during the prior fiscal year.

History

Authority: AS 18.56.088(c)(6)AS 18.56.090(b)
Eff. 5/14/97, Register 142

15 AAC 154.440 Eligible expenditures

(a) A grantee may expend funds granted under a capital grant only for the purchase, construction or rehabilitation of emergency shelter or transitional housing facilities or for the purchase of furnishings or appliances for such facilities.

(b) A grantee may expend funds under an operating grant for non-capital expenses reasonably necessary to operate an emergency shelter, a transitional housing facility, or a program that includes case management and social services related to homeless prevention and/or permanent housing placement.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/14/97, Register 142; am 10/20/2009, Register 193

15 AAC 154.450 Community emergency grants

(a) The Corporation will, in its discretion, make grants to a municipality, or to a nonprofit corporation designated by the municipality, to meet the emergency housing needs of homeless and near-homeless persons in an area declared to be a federal or state disaster area. The Corporation may not make more than one community emergency grant in a community during a fiscal year.

(b) Community emergency grant funds may be used for both capital or operating expenses.

(1) a description and supporting evidence of the emergency that has adversely affected housing conditions in the applicant's community;

(2) a description of the applicant's experience in providing housing services;

(3) a narrative plan describing the services the applicant intends to provide, including the date for completion of the grant;

(4) a proposed budget including a statement identifying all other funding sources by amount, source and anticipated commitment dates for each source;

(5) the signature of a municipal official with authority to apply for the grant or, if the applicant is a nonprofit corporation, a copy of the agreement between the municipality and nonprofit corporation designating it as the municipality's representative; and

(6) if the applicant has previously received a grant under this section, evidence that the emergency is materially different from the emergency for which the prior grant was made.

(d) Staff shall evaluate a community emergency grant application for completeness and forward the application to the Executive Director/CEO with its recommendation. The Executive Director/CEO shall make a final determination on the application.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/14/97, Register 142; am 10/20/2009, Register 193

15 AAC 154.460 Definitions

For the purposes of 15 AAC 154.400 - 154.450 the following terms have the following meanings:

(1) "administrative costs" means

(A) salaries, wages and related costs for grantee staff whose primary responsibilities involve program administration, developing systems for ensuring compliance with program requirements, preparing reports and other documents related to the Homeless Assistance Program, performance of financial management responsibilities related to the grant and coordinating the resolution of audit and/or monitor findings;

(B) administrative services performed under third party contracts or agreements such as accounting services and audit services; and

(C) public information activities, such as notices for predevelopment permit hearings or notices to announce availability and eligibility criteria for homeless services;

(2) "community emergency" means any occasion or instance for which, in the determination of the Governor, additional assistance is needed to supplement local efforts and capabilities to save lives and to protect property and public health and safety, or to lessen or avert the threat of catastrophe in any part of Alaska;

(3) "furnishings" means essential items which must be supplied to housing to make it habitable, including items such as beds, dressers, tables and chairs;

(4) "homelessness" means the state of an individual who lacks a fixed, regular, and adequate nighttime residence, and includes an individual who

(A) is sharing the housing of other individuals because of loss of housing, economic hardship, domestic violence, or a similar reason;

(B) is living in a motel, hotel, trailer park, or camping ground because of the lack of alternative adequate accommodations;

(D) is abandoned in a hospital;

(E) is waiting for a foster care placement;

(F) has a primary nighttime residence that is a public or private place not designed for or ordinarily used as a regular sleeping accommodation for human beings;

(G) is living in a car, a park, a public space, an abandoned building, substandard housing, a bus or train station, or a similar setting;

(H) is fleeing a domestic violence situation, does not have an alternative residence, and lacks the resources and support needed to obtain housing;

(I) is being evicted within a week, does not have an alternative residence, and lacks the resources and support needed to obtain housing; and

(J) is being discharged within a week from an institution, including a mental health treatment facility, substance abuse treatment facility, or prison, in which the individual has been a resident for more than 30 consecutive days, does not have an alternative residence, and lacks the resources and support needed to obtain housing;

(5) "homeless prevention services" means actions taken to prevent persons who are in imminent danger of becoming homeless from losing a place of abode, including payment of past due rent or mortgage payments; payment of water, sewer, heating fuel or electric utility bills;

(6) "housing placement services" means actions taken to assist homeless persons to obtain permanent housing in facilities not operated by the grantee and includes but is not limited to payment for security deposits, utility deposits or first month's rent;

(7) "social services" means the provision of food, food supplies and other household goods and supplies; child care for homeless families while in shelter or transitional housing; and other services designed by the applicant and approved by AHFC to meet the special needs of the homeless and near homeless;

(8) "transitional housing" means temporary supportive housing provided by the grantee to assist homeless persons to obtain permanent housing within 24 months and includes non-profit hotels/motels which specifically target homeless persons in their policies.

History

Authority: AS 18.56.088; AS 18.56.090
Eff. 5/14/97, Register 142; am 10/20/2009, Register 193

Authority: AS 18.55.100; AS 18.56.088
Eff. 6/11/96, Register 139; am 6/18/2008, Register 187

Article 9 Other Grant Programs

15 AAC 154.900 Grant Programs

15 AAC 154.900. Grant programs described in other chapters. (a) In addition to the grant programs described in this chapter, the Corporation conducts the following grant programs that are described in the chapters of the Corporation's regulations indicated below: (1) home energy loan subsidy grants (15 AAC 155.210 - 15 AAC 155.280); (2) home energy rating rebate grants (15 AAC 155.300 - 15 AAC 155.350); and (3) low-income residential energy efficiency and retrofit grants (15 AAC 155.410 - 15 AAC 155.470). (b) In addition to the grant programs described in 15 AAC 154.900(a), the Corporation participates in the HOME program funded through HUD in accordance with HUD requirements.

History

Authority: AS 18.55.100; AS 18.56.088
Eff. 5/7/93, Register 130

15 AAC 154.910 Grant Programs

15 AAC 154.910. Selection of co-applicants. The Corporation may select a co-applicant for a federal grant application through informal solicitation procedures approved by the executive director.

History

Authority: AS 18.55.100; AS 18.56.088
Eff. 9/23/97, Register 145

Chapter 155 AHFC Energy Efficiency and Conservation Programs

Article 1 Building Energy Efficiency Standard

15 AAC 155.010 Adoption of energy standard and amendments

The International Energy Conservation Code of 2018, with Alaska-specific amendments dated November 28, 2018, which are adopted by reference, shall constitute the building energy efficiency standards for Alaska. The standards apply to buildings whose construction began on or after January 1, 2019, and establish criteria for a building's thermal envelope and other mandatory energy efficiency measures for residential and commercial buildings subject to the requirements of AS 46.11.040.

History

Authority: AS 18.56.088; AS 18.56.855; AS 46.11.900 AS 18.56.096; AS 46.11.040
Eff. 5/7/93, Register 130; am 12/16/93, Register 130; am 2/1/2002, Register 161; am 11/8/2006, Register 182; am 2/9/2010, Register 194; am 3/9/2011, Register 204; am 4/3/2013, Register 209; am 6/18/2014, Register 212; am 11/28/2018, Register 229

15 AAC 155.020 Applicability of standard; exemptions

(a) The standard adopted in 15 AAC 155.010 applies to:

(1) a residential building, the construction of which began after December 31, 1991, that receives state financial assistance; or

(2) a community-owned building, the construction of which began after December 31, 1991, that is constructed, improved, purchased, or used with state financial assistance, other than under AS 29.60.010 - 29.60.375 and AS 29.60.450 - 29.60.599.

(b) The standard does not apply to a building that is:

(1) in a community, or a part of a community, exempted from the standard by the Corporation under (c) of this section; or

(2) provided to temporarily meet an emergency need due to fire, flood, or other natural disaster.

(c) Upon a request under (d) of this section, the executive director will determine whether a community, or a part of a community, is exempt from meeting the standard adopted in 15 AAC 155.010. The executive director will grant an exemption if the executive director determines that the cost of heating fuel in the community, or a part of the community, does not economically justify the estimated cost to meet the standard using a life-cycle cost analysis.

(d) A community may request an exemption, and may appeal any denial of an exemption in the following manner:

(1) a request must be sent in writing to the executive director and must include information necessary to support the request; the request must be signed by an individual authorized to sign for the community;

(2) the executive director will send his or her decision to the requester; the decision will be sent by certified mail within 60 days after either receipt of the request or the executive director's finding that the necessary information has been included, whichever is later;

(3) on the community's behalf, the requester may appeal the executive director's decision under 15 AAC 150.210.

History

Authority: AS 18.56.088; AS 46.11.040 AS 18.56.096(c)AS 46.11.900
Eff. 5/7/93, Register 130; am 2/1/2002, Register 161

15 AAC 155.030 Compliance with the standard

(a) A building complies with the standard adopted in 15 AAC 155.010 if:

(1) the building has been rated by an energy rater under Chapter 4, Section 404 of the energy standard and has been assigned an energy rating of "four-star", "four-star plus", "five-star", or "five-star plus" using the Alaska Home Energy Rating System established under 15 AAC 155.510 - 15 AAC 155.560; however, a building constructed after December 31, 1994 must be assigned a "four-star plus" or higher rating in order to comply with the standard;

(2) an authorized inspector certifies in writing, in a format provided by the Corporation, that the building conforms to that standard. For purposes of this paragraph, an "Authorized Inspector" means a person who:

(A) is a licensed architect, a licensed engineer, or an individual who is registered under AS 08.18 to perform home inspections for new construction who has satisfied the requirements of (c) of this section; or

(B) a licensed mechanical contractor who has satisfied the requirements of (c) of this section, except that such a person may only certify compliance with the ventilation requirements of the energy standard;

(3) a certificate of occupancy or of compliance with a municipal building code has been issued for a building constructed after the building code of the municipality was determined by the executive director, under 15 AAC 155.030(d) to meet or exceed the standard adopted in 15 AAC 155.010;

(4) the building has been certified by the builder as complying with the standard under the provisions of 15 AAC 155.040;

(5) the building qualifies for financing under 15 AAC 151.600, relating to nonconforming housing, and has an energy rating, rated by an energy rater under Chapter 4, Section 404 of the energy standard, that is acceptable to the Corporation, or

(6) the Corporation determines that the documented proof of compliance with 15 AAC 155.010 by one or more individual units in a condominium building and other evidence demonstrates compliance with 15 AAC 155.010 by one or more other individual units in the condominium building which lack documented proof of compliance.

(b) Compliance with ventilation requirements may be certified separately from the certification of compliance with other requirements of the energy standard.

(c) In order to certify compliance with the standard under (a)(1), (a)(2), or (a)(4) of this section, a person must provide documentation to the Corporation showing that (1) the person has completed training approved by the Corporation in cold-climate home building, (2) the person has, within the last two years, completed training approved by the Corporation in BEES ventilation requirements, and (3) the person has successfully passed any testing required by the Corporation.

(d) A municipality may request from the executive director a determination of whether the municipality's building code meets or exceeds the standard adopted in 15 AAC 155.010. The request must include a copy of the applicable portions of the municipal building code and will be acted on as follows:

(1) the executive director will send a determination on the request to the municipality by certified mail within 60 days after receipt of the request; and

(2) a municipality may appeal the executive director's determination under 15 AAC 150.210.

(e) If the executive director determines under 15 AAC 155.030(d) that a municipality's building code does not meet or exceed the standard adopted in 15 AAC 155.010, the municipality may submit another request under 15 AAC 155.030(d) when the municipal code has been changed to bring it into compliance with that standard.

(f) Repealed 1/31/2018.

History

Authority: AS 18.56.088; AS 46.11.040 AS 18.56.096; AS 46.11.900
Eff. 5/7/93, Register 130; am 2/1/2002, Register 161; am 12/14/2005, Register 179; am 11/8/2006, Register 182; am 9/28/2011, Register 204; am 1/31/2018, Register 226

15 AAC 155.040 Self-certification by builder

The builder of a residential building who satisfies the requirements of 15 AAC 155.030(c) may certify to the Corporation that the building complies with the energy standard adopted under 15 AAC 155.010. The builder's certification must state that the builder constructed or directly supervised the construction of the building and has personal knowledge that the building complies with the standard.

History

Authority: AS 18.56.088; AS 18.56.096; AS 46.11.040
Eff. 2/1/2002, Register 161

Authority: AS 18.56.088; AS 18.56.410; AS 18.56.850
Eff. 5/7/93, Register 130

Authority: AS 18.56.088; AS 18.56.410; AS 18.56.850
Eff. 5/7/93, Register 130

Authority: AS 18.56.088; AS 18.56.850
Eff. 5/7/93, Register 130; am 4/30/2008, Register 186; am 7/17/2008, Register 187

Authority: AS 18.56.088; AS 18.56.096; AS 18.56.850
Eff. 5/7/93, Register 130; am 2/1/2002, Register 161; am 2/9/2010, Register 194

Authority: AS 18.56.088; AS 18.56.090; AS 18.56.855
Eff. 7/14/2010, Register 204; am 12/3/2025, Register 257

Article 9 Definitions

15 AAC 155.990 AHFC Energy Efficiency and Conservation Programs

15 AAC 155.990. Definitions. In 15 AAC 155.010 - 15 AAC 155.990, (1) "administrative costs" means indirect costs for a non-profit organization or local government with a federally assigned indirect rate and for other entities costs identified in the grant or contract such as office rental, telephone, supplies, computer, and administrative personnel; (2) "director" means the director of the rural housing division in the Corporation; (3) "division" means the rural housing division in the Corporation; (4) "dwelling unit" means a house, including a stationary mobile home, an apartment, a group of rooms, or a single room occupied as separate living quarters which provide complete independent living facilities for one or more persons, including permanent provisions for sleeping, cooking, and eating; "dwelling unit" does not include a motorized vehicle, a travel trailer, a hotel room, a bed & breakfast, or a housekeeping unit leased or maintained by the United States for employee or military housing; (5) "elderly person" means a person who is 60 years of age or older; (6) "energy rating" means the star rating determined for a residential building by a person who is currently certificated under, and who uses forms and procedures in accordance with, the Home Energy Rating System in 15 AAC 155.510 - 15 AAC 155.560; there are 11 different ratings, with "one-star" as the lowest rating and "six-star" as the highest rating; (7) "grantee" means the entity or person named in the grant award as a recipient; (8) "household income" means the total cash receipts from all sources of each occupant who is not a dependent, full-time student and who resides in a dwelling unit with specific allowances as determined by the corporation; it: (A) includes alimony, assistantships, dividends excluding Alaska Permanent Fund dividends, fellowships, government employee pensions, grants, interest, longevity bonus payments from the state, military family allotments, net gambling or lottery winnings, net receipts from self-employment (i.e. net business income), periodic receipts from estates or trusts, private pensions, railroad retirement, regular insurance or annuity payments, regular support from an absent family member or someone not living in the household, net rental income, net royalties, social security (without exemption for dependent students), strike benefits from a union, training stipends, unemployment compensation, wages and salaries before any deductions, worker's compensation, and veterans' payments (without exemption for dependent students); and (B) does not include assets drawn down such as a bank withdrawal, Alaska longevity bonus, Alaska permanent fund dividend, capital gains, child support, compensation for injury, dependent student income (earnings of full-time high school students or post-secondary students enrolled for at least 12 credit hours), dividends not exceeding $2,000 per individual from a Native Corporation (Public Law 100-241) federal non-cash benefits (such as Medicare, Medicaid, Food Stamps, school lunches, and housing assistance), food or rent received in lieu of wages, gifts, grants or loans to a student, JTPA payments, LIHEAP payments, loans, lump-sum inheritances, non-cash benefits such as employee fringe benefits, one-time insurance payments, payment for foster children or foster care adults, sale of assets such as property or vehicle, scholarships for college or university, and tax refunds; (9) "life-cycle cost" has the meaning provided in AS 46.11.900; (10) "program" means the Home Energy Conservation and Weatherization Program in 15 AAC 155.410 - 15 AAC 155.480, the home energy loan subsidy program in 15 AAC 155.210 - 15 AAC 155.280, the home energy rating rebate program in 15 AAC 155.300 - 15 AAC 155.350, and the energy rated homes of Alaska program in 15 AAC 155.500 - 15 AAC 155.560; (11) "residential building" means a building with dwelling units intended primarily to provide dwelling accommodations, but does not include a mobile home; (12) "standards" means the thermal and lighting energy standards as defined in AS 46.11.900(8)(A)(ii) and AS 46.11.900(8)(B)(ii) and titled the Building Energy Efficiency Standard, amended April 3, 2013, and adopted by reference in 15 AAC 155.010; (13) "state," notwithstanding the definition at 15 AAC 150.900, means the State of Alaska and all state agencies including a department, institution, board, commission, division, authority, public corporation, committee, or other administrative unit of the executive, judicial, or legislative branch of state government, including the University of Alaska, the Alaska Aerospace Corporation, and the Alaska Railroad Corporation; (14) "state financial assistance" has the meaning provided in AS 46.11.900 but does not include assistance provided under 15 AAC 155.410 - 15 AAC 155.480; for purposes of this definition, the Corporation is considered a part of the state; (15) "substantially complete" means that a building has all of the normal integral parts, including foundation, floor, walls, roof, windows, doors, and permanent heating system; and (16) "thermal envelope" means the space in a building that is contained within the building's wall, roof, and floor or crawl spaces and that separates the building's heated space from unheated spaces, the ground, or the outdoors.

History

Authority: AS 18.56.088; AS 18.56.410; AS 46.11.040 AS 18.56.096; AS 18.56.850; AS 46.11.900
Eff. 12/16/93, Register 130; am 4/30/2008, Register 186; am 7/17/2008, Register 187; am 3/9/2011, Register 204; am 4/3/2013, Register 209

Chapter 160 Authorized Games of Chance and Skill

Article 1 Permits and Licenses

15 AAC 160.010 Permit required

(a) A municipality or qualified organization that seeks to conduct an activity permitted under AS 05.15 shall apply to the department for a permit.

(b) If a suborganization of a parent qualified organization seeks to conduct an activity permitted under AS 05.15, the suborganization shall apply to the department for its own permit. The suborganization itself must meet the requirements of AS 05.15 and this chapter in order to receive a permit; the suborganization cannot rely solely on the issuance of a permit to the parent qualified organization.

History

Authority: AS 05.15.020; AS 05.15.095; AS 05.15.140 AS 05.15.040; AS 05.15.100 AS 05.15.060; AS 05.15.130
Eff. 7/30/94, Register 131

15 AAC 160.020 Permit application

(a) An applicant for a new permit shall submit to the department

(1) a completed original application on a form prescribed by the department;

(2) the annual permit fee required under AS 05.15.020;

(3) if incorporated, a certified copy of the applicant's articles of incorporation;

(4) if a partnership, a copy of the applicant's partnership agreement;

(5) a copy of the applicant's bylaws and copies of the applicant's national and state charters, if any; bylaws and charters must contain a dissolution clause that provides for the disposition of net proceeds from charitable gaming conducted under this chapter to a permittee, other than a multiple-beneficiary permittee;

(6) a certification, to be provided on the application form, that the applicant has at least 25 members who are state residents under AS 01.10.055, and a list of at least 25 names of current members who are certified to be members and state residents, including the names of the member in charge and each alternate member in charge; if more than 25 current members are certified to be members and state residents, a partial list may be provided if it gives at least 25 names, including the member in charge and each alternate member in charge;

(7) if exempt from federal income tax under 26 U.S.C. 501(c), as amended through October 24, 1992, an Internal Revenue Service certificate or letter of tax exemption; and

(8) documents demonstrating that the applicant has been in existence continually for a period of at least three years immediately before the date of application.

(b) An applicant for a renewed permit shall submit to the department

(1) a completed original application on a renewal form prescribed by the department;

(2) the annual permit fee required under AS 05.15.020;

(3) if incorporated, a certified copy of the changes to the applicant's articles of incorporation since the permit was last issued;

(4) if a partnership, a copy of any changes to the applicant's partnership agreement since the permit was last issued;

(5) copies of any changes to the applicant's bylaws, and national and state charters, since the permit was last issued;

(6) a certification that the applicant has at least 25 members in this state; and

(7) if exempt from federal income tax under 26 U.S.C. 501(c), as amended through October 24, 1992, an Internal Revenue Service certificate or letter of tax exemption, if not already submitted to the department under (a) of this section.

(c) An applicant for a permit that is a municipality, school, or university is exempt from the requirement to submit the information under (a)(6) or (b)(6) of this section.

(d) An applicant for a permit shall retain a copy of an application submitted under (a)(1) or (b)(1) of this section for three years after the date that the application is submitted to the department.

(e) An applicant for a permit, that is not a municipality, shall accomplish the notice required under AS 05.15.030(a) by submitting one copy of the application submitted under (a)(1) or (b)(1) of this section to the city or borough nearest to each location in which the applicant seeks to conduct an activity permitted under AS 05.15. If the applicant proposes activity in an area served by both a city and a borough, the applicant may choose which of the two will receive notice of the application.

History

Authority: AS 05.15.020; AS 05.15.060; AS 05.15.120 AS 05.15.030; AS 05.15.095; AS 05.15.140 AS 05.15.040; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; am 9/3/2005, Register 175; am 6/22/2008, Register 186

15 AAC 160.030 Operator's license application

(a) An applicant for an operator's license shall submit to the department

(1) a completed original application on a form prescribed by the department, containing only accurate and complete information; and

(2) proof of liability insurance satisfactory to the department in the amounts specified in 15 AAC 160.210 for each location in which the applicant seeks to conduct an activity permitted under AS 05.15.

(b) The department may accept lienable property located in the state as a security posted under AS 05.15.122(b)(5) if

(1) the applicant is unable to post another form of bond or security satisfactory to the department;

(2) repealed 11/10/96;

(3) the applicant's equity in the property

(A) is at least two times the amount specified in AS 05.15.122(b)(5), as shown in a current, written valuation appraisal from a certified real estate appraiser authorized under AS 08.87, certifying that the property satisfies the conditions of this subparagraph; in this subparagraph, "valuation appraisal" has the meaning; given in AS 08.87.900; and

(B) and at all times remains at least two times the amounts specified in AS 05.15.122(b)(5); and

(4) for renewal applications filed on or after June 22, 2008, the applicant obtains a current, written valuation appraisal every five years from a certified real estate appraiser authorized under AS 08.87, certifying that the property satisfies the conditions of (3) of this subsection; however, the department may require an annual valuation appraisal if the department has reason to believe that the property no longer has the value attributed to it by the most recent appraisal on file with the department; in this paragraph, "valuation appraisal" has the meaning given in AS 08.87.900.

(1) meets the requirements of AS 05.15.167(a);

(2) will be in effect for two years after the date the operator's license expires; and

(3) if a certificate of deposit, is in the name of the state in trust for the applicant and is accompanied by a completed assignment of negotiable instrument form prescribed by the department.

(d) An applicant for an operator's license shall retain a copy of the application for three years after the date that the application is submitted to the department.

(e) An applicant for an operator's license, that is not a municipality, shall accomplish the notice required under AS 05.15.030(a) by submitting one copy of the application described under AS 05.15.122(b) to the city or borough nearest to each location in which the applicant seeks to conduct an activity permitted under AS 05.15. If the applicant proposes activity in an area served by both a city and a borough, the applicant may choose which of the two will receive notice of the application.

(f) If an applicant is a natural person and seeks reinstatement of an operator's license that has been revoked, the applicant must retake the test required by AS 05.15.122(b). If an applicant is a municipality or qualified organization and seeks reinstatement of an operator's license that has been revoked, the applicant must designate a municipal employee or member of the organization to retake the test required by AS 05.15.122(b), if the designated individual has taken the test before, or to take the test, if the designated individual has not taken the test before.

(g) A natural person applying for an operator's license, or an individual designated under AS 05.15.122(b) by a municipality or qualified organization, must be at least 21 years of age.

History

Authority: AS 05.15.030; AS 05.15.100; AS 05.15.167 AS 05.15.060; AS 05.15.122 AS 05.15.095; AS 05.15.165
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 6/22/2008, Register 186

15 AAC 160.040 Pull-tab manufacturer's license application

An applicant for a pull-tab manufacturer's license under AS 05.15.181 shall submit to the department

(1) a completed original application on a form provided by the department; and

(2) the fee required under AS 05.15.181(b).

History

Authority: AS 05.15.060; AS 05.15.181
Eff. 7/30/94, Register 131

15 AAC 160.050 Pull-tab distributor's license application

(a) An applicant for a pull-tab distributor's license under AS 05.15.183 shall submit to the department

(1) a completed original application on a form prescribed by the department; and

(2) the fee required under AS 05.15.183(b).

(b) For a new application filed on or after June 22, 2008, an applicant for a distributor license must be at least 21 years of age.

History

Authority: AS 05.15.060; AS 05.15.183
Eff. 7/30/94, Register 131; am 6/22/2008, Register 186

15 AAC 160.060 Monte Carlo activity permit

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.070 Application amendments

(a) If information provided in an original or amended application for a permit, registration, or license changes, the applicant, permittee or licensee shall submit to the department an amended application that indicates the changed information, and request reissuance of the permit, registration, or license, as applicable.

(b) Until the department issues the new permit, registration, or license, the permittee or licensee may conduct only those activities allowed under the existing permit, registration, or license.

(c) Upon receipt of a reissued permit, registration, or license, the permittee, registered vendor, or licensee shall immediately destroy the existing permit, registration, or license, or return it to the department.

(d) Amended applications under (a) of this section must be filed with the department within 10 days after the change and on a form provided by the department.

(e) An applicant for a permit or license that amends its application under (a) of this section shall immediately provide each notice required under AS 05.15.030.

History

Authority: AS 05.15.030; AS 05.15.100; AS 05.15.183 AS 05.15.040; AS 05.15.122; AS 05.15.188 AS 05.15.060; AS 05.15.145
Eff. 7/30/94, Register 131; am 9/3/2005, Register 175

15 AAC 160.075 Addresses

(a) A permittee, registered vendor, or licensee shall maintain a current mailing address on file with the department at all times. The current mailing address on file for a permittee, registered vendor, or licensee is the address of the permittee, registered vendor, or licensee for official communications, notifications, and service of legal process.

(b) A permittee, operator, or distributor shall maintain a current physical address on file with the department at all times for each location at which

(1) bingo or pull-tab activities are conducted; or

(2) gaming records are maintained.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.183 AS 05.15.100; AS 05.15.145; AS 05.15.188
Eff. 9/3/2005, Register 175

15 AAC 160.080 Supplemental information

If the information submitted on the application required under this chapter is incomplete, inconsistent, or leads the department to reasonably believe that a violation of AS 05.15 or this chapter has occurred or will occur, if the permit or license is issued, the department will, in its discretion, require the applicant to submit additional information to complete the investigation or to evaluate the application.

History

Authority: AS 05.15.020; AS 05.15.060; AS 05.15.130 AS 05.15.030; AS 05.15.095; AS 05.15.140 AS 05.15.040; AS 05.15.100
Eff. 7/30/94, Register 131

15 AAC 160.090 Departmental consideration of local government unit protest

The department will consider a protest by a local government unit under AS 05.15.030(a) if the protest is filed with the department within 15 calendar days from the date the department receives the application.

History

Authority: AS 05.15.030; AS 05.15.060
Eff. 7/30/94, Register 131

15 AAC 160.100 Fingerprints

(a) If in the course of an investigation under AS 05.15 and this chapter the department determines that fingerprints are necessary to further the investigation, the department will, in its discretion, request a clear set of fingerprints from a member in charge or an alternate member in charge of a permittee, a licensee, a registered vendor, or their employees. A person shall submit the fingerprints on a form approved by the department within ten days of the request.

(b) The department will, in its discretion, submit fingerprints obtained under (a) of this section to the identification division of the Federal Bureau of Investigation and to the Department of Public Safety.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.181 AS 05.15.100; AS 05.15.140; AS 05.15.183 AS 05.15.105; AS 05.15.145
Eff. 7/30/94, Register 131

15 AAC 160.110 Issuance, renewal, or denial of permit or license

(a) Upon approval of an application and other materials required for a permit or license under AS 05.15 and this chapter, the department will issue the permit or license. If the applicant does not meet the requirements for a permit or license under AS 05.15 and this chapter, the department will deny the permit or license in a written notice to the applicant. The department may deny a permit or license for the same grounds for which it could be revoked or suspended under AS 05.15 or this chapter.

(b) An applicant for a permit or license under AS 05.15 may not conduct an activity permitted under AS 05.15 until the permit or license has been issued by the department and is posted at the location of the activity in a manner that is clearly visible to the public.

(c) A permit or license under AS 05.15 is valid for the calendar year for which it is issued unless it is suspended or revoked by the department.

(d) Repealed 9/3/2005.

(e) Repealed 11/10/96.

(f) If a permittee's or an operator's renewal application, annual filing fees, and completed tests required under AS 05.15.112 and 05.15.122 are received by the division before December 15 of the year before the calendar year for which the permit or license is sought, and the renewal application is complete in all substantial respects, the department will issue to the permittee or operator a temporary permit or license effective January 1 through February 15 of the new permit or license year, unless the department has found the same grounds for which the permit or license could be revoked or suspended under AS 05.15 or this chapter. A temporary multiple-beneficiary permit will apply only to those member permittees that were members before the filing of the renewal application. The issuance of a temporary permit or license does not preclude the department from denying renewal or taking any other action relative to the suspension or revocation of a permit or license as may be authorized by statute or regulation.

(g) Repealed 9/3/2005.

(h) If a permit or license application, other than an application for renewal, is denied, the applicant may request an informal conference within 30 days after the mailing of the notice of denial. The applicant may request an informal conference by filing a brief statement why the person is aggrieved by the denial. After receipt of a request for informal conference, the department will apply the procedures of 15 AAC 05.020, to the extent consistent with this chapter. If the applicant files a request for informal conference, and if the informal conference decision upholds the denial, an aggrieved applicant may request a formal hearing under 15 AAC 160.910.

History

Authority: AS 05.15.040; AS 05.15.100; AS 05.15.122 AS 05.15.060; AS 05.15.112
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.120 Transfer of license prohibited

A license issued under AS 05.15 is not transferable.

History

Authority: AS 05.15.060; AS 05.15.181 AS 05.15.122; AS 05.15.183
Eff. 7/30/94, Register 131

15 AAC 160.140 Surrender of license upon suspension or revocation

If the department suspends or revokes a license, the licensee shall immediately surrender the license to the department upon notification of the suspension or revocation. A license is not valid beyond the effective date of the suspension or revocation, whether surrendered or not to the department, except if under appeal with the department.

History

Authority: AS 05.15.060; AS 05.15.128; AS 05.15.181 AS 05.15.122; AS 05.15.170; AS 05.15.183
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.150 Notification of change in name or legal status

Repealed.

History

Eff. 7/30/94, Register 131; repealed 1/1/2003, Register 164

15 AAC 160.160 No prorating of fees

The department will not prorate a permit fee or license fee or license fee paid under AS 05.15.

History

Authority: AS 05.15.020; AS 05.15.060; AS 05.15.181 AS 05.15.040; AS 05.15.122; AS 05.15.183
Eff. 7/30/94, Register 131

15 AAC 160.170 Refund of fees

The department will refund a permit or license fee paid under AS 05.15 if

(1) the applicant notifies the department in writing within 10 calendar days from receipt of the application by the department that the application is being withdrawn; and

(2) at the time of notification, the department has not issued the permit or license.

History

Authority: AS 05.15.020; AS 05.15.060; AS 05.15.181 AS 05.15.040; AS 05.15.122; AS 05.15.183
Eff. 7/30/94, Register 131

15 AAC 160.180 Deadline for permit or license renewal application

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

Article 2 Operators

15 AAC 160.190 Operator's license required

(a) A person, municipality, or qualified organization that conducts gaming for a permittee must hold an operator's license under AS 05.15.122, except as provided in (b) of this section.

(b) A person is not required to hold an operator's license to

(1) work in gaming as an employee of a licensed operator or registered vendor;

(2) work in gaming as an employee or a volunteer for a permittee, if the person does not work as a manager of gaming for more than one gaming entity in a calendar year, whether a permittee or multiple-beneficiary permittee;

(3) sell pull-tabs as a registered vendor with an endorsement issued under AS 05.15.188(b); or

(4) sell raffle, classics, dog mushers contest, or fish derby tickets on behalf of a permittee, if the person does not promote, pay expenses for, or otherwise conduct the raffle.

(1) the person's compensation is subject to income tax withholding by the permittee, operator, or registered vendor under federal law;

(2) the wages, indirect compensation, or gifts received by the person from the permittee, operator, or registered vendor are not directly related to the gross receipts or profitability of a specific gaming activity; and

(3) the person has no financial interest in any property sold, leased, or rented to the permittee, operator, or registered vendor for use in conducting gaming activity.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.188
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.200 Change of operator bond or security

If the department determines that the licensee's bond or security posted no longer meets the requirements of AS 05.15.122, AS 05.15.167, and this chapter, the department will require a licensee to change the form of bond or security posted to meet those requirements.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.167
Eff. 7/30/94, Register 131

15 AAC 160.210 Minimum insurance coverage for operators

(a) For purposes of AS 05.15.122(b)(4), an operator's liability insurance is satisfactory to the department if it is in the amount of $100,000 per person and $300,000 per occurrence for each location where the operator conducts an activity permitted under AS 05.15.

(b) An operator shall immediately notify the department in writing if the operator's insurance expires or is discontinued for any reason.

History

Authority: AS 05.15.060; AS 05.15.165 AS 05.15.122; AS 05.15.690
Eff. 7/31/94, Register 131

15 AAC 160.220 Contracts with permittees

(a) In addition to complying with AS 05.15.115, a contract between an operator and an authorizing permittee must include

(1) a termination clause that allows the permittee or operator to terminate the contract upon 30 days notice in writing;

(2) to the extent known at the time the contract is executed, a detailed listing of the rental costs for

(A) facilities by location; and

(B) equipment by location;

(3) the amount of the operator fee;

(4) the name and address of the primary member in charge and alternate member in charge; and

(5) the length of time the primary member in charge and the alternate member in charge have been,

(A) if a qualified organization, a member of the organization or the board of directors; or

(B) if a municipality, an employee of the municipality.

(b) A permittee or an operator shall submit a signed copy of the contract to the department at least 15 days before the planned commencement of gaming activities under AS 05.15 and this chapter.

(c) If a permittee or an operator terminates a contract, the permittee and the operator shall each immediately notify the department in writing of the effective date of the termination of the contract. Upon approval by the department, if a permittee terminates a contract with an operator for non-use of the permit, and shows that the operator did not conduct activity under AS 05.15 for the permittee in the current calendar year, the permittee's prize limits under AS 05.15.180(g) and 15 AAC 160.600(a) are not reduced.

(d) Approval of a contract by the department under AS 05.15.115 constitutes approval as to the form required under AS 05.15.115 and this section only.

(e) Repealed 1/1/2003.

(f) An operator may not contract with a multiple-beneficiary permittee.

History

Authority: AS 05.15.060; AS 05.15.115 AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.230 Operator rental and wage costs

An operator shall separately account for the cost of rental of premises and the cost of the wages of the operator's employees in reports filed under AS 05.15.083 or 05.15.087.

History

Authority: AS 05.15.060; AS 05.15.087 AS 05.15.083; AS 05.15.160
Eff. 7/30/94, Register 131

15 AAC 160.240 Operator's daily summary of activity

An operator's daily summary of activity required under AS 05.15.087(a) must include a daily accounting of the

(1) amount of gross receipts, the value of prizes awarded, and the expenses at each location for each gaming activity conducted during the day on behalf of the permittee;

(2) gross receipts and the value of prizes awarded for each pull-tab series conducted during the day;

(3) date that each pull-tab series conducted during the day was first put into play; and

(4) serial number of each pull-tab series withdrawn from sale during the day.

History

Authority: AS 05.15.060; AS 05.15.087; AS 05.15.100
Eff. 7/30/94, Register 131

15 AAC 160.250 Operator's monthly report to permittee

An operator's monthly report required under AS 05.15.087(a) must include a monthly accounting of the

(1) amount of gross receipts;

(2) value of prizes awarded;

(3) total expenses;

(4) expenses allowable under AS 05.15.160(a)(2)(B); and

(5) net proceeds at each location for each gaming activity conducted during the month on behalf of the authorizing permittee.

History

Authority: AS 05.15.060; AS 05.15.087; AS 05.15.100
Eff. 7/30/94, Register 131

15 AAC 160.260 Operator expenses

Repealed.

History

Eff. 7/30/94, Register 131; am 11/10/96, Register 140; repealed 1/1/2003, Register 164

15 AAC 160.270 Operator payment to permittee

(a) An operator shall pay annually to an authorizing permittee at least

(1) 30 percent of the adjusted gross income, as determined under AS 05.15.128(a)(1), from pull-tab activity conducted on behalf of the authorizing permittee; and

(2) 10 percent of the adjusted gross income, as determined under AS 05.15.128(a)(1), from a gaming activity other than pull-tab activity conducted on behalf of the authorizing permittee.

(b) In determining the amount of the payments required under (a) of this section, net income or losses from one gaming activity conducted by an operator on behalf of a permittee may not be combined with a net income or losses from another gaming activity.

(c) In determining gross income, adjusted gross income, or net proceeds under AS 05.15 and this chapter, losses from bad checks, uncollectible debts, or employee theft or fraud may not be charged by the operator to activities conducted under AS 05.15 and this chapter to calculate payment due a permittee.

History

Authority: AS 05.15.060; AS 05.15.087; AS 05.15.160 AS 05.15.083; AS 05.15.128; AS 05.15.165
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.290 Operator reports to the department

(a) The quarterly report required under AS 05.15.083(a) must be on a form provided by the department and the report must include, for each authorizing permittee on whose behalf gaming activity was conducted during the quarter,

(1) the amount of gross receipts for each gaming activity;

(2) the value of prizes awarded for each gaming activity;

(3) the total value of prizes including donations;

(4) the amount of municipal, state, and federal taxes paid;

(5) the adjusted gross income;

(6) the expenses under AS 05.15.160(a);

(7) the total net proceeds;

(8) other information required by AS 05.15.083(a); and

(9) additional information that the department determines to be necessary to determine the amount of proceeds due the permittee.

(b) The annual report required under AS 05.15.083(b) must be on a form provided by the department. The report must include, for each authorizing permittee on whose behalf gaming activity was conducted during the year,

(1) the amount of gross receipts for each gaming activity;

(2) the value of prizes awarded for each gaming activity;

(3) the expenses under AS 05.15.160(a);

(4) the amount of net proceeds for each gaming activity;

(5) other information required by AS 05.15.083(b); and

(6) additional information that the department determines to be necessary to determine the amount of proceeds due the permittee.

History

Authority: AS 05.15.060; AS 05.15.083
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.300 Ownership of gaming items

(a) If an operator purchases a gaming item and charges it as an expense to an authorizing permittee, the gaming item becomes the property of the permittee at the time of purchase.

(b) If an operator ceases conducting gaming activity on behalf of an authorizing permittee, the operator shall immediately return all gaming items owned by the permittee to the permittee.

(c) As used in this section, "gaming item" includes pull-tabs, equipment, supplies, and other items purchased in connection with gaming activity.

History

Authority: AS 05.15.060; AS 05.15.160
Eff. 7/30/94, Register 131

15 AAC 160.310 Review of financial records

(a) The review of an operator's financial records required under AS 05.15.165(e) must be performed by a certified public accountant licensed under AS 08.04. Multiple-beneficiary permittees authorized under AS 05.15.145 are subject to the same reporting requirements as operators under this section.

(b) An operator or a multiple-beneficiary permittee shall have prepared financial statements that present financial position, results of operations and cash flows of the gaming operations, and notes to the financial statements in accordance with generally accepted accounting principles.

(c) In addition to the financial statements required by (b) of this section, information required in (d) and (e) of this section shall be presented in either the notes to the financial statements or as supplementary information as appropriate. In formation presented as supplementary information shall be subjected to the inquiry and analytical procedures applied in the review of the basic financial statements.

(d) Notes to the financial statements in (c) of this section must include the following disclosures:

(1) method of calculating adjusted gross income;

(2) inventory method concerning bingo and pull-tab supplies and opened and unopened series of pull-tabs.

(e) Supplementary information in (c) of this section must include the following material:

(1) explanation of differences, if any, in methods of financial reporting and reports prepared for this state and the permittees, and reconciliation of any differences in the statement of operations and annual report required under AS 05.15.083(b);

(2) itemized schedule by the permittee showing gross receipts, prizes, taxes, adjusted gross income, payments of net proceeds, and authorized expenses excluding operator fees;

(3) itemized schedule of authorized game related expenses, if not itemized separately in the statement of operations, or in the schedule under (2) of this subsection.

History

Authority: AS 05.15.060; AS 05.15.145 AS 05.15.083; AS 05.15.165
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.320 Demand upon bond or security

Except if under appeal with the department, the department will make demand on a bond or security if an operator refuses to pay an amount due to the department, including taxes, fees, penalties, and interest, or if after demand by an authorizing permittee, an operator refuses to pay otherwise undisputed net proceeds due to the authorizing permittee, the department will make demand on the bond or security posted by the operator under AS 05.15.122(b)(5).

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.167
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.330 Release of bond or security

(a) If the department determines that the requirements of (b) of this section have been met and two years have passed since the final day the operator conducted gaming activity on behalf of an authorized permittee, the department will release the remainder of a bond or security posted under AS 05.15.122(b)(5) in the following situations:

(1) the operator's license expired or was denied, suspended, or revoked;

(2) the operator has requested in writing to the department to release the bond or security.

(b) Before the department releases a bond or security under (a) of this section, the department must first determine that

(1) the operator has filed all reports due under AS 05.15.083, 05.15.087, and 05.15.165(e) and has paid all amounts due the state under AS 05.15; and

(2) repealed 11/10/96;

(3) a claim has not been filed in a court by a permittee against the bond.

(c) The department will, in its discretion, waive the two-year requirement in (a) of this section if each authorizing permittee covered by the bond or security certifies in writing that the permittee is not

(1) due any net proceeds from the operator; and

(2) aware of any violations of AS 05.15 or this chapter by the operator that have not previously been reported to the department.

History

Authority: AS 05.15.060; AS 05.15.087; AS 05.15.165 AS 05.15.083; AS 05.15.122; AS 05.15.167
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

Article 3 Vendors

15 AAC 160.340 Vendor contracts

(a) If a permittee enters into a contract described under AS 05.15.188, the permittee shall submit a copy of the contract to the department for inspection as allowed under AS 05.15.188(f).

(b) In addition to the requirements under AS 05.15.188, a contract between a permittee and a vendor must contain

(1) the beverage dispensary license number or package store license number of the vendor;

(2) a means for determining the amount of compensation to be paid to the vendor under AS 05.15.188(i);

(3) a plan for disposing of the pull-tab series if the permittee or the vendor is prohibited from selling pull-tabs; and

(4) a method for handling receipts for prizes required under AS 05.15.187(i).

History

Authority: AS 05.15.060; AS 05.15.187; AS 05.15.188
Eff. 7/30/94, Register 131

15 AAC 160.350 Registered vendor compensation

(a) A permittee may not pay, and a registered vendor may not accept permittee payment of, any expense incurred by the registered vendor that would cause the permittee to receive, in violation of AS 05.15.188, less than 70 percent of the ideal net of a pull-tab game sold to the vendor. A permittee may not engage in a sales transaction under AS 05.15 or this chapter with a person, whether licensed or not, who sells or provides gaming supplies or equipment to a third party, if the same sale made directly to the third party would result in a prohibited conflict of interest under AS 05.15 or this chapter.

(b) A registered vendor may not participate in a purchase inducement program prohibited by 15 AAC 160.942 or accept, as a gift, as a loan, or for rent at less than fair market value, a pull-tab point-of-sale system or pull-tab dispensing device from a third party, or from a distributor who supplies pull-tab games for a permittee for which the registered vendor sells pull-tab games. A registered vendor may not purchase, rent, or otherwise receive a pull-tab point-of-sale system or pull-tab dispensing device from a permittee even if the registered vendor provides fair market value for the system or device.

(c) A permittee may sell pull-tabs in premises that otherwise qualify as a vendor location, without the business in that premises becoming a registered vendor, and without the permittee receiving the payment required under AS 05.15.188(i) for any pull-tab series that the permittee sells, if

(1) the business is not paid or provided compensation other than lease payments;

(2) the lease is executed in accordance with 15 AAC 160.935(c);

(3) lease payments do not exceed the amount calculated under 15 AAC 160.935(c)(2);

(4) the sale of pull-tabs is conducted in a space separate and distinct from any area where alcoholic beverages are stored or dispensed;

(5) the sale of pull-tabs is conducted by employees or volunteers of the permittee; and

(6) the department has issued a permit for that location.

History

Authority: AS 05.15.060; AS 05.15.188
Eff. 7/30/94, Register 131; am 6/22/2008, Register 186

15 AAC 160.360 Vendor sales areas

A vendor may sell pull-tabs only in an area of an establishment that excludes a person under the age of 21 years unless the person is accompanied by a parent, guardian, or spouse who has attained the age of 21 years.

History

Authority: AS 05.15.060; AS 05.15.188; AS 05.15.690
Eff. 7/30/94, Register 131

Article 4 Multiple-Beneficiary Permits and Self-Directed Permits

15 AAC 160.361 Multiple-beneficiary permits

(a) A municipality or qualified organization must obtain a permit under AS 05.15.020 before applying to become a member of a multiple-beneficiary permittee.

(b) A multiple-beneficiary permittee with fewer than six members may add an additional member by filing an amended application with the department, if the addition of the new member does not result in the multiple-beneficiary permit cumulatively having more than six members in a calendar year.

(c) An application for a multiple-beneficiary permit must include a copy of the joint venture agreement among the members, including the percentage of participation in gross receipts for each member.

(d) A multiple-beneficiary permittee shall allocate taxes, prizes, and expenses in the proportion that it allocates gross receipts among its members, but no member may be allocated a sales tax liability for sales that were not subject to a sales tax.

(e) A multiple-beneficiary permittee may allocate gross receipts, taxes, prizes or expenses to a new member only from the date that the department approves the addition of the new member.

(f) A multiple-beneficiary permittee may not allocate to an individual member permittee more than the annual prize limit for a municipality or qualified organization under AS 05.15.180(g) or 15 AAC 160.600(a).

(g) A multiple-beneficiary permittee shall pay net proceeds to its member permittees on a quarterly basis no later than the end of the month following the end of each calendar quarter.

(h) A multiple-beneficiary permittee may not spend or otherwise dedicate net proceeds except to distribute the net proceeds to its member permittees.

(i) A multiple-beneficiary permittee or its member permittees may not sublease gaming facilities to another multiple-beneficiary permittee or its member permittees at a price higher than that paid by the multiple-beneficiary permittee.

(j) The results of an action taken against a multiple-beneficiary permittee shall apply to the individual permits of those members of the multiple-beneficiary permittee who were members at the time of the violation that was the subject of the action.

(k) The department shall notify the primary member in charge of a multiple-beneficiary permittee regarding a violation by one of its member permittees of AS 05.15 or this chapter.

(l) Individual members of the multiple-beneficiary permittee shall jointly file the annual certified public accountant review required by 15 AAC 160.310(a).

(m) Each member of a multiple-beneficiary permittee must be actively involved in the gaming activities conducted by the multiple-beneficiary permittee, including management oversight, policy setting, and authorization of expenditures.

(n) A multiple-beneficiary permittee may not contract with an operator.

History

Authority: AS 05.15.020; AS 05.15.100; AS 05.15.145 AS 05.15.060; AS 05.15.130; AS 05.15.180
Eff. 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.363 Contributions, loans, and gifts

(a) For use in gaming, an entity that conducts gaming under a self-directed permit may

(1) make a capital contribution from a non-gaming source; and

(2) secure a loan or accept a gift that is not from a gaming source or from a person or entity that is not prohibited from participating in gaming under AS 05.15.105.

(b) A member of a multiple-beneficiary permittee may make a capital contribution or loan from a non-gaming source to the multiple-beneficiary permittee.

(1) accept a capital contribution of non-gaming funds from a member;

(2) secure a loan or accept a gift that is not from a gaming source or from a person or entity that is not prohibited from participating in gaming under AS 05.15.105.

(d) A multiple-beneficiary permittee must notify the department within 10 days after the receipt of a capital contribution from a non-gaming source. The notice must include the name of the contributor, the amount of the contribution, and the date of the contribution.

(e) Except for a loan from a financial institution or a similar entity engaged in the business of making loans, a loan in any amount

(1) must be set out in a written loan agreement provided to the department; and

(2) may not provide for interest in excess of five percentage points above the annual rate charged member banks for advances by the 12th Federal Reserve District on the day that the loan commitment is made.

(f) A permittee or multiple-beneficiary permittee shall notify the department within 10 days of the receipt of a gift, other than a donated prize with a value less than $1,000, for use in gaming. The notice must include the name of the donor, a description of the gift, the amount or fair market value of the gift, and a statement signed and dated by the donor that the gift is irrevocable.

(g) The use of proceeds from a contribution, loan, or gift to purchase assets or to pay for gaming expenses does not change the accounting required by this chapter for gross receipts and expenses of gaming activities. The use of a contribution, gift, or loan to make the requirement for dedication of net proceeds has no effect in the determination of whether the limitation of AS 05.15.160 on expenses or the limitation of AS 05.15 and this chapter on prizes has been exceeded.

History

Authority: AS 05.15.060; AS 05.15.105 AS 05.15.100; AS 05.15.145
Eff. 1/1/2003, Register 164

15 AAC 160.365 Manager of gaming

(a) A multiple-beneficiary permittee, and a permittee that engages in pull-tab sales or bingo under a self-directed permit, must designate the person who is its manager of gaming as defined in 15 AAC 160.995, and must notify the department within 10 days of a designation of a new manager of gaming.

(b) Unless the presumption is rebutted by other evidence, an employee of a multiple-beneficiary permittee or a permittee is presumed to be a manager of gaming if the employee is exempt from AS 23.10.050 - 23.10.150 (Alaska Wage and Hour Act) under AS 23.10.055(9) for reasons other than being a salesman. A multiple-beneficiary permittee's or a permittee's designation of a person as its manager of gaming does not prevent the department from finding a different person to be the actual manager of gaming for the permittee.

(c) In determining who the manager of gaming is, the department will consider the totality of the circumstances, including the person's compensation from all gaming sources, and whether the person is an employee, makes policy, reports to the board of directors, reports to or interacts with the department, acts in a managerial or supervisory capacity, or supervises or evaluates employees who act in a managerial or supervisory capacity.

History

Authority: AS 05.15.060; AS 05.15.130; AS 05.15.145
Eff. 1/1/2003, Register 164

Article 5 Pull-Tab Games

15 AAC 160.370 Pull-tab manufacture

(a) Subject to AS 05.15, a pull-tab manufactured, sold, or distributed in the state must comply with the

(1) Standards on Pull-Tabs of the North American Gaming Regulators Association, as amended as of October 20, 1998 and adopted by reference; and

(2) Pull-Tab Record-Keeping and Reporting Standards of the North American Gaming Regulators Association, dated May 11, 1994 and adopted by reference.

(b) Except as provided under (a) of this section, a pull-tab manufactured, sold, or distributed in the state must

(1) be manufactured so that it is impossible to identify whether it is a winning or losing pull-tab until it has been played by a player as intended:

(2) be manufactured using at least a two-ply paper stock construction so that the pull-tab is opaque;

(3) have an individual serial number and the name of the manufacturer conspicuously printed on the face or cover of the pull-tab; and

(4) display to the player how to open the pull-tab to determine the winning symbols or numbers.

(1) be of the same length, width, and thickness, not varying by more than 3/64 of an inch in any dimension; and

(2) be color coded if an individual serial number is repeated.

(d) A licensed pull-tab manufacturer shall establish its own method of game protection that allows the manufacturer and the department to determine, after the pull-tab has been played, the difference between an authentic winning pull-tab and a non-winning, altered, or forged pull-tab. The manufacturer shall submit to the department a letter explaining the method of game protection used and shall inform the department of any changes in its method of game protection.

History

Authority: AS 05.15.060; AS 05.15.183; AS 05.15.187 AS 05.15.181; AS 05.15.185; AS 05.15.188
Eff. 7/30/94, Register 131; am 9/3/2005, Register 175

15 AAC 160.380 Pull-tab series assembly, packaging, and flare cards

(a) A licensed pull-tab manufacturer shall assemble and package a pull-tab series so that a winning pull-tab or the approximate location of a winning pull-tab cannot be determined before the pull-tab has been played by a player.

(b) A winning pull-tab must be distributed randomly among all other pull-tabs in its series.

(c) A pull-tab series must be packaged and clearly marked on the outside with the name of the licensed pull-tab manufacturer, the pull-tab serial number, and the name of the pull-tab game.

(d) If a pull-tab series is packaged in more than one container, the entire series of individual pull-tabs must be thoroughly mixed and distributed evenly among the containers so that a winning pull-tab, the approximate location of a winning pull-tab, or a concentration of winning pull-tabs cannot be determined before the pull-tab has been played by a player.

(e) With each pull-tab series, and except as provided in (f) of this section, a pull-tab manufacturer shall include a flare card containing

(1) the name or registered trademark of the manufacturer;

(2) the name of the pull-tab series;

(3) the serial number of the pull-tab series;

(4) the number of pull-tabs in the series;

(5) the prize structure, including the number of winning pull-tabs in the series for each prize;

(6) the winning symbols or numbers for each prize in the series; and

(7) the price per pull-tab.

(f) A pull-tab manufacturer may have a seal card serve as a flare card in a pull-tab series, if the seal card meets the requirements of (e) of this section, 15 AAC 160.400, and 15 AAC 160.410 for a flare card.

History

Authority: AS 05.15.060; AS 05.15.183; AS 05.15.187 AS 05.15.181; AS 05.15.185; AS 05.15.188
Eff. 7/30/94, Register 131; am 6/22/2008, Register 186

15 AAC 160.390 Failure to comply

The department will refuse to allow a pull-tab series to be manufactured, sold, or distributed in the state if the series does not comply with AS 05.15 or this chapter, including the standards on pull-tabs of the North American Gaming Regulators Association, as amended from time to time.

History

Authority: AS 05.15.160; AS 05.15.183; AS 05.15.187 AS 05.15.181; AS 05.15.185; AS 05.15.188
Eff. 7/30/94, Register 131

15 AAC 160.400 State identification stamps

(a) The department will issue to a licensed pull-tab manufacturer a set of state identification stamps, imprinted with the same unique state identification number, to be used for identifying and tracking the sale and distribution of a series of pull-tabs.

(b) If a pull-tab series is available to the public for play, the accompanying flare card containing the state identification stamp must be displayed so that the flare card and state identification stamp are clearly visible to the gaming public. The flare card and state identification stamp must be displayed at all times while the pull-tab series is available to the public for play and must be removed when the series has been played out or removed from play for any reason.

History

Authority: AS 05.15.160; AS 05.15.183; AS 05.15.187 AS 05.15.181; AS 05.15.185; AS 05.15.188
Eff. 7/30/94, Register 131

15 AAC 160.410 Manufacturer distribution

(a) A licensed pull-tab manufacturer may distribute only those pull-tabs in this state that the manufacturer designed, constructed, assembled, and packaged.

(b) A licensed pull-tab manufacturer may not distribute a pull-tab series in this state to a licensed pull-tab distributor unless the manufacturer has

(1) affixed a state identification stamp on the face of the flare card accompanying the series of pull-tabs;

(2) included with the pull-tab series the remaining state identification labels from the set for use by the permittee, distributor, or operator, in accordance with other provisions of this chapter; and

(3) recorded the state identification number as required under this chapter.

(d) A licensed pull-tab manufacturer shall affix a packing slip outside of a shipment of pull-tabs to be shipped in this state. The packing slip must contain

(1) the name of the licensed pull-tab manufacturer;

(2) the pull-tab serial number;

(3) the date of packaging of the series;

(4) the name or identification of the person who packaged the shipment; and

(5) the state identification number.

History

Authority: AS 05.15.060; AS 05.15.181; AS 05.15.185
Eff. 7/30/94, Register 131; am 6/22/2008, Register 186

15 AAC 160.420 Distributor distribution

(a) A pull-tab series distributed in this state by a licensed pull-tab distributor must be accompanied by a written invoice. The invoice must include the

(1) name and form number of the series;

(2) pull-tab serial number;

(3) state identification stamp number;

(4) distribution date;

(5) name and permit number or license number of the permittee, operator, or distributor who purchased the series;

(6) amount charged for the series;

(7) face amount of any coins or currency included with the series; and

(8) amount of pull-tab tax required under AS 05.15.184, except when an invoice is from one distributor to another distributor.

(b) A distributor may not distribute a pull-tab series unless the distributor has included with the pull-tab series the state identification stamps.

(c) A distributor must track the pull-tab games distributed and account for all pull-tab games purchased, sold, and in inventory. The inventory data maintained by the distributor must include the manufacturer's serial number, state identification stamp number, description, and form number. The distributor must explain any discrepancy or unaccounted pull-tab games.

History

Authority: AS 05.15.060; AS 05.15.184 AS 05.15.183; AS 05.15.185
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.430 Manufacturer's monthly report

The monthly report required under AS 05.15.181(e) must be submitted on a form provided by the department. The monthly report must include the following information for each pull-tab series distributed in this state by the licensed pull-tab manufacturer since the last required monthly report:

(1) the name and form number of the series;

(2) the pull-tab serial number;

(3) the state identification number;

(4) the name of the licensed pull-tab distributor to whom the series was distributed.

History

Authority: AS 05.15.060; AS 05.15.181
Eff. 7/30/94, Register 131

15 AAC 160.440 Distributor's monthly report

(a) The monthly report required under AS 05.15.183(d) must be submitted on a form provided by the department. The monthly report must include the following information for each pull-tab series distributed by the licensed pull-tab distributor since the last required monthly report:

(1) the name and form number of the series;

(2) the pull-tab serial number;

(3) the state identification number;

(4) the distribution date;

(5) the name of the manufacturer;

(6) the price per pull-tab;

(7) the pull-tab count;

(8) the expected gross pay out of prizes;

(9) the ideal net;

(10) the name of the permittee, operator, or licensed pull-tab distributor to whom the pull-tab series was distributed;

(11) repealed 1/1/2003;

(12) repealed 1/1/2003.

(b) A distributor shall maintain for three years immediately following the end of the calendar year of the sale a record of the price that the permittee or operator paid for each pull-tab series distributed. The distributor is not required to include this information in the monthly report made under AS 05.15.183(d), but must provide it to the department upon request.

History

Authority: AS 05.15.060; AS 05.15.184 AS 05.15.183; AS 05.15.185
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.450 Payment for pull-tabs

Within 30 days of actual delivery of a pull-tab series to a permittee, an operator on behalf of a permittee, or a receiving pull-tab distributor, the permittee, operator, or receiving distributor shall pay to the distributing distributor the full purchase price by check made payable to the distributing distributor.

History

Authority: AS 05.15.060; AS 05.15.184; AS 05.15.185
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.460 Pull-tab tax

(a) The pull-tab tax required under AS 05.15.184 must be collected and paid to the department by the licensed pull-tab distributor that first distributes the pull-tab series to a permittee or an operator on behalf of a permittee.

(b) At the time the licensed pull-tab distributor files the monthly report required under AS 05.15.183(d), the distributor shall pay to the department the pull-tab tax required under AS 05.15.184 that the distributor collected or should have collected since the date the distributor filed its last monthly report.

(c) The pull-tab tax required by AS 05.15.184 shall be calculated on the ideal net of a pull-tab series, as established by the manufacturer, and exclusive of any additional prize that a permittee or operator may award for the last pull-tab sold in a series. A distributor may not add a prize to a pull-tab series for the last pull-tab sold from that series. Any prize awarded by a permittee or an operator for the last pull-tab sold, that is not included in the prize structure for the game as manufactured, when combined with the prize total for that pull-tab, if any, may not exceed the $500 limit in 15 AAC 160.480(a)(3), and any prize for the last pull-tab sold in a series must be reduced appropriately if the aggregate total would exceed $500.

History

Authority: AS 05.15.060; AS 05.15.184
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 11/4/2005, Register 176

15 AAC 160.470 Pull-tab games

(a) The sales price for a pull-tab may not exceed $2.

(b) A permittee, operator, or registered vendor may not sell a pull-tab that is marked, defaced, tampered with, in a condition that may deceive the gaming public, or in a condition that affects the chances of the gaming public winning or losing on that pull-tab. To protect the best interests of the public, a pull-tab series with a prize for the last pull-tab sold may not be combined with another series, even though the combination might be generally allowable under AS 05.15.187(c).

(1) pull-tab prize of $50 or more shall be paid only by cash or check; and

(2) non-cash item may not be awarded as a prize in a pull-tab game.

(d) A pull-tab prize of less than $50 may be traded for other pull-tabs, but must be accounted as a cash prize when preparing a report required under AS 05.15 or this chapter.

(e) A pull-tab series conducted under one permit may not be

(1) combined with a pull-tab series conducted under another permit; or

(2) transferred to another permit.

(f) A mechanical or electronic device may not be used to select the symbols or numbers used to determine the winners of a pull-tab game.

(g) Pull-tabs may not be sold to the public from the original packing box or container unless the container has been designed for retail sales, and the pull-tabs have been properly mixed.

(h) A permittee, operator, or registered vendor shall verify the identity of the individual redeeming winning pull-tabs of $50 or more.

(i) A permittee, operator, or registered vendor shall deface or punch all winning pull-tabs of $50 or more immediately after redemption.

(j) To close a pull-tab series, a permittee or operator may

(1) use pull-tabs from the series as door prizes;

(2) sell pull-tabs from the series at a discount; or

(3) offer a prize for the last pull-tab sold in the series.

(k) A permittee, operator, or registered vendor may not sell pull-tabs to an employee, an officer, a director, a member in charge, an alternate member in charge, a manager of gaming, a person who has access to pull-tab game information or accounting records, or a related party. For purposes of this subsection, a related party includes a direct relative or an affiliate of a person regulated by this chapter.

(l) A permittee, operator, or registered vendor may use a pull-tab dispensing device, with prior approval from the department, to dispense pull-tab games, but shall prohibit players from having direct access to the device.

(m) Unclaimed coins in a coin board must be awarded to the player who buys the last ticket to close out the game, and house rules must govern distribution of any prize behind an unclaimed coin that is awarded to the buyer of the last ticket. The winner of an unclaimed prize in a seal card must be determined from the players in the seal card game under house rules. Any prize or aggregation of prizes awarded under this subsection is subject to the limitation set out in 15 AAC 160.480(a)(3).

(n) For purposes of 15 AAC 160.480(a)(3), a coin in a coin board is valued at face value.

(o) A player may not have any contact with a pull-tab contained in a jar, container, or dispensing device until the permittee, operator, or registered vendor has sold and provided the pull-tab to the player.

History

Authority: AS 05.15.060; AS 05.15.170; AS 05.15.187
Eff. 7/30/94, Register 131; am 1/1/2003, Register 164; am 9/3/2005, Register 175; am 6/22/2008, Register 186

15 AAC 160.480 Limitation on pull-tab sales

(a) A pull-tab may not be sold in this state if

(1) the pull-tab series does not contain the entire prize structure;

(2) the prize structure of the pull-tab series is available at more than one location; or

(3) any prize or the prizes in aggregate on a single pull-tab in the pull-tab series exceed $500.

(b) A person must be 21 years of age or older to sell, purchase, or play a pull-tab.

(d) Repealed 11/10/96.

History

Authority: AS 05.15.060; AS 05.15.187
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.490 Withdrawal and destruction of pull-tab series

A pull-tab series must be withdrawn from sales if

(1) the permittee's prize award limitation, as identified in AS 05.15.180(g), has been reached for the calendar year; if the permittee is authorized to conduct pull-tab activities during the next calendar year, play of the withdrawn pull-tab series must be resumed when the new permit is received or at the beginning of the next calendar year, whichever is later;

(2) the operator stops conducting gaming activity under one permit and begins conducting gaming activity under another permit; if the operator resumes conducting gaming activities under the first permit, the withdrawn pull-tab must be returned to play immediately;

(3) the permittee terminates its contract with the operator; immediately following the date on which the permittee terminates its contract with the operator, the operator shall inventory the pull-tab series and return it, with the state identification stamps, to the permittee; if the permittee or the permittee's new operator resumes pull-tab activities, the withdrawn pull-tab series must be returned to play immediately;

(4) the pull-tabs are lost, stolen, or damaged, as long as the permittee or the operator submits the circumstances of the incident and subsequent withdrawal to the department in writing within ten days of the incident;

(5) the permittee discontinues pull-tab activity; all pull-tabs open for sale and in the possession of the permittee or the operator must be immediately withdrawn and destroyed under department supervision unless the department directs otherwise;

(6) the permittee's permit is suspended, revoked, or not renewed; all pull-tabs open for sale and still in the possession of the permittee or the operator must be immediately withdrawn and destroyed under department supervision unless the department directs otherwise;

(7) the department approves the withdrawal after receiving a written request from the permittee and determining that approval is necessary to protect the best interest of the public; the department will direct the permittee in handling the pull-tab series; or

(8) a manufacturing defect exists in the pull-tab series and the notice requirement under AS 05.15.187(d) is met within 10 days of discovery of the defect; the department will direct the disposition of the pull-tab series.

History

Authority: AS 05.15.060; AS 05.15.187
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

Article 6 Bingo

15 AAC 160.500 Alcohol access and employee play prohibited

(a) A bingo game may not be conducted under a permit in a room, enclosure, or outdoor area where alcoholic beverages are sold, served, or consumed during the process of the bingo game.

(b) A permittee or operator may adopt house rules that prohibit an employee from playing a game of bingo. The caller of a bingo game may not play a game of bingo conducted by the permittee at the location where the caller is working.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.165
Eff. 7/30/94, Register 131; am 1/1/2003, Register 164

15 AAC 160.510 Bingo card sales

(a) A permittee or an operator shall establish the price for each bingo card, set of bingo cards, or packet of bingo cards before the start of sales for a bingo game or session. A bingo card, set of bingo cards, or packet of bingo cards may not be provided to a player for free, on credit, or at a discount, and the same price per card, whether paper or electronic, must be charged to all players.

(b) A bingo card must be sold at the location of the bingo game where it is to be played. The bingo card must be sold during or immediately before the session for which the bingo card is sold. A bingo card may not be sold if the sale allows a player an advantage over another player. The bingo card may only be played during the session for which the bingo card was sold.

(c) A permittee or operator may not reserve a bingo card or unit of electronic bingo paper for use by a particular player or group of players, and must provide bingo cards and electronic bingo paper to all interested players equally, for as long as bingo cards or units of electronic bingo paper are available, except a braille bingo card may be reserved for use by a player who has a vision impairment.

(d) A permittee or an operator that had annual gross receipts in bingo that exceeded $300,000 during the previous calendar year may not use hard cards.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 6/22/2008, Register 186

15 AAC 160.520 Bingo receipting requirements

(a) A permittee or an operator shall provide a bingo sales receipt to a player for the bingo card, set of bingo cards, or packet of bingo cards at the time of initial purchase and payment is received from a player. A permittee or an operator shall retain a copy of the receipt for three years from the date that the receipt was issued.

(b) A permittee or an operator that had annual gross receipts from bingo that exceed $100,000 during the previous calendar year, or who expects to have gross receipts from bingo in excess of $100,000 during the current calendar year, shall issue a sales receipt from a cash register. For purposes of calculating annual gross receipts under this subsection, an operator shall include gross receipts from bingo games conducted for all permittees who have authorized the operator to conduct bingo games on their behalf.

(c) Notwithstanding (b) of this section, a validated bingo sheet may serve in place of a cash register receipt for floor sales.

(d) A player must present the initial bingo sales receipt or validated bingo sheet for the bingo card, set of bingo cards, or packet of bingo cards being played to the permittee or operator in order to be awarded the prize for the bingo game.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.530 Cash register receipts

(a) In providing a cash register receipt under 15 AAC 160.520(b), a permittee or operator shall comply with the following:

(1) a consecutively-numbered receipt from a cash register must be given to the player; the receipt must include the

(A) repealed 11/10/96;

(B) date of sale;

(D) name of the location;

(2) a cash register must have a consecutive four-digit customer receipt number that does not return to zero until at least 9,999 receipts have been printed;

(3) a cash register must have sufficient keys to record separately each type of sale and must provide a total for each type of sale recorded; a cash register must retain these totals between uses even if its power source is interrupted;

(4) repealed 11/10/96;

(5) if a cash register is used by the permittee or operator for purposes other than recording the receipts from bingo, the internal cash register tapes from the other purposes must be retained for the time period required under 15 AAC 160.870(a).

(b) A permittee or an operator that had gross receipts from bingo that did not exceed $100,000 during the previous calendar year, or that expects to have gross receipts that do not exceed $100,000 during the current calendar year, may use a preprinted or handwritten receipt in lieu of the cash register receipt required under 15 AAC 160.520. In providing a preprinted or handwritten receipt, a permittee or an operator shall comply with the following:

(1) the receipt must be consecutively numbered;

(2) the receipt must be in duplicate; the original copy is to be given to the player and the duplicate is to be retained as a bingo record.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.540 Consecutively-numbered ticket receipts

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.550 Consecutively-numbered disposable bingo card receipts

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.560 Disclosure of prizes and procedures

(a) Before bingo card sales begin, a permittee or an operator shall disclose to each player and conspicuously post upon the premises the price collected to play, the house procedures under which prizes may be won, and the list of prizes to be awarded.

(b) If a player wins a prize, the permittee or operator shall announce the number of winners claiming that prize and proceed with the schedule of bingo games.

(c) For each session of bingo conducted by a permittee or an operator, the permittee or operator shall provide to each player a schedule of bingo games to be played and the number and value of prizes to be awarded for each game.

(d) The house rules of the permittee or operator shall be posted in a conspicuous place upon the premises where the bingo game is conducted.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.570 Bingo equipment

(a) "Bingo equipment" means equipment that is made or sold for use in bingo games permitted under AS 05.15. Unless otherwise specified, "bingo equipment" includes a machine or other device from which balls are withdrawn to determine the letters and numbers to be called, the balls themselves, a bingo card, and other devices commonly used in the direct operation of a bingo game.

(b) In conducting a bingo game, a permittee or operator shall use

(1) a device which mixes and allows for random withdrawing of balls to determine the letters and numbers to be called; the device must be constructed in a manner that

(A) allows players to view the mixing action of the balls; and

(B) prevents its operation from being interrupted so as to change the random placement of balls at the exit receptacle of the device, except as provided under 15 AAC 160.590(k);

(2) a set of 75 balls bearing the numbers one through 75; balls one through 15 must bear the letter "B"; balls 16 through 30 must bear the letter "I"; balls 31 through 45 must bear the letter "N"; balls 46 through 60 must bear the letter "G"; balls 61 through 75 must bear the letter "O"; the balls must be the same size, weight, shape, and balance so that at all times during a bingo game each a ball in the device has an equal opportunity of selection; the 75 balls must be available for inspection by the players before a bingo session begins to determine that all are present and meet the requirements of this section; and

(3) manufactured and preprinted bingo cards that have 25 spaces, the center of which may be a free space, arranged in five even columns headed with the letters "B," "I," "N," "G," and "O," respectively; each set of disposable bingo cards must be consecutively numbered from the first card to the last card, or from the first sheet of disposable bingo cards to the last sheet of disposable bingo cards; each bingo card or sheet of disposable bingo cards must have printed on its face both its individual card or sheet number and the series number assigned by the manufacturer to that set of cards;

(A) repealed 11/10/96;

(B) repealed 11/10/96.

(c) A permittee or operator may use a flashboard to display the numbers called. The flashboard must be visible to all players and must clearly indicate all numbers that have been called. If the flashboard malfunctions during a bingo session, it need not be repaired during that session, but it must be repaired before it is used in a later session.

(d) A permittee or operator may use a video camera and display for the benefit of the players and for bingo card winner verification.

(e) Electronic or computerized bingo devices are prohibited, except those devices that qualify as "electronic bingo paper" and have been approved for use by the department.

(f) Bingo cards that may be played without the calling of balls, sometimes known as "instant bingo," are prohibited.

(g) If two or more sets of disposable bingo cards share a common series number, only one set may be played at a time at a session.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.580 Allowable number of bingo sessions and games

(a) A permittee who conducts bingo on its own behalf without the services of an operator may conduct up to 14 bingo sessions in a calendar month. An operator who conducts bingo games on behalf of a permittee may conduct up to 11 bingo sessions in a calendar month.

(b) The holders of a multiple-beneficiary permit under AS 05.15.100(d) may conduct a maximum of 14 bingo sessions per holder in a calendar month.

(d) Bingo sessions are limited to four sessions within a 24-hour time frame.

(e) If more than a single bingo session is conducted within a 24-hour time frame, at least a one-hour break must be held between each bingo session being conducted.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.145
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 9/3/2005, Register 175

15 AAC 160.590 Conduct of bingo games

(a) A permittee or operator may not conduct bingo activity

(1) with an intent to defraud, as defined in AS 11.46.990; or

(2) in deception, as defined in AS 11.81.900.

(b) If a permittee or operator does not provide braille bingo cards, a player who has a vision impairment may use a personal braille bingo card. The permittee or operator shall ensure that the personal braille bingo card is not identical to another bingo card in use. The permittee or operator may inspect and reject a personal braille bingo card that does not meet the requirements of this chapter.

(d) Immediately before a bingo game begins, the permittee or operator shall call out and display the pattern of numbers required to be covered in order to win the bingo game's prize.

(e) If duplicate hard bingo cards are to be used in play, the permittee or operator shall conspicuously post that fact and notify all players.

(f) Following the drawing of a ball in a bingo game, the permittee or operator shall call out and display to the players the letter and number on the ball. If a flashboard is used, the corresponding letter and number on the flashboard must be lighted.

(g) Once drawn, a ball may not be returned to the receptacle until after the conclusion of the bingo game.

(h) The winner of a bingo game is the first player to complete the particular arrangement of numbers on a bingo card based on balls called.

(i) If a player declares a winning arrangement of numbers, the player shall submit the bingo card for verification to the permittee or operator and to at least one neutral player. A neutral player is a player who is not a direct relative of the declaring player and who does not have a prohibited financial interest with the permittee or operator.

(j) If more than one player declares a winning arrangement of numbers on the call of the same ball, the bingo game prize shall be divided equally among the verified winning players.

(k) If a player declares a winning arrangement of numbers, the permittee or operator shall draw a ball from the receptacle. If the declaring player's arrangement is not verified, the permittee or operator shall resume the game by calling the ball drawn under this subsection.

(l) Once a permittee or operator begins to call a drawn ball, the permittee or operator shall complete the call. If a player achieved bingo based upon the previous ball called, the player shall share the prize for the bingo game with a player, if any, who achieves bingo on the subsequent ball called.

(m) Once all declaring players' arrangements are verified, the permittee or operator shall award the prize for the bingo game to that player or players.

(n) All prizes must be awarded by the end of a bingo session. All merchandise offered as prizes to bingo players must be paid for by the permittee or operator without lien or interest of others before the merchandise is offered as a prize.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131

15 AAC 160.600 Bingo prize limitations

(a) A permittee that conducts bingo activity on its own behalf may award a maximum of $840,000 in bingo prizes in a calendar year. The holders of a multiple-beneficiary permit under AS 05.15.100(d) may award a maximum in bingo prizes each year of $840,000 times the number of holders of the permit.

(b) A permittee that contracts with an operator to conduct bingo activity on the permittee's behalf may award a maximum of $660,000 in bingo prizes in a calendar year. Upon approval from the department, if a permittee terminates a contract with an operator for non-use of the permit and shows that the operator did not conduct activity under AS 05.15 for the permittee in the current calendar year, the permittee's full annual prize amount under (a) of this section is not reduced.

(c) The annual prize payout for bingo conducted under a permit issued under AS 05.15 may not exceed 85 percent of the gross receipts from bingo activity. The prize payout and gross receipts for bingo activity must be separately calculated by each permittee on a calendar year basis.

(d) A free bingo card may not be given as a bingo game prize.

(e) For purposes of this section,

(1) "prize payout" means the value of prizes awarded for bingo activity;

(2) "bingo activity" does not include the sale of ink refills, daubers, food, beverages, or similar items not directly connected to the play of bingo.

History

Authority: AS 05.15.060; AS 05.15.115 AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131; am 9/3/2005, Register 175

15 AAC 160.610 Bingo prize receipting requirements

(a) A permittee or an operator shall obtain a bingo game prize receipt at the time the prize is won and retain the receipt as required under 15 AAC 160.870(a).

(b) Bingo game prize receipts must be consecutively numbered.

(1) the location, the name of the permittee, and, if applicable, the operator;

(2) the date the receipt was issued;

(3) the bingo game number;

(4) the printed name of each prize winner;

(5) a description of the prize or a copy of the invoice issued when the prize was purchased; and

(6) the signature of each prize winner.

(d) Repealed 11/10/96.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.620 Bingo prize limits

The total value of cash and merchandise prizes awarded for a bingo game may not exceed $1,000. The total value of cash and merchandise prizes awarded during a session of bingo may not exceed $5,000. The value of a merchandise prize, including a donated prize, is the fair market value of the merchandise.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.625 Bingo session records

(a) At the conclusion of each bingo session, a permittee or an operator shall prepare a

(1) bingo session report that includes

(A) the amount of the beginning till;

(B) gross sales from bingo cards, sets of bingo cards, and packets of bingo cards;

(D) cash prizes and non-cash prizes paid out;

(E) adjustments for voids, overrings, returns, and other similar items;

(F) the amount of the deposit to be made to the bank account under 15 AAC 160.820;

(G) the amount of the ending till; and

(H) a record of all prizes paid out; and

(2) copy of the session schedule that reflects the

(A) name and type of each bingo game conducted; and

(B) prize awards for each game; and

(3) floor sale tally sheet that includes the

(A) number of bingo cards, set of bingo cards, or packet of bingo cards sold during the session;

(B) number of bingo cards, set of bingo cards, or packet of bingo cards not sold during the session;

(D) total amount of money collected by the floor seller during the session.

(b) A permittee or an operator subject to the receipting requirements under 15 AAC 160.520(a) must attach an internal cash register tape to the session report. The register tape must include total sales, total payouts, voids, overrings, returns, and other similar items.

History

Authority: AS 05.15.060; AS 05.15.080; AS 05.15.083
Eff. 11/10/96, Register 140

15 AAC 160.630 Bingo employee identification tags

A permittee or an operator shall provide an identification name tag for each employee involved in conducting bingo activity. The employee's name on the identification tag must be clearly printed and easily read by the gaming public. The permittee or operator shall ensure the employee wears the tag at all times when the employee works at the bingo game location.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

Article 7 Raffles, Lotteries, and Other Gaming Activities

15 AAC 160.640 Raffle tickets

(a) Raffle tickets must be consecutively numbered and must have a numbered, detachable stub for purposes of the drawing at the conclusion of raffle ticket sales.

(b) A raffle ticket must provide the following information on its face:

(1) the date and location of the drawing;

(2) the name of the permittee and the permit number;

(3) if applicable, the name of the operator and the operator's license number;

(4) the price of the raffle ticket;

(5) whether the player must be present at the drawing to be eligible for a prize;

(6) the ticket number.

(c) A permittee or operator conducting a raffle shall disclose the raffle procedures, prizes, and the price collected from a player either on a pamphlet or similar document given to a player at the time of sale, or on the face of the raffle ticket.

(d) The detachable stub on a raffle ticket must provide the following information on its face:

(1) the permit number;

(2) if applicable, the operator's license number;

(3) adequate space for a player to write the player's name, mailing address, and telephone number;

(4) the ticket number.

(e) Repealed 9/3/2005.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.170
Eff. 7/30/94, Register 131; am 9/3/2005, Register 175; am 6/22/2008, Register 186

15 AAC 160.650 Raffle drawings

(a) At a raffle drawing, the permittee or operator shall post a copy of the permit and a copy of the operator's license, if applicable, in a manner that is clearly visible to the gaming public.

(b) Before a raffle drawing, the permittee or operator shall place the detachable stubs of all raffle tickets sold into a receptacle that is designed so that each stub placed within it has an equal opportunity of being drawn.

(d) A raffle drawing must determine a winning detachable stub for each prize offered.

(e) A raffle drawing must occur at the date and location scheduled, which must be no later than the end of the calendar year following the calendar year in which the first ticket for the raffle was sold. If a raffle drawing cannot be held at the date and location scheduled for a reason that is beyond the control of the permittee or operator, the permittee or operator shall

(1) immediately notify the department in writing of the reason;

(2) reschedule the date and location of the raffle drawing, only if the entire raffle is completed no later than the end of the calendar year following the calendar year in which the first ticket for the raffle was sold; and

(3) if a player must be present at the raffle drawing to be eligible for a prize, notify each player in writing of the date and location of the rescheduled drawing.

(f) If a permittee or operator elects to terminate a raffle after a raffle ticket is sold but before the raffle drawing, or does not hold the raffle drawing within the time allowed under this section, the permittee or operator shall

(1) notify the department in writing before the scheduled date of the drawing of the reason for the termination; and

(2) refund the price of each ticket sold to each player not later than 20 days after the scheduled date of the drawing.

(g) If a permittee or operator awards a raffle cash prize of $50 or more, the winner shall acknowledge receipt of the prize by completing and signing a raffle prize form that includes the winner's name and address.

(h) A permittee or operator shall make every reasonable effort to award a raffle prize. If, after not more than 45 days following a raffle drawing, a raffle prize is not awarded, the permittee or operator shall conduct a drawing from the non-winning detachable stubs to determine a new winning detachable stub. The person named on that detachable stub shall be awarded the unawarded raffle prize.

(i) If a permittee or operator changes one or more prizes in a raffle after one or more tickets have been sold, the permittee or operator must either

(1) terminate the raffle and refund the ticket price to each ticket holder; or

(2) notify each ticket holder before the raffle is held and offer the ticket holder a refund.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 1/1/2003, Register 164

15 AAC 160.652 Special-draw raffles

(a) A special-draw raffle is an activity in which the winner is determined by means other than drawing from a container. Permittees may conduct, without prior approval of the department, a rubber ducky raffle where the duckies are placed into a moving body of water all at once by a loader or other means and prizes are awarded based on the order in which rubber duckies cross the finish line. Permittees must obtain prior written approval of the department to conduct any other special draw contest. The department will not approve a special draw raffle unless it meets the standards set out in (b) of this section.

(b) The department will approve an application for a special-draw raffle only if

(1) the special-draw method of selecting the winner of the raffle involves random chance not subject to influence by the person conducting the raffle;

(2) participants are not able to place bets on the outcome of the special draw;

(3) only one prize is awarded for each special draw;

(4) the special-draw does not involve a casino-gaming device such as a number wheel, dice, or cards; and

(5) the proposed raffle is not contrary to the public interest.

(c) The department will not approve a special-draw contest if participants participate in the game by placing a token on one of a series of numbers or colors and the winner is selected by throwing a dart at a spinning wheel on which the same numbers or colors have been painted.

(d) The price of a raffle ticket may not exceed $100.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180
Eff. 1/1/2003, Register 164; am 8/1/2014, Register 211

15 AAC 160.656 Raffle variations

(a) The provisions of 15 AAC 160.640(b) - (d) do not apply to the following raffle variations if they are conducted at a single event, at a single time and gaming location, with all players present:

(1) a bucket or basket raffle;

(2) a raffle with a merchandise prize;

(3) a split-the-pot raffle.

(b) A permittee may conduct a calendar raffle. If the winning tickets are to be returned to the ticket pool for drawings on subsequent dates in the raffle, this provision must be included in the house rules.

(c) With adequate notice to raffle ticket purchasers, a permittee may conduct a progressive raffle. A sign-in book, a descriptive poster at the point of sale, and serialized dual roll tickets may be used to satisfy the requirements of 15 AAC 160.640(b) - (d). House rules must provide for player eligibility and rules of play. One year from the start of a progressive raffle, if there has been no winner, the permittee must draw until there is a winner, at which time the permittee may start a new progressive raffle. Prizes may not exceed 85 percent of gross receipts.

(d) Any raffle format not described by 15 AAC 160.640, 15 AAC 160.652, or this section must be approved by the department under AS 05.15 and this chapter before the raffle may be conducted.

(e) House rules describing the rules and procedures governing a raffle under this section must be prominently posted before the sale of tickets starts.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180
Eff. 9/3/2005, Register 175

15 AAC 160.660 Ownership of raffle prizes

A raffle prize must be owned by the permittee or operator without lien or other adverse interest before the raffle drawing.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131

15 AAC 160.670 Raffle record

(a) A permittee or operator conducting a raffle shall keep a record of

(1) the number of raffle tickets printed;

(2) the number of raffle tickets sold;

(3) the number of unsold raffle tickets;

(4) the price collected for a raffle ticket;

(5) the raffle prizes;

(6) the date and location of the raffle drawing;

(7) the raffle prizes claimed;

(8) the name, address, telephone number, and prize won for each prize winner; and

(9) the disposition of unclaimed raffle prizes.

(b) The record described in (a) of this section must be retained by the permittee or operator for a period of three years from the date of the raffle drawing.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131

15 AAC 160.671 Dispensing raffle and lottery tickets by vending machine

(a) To use a vending machine to sell raffle or lottery tickets, the permittee or operator must receive prior approval from the department.

(b) Before the department will approve the use of a vending machine under this section,

(1) the permittee or operator must certify, in writing, that the operation of the vending machine is compliant with the applicable requirements of AS 05.15 and this chapter;

(2) the permittee or operator must post a copy of the permit and a copy of the operator's license, if applicable, in a manner that is clearly visible to the gaming public;

(3) the name and permit number of the qualified organization that benefits from the proceeds of the vending machine must appear conspicuously on the vending machine or on a video screen display on the vending machine; and

(4) the name, telephone number, and address of the person responsible for servicing the vending machine must appear conspicuously on the vending machine or on a video screen display on the vending machine.

(c) In this section, "vending machine" means a machine, object, or instrument designed to sell and dispense a raffle or lottery ticket.

History

Authority: AS 05.15.060; AS 05.15.165 AS 05.15.100; AS 05.15.180
Eff. 5/25/2016, Register 218

15 AAC 160.675 Animal classics permit application

(a) An applicant for an animal classic permit is subject to the permit application requirements of 15 AAC 160.020.

(b) In addition, unless currently on file with the department, an applicant for an animal classic permit shall submit the following:

(1) documents demonstrating the applicant was in existence before November 1, 2002;

(2) documents demonstrating the applicant conducted an animal classic before November 1, 2002.

(c) The department may consider documents such as newspaper articles, newspaper or other printed advertisements, state permits or records, municipal permits or records, accounting records, and receipts for expenses of operating an animal classic as proof the applicant conducted an animal classic before November 1, 2002.

History

Authority: AS 05.15.060; AS 05.15.115 AS 05.15.100; AS 05.15.180
Eff. 12/18/2004, Register 172

15 AAC 160.676 Animal classics

(a) Animal classics are subject to the following general standards:

(1) a permittee may conduct an animal classic with only one wheel or grid at any given time;

(2) an operator may conduct an animal classic with only one wheel or grid per location at any given time;

(3) an animal classic must be conducted in the same manner as it was before November 2002, except as necessary to comply with requirements of this section;

(4) animal classic players and workers must be 19 years old or older.

(b) In addition to the requirements in (a) of this section, an animal classic that is a rat race is subject to the following:

(1) the odds of winning may not exceed 38 to 1;

(2) the odds of winning must be posted in a manner that is clearly visible to the gaming public;

(3) individual bets on each numbered or colored hole a rat, hamster, gerbil, or other rodent might enter may not exceed $2 per numbered or colored hole;

(4) an individual betting on more than one numbered or colored hole in any single round of betting may not place an aggregate amount of bets exceeding $10.

(c) In addition to the requirements in (a) of this section, an animal classic that is a chicken contest may not use a grid that exceeds 24 squares by 48 squares.

(d) If a permittee or an operator awards an animal classic prize of $50 or more, including the fair market value of a merchandise prize, the permittee or operator shall ensure the winner acknowledges receipt of the prize by completing and signing a receipt that includes the winner's name and mailing address.

History

Authority: AS 05.15.060; AS 05.15.115 AS 05.15.100; AS 05.15.180
Eff. 12/18/2004, Register 172

15 AAC 160.680 Dog mushers' contests

(a) A mushers' contest must be based on an event involving sleds drawn by dog teams over a course laid out by a dog musher's association.

(b) A prize awarded in a dog mushers' contest must be awarded as set out in house rules established by the permittee or operator conducting the contest.

(c) If a permittee or operator awards a dog mushers' contest cash prize of $50 or more, the permittee or operator shall provide the winner with a receipt and shall complete the dog mushers' contest prize form provided by the department.

History

Authority: AS 05.15.060; AS 05.15.180 AS 05.15.100; AS 05.15.690
Eff. 7/30/94, Register 131; am 11/13/2014, Register 212

15 AAC 160.690 Fish derbies

(a) A prize awarded in a fish derby must be awarded as set out in house rules established by the permittee or operator conducting the fish derby.

(b) A fish derby association may award a door prize from a drawing

(1) of all tickets sold for the derby; or

(2) for each fish entered in the derby.

(c) If a permittee or operator awards a fish derby cash prize of $50 or more, including the fair market value of a merchandise prize, the permittee or operator shall ensure that the winner acknowledges receipt of the prize by completing and signing a receipt that is prescribed by the department.

History

Authority: AS 05.15.060; AS 05.15.180 AS 05.15.100; AS 05.15.690
Eff. 7/30/94, Register 131; am 11/13/2014, Register 212

15 AAC 160.700 Ice classics

(a) If the department determines that a material conflict exists between the Kenai Rotary Club and the Soldotna Rotary Club in the joint operation and administration of the Kenai River Ice Classic, then the club whose application is first received by the department will receive the permit to conduct the activity, if all other provisions of AS 05.15 and this chapter are met.

(b) A permittee or operator conducting an ice classic shall immediately notify the department if the permittee or operator is disqualified by a government agency from conducting activity in the state. Upon such disqualification, the department will suspend the permit or operator's license and no further activity permitted under AS 05.15 may be conducted by the permittee or operator until the permit or operator's license is reinstated by the department.

(c) If the permittee or operator awards an ice classic cash prize of $50 or more, the permittee or operator shall ensure that the winner acknowledges receipt of the prize by completing and signing a receipt that is prescribed by the department.

History

Authority: AS 05.15.060; AS 05.15.180 AS 05.15.100; AS 05.15.690
Eff. 7/30/94, Register 131; am 11/13/2014, Register 212

15 AAC 160.705 Big bull moose derbies

(a) A prize awarded in a big bull moose derby must be awarded as set out in house rules established by the permittee or operator conducting the big bull moose derby. A big bull moose derby may involve

(1) a legal hunt for moose by hunters;

(2) one or more drawings in which all hunters who participate in a derby conducted under (1) of this subsection are entered; house rules must state the prize amount and drawing schedule for each drawing; and

(3) an event in which participants try to guess the size of the winning antlers in the derby conducted under (1) of this subsection; participants in that event need not be hunters who are entered in the derby.

(b) Tickets sold for an event under (a) of this section must include the name and the permit number of the permittee and, if applicable, the name and license number of the operator. House rules must be available to ticket buyers at the time of purchase and must be posted at the time and place of a drawing under (a)(2) of this section or determination of a winner under (a)(1) or (3) of this section.

(c) An employee of the Department of Fish and Game may not participate as a player in an event under (a) of this section.

(d) If a permittee or an operator awards a big bull moose derby prize of $50 or more, including the fair market value of a merchandise prize, the permittee or operator shall ensure that the winner acknowledges receipt of the prize by completing and signing a receipt that is prescribed by the department.

History

Authority: AS 05.15.060; AS 05.15.180 AS 05.15.100; AS 05.15.690
Eff. 11/13/2014, Register 212

15 AAC 160.710 Salmon classics and king salmon classics

(a) An employee of the Department of Fish and Game may not participate as a player in a salmon classic or king salmon classic.

(b) A permittee or operator conducting a salmon classic or king salmon classic shall immediately notify the department if the permittee or operator is disqualified by a government agency from conducting activity in the state. Upon such disqualification, the department will suspend the permit or operator's license and no further activity permitted under AS 05.15 may be conducted by the permittee or operator unless the permit or operator's license is reinstated by the department.

(c) If a permittee or operator awards a salmon classic cash prize or king salmon classic cash prize of $50 or more, the permittee or operator shall provide the winner with a receipt and shall complete the salmon classic prize form or king salmon classic prize form provided by the department.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131

15 AAC 160.715 Calcutta pools

(a) A separate permit must be obtained for each Calcutta pool. The application must specify the physical address or location of the intended Calcutta pool.

(b) A Calcutta pool auction must take place at a single event.

(c) A bidder in a Calcutta pool auction must be physically present at the auction of participants or contestants in the event that is the subject of the Calcutta pool and must personally make all bids. An auction bid may not be placed by proxy or by any other means of indirect communication.

(d) A permittee shall include the report for each Calcutta pool required under AS 05.15.080(c) with the quarterly report filed with the department under AS 05.15.080(a) or, if a report is not required for that quarter, with the annual report filed with the department under AS 05.15.080(b).

(e) If a permittee awards a Calcutta pool prize with a value of $50 or more, the permittee shall ensure that the winner acknowledges receipt of the prize by completing and signing a prize receipt form that includes the winner's name, address, and telephone number.

(f) A person involved in the conduct of a Calcutta pool must be an employee, volunteer, or member of the permittee that conducts the Calcutta pool, and must be 18 years of age or older.

(g) House rules must clearly explain how a Calcutta pool will be conducted, must specify who may participate as a bidder, and must be conspicuously posted where the Calcutta pool is held.

(h) A permittee or qualified organization that conducts an event on which a Calcutta pool could be conducted may not authorize another permittee to conduct a Calcutta pool on that event, even if the permittee or qualified organization does not conduct a Calcutta pool on the event itself.

(i) A permittee authorized to conduct a Calcutta pool on an event run by a person who does not qualify for a permit must submit a copy of the agreement to conduct a Calcutta pool to the department with an original or amended application.

(j) A permittee may not pay any portion of the net proceeds from a Calcutta pool to the person who authorizes the permittee to conduct a Calcutta pool, and may not pay for the right to conduct a Calcutta pool.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.180 AS 05.15.080; AS 05.15.115; AS 05.15.690
Eff. 11/4/2005, Register 176

15 AAC 160.717 Crane classics

(a) A prize awarded in a crane classic must be awarded as set out in house rules established by the permittee or operator conducting the crane classic. These rules must be conspicuously posted wherever tickets for the classic are sold.

(b) If a permittee or operator awards a crane classic prize with a value of $50 or more, the permittee or operator shall ensure that the winner acknowledges receipt of the prize by completing and signing a prize receipt form that includes the winner's name, address, and telephone number.

(c) Tickets sold for a crane classic must include the name and the permit number of the permittee and, if applicable, the name and the license number of the operator.

History

Authority: AS 05.15.060; AS 05.15.180 AS 05.15.100; AS 05.15.690
Eff. 11/4/2005, Register 176; am 11/13/2014, Register 212

15 AAC 160.720 Monte Carlo events

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.730 Monte Carlo house procedures

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.740 Personnel and accounting for Monte Carlo events

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.750 Monte Carlo blackjack

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.760 New Year's Eve Monte Carlo events

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

15 AAC 160.770 Change in Monte Carlo events

Repealed.

History

Eff. 7/30/94, Register 131; repealed 11/10/96, Register 140

Article 8 Accounting and Recordkeeping

15 AAC 160.780 Advertising expenses

The total amount of advertising expenses for a gaming activity permitted under AS 05.15 may not exceed five percent of the permittee's adjusted gross income from gaming activities.

(1) repealed 11/10/96;

(2) repealed 11/10/96.

History

Authority: AS 05.15.060; AS 05.15.128; AS 05.15.160
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.790 Depreciation

(a) Except as provided in (b) of this section, a permittee shall depreciate assets used to conduct an activity permitted under AS 05.15, using the straight-line method over a period of five, 10, or 30 years. A permittee shall use a

(1) five-year depreciation period for all personal property and computer software used in gaming activity;

(2) 10-year depreciation period for an improvement that the permittee owns and uses in a gaming activity to leased real property; if the permittee does not own the improvements, no depreciation may be claimed under this section; and

(3) 30-year depreciation period for real property that the permittee owns and uses in gaming activity.

(b) In lieu of depreciation, a permittee may expense the entire cost of an asset described in (a)(1) of this section in the year of purchase if expenses remain within the limits of AS 05.15.160.

History

Authority: AS 05.15.060; AS 05.15.130; AS 05.15.160
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.800 Promotional items

(a) A permittee, operator, or licensed pull-tab distributor may receive or distribute a free promotional item, if the promotional item has little intrinsic value and no monetary exchange value.

(b) An item with a discount that would reduce the item's price substantially below fair market value is not a promotional item for purposes of this section, and will be considered a gift under 15 AAC 160.350 and 15 AAC 160.954.

History

Authority: AS 05.15.060
Eff. 7/30/94, Register 131; am 6/22/2008, Register 186

15 AAC 160.810 Net proceeds

(a) A permittee or an operator may not pay a person for services rendered to conduct gaming activities or pay gaming prizes or expenses from the net proceeds.

(b) A permittee shall keep a detailed record of disbursements from the net proceeds for three years after the record was made.

(c) A permittee that dedicates net proceeds to a scholarship for education may only award the scholarship to a resident of the state or to a person who will use the scholarship in the state.

(d) Repealed 11/10/96.

(e) Repealed 11/10/96.

(f) A permittee that dedicates or otherwise transfers net proceeds to another organization must take steps to ensure that the net proceeds are spent in accordance with AS 05.15.150.

History

Authority: AS 05.15.060; AS 05.15.150
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.820 Bank account

(a) A permittee or an operator shall deposit money collected from gaming activities, less cash prizes actually paid, in a bank account with check-writing privileges in the name of the permittee or operator. Deposits for each bingo session or any other authorized activity under AS 05.15 shall be made within three calendar days of the close of the bingo session or within three calendar days of the conduct of any other authorized activity under AS 05.15. The bank account must be separate from an account used for other money of the permittee or operator. After December 31, 2006, the bank account must include the word "gaming" in the name or title that appears on checks and statements, but existing checks maybe used until December 31, 2007.

(b) A disbursement from a permittee bank account described under (a) of this section must be made by a check that is signed by two authorized members of the permittee who are natural persons and residents of the state, except for electronic payment, through the department's website, of the annual fee under AS 05.15.020(c)(2) - (4), the additional fee under AS 05.15.020(b), or interest or penalty under AS 05.15.095(c) or (d).

(1) repealed 11/10/96;

(2) may not be drawn to "cash" or to a fictitious payee; and

(3) may not be signed in advance or with a signature stamp.

(d) Interest income earned on the bank account required by (a) of this section is subject to the provisions of AS 05.15.150.

(e) Notwithstanding (a) of this section, a permittee desiring a longer period in which to deposit money from an authorized activity must first apply to the department for special permission. If the permittee establishes, to the department's satisfaction, that circumstances beyond the permittee's control justify the extension, the department will grant the request.

(f) A permittee may not accept or cash a third-party personal check from a player for the purchase of bingo cards or pull-tabs, or for participation in any other gaming activity conducted under AS 05.15 and this chapter.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; am 9/3/2005, Register 175; am 11/5/2006, Register 180; am 6/22/2008, Register 186

15 AAC 160.822 Net proceeds held for more than one year

(a) A permittee that receives permission from the department under AS 05.15.150(b) to hold net proceeds for a period longer than one year must

(1) account for the net proceeds and earnings each year when the permittee files its annual financial statement;

(2) spend the net proceeds and earnings within the time period specified in its application under AS 05.15.150(b) and approved by the department;

(3) notify the department of

(A) any change in circumstances or intention from the original application;

(B) when and how the net proceeds and earnings are spent; and

(4) receive additional approval from the department before implementing a new plan for the distribution of net proceeds and earnings.

(b) Until it spends the net proceeds and earnings, the permittee must retain the net proceeds and earnings in its bank account required by 15 AAC 160.820(a). Notwithstanding 15 AAC 160.820(a), the permittee may deposit the net proceeds and earnings into another account in the permittee's name that is insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration Insurance Fund and is separate from an account used for other money of the permittee.

(c) If the department finds the immediate dedication of the net proceeds and earnings to be necessary to protect the best interests of the public, the department may rescind permission to hold net proceeds for more than one year and require dedication of the net proceeds and earnings.

(d) Notwithstanding the approval given by the department under (a) of this section, the net proceeds and earnings being held for longer than one year are subject to the dissolution clause required under 15 AAC 160.020.

(e) Net proceeds received by a permittee as a donation from another permittee are subject to the requirements of AS 05.15.150 and this section.

History

Authority: AS 05.15.060; AS 05.15.150
Eff. 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.830 Method of accounting

(a) A permittee or licensee shall use accounting principles that conform to generally accepted accounting principles (GAAP) as modified by AS 05.15 and this chapter.

(b) The accounting for a gaming activity must include all gross receipts and expenses attributable to the conduct of the gaming activity. All gaming gross receipts and expenses must be matched to each gaming

(1) permit; and

(2) activity.

(c) Gross receipts and expenses from gaming activities other than bingo and pull-tabs may be reported using either the cash or modified cash method of accounting.

(d) Even though a permittee or licensee uses a different accounting method for tax, financial, or other purposes, the permittee or licensee must use the other comprehensive basis of accounting method for the accounting of revenue and expenses of charitable gaming that is required by AS 05.15 and this chapter.

(e) A permittee may not pay the expenses of gaming conducted on its behalf by an operator. A member of a multiple-beneficiary permittee may not pay the expenses of gaming conducted by the multiple-beneficiary permittee.

(f) Expenses incurred in connection with gaming activities, except for prizes paid by cash or merchandise awarded as prizes, must be paid by a check drawn on the bank account described under 15 AAC 160.820(a).

(g) A permittee that receives a refund from a landlord, contractor, or supplier for goods or services purchased, or rental or lease expenses incurred during a calendar year, may reduce the amount of gaming expenses by the amount of the refund for that calendar year. A cash refund of expenses paid before the year-end must be received before January 31 of the year following the year to which the refund applies. A signed statement from the landlord, contractor, or supplier of the goods or services must be submitted to the department by January 31. The statement must disclose the amount of the refund and confirm that the price of goods or services in subsequent years will not be increased to recover the refund and that there is no agreement or expectation for repayment or offset of the refund.

(h) A permittee may request in writing an extension of the January 31 deadline for receiving the refund only if the extension does not prevent the timely filing of an annual report. An extension under this subsection is not the basis for issuance of a permit or a temporary permit.

(i) Gross receipts and expenses not reported as a result of a change to the accrual method of accounting under (a) of this section will not be considered by the department in determining compliance with AS 05.15.160(c) and (d) in the year immediately before the change.

(j) A permittee may report pull-tab inventory based on the number of sealed pull-tab series in the permittee's possession.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.160
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.835 Net proceeds and unauthorized expenses

(a) Unauthorized expenses include both expenses that are

(1) not authorized by AS 05.15 or this chapter; and

(2) otherwise authorized but that exceed the total annual amount of authorized expenses allowed under AS 05.15.160.

(b) An operator and a multiple-beneficiary permittee must distribute to a permittee all net proceeds of gaming activity. Except as provided in 15 AAC 160.830(g), a permittee or licensee may not incur expenses that result in net proceeds being less than 10 percent of adjusted gross income on an annual basis from gaming activity other than pull-tabs, and 30 percent of adjusted gross income on an annual basis from pull-tab activity.

(c) A permittee that is the victim of a theft or embezzlement that will result in a recovery of a known amount from a bond or court-ordered restitution confirmed by the insurer or court before the date of the annual report due under AS 05.15.080(b) or AS 05.15.145(d) shall

(1) record the payment due under the bond or restitution as a gaming asset;

(2) offset the amount of the theft or embezzlement loss with a credit in the amount of the recovery from the bond or restitution; and

(3) deposit amounts collected from the recovery from the bond or restitution into the bank account required by 15 AAC 160.820 and disburse the amounts within 30 days as a deferred payment of net proceeds to the permittees originally affected by the theft or embezzlement.

(d) For purposes of 15 AAC 160.880(a)(20), the deferred payments under (c) of this section shall be treated as a timely distribution of net proceeds to a permittee.

(e) Notwithstanding (a)(1) and (2) of this section, all expenses incurred in activity under AS 05.15 and this chapter must be included in reports filed under AS 05.15.080, 05.15.083, and 05.15.087.

History

Authority: AS 05.15.060; AS 05.15.150; AS 05.15.180 AS 05.15.100; AS 05.15.160
Eff. 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.840 Permittee quarterly report

(a) The quarterly report required under AS 05.15.080(a) must be on a form provided by the department and must include all information requested on the form.

(b) A permittee that utilizes a multiple-beneficiary permit shall file a quarterly report separate from the quarterly report filed by the multiple-beneficiary permittee.

History

Authority: AS 05.15.060; AS 05.15.080
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.850 Permittee annual report

(a) The annual report required under AS 05.15.080(b) must be on a form provided by the department and must include all information requested on the form.

(b) A permittee that contracts with an operator to conduct gaming activities shall include on the annual report required under AS 05.15.080(b) the total amount of gross receipts and the total amount of net proceeds that the permittee received from the operator from gaming activities.

(c) A permittee that utilizes a multiple-beneficiary permit to conduct gaming activities shall include on the annual report required under AS 05.15.080(b) the total amount of gross receipts and the total amount of net proceeds that the permittee received from the activities conducted under the multiple-beneficiary permit.

History

Authority: AS 05.15.060; AS 05.15.080
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.860 Grace periods for reports and annual review of financial records

(a) The department may grant to a permittee or licensee one 30-day grace period to file a report or annual review of financial records required under AS 05.15 or this chapter. The department will not grant more than one grace period for the report or annual review of financial records.

(b) Except for good cause shown, a request for a grace period must be filed with the department in writing on or before the due date for the report or annual review of financial records. The report or annual review of financial records must include a complete statement of the reason for the request. For the purposes of this subsection, "good cause" means a reason outside of the control of the permittee or licensee as determined by the department in its discretion.

(1) deny, suspend, of revoke the permittee's permit or the licensee's license for failing to file the report or annual review of financial records by the due date; or

(2) consider the corresponding report delinquent under AS 05.15.095(b).

(d) If the department grants a grace period under this section, the permittee or licensee shall attach a copy of the department's grace period letter to the corresponding report or annual review of financial records when the report or annual review of financial records is filed.

(e) The department will not grant a grace period to pay a fee or tax required under AS 05.15 or this chapter.

History

Authority: AS 05.15.060; AS 05.15.080; AS 05.15.083
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 9/3/2005, Register 175

15 AAC 160.870 Retention of records

(a) Unless otherwise provided in AS 05.15 or this chapter, a permittee or an operator shall retain all records and supporting documents pertaining to gaming activities authorized under AS 05.15 for three years from the later of the due date or filing date of the annual report on which the income, deduction, payment of, or use of net proceeds is claimed.

(b) A manufacturer or distributor shall maintain all records and supporting documents pertaining to gaming activities authorized under AS 05.15 for three years from the later of the due date or filing date of the last monthly report for the calendar year in which the record or document was made.

History

Authority: AS 05.15.060
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

Article 9 Suspension and Revocation

15 AAC 160.880 Suspension or revocation of a permit, license or registration

(a) The department may suspend or revoke a permit, license, or registration under AS 05.15 if the permittee, licensee, or registered vendor

(1) knowingly makes a false statement or knowingly submits false information in order to obtain a permit, license, or registration or on a report required under AS 05.15 or this chapter;

(2) fails to provide the information, documentation, or fees required in the application or reporting process under AS 05.15 or this chapter;

(3) fails to meet or maintain the necessary qualifications for a permit, license, or registration under AS 05.15 or this chapter;

(4) fails to pay to the department a tax, fee, penalty, or interest payment required under AS 05.15 or this chapter;

(5) alters, or allows to be altered, a permit, license, or registration issued under AS 05.15;

(6) allows another person to use a permit, license, or registration issued under AS 05.15, except when a permittee contracts with a licensed operator or registered vendor as authorized under AS 05.15 or this chapter;

(7) violates or negligently allows an employee to violate a provision of AS 05.15 or this chapter;

(8) fails to file timely a report or supplemental information required by AS 05.15 or this chapter;

(9) fails to prepare and retain books and records to substantiate a report required under AS 05.15 or this chapter;

(10) fails to provide promptly for inspection information or documentation requested by an authorizing permittee or the department, if the information or documentation is necessary to substantiate a report, tax, or payment required under AS 05.15 or this chapter;

(11) fails to remit the pull-tab tax to a pull-tab distributor as required under AS 05.15.184 or 15 AAC 160.460;

(12) has a prohibited conflict of interest in a gaming activity;

(13) knowingly allows a person who has a prohibited conflict of interest to conduct or be responsible for conducting a gaming activity;

(14) uses, or allows the use of, net proceeds derived from a gaming activity for a purpose other than those allowed under AS 05.15 or this chapter;

(15) conducts a gaming activity with an intent to defraud as defined in AS 11.46.990 or in deception as defined in AS 11.81.900;

(16) denies the department access to premises where a gaming activity is conducted;

(17) uses a person other than a licensed operator, an employee, a volunteer, a registered vendor, or a person identified under 15 AAC 160.190(b) to conduct a gaming activity on behalf of the permittee;

(18) fails to notify the department as required under AS 05.15 or this chapter;

(19) conducts, or allows others to conduct, a gaming activity, including gambling as proscribed under AS 11.66, for which the permittee, licensee, or registered vendor is not authorized under AS 05.15 or this chapter on premises where an activity subject to AS 05.15 or this chapter is conducted;

(20) fails to distribute to a permittee the net proceeds or other payments required by AS 05.15 and this chapter;

(21) is convicted of a felony or crime involving theft or dishonesty, or a violation of gambling laws;

(22) participates in a transaction, or a series of transactions, that results in the permittee receiving, in violation of AS 05.15.188, less than 70 percent of ideal net in a pull-tab series; or

(23) engages in a transaction that violates 15 AAC 160.942.

(b) The department will issue a notice of suspension or revocation to a permittee, licensee, or registered vendor in writing. In the notice, the department will include the grounds for the intended suspension or revocation, the legal authority for the intended action, and statement of the opportunity to request an informal conference within 30 days after the mailing of the notice. Within 30 days after the department mails the notice, the permittee, licensee, or registered vendor may request an informal conference by filing a brief statement why the person is aggrieved by the intended suspension or revocation. If the permittee, licensee or registered vendor fails to file a request for informal conference, the noticed suspension or revocation is effective 30 days after the date of mailing to the permittee, licensee, or registered vendor. After receipt of a request for informal conference, the department will apply the procedures of 15 AAC 05.020, to the extent consistent with this chapter. In an informal conference decision, the department will affirm, overrule, or modify a suspension or revocation. If the permittee, licensee, or registered vendor files a request for informal conference, and if the informal conference decision upholds the suspension or revocation as noticed or modified, the upheld suspension or revocation is effective 15 days after the written informal conference decision is mailed. A permittee, licensee, or registered vendor aggrieved by the result of an informal conference decision may request a formal hearing under 15 AAC 160.910. Notwithstanding the filing of a request for formal administrative hearing, a person or entity may not engage in conduct regulated by AS 05.15 or this chapter beyond the effective date of the suspension or revocation unless the suspension or revocation has been administratively or judicially stayed.

(c) Upon suspension or revocation of a permit, license, or registration, or upon agreement requiring a temporary or permanent closure of a gaming location, the department shall post a notice of the action on the premises.

History

Authority: AS 05.15.010; AS 05.15.105; AS 05.15.184 AS 05.15.050; AS 05.15.140; AS 05.15.690 AS 05.15.060; AS 05.15.170
Eff. 7/30/94, Register 131; am 1/1/2003, Register 164; am 9/3/2005, Register 175; am 6/22/2008, Register 186

15 AAC 160.885 Immediate revocation

(a) The department may immediately revoke a permit, license, or registration issued under AS 05.15 and this chapter if

(1) a permittee or licensee fails to comply with the requirements of AS 05.15 and this chapter for the distribution of net proceeds or limitations on expenses;

(2) a permittee or licensee fails to file timely a report required by AS 05.15 or this chapter;

(3) a permittee is not a municipality or qualified organization;

(4) a permittee pays gaming taxes, prizes, or expenses with net proceeds; or

(5) a registered vendor fails to pay to a permittee the statutorily required percentage of the ideal net upon delivery of a pull-tab series to the registered vendor.

(b) The department will use the following procedures when immediately revoking a permit, license, or registration:

(1) the department will send to the permittee, licensee, or registered vendor a written notice of intent to revoke immediately; the notice must allege a violation of one or more of the provisions listed in (a) of this section and cite the evidence on which the department relied to determine that the violation had occurred;

(2) the department will provide copies of all documentary evidence on which it relied in reaching its determination;

(3) the notice of intent to revoke immediately shall provide the permittee, licensee, or registered vendor a period of time to show cause why the department should not immediately revoke the permit, license, or registration; the time allowed must be not less than five days nor more than 20 days from the day that the permittee, licensee, or registered vendor receives the notice; the permittee, licensee, or registered vendor may submit evidence as part of its response;

(4) if the permittee, licensee, or registered vendor does not file a response to the notice of intent to revoke immediately, the revocation becomes effective after expiration of the period of time allowed for response in the notice;

(5) if the permittee, licensee, or registered vendor files a response to the department's notice of intent to revoke immediately, an appeals officer within the tax division of the department who did not participate in the preparation of the original notice shall review the allegations, evidence, and response; the appeals officer shall issue a written decision that either affirms or overrules the immediate revocation; the appeals officer may affirm for the reasons expressed in the notice or for any reason supported by the record; if affirmed, the immediate revocation becomes effective five days after the date of the decision issued by the appeals officer; if the record does not support a determination that the permittee, licensee, or registered vendor violated AS 05.15 or this chapter as alleged, or if the appeals officer determines that immediate revocation is not warranted, the appeals officer shall overrule the immediate revocation;

(6) regardless of whether the permittee, licensee, or registered vendor files a response to the notice of intent to revoke immediately, the permittee, licensee, or registered vendor has 15 days from the date that the immediate revocation becomes effective to appeal the revocation to a formal hearing under 15 AAC 160.910; notwithstanding the filing of an appeal, the permittee, licensee, or registered vendor may not engage in an activity requiring a permit, license, or registration beyond the effective date of the department's action unless the revocation has been administratively or judicially stayed.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.183 AS 05.15.100; AS 05.15.181; AS 05.15.188
Eff. 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.886 Renewal of a permit, license, or registration

(a) The department may deny an application for renewal of a permit, license, or registration on the same grounds for which the permit, license, or registration could be revoked or suspended under AS 05.15 or this chapter.

(b) If it appears to the department that a permittee, licensee, or registered vendor may not be in compliance with the requirements of AS 05.15 or this chapter for the year preceding the year for which a renewal of a permit, license, or registration is or may be sought, the department may require that an applicant or prospective applicant submit supplemental information before the department acts on any renewal application.

(c) The department shall use the following procedures before denying an application for renewal of a permit, license, or registration:

(1) the department will send the permittee, licensee, or registered vendor a written notice of intent to deny the application for renewal; the notice must state the grounds for denial and cite the evidence on which the department relied to reach this conclusion;

(2) the department will provide copies of all documentary evidence on which it relied in reaching its determination;

(3) the notice of intent to deny renewal must provide a period of time for the permittee, licensee, or registered vendor to respond to the department's reasons for denial; the time allowed must be not less than five days nor more than 20 days from the day the permittee, licensee, or registered vendor receives the notice; the permittee, licensee, or registered vendor may submit evidence to the department as part of its response;

(4) if the permittee, licensee, or registered vendor does not file a response to the notice of intent to deny renewal, the denial becomes effective on the later of January 1 of the year for which renewal is sought or the expiration of any temporary permit or license issued to the applicant;

(5) if the permittee, licensee, or registered vendor files a response to the department's notice of intent to deny renewal, the department will provide for a review of the allegations, evidence, and response by an appeals officer in the tax division of the department who did not participate in the preparation of the original notice; the appeals officer will issue a written decision that either affirms or overrules the denial; the appeals officer may affirm for the reasons expressed in the original denial or for any reason supported by the record; if the record does not support a conclusion that the permittee, licensee, or registered vendor violated AS 05.15 or this chapter as alleged, or if the appeals officer determines that denial of renewal is not warranted, the appeals officer shall overrule the denial; if affirmed, the denial becomes effective on the later of January 1 of the year for which renewal is sought or the expiration of any temporary permit or license issued to the applicant;

(6) regardless of whether the permittee, licensee, or registered vendor files a response to the notice of intent to deny renewal, the permittee, licensee, or registered vendor has 15 days from the date the denial becomes effective to appeal the denial to a formal hearing under 15 AAC 160.910; notwithstanding the filing of an appeal, the permittee, licensee, or registered vendor may not engage in an activity requiring a permit, license, or registration beyond the effective date of the department's action unless the denial has been administratively or judicially stayed.

(d) Nothing in this section limits the ability of the department to revoke or immediately revoke a permit, license, or registration that has been renewed.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.183 AS 05.15.100; AS 05.15.181; AS 05.15.188
Eff. 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.890 Disposition of money upon suspension or revocation

Upon suspension or revocation of a permit, operator's license, or registration, the permittee, operator, or vendor may only withdraw gaming money

(1) to pay for authorized expenses that were accrued before the suspension or revocation; or

(2) for dedication of net proceeds in a manner consistent with those stated on the permit application.

History

Authority: AS 05.15.050; AS 05.15.128; AS 05.15.170 AS 05.15.060; AS 05.15.150
Eff. 7/30/94, Register 131

15 AAC 160.900 Notice of criminal conviction

An applicant, permittee, licensee, or vendor, who is convicted of a violation described under AS 05.15.105 or who, in connection with gaming activity, knowingly employs a person who is convicted of a violation described under AS 05.15.105 shall immediately notify the department in writing of the conviction.

History

Authority: AS 05.15.060; AS 05.15.105
Eff. 7/30/94, Register 131

Article 10 Hearings

15 AAC 160.910 Request for formal administrative hearing

(a) A person, municipality, qualified organization, applicant, permittee, registered vendor, or licensee may file a request for a formal hearing to obtain administrative review of an informal conference decision by the department that

(1) denies, suspends, or revokes the applicant's, permittee's, registered vendor's, or licensee's permit, license, or registration under AS 05.15;

(2) upholds assessment of a tax, interest, or penalty against the permittee, registered vendor, or licensee under AS 05.15 or this chapter;

(3) requires the person, qualified organization, or municipality to obtain a permit, license, or registration under AS 05.15; or

(4) orders the registered vendor or licensee to pay a refund required by AS 05.15 or this chapter.

(b) A written request for a formal administrative hearing must be filed with the department within 15 days after the date the appealed action by the department becomes effective. For purposes of this section, a written request is considered filed on the date that it is delivered to the department in Juneau, or, if delivered by the United States mail, the date of the postmark.

(c) Within 15 days after receiving the request, the department will forward the request, along with a copy of the underlying department decision and the record on which the department relied to support the decision, to the Department of Administration, Office of Administrative Hearings.

(d) Notwithstanding the filing of a request for formal administrative hearing, a person or entity may not engage in conduct regulated by AS 05.15 or this chapter if the department has denied, suspended, or revoked the person's or entity's permit, license, or registration, unless the denial, suspension, or revocation has been administratively or judicially stayed.

(e) The administrative law judge will issue a stay upon a determination that the party seeking the stay is likely to prevail on the merits. The administrative law judge may conduct a hearing to determine the need for a stay and may impose reasonable additional requirements upon a party seeking a stay, as determined necessary to further the public interest.

History

Authority: AS 05.15.060; AS 05.15.170 AS 05.15.128; AS 05.15.610
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; am 9/3/2005, Register 175

15 AAC 160.920 Administrative appeals

Repealed.

History

Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; repealed 9/3/2005, Register 175

Article 11 General Provisions

15 AAC 160.930 Permit, license, or registration required

A person may not conduct an activity for which a permit, license, or registration is required under AS 05.15 unless the appropriate permit, license, or registration has been issued to the person by the department.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131

15 AAC 160.932 Interpretation

The department will strictly interpret AS 05.15 and this chapter to protect the interests of the public, municipalities, and qualified organizations.

History

Authority: AS 05.15.060; AS 05.15.140 AS 05.15.110; AS 05.15.610
Eff. 1/1/2003, Register 164

15 AAC 160.934 Criminal history checks

(a) On an application or an amended application filed with the department on or after June 22, 2008, the following individuals must agree to submit to a criminal history check by the department for conviction of any offense that would bar them from involvement in activity regulated under AS 05.15 or this chapter:

(1) a natural person applying for an operator's license;

(2) a member in charge;

(3) an alternate member in charge;

(4) a manager of gaming.

(b) Upon request from the department, the following individuals must agree to submit to a criminal history check by the department for conviction of any offense that would bar them from involvement in activity regulated under AS 05.15 or this chapter:

(1) a registered vendor;

(2) a manager, a supervisor, a fund raiser, or a consultant for an operator or a registered vendor.

(c) If the department has reason to believe that an individual may have a conviction for an offense that would bar the individual from involvement in activity regulated under AS 05.15 or this chapter, the department may request the individual to submit to criminal history checks in addition to those required by (a) and (b) of this section. As part of the review under this subsection, the department may require the individual to provide a set of fingerprint cards.

(d) In this section,

(1) "criminal justice information" has the meaning given in AS 12.62.900;

(2) "government unit" has the meaning given in 13 AAC 68.905;

(3) "proof of identity" means personal descriptors required either on a form prescribed by the department or in a format approved by the department; "proof of identity" includes one or more of the following:

(A) a set of fingerprint cards;

(B) two pieces of identification presented in person by the individual to the department, one of which must be a valid picture identification issued by a government unit;

(C) a signed statement attesting, under penalty for unsworn falsification in violation of AS 11.56.210, that the personal descriptors accurately describe the individual signing the statement;

(4) "submit to a criminal history check" means to provide the department with

(A) proof of identity; and

(B) a written consent, on a form prescribed by the department, to determine what criminal justice information exists concerning the individual giving the consent.

History

Authority: AS 05.15.060; AS 05.15.105
Eff. 6/22/2008, Register 186

15 AAC 160.935 Primary gaming location

(a) An operator may not conduct any retail or other business activity at a primary gaming location without the permittee's written consent.

(b) A primary gaming location must have a separate entrance and must be constructed and marked to alert the public that gaming activity occurs inside unless the location is a kiosk.

(c) A permittee may lease a premise to conduct an activity permitted under AS 05.15 in premises other than a primary gaming location if

(1) the permittee and lessor execute a written lease agreement;

(2) the lease payments will not exceed 20 percent of the ideal net of the pull-tab activity conducted in the premises if the premises otherwise qualifies as a vendor location;

(3) the activity is conducted in a separate and distinct area of the premises;

(4) the activity is conducted by an employee, a volunteer, or a member of the permittee;

(5) the lessor does not participate as a player in the activity; and

(6) an employee of the lessor does not participate as a player in the activity;

(7) repealed 11/10/96;

(8) repealed 11/10/96.

(d) A permittee may not lease more than five premises under (c) of this section at any one time.

(e) A permittee shall provide to the department a copy of any lease agreement for any property used for gaming purposes under AS 05.15, including agreements between the permittee and the lessor, sublease agreements between the permittee and a sublessor, and lease agreements between the sublessor and its lessor.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140

15 AAC 160.936 Operator location in facility where alcohol is served or sold

An operator may lease a premise to conduct an activity under AS 05.15 that would otherwise qualify as a vendor location if

(1) the operator and the lessor of the premises enter into a written lease;

(2) the activity is conducted in a separate area of the premises;

(3) the activity is conducted by a person under control of the operator not employed by the lessor of the premises; and

(4) the lessor and the lessor's employees do not participate as players in the activity.

History

Authority: AS 05.15.060; AS 05.15.122; AS 05.15.187 AS 05.15.100; AS 05.15.165
Eff. 1/1/2003, Register 164

15 AAC 160.938 Permittee activity restriction

A permittee or an operator may not employ house players or extend credit to players.

History

Authority: AS 05.15.060
Eff. 11/10/96, Register 140

15 AAC 160.940 Copy of procedures, statutes, and regulations on premises

(a) A permittee, operator, or vendor shall post the house procedures on the premises where an activity permitted under AS 05.15 is being conducted. The posting must be in a manner that is clearly visible to the gaming public.

(b) A permittee, operator, or vendor shall obtain and maintain a current copy of AS 05.15 and this chapter on the premises where an activity permitted under AS 05.15 is being conducted. The copy must be available for inspection by a person upon request.

History

Authority: AS 05.15.060
Eff. 7/30/94, Register 131

15 AAC 160.942 Purchase inducement programs

(a) A permittee, operator, registered vendor, licensed pull-tab distributor, or employee of a permittee, operator, registered vendor, or licensed pull-tab distributor may not offer or participate in a purchase inducement program, either directly or indirectly through a third party.

(b) A purchase inducement program includes

(1) a transaction or series of transactions in which a distributor of items or services, regardless of whether those items or services are related to gaming, offers additional items or services of more than negligible value without charge or at discounted prices, as an inducement to purchase items or services from the distributor, or in exchange for an agreement, arrangement, commitment, or other assurance to purchase items or services from the distributor, regardless of whether the offer is subject to a minimum purchase requirement or requires an agreement to purchase exclusively from one person; and

(2) a program in which a purchaser may earn items or services of more than negligible value, or may earn points that may be redeemed for those items or services.

(c) A purchase inducement program does not include a discount in the purchase price of items or services that a distributor may offer, if the discount

(1) directly reduces the invoiced amount due for the items or services purchased; and

(2) does not include an agreement, arrangement, commitment, or other assurance to purchase items or services at the time of the transaction or in the future.

(d) A licensed pull-tab distributor shall provide to a permittee or operator an invoice

(1) on which each of the following items or services that the licensed pull-tab distributor sells or provides is separately listed on the invoice, with the original retail price and the final price, net of all discounts, if any:

(A) pull-tab games;

(B) bingo paper;

(D) mechanical pull-tab dispensing devices;

(E) electronic pull-tab dispensing devices;

(F) bingo daubers;

(G) blowers for bingo;

(H) flashboards for bingo;

(I) television monitoring systems or system components for bingo;

(J) electronic bingo paper;

(K) bingo or pull-tab point-of-sale systems;

(L) any other item of gaming equipment;

(M) any other item or service, regardless of whether the item or service is related to gaming; and

(2) that includes on the front of each page of the invoice the following notice, in bold print at least one-eighth inch high: "Purchase inducement programs, other than monetary discounts, are prohibited by regulation, and participation in them is cause to suspend, revoke, or deny a license or permit under AS 05.15.

(e) If a permittee or operator purchases or receives items or services from a distributor other than a licensed pull-tab distributor, the permittee or operator shall obtain from that distributor an invoice that

(1) separately lists the original retail price and the final price, net of all discounts, for each item purchased; and

(2) includes the notice required under (d)(2) of this section.

(f) A permittee, operator, or registered vendor may purchase, lease, or use only a pull-tab point-of-sale system or pull-tab dispensing device that accepts data for all pull-tab games sold in the state by licensed pull-tab distributors.

(g) A registered vendor

(1) may not purchase, lease, or accept a pull-tab point-of-sale system or pull-tab dispensing device from a permittee; and

(2) shall retain proof of purchase of a pull-tab point-of-sale system or pull-tab dispensing device for as long as the registered vendor owns the equipment.

(h) In this section, "negligible value" means a modest intrinsic value and no exchange value.

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.187
Eff. 6/22/2008, Register 186

15 AAC 160.945 Conduct of gaming on the airwaves

(a) An activity permitted under AS 05.15.100(a) may be conducted on the airwaves by a noncommercial broadcasting station or network of stations if the station or network

(1) conducts the activity under a permit issued to the station or network by the department under AS 05.15.100(a); and

(2) has not contracted with an operator to conduct the activity on the airwaves.

(b) [Annulled; see editor's note.] For purposes of AS 05.15.640, the term "broadcasting" includes use of the internet.

(c) Permittees and licensees that use the internet as provided in this section shall take reasonable measures, including web sites protected by the use of passwords, to ensure that persons or entities that do not hold permits or licenses under AS 05.15 do not have access to such web sites. The promotion or the conduct of gaming activities does not include use by permittees and licensees of

(1) electronic mail and facsimile machines to communicate among themselves; or

(2) web sites to buy and sell gaming supplies, including pull-tabs.

(d) Nothing in this section relieves a permittee or licensee of paying gaming expenses by check as required by 15 AAC 160.830(f).

History

Authority: AS 05.15.060; AS 05.15.100; AS 05.15.640
Eff. 7/30/94, Register 131; am 1/1/2003, Register 164

15 AAC 160.950 Advertisements

An advertisement for an activity permitted under AS 05.15 must conspicuously display or announce the name of the permittee, the permit number under which the activity is to be conducted and, if applicable, the name and license number of the operator.

History

Authority: AS 05.15.060; AS 05.15.122
Eff. 7/30/94, Register 131

15 AAC 160.954 Conflicts of interest

(a) Charitable gaming must be conducted with high standards of integrity in a manner that assures the gaming public that the gaming is free from corruption and criminal influence. A person regulated under this chapter must avoid relationships that could support an inference of a conflict of interest or self-dealing, and may not have a prohibited conflict of interest in a gaming activity.

(b) A person regulated under this chapter has a prohibited conflict of interest if the person or a related party is involved in any of the following activities:

(1) a gaming transaction with a related party, unless the transaction is allowed under (c) of this section;

(2) giving or receiving a loan, or gifts with a total fair market value of more than $100 per year, from

(A) an operator, distributor, registered vendor, or manufacturer to a permittee, or to an employee of a permittee who acts in a managerial or supervisory capacity; or

(B) a permittee to an operator, distributor, registered vendor, or manufacturer;

(3) leasing or subleasing by a distributor of facilities used in the conduct of gaming after January 1, 2004;

(4) employing, contracting with, or allowing a person to act as a manager of gaming if the person acts as a manager of gaming for more than one permittee in a calendar year;

(5) employing, contracting with, or allowing a person to act in a managerial or supervisory capacity for a permittee if the person is or acts as a distributor, operator, or manufacturer;

(6) allowing a person to participate as a player in pull-tab activity conducted by or for the permittee if

(A) the person or a related party has access to pull-tab information or accounting records; or

(B) the person is prohibited from play in a gaming activity by AS 05.15.187(h);

(7) a gaming transaction between the person and a third party, regardless of whether the third party is regulated under AS 05.15 or this chapter, in which

(A) the item or service being conveyed between the person and the third party is subsequently sold or provided to another person regulated under this chapter; and

(B) the gaming transaction, if conducted directly between the person and another person regulated under this chapter, without the third party's involvement, would result in a prohibited conflict of interest under AS 05.15 and this chapter;

(8) an activity that violates 15 AAC 160.942.

(1) a contract of employment with a direct relative, if the wage or salary paid is comparable to that paid for similar employees in gaming regulated under AS 05.15;

(2) a lease of a gaming location by an operator under 15 AAC 160.936;

(3) a lease of a gaming location by a multiple-beneficiary permittee from a member permittee or permittees, if the multiple-beneficiary permittee biennially obtains an appraisal from a certified real estate appraiser authorized under AS 08.87, certifying that the lease amount is not in excess of market value for general commercial space in the community;

(4) a transaction with a direct relative in a remote community for which the person regulated under this chapter proves

(A) no alternative party could practicably provide the good or service procured;

(B) the price paid for the good or service was no greater than that paid by others for the same good or service;

(5) a gaming transaction occurring before January 1, 2004, between an operator and a distributor who is the operator's spousal equivalent;

(6) a contribution, loan, or gift under 15 AAC 160.363;

(7) the sale of a raffle ticket by a person regulated under this chapter to a related party;

(8) participation by a person regulated under this chapter in any activity permitted under AS 05.15 or this chapter, other than pull-tabs, who is not barred by 15 AAC 160.500(b), by house rules, or by the minimum age requirements in AS 05.15.180 or this chapter, and who is not involved with selection of a winner in the activity.

(d) It is a prohibited conflict of interest for

(1) a person to be or act as both an operator and a distributor; or

(2) a registered vendor to employ or have a contract other than a gaming contract with a permittee with whom the registered vendor has a gaming contract.

(e) For purposes of this section,

(1) a related party includes a direct relative or an affiliate of a person regulated by this chapter; and

(2) a gaming transaction includes a transaction that results in an "authorized expense" described under 15 AAC 160.995(3).

(f) A person regulated under this chapter includes the entity that receives a license, permit, or registration, and an official representative of the entity. An official representative of a person regulated under this chapter includes, if applicable, the person's

(1) primary and alternate members in charge of a permittee, including the primary and alternate members in charge of the member permittees of a multiple-beneficiary permit;

(2) manager of gaming for a permittee;

(3) officers;

(4) board of directors;

(5) partners; and

(6) affiliates.

History

Authority: AS 05.15.060; AS 05.15.140; AS 05.15.188
Eff. 11/10/96, Register 140; am 1/1/2003, Register 164; am 6/22/2008, Register 186

15 AAC 160.955 Prohibited financial interests for permittees

Repealed.

History

Eff. 7/30/94, Register 131; am 11/10/96, Register 140; repealed 1/1/2003, Register 164

15 AAC 160.956 Prohibited financial interests for operators

Repealed.

History

Eff. 11/10/96, Register 140; repealed 1/1/2003, Register 164

15 AAC 160.957 Prohibited financial interests for multiple-beneficiary permittees

Repealed.

History

Eff. 11/10/96, Register 140; repealed 1/1/2003, Register 164

15 AAC 160.958 Prohibited financial interests for distributors

Repealed.

History

Eff. 11/10/96, Register 140; repealed 1/1/2003, Register 164

15 AAC 160.959 Prohibited financial interests for manufacturers

Repealed.

History

Eff. 11/10/96, Register 140; repealed 1/1/2003, Register 164

15 AAC 160.960 Interest on delinquent fees

Interest on a delinquent fee under AS 05.15 or this chapter begins accruing on the date the fee is due to the department. The interest is calculated at the rate set under AS 43.05.225.

History

Authority: AS 05.15.060; AS 05.15.095
Eff. 7/30/94, Register 131

15 AAC 160.963 Activity banned during delinquency

(a) A permittee or operator may not conduct an activity under AS 05.15 or this chapter, or a distributor may not sell pull-tabs, during a period in which a financial report, annual report or monthly pull-tab report is delinquent.

(b) Upon notice from the department, a permittee or operator may not conduct an activity under AS 05.15 or this chapter, or a distributor may not sell pull-tabs, during a period in which a tax, fee, penalty, or interest due to the department from the permittee, operator, or distributor, is delinquent.

(c) Upon notice from the department, a distributor may not sell pull-tabs or other gaming supplies to a permittee or an operator during a period in which a report, tax, fee, penalty, or interest due to the department from a permittee or operator is delinquent, until the department informs the distributor that the report or amount due has been filed or paid.

(d) With agreement from the department for extended payment of an undisputed fee, tax, penalty, or interest, a permittee or licensee may continue to conduct gaming activity pending final payment.

History

Authority: AS 05.15.060; AS 05.15.095
Eff. 9/3/2005, Register 175

15 AAC 160.965 Request for waiver of penalty

(a) A permittee or licensee may request the department to waive a penalty due the department under AS 05.15.095(d) for reasonable cause. A waiver request must be made in writing to the department and must provide a detailed explanation of the reasons said to justify the waiver.

(b) Reasons constituting reasonable cause under AS 05.15.095(d) include

(1) war, riot, rebellion, act of God, or other disaster that rendered it impossible for the permittee or licensee to pay the fee or that made the delay in paying the fee unavoidable; and

(2) an act or omission by a third party that was beyond the control of the permittee or licensee and made delay in paying the fee unavoidable.

History

Authority: AS 05.15.060; AS 05.15.095
Eff. 7/30/94, Register 131

15 AAC 160.970 Member in charge restriction

(a) A member in charge or alternate member in charge of a permittee may not be an operator, employee of an operator, registered vendor, or employee of a registered vendor that conducts gaming activity for the permittee.

(b) A member in charge or alternate member in charge must be a natural person. A change in a member in charge or alternate member in charge must be reported to the department on an amended application under 15 AAC 160.070.

(c) A member in charge or an alternate member in charge who is designated on a permit application must have been an active member of the permittee, on the board of directors of the permittee, or an employee of the permittee for at least six months before the date of the permit application.

(d) The member in charge, and the alternate member in charge in the absence of the member in charge,

(1) are the principal points of contact between the permittee and the department, particularly in the investigation of complaints and the review or audit of reports;

(2) are responsible for ensuring that gaming activity, including oversight of the manager of gaming, if any, is properly conducted, that gaming activity is properly recorded and reported, and that requested information and records are provided to the department in a timely manner; and

(3) shall make an effort to ensure that adequate internal controls are used on activities conducted under AS 05.15 and this chapter, and that net proceeds are properly used.

(e) For a permittee to conduct an activity under AS 05.15 or this chapter, the member in charge or alternate member in charge must be actively carrying out the responsibilities of a member in charge. A permittee must maintain active plans to replace a member in charge or alternate member in charge who resigns or is no longer able to serve as member in charge or alternate member in charge. If a permittee does not have a natural person actively carrying out the responsibilities of a member in charge, the permit is suspended until the department receives an amended application identifying a member in charge and the new member in charge has passed the test required by AS 05.15.112(a).

(f) a member in charge or an alternate member in charge must be at least 21 years of age

History

Authority: AS 05.15.060; AS 05.15.112
Eff. 7/30/94, Register 131; am 9/3/2005, Register 175; am 6/22/2008, Register 186

15 AAC 160.975 Permittee and operator tests

(a) The department will not issue a permit to a municipality, qualified organization, or multiple-beneficiary permittee until the applicant's member in charge and alternate member in charge have passed the test required under AS 05.15.112(a).

(b) The department will not issue an operator's license to a person, municipality, or qualified organization until the person, the designated employee of the municipality, or the designated member of the organization has passed the test required under AS 05.15.122(b)(6).

(c) For applications for permits for calendar years after 2005, a manager of gaming for a multiple-beneficiary permittee, or for a permittee that engages in bingo or pull-tab sales under its own permit, must pass the test required of a member in charge under AS 05.15.112(a).

(d) A prospective member in charge, prospective alternate member in charge, prospective manager of gaming, or applicant for an operator license who fails to pass the test required under AS 05.15.112(a) or AS 05.15.122(b)(6) must arrange with the department for retesting. The department may require additional study time before rescheduling the test for the person being tested.

(e) The department may require operators, members in charge, alternate members in charge, and managers of gaming to retest, if the department finds that changes in AS 05.15 or this chapter are sufficiently extensive to warrant it.

History

Authority: AS 05.15.060; AS 05.15.112; AS 05.15.122
Eff. 7/30/94, Register 131; am 9/3/2005, Register 175

15 AAC 160.980 Inspection of premises, books, and records

(a) Premises used to conduct an activity permitted under AS 05.15 must be open to inspection by the department whenever an activity is conducted at the premises or any other reasonable time. During an inspection, the department may

(1) count the money on hand or received from gaming activity while the activity is conducted;

(2) repealed 1/1/2003;

(3) repealed 1/1/2003;

(4) inspect the books and records of the permittee, licensee, registered vendor, employee, or other person that directly participates in the conduct of the activity; or

(5) inspect the premises as reasonably necessary to enforce AS 05.15 and this chapter.

(b) An operator or a permittee shall, within a reasonable amount of time, provide the permittee or the department the following books and records upon request:

(1) general and subsidiary ledgers;

(2) bank statements and bank reconciliations;

(3) records of all accounts into which gaming receipts have been deposited or transferred;

(4) repealed 11/10/96;

(5) income tax returns as they relate to gaming activities under AS 05.15;

(6) Alaska Department of Labor and Workforce Development records;

(7) reports filed under AS 05.15.083 or 05.15.087;

(8) other books and records requested by the permittee necessary to determine the amount of proceeds due the permittee;

(9) other books and records requested by the department in furtherance of the purposes of AS 05.15 or this chapter.

(c) A book or record made available for inspection under AS 05.15 or this chapter must be readily available to the department at a location in the state. The department will, in its discretion, require a book or record, or a copy of a book or record, to be forwarded to the department for inspection.

(d) Unless the department consents in writing to a different deadline, a permittee, licensee, or registered vendor shall provide to the department books, records, information, or other documents requested by the department within fourteen days of receipt of the request.

History

Authority: AS 05.15.060; AS 05.15.083 AS 05.15.070; AS 05.15.087
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164

15 AAC 160.985 Advisory notices and notices of violation

(a) The department may issue an advisory notice to a permittee, licensee, or registered vendor if an incident occurs or a defect is identified that could result in a violation of AS 05.15 or this chapter. An advisory notice may not constitute grounds for administrative or court action against a permittee, licensee, or registered vendor, but may constitute grounds for issuance of a notice of violation if the incident or defect continues uncorrected. A copy of an advisory notice will be filed only in the enforcement file of a permittee, licensee, or registered vendor.

(b) The department may issue a notice of violation to a permittee, licensee, or registered vendor if the department has reason to believe that a violation of AS 05.15 or this chapter has occurred or might occur.

(c) The department will place a notice of violation and any written response in the permanent record of the department for the permittee, license, or registered vendor to whom the notice was issued.

History

Authority: AS 05.15.060; AS 05.15.100
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 9/3/2005, Register 175

15 AAC 160.990 Proof of activity

In fulfilling its duties under AS 05.15.180(b), the department will presume that an activity did not exist and was not conducted before January 1, 1959. A permittee or operator may overcome this presumption by submitting documentation such as newspaper articles, records, and other proof that establishes that the activity did exist and was conducted as required under AS 05.15.180(b).

History

Authority: AS 05.15.060; AS 05.15.140 AS 05.15.100; AS 05.15.180
Eff. 7/30/94, Register 131

15 AAC 160.992 Reinstatement of persons prohibited from involvement

(a) Disqualification of a person under AS 05.15.105 terminates 10 years after the person's conviction for a crime that is at the time of conviction for the violation of a law of this state or, if of another jurisdiction, would if committed in this state be a Class B felony other than extortion, a Class C felony, or an unclassified felony described outside AS 11, and that is not a crime of dishonesty or theft or a violation of gambling laws.

(b) Disqualification of a person for a conviction for the violation of a law of this or another jurisdiction that is a crime of dishonesty or theft or is a violation of gambling laws, that is not an unclassified felony described in AS 11, a Class A felony, or the crime of extortion, terminates 10 years after the date of conviction if the department determines that the

(1) person is of good moral character, honesty, and integrity; and

(2) person's involvement in charitable gaming is not against the public interest.

(c) A person disqualified under (a) of this section must make application to participate in charitable gaming. The application, which may be submitted up to six months before the anticipated 10th anniversary of the conviction, shall be made by letter accompanied by a copy of the document evidencing the conviction and the date of conviction. The department will notify the person when the department considers the person no longer to be disqualified and the date on which the person may become involved in charitable gaming.

(d) A person disqualified under (b) of this section must make application to the department on a form to be provided by the department for authorization to become involved in charitable gaming. Application may be submitted up to six months before the anticipated 10th anniversary of the conviction. The department will notify the person when it no longer considers the person to be disqualified and the date on which the person may become involved in charitable gaming. At the time of application the person must provide the following items:

(1) a copy of the document evidencing the conviction and the date of conviction;

(2) letters from at least three persons unrelated to the applicant, such as clergy, professionals in the field of psychology or psychiatry, or law enforcement officials, recommending that the applicant be permitted to participate in charitable gaming, indicating their opinions as to the character, honesty, and integrity of the applicant, the basis for their opinions, and the length of time the applicant has been known to them;

(3) a letter from an official of the permittee indicating how the applicant is to be involved in charitable gaming and why the applicant's involvement will not be against the public interest; if more than one permittee is involved, such as when the applicant intends to act as an operator, a vendor, a distributor, or a managerial or supervisory employee of any of these entities, the applicant must produce letters from at least two permittees who will be served by the licensee, containing the same information as from a single permittee.

(e) A crime of dishonesty is a crime in which a material element involves lying, cheating, deception, or fraud, and includes a crime listed in AS 11.46.500 - 11.46.990 or, if committed in another jurisdiction, a crime that is substantially similar.

(f) A crime of theft is larceny, robbery, burglary, forgery, and all other crimes listed in AS 11.46.100 - 11.46.290 or, if committed in another jurisdiction, a crime that is substantially similar.

(g) A violation of gambling law involves a violation of AS 11.66.200 - 11.66.280 or, if committed in another jurisdiction, a crime that is substantially similar.

(h) Conviction for an unclassified felony, a Class A felony, or the crime of extortion, or, if committed in another jurisdiction, a crime that is substantially similar is a bar to participation in charitable gaming and the disqualification may not be terminated.

History

Authority: AS 05.15.060; AS 05.15.105
Eff. 11/10/96, Register 140

15 AAC 160.995 Definitions

As used in AS 05.15 and this chapter, unless the context requires otherwise,

(1) "advisory notice" means an informal notice by the department to a multiple-beneficiary permittee or other permittee, licensee, or registered vendor that a complaint has been filed with the department or that the department has reason to believe that a violation of AS 05.15 or this chapter has occurred;

(2) "affiliate" means a separate legal entity that controls, is controlled by, or is under common control with the person, whether the control is exercised by ownership or contract; "affiliate" includes a parent, subsidiary, or other business with at least 10 percent ownership by the person and related parties;

(3) "authorized expenses" means costs that are reasonable, ordinary, and necessary to the conducting of an activity permitted under AS 05.15; "authorized expenses"

(A) includes

(i) the depreciation and maintenance of equipment used exclusively in an activity permitted under AS 05.15;

(ii) the printing of raffle tickets;

(iii) advertising;

(iv) utilities, maintenance, property taxes, insurance, and depreciation of the portion of a building, together with improvements, owned by the holder of the permit that is used for gaming activity;

(v) the lease or rental of property and facilities;

(vi) postage;

(vii) freight;

(viii) accounting services;

(ix) employee wages and payroll taxes;

(x) pull-tab taxes under AS 05.15.184;

(xi) janitorial services for the premises;

(xii) food for player consumption on the premises provided free of charge;

(xiii) legal and consulting services, if directly related to the conduct of an activity authorized under AS 05.15 or this chapter;

(xiv) door prizes;

(xv) interest on allowable loans; and

(xvi) other amounts allowed by generally accepted accounting principles as modified by AS 05.15 and this chapter;

(B) does not include

(i) gifts to members and players;

(ii) membership fees;

(iii) vehicle cost and expenses;

(iv) fees not directly related to the conduct of the authorized activity;

(v) entertainment;

(vi) tobacco products and alcoholic beverages;

(vii) transportation of players;

(viii) child care or babysitting;

(ix) promotional items;

(x) lobbying expenses;

(xi) for purposes of AS 05.15.165(b), the amount of otherwise authorized expenses that exceed the limitations provided in AS 05.15.160(c) and (d);

(xii) an amount paid for expenses other than goods and services directly connected to the conduct of the gaming activities if a legal obligation does not exist to make payment;

(xiii) general administrative or other overhead not related to gaming;

(xiv) per diem or stipends to members, including board members and officers, to attend organizational meetings in their own communities; and

(xv) other expenditures not directly connected to the gaming activities.

(4) "cash prizes" include

(A) currency and coinage of the United States or a foreign country;

(B) gold, silver, and other precious metals;

(D) gift certificates redeemable for cash;

(5) "direct relative" means the individual's spouse or spousal equivalent, parent, mother-in-law, father-in-law, brother-in-law, sister-in-law, brother, sister, child, or stepchild;

(6) "door prize" means a prize awarded in a drawing for which no consideration is provided by any of the participants;

(7) "electronic bingo paper" means an electronic device that replicates a traditional bingo card as described in 15 AAC 160.570(b)(3) and that is not capable of being connected to a random number generator, or of being played without the direct participation of a player in a bingo game;

(8) "financial interest" for a person means the person or the person's direct relative has an ownership interest in, or receives a financial benefit from an asset; for purposes of this chapter, a person has a financial interest in a corporation if the person or the person's direct relative owns 10 percent or more of the outstanding stock, or is an officer or director, of a corporation that owns or receives benefit from an asset;

(9) "flare card" means a printed card or sheet that is provided by a pull-tab manufacturer with a pull-tab game;

(10) "gift"

(A) means a voluntary transfer of something of value for which no consideration is received;

(B) includes an item given as a promotion or inducement;

(C) does not include a donation provided to a charitable organization to be used by that organization to support its charitable mission, if the donation has no effect on gaming and is not for the benefit of an official representative of the organization;

(11) "hard card" means a reusable bingo card;

(12) "ideal gross receipts" means the amount of receipts that would be received if each pull-tab in a series was sold at face value;

(13) "licensee" means a person that holds a valid operator's license under AS 05.15.122, pull-tab manufacturer's license under AS 05.15.181, or pull-tab distributor's license under AS 05.15.183;

(14) "manager of gaming" means the person responsible for the conduct of gaming by a permittee or multiple-beneficiary permit;

(15) "non-gaming source" means a source of income from activities not regulated by AS 05.15 or this chapter;

(16) "nonprofit trade association" means an association of merchants, craftsmen, or businesses in a particular trade or industry that is organized for the promotion of the common interest of the trade or industry and that operates without profit to its members;

(17) "notice of violation" means a written notice by the department to a permittee, licensee, or registered vendor that a violation of AS 05.15 or this chapter has occurred or may occur;

(18) "outboard motor association" means an association that operates without profit to its members and is organized primarily to promote power-boat racing and use of power boats;

(19) "permit" means a permit issued by the department under AS 05.15.020 or a multiple-beneficiary permit under AS 05.15.100(d);

(20) "permittee" means an entity or group of entities holding a permit;

(21) "primary gaming location" means a location used primarily for the conduct of a gaming activity;

(22) "prohibited financial interest" means a prohibited conflict of interest under this chapter;

(23) "self-directed permit" means a qualified organization or municipality that conducts an authorized activity under its own permit;

(24) "spousal equivalent" means a person who is cohabiting with another person in a relationship that is like a marriage but that is not a legal marriage;

(25) "validated bingo sheet" means a date-stamped bingo sheet or bingo card;

(26) "animal classic" has the meaning given in AS 05.15.690;

(27) "chicken contest" means a game of chance in which prizes are awarded for the correct guess concerning an activity involving chicken manure and

(A) a numbered grid; or

(B) a lettered grid;

(28) "rat race" means a game of chance in which prizes are awarded for the correct guess of which numbered or colored hole on a wheel a rat, hamster, gerbil, or other rodent enters as the wheel is slowly rotated;

(29) "bucket or basket raffle" means a raffle in which

(A) a bucket or basket is placed in front of each of two or more prizes;

(B) a player buys dual roll tickets, with the option of placing one of each ticket pair in the bucket or basket of choice for drawing for the indicated prize; and

(30) "calendar raffle" means a raffle in which a player buys a calendar with an attached raffle ticket stub, and where the player submits the stub for deposit in a drawing container, with drawings to be conducted on multiple dates, as stated in the schedule provided with the calendar;

(31) "progressive raffle" means a raffle in which

(A) the drawing is made from a pool consisting of the entire list of members of the permittee organization;

(B) if the person whose member number is drawn purchased a ticket for that particular drawing, that person wins the raffle prize amount, consisting of the prize money accumulated since the last winning member number was drawn; and

(C) if the person drawn did not purchase a ticket for that particular drawing, there is no winner for that drawing and the prize is added to the prize to be awarded at the next regular drawing in the progressive raffle;

(32) "split-the-pot raffle" means a raffle where the prize is 50 percent of the gross receipts raised in selling tickets;

(33) "coin board" means a game board with legal tender or commemorative coins that is played in conjunction with a pull-tab game, in which some pull-tabs are designated in advance as winners of

(A) one of the coins; and

(B) the item or amount of cash described in the space on the board behind the coin awarded to the winner;

(34) "point-of-sale system" means a computerized system that is used in conjunction with the sale of bingo cards, electronic bingo paper, or pull-tabs to generate sales records and data, and to enhance sales security and cash control;

(35) "pull-tab dispensing device" means a mechanical or electronic device that dispenses pull-tab games, may be connected to a cash register or a point-of-sale system, and cannot accept money or other forms of payment for the pull-tabs dispensed;

(36) "seal card" means a board or placard that is played in conjunction with a pull-tab game and that contains one or more seals that, when removed or opened, reveal designated winning numbers, letters, or symbols;

(37) "supervisor" means a person who directs subordinate employees, under the authority of the employer, in the conduct of activities under AS 05.15 and this chapter.

(38) "house rules" means the rules and procedures established by a permittee, operator, or registered vendor that guide the conduct of an activity under AS 05.15 and this chapter by a permittee, operator, or registered vendor.

History

Authority: AS 05.15.020; AS 05.15.130; AS 05.15.181 AS 05.15.060; AS 05.15.160; AS 05.15.183 AS 05.15.112; AS 05.15.165; AS 05.15.184 AS 05.15.122; AS 05.15.180; AS 05.15.690
Eff. 7/30/94, Register 131; am 11/10/96, Register 140; am 1/1/2003, Register 164; am 12/18/2004, Register 172; am 9/3/2005, Register 175; am 6/22/2008, Register 186; am 11/13/2014, Register 212

Chapter 165 Tax on Gaming or Gambling Activities Aboard Large Passenger Vessels

15 AAC 165.110 Tax returns, payment, and administration

(a) An operator shall file an annual tax return on a calendar year basis. The tax return, and the total tax imposed by AS 43.35.210, are due on April 15 of the following calendar year.

(b) The operator shall file the tax return on a form prescribed by the department. The operator or an authorized agent of the operator shall sign the tax return under penalty of unsworn falsification.

History

Authority: AS 43.05.080; AS 43.35.210
Eff. 4/11/2008, Register 186

15 AAC 165.120 Extension of time for filing return

(a) An operator may file for an automatic six-month extension of time for filing a tax return.

(b) An operator must file an application for an extension of time for filing a tax return with the department no later than the tax return due date. The operator must attach a copy of the extension application with the tax return.

History

Authority: AS 43.05.080; AS 43.35.210
Eff. 4/11/2008, Register 186

15 AAC 165.130 Calculation of tax

An operator shall calculate the amount subject to tax imposed by AS 43.35.210 by multiplying adjusted gross income from gaming or gambling earned during the entire voyage by the percentage of gaming or gambling hours conducted in waters under the state's jurisdiction. The operator shall calculate the percentage by dividing the total number of gaming or gambling hours while in waters under the state's jurisdiction by the total number of gaming or gambling hours during the entire voyage.

History

Authority: AS 43.05.080; AS 43.35.200; AS 43.35.210
Eff. 4/11/2008, Register 186

15 AAC 165.140 Records retention and inspection

An operator shall preserve in hard copy or in electronic format, all books, records, and any other data used to prepare the tax return. The operator shall retain those materials for three years following the return due date or the date the operator files the return, whichever is later. For each large passenger vessel on which the operator conducted gaming or gambling in waters under the state's jurisdiction, the operator shall prepare and maintain information that includes

(1) the name and call sign of the vessel providing each voyage;

(2) a list of all voyages that the vessel completed during the year;

(3) the names of the ports where each voyage originated and ended;

(4) the beginning and ending date of each voyage;

(5) the total gaming and gambling hours for each voyage;

(6) the total gaming and gambling hours conducted in waters under the state's jurisdiction for each voyage;

(7) the books and records used to calculate the amount of adjusted gross income from gaming or gambling earned on each voyage, including the books and records used to support the amount of adjusted gross income from gaming or gambling reflected in audited financial statements; and

(8) the amount of federal and municipal taxes paid or owed that were deducted in computing the adjusted gross income from gaming and gambling for each voyage.

History

Authority: AS 43.05.080; AS 43.35.210
Eff. 4/11/2008, Register 186

15 AAC 165.900 Definitions

(a) In AS 43.35.200 - 43.35.220 and this chapter, unless the context requires otherwise,

(1) "gaming or gambling" means a contest, game, or activity in which a person stakes or risks something of value upon

(A) the outcome of a contest of skill or chance or a future contingent event not under the person's control or influence; and

(B) an agreement or understanding that the person or another person will receive something of value in the event of a certain outcome;

(2) "gross income" means the difference between gaming wins and losses before deducting costs and expenses as computed under United States generally accepted accounting principles;

(3) "large passenger vessel" means a vessel that provides sleeping accommodations for all of its passengers and that makes at least one voyage of the type described in 15 U.S.C. 1175 (Johnson Act) during the year;

(4) "operator" means a person that conducts gaming or gambling on a large passenger vessel during a voyage described in 15 U.S.C. 1175 (Johnson Act) in waters under the state's jurisdiction;

(5) "passenger" has the meaning given in AS 43.52.295(3);

(6) "prizes awarded" means cash or other consideration given to a participant in gaming or gambling; "prizes awarded" does not include

(A) amounts already accounted for in the calculation of gross income; or

(B) complimentaries, promotional allowances, or other goods or services that would be accounted for as revenue if sold;

(7) "waters under the state's jurisdiction" or "waters under the jurisdiction of the State of Alaska" means waters to which the state's jurisdiction extends under AS 44.03.010.

(b) In this chapter, "gaming or gambling hours" means the hours during which gaming or gambling is conducted or during which gaming or gambling devices, machines, or instruments are available for play.

History

Authority: AS 43.05.080; AS 43.35.210
Eff. 4/11/2008, Register 186