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SB 3001

Alaska Senate•In Senate Committee

Summary

SB 3001, “Oil & Gas Property Tax; Muni Tax; Agdc”, was introduced in the Senate on Jun 20, 2026 by Sen. Rules. It was referred to Finance, and last saw action on Jun 20, 2026: REFERRED TO FINANCE.

Record

Text

SB 3001 has no co-sponsors and has not gone to a roll call.

sb3001/introduced.txt
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                                   SENATE BILL NO. 3001
                       IN THE LEGISLATURE OF THE STATE OF ALASKA
               THIRTY-FOURTH LEGISLATURE - THIRD SPECIAL SESSION
 BY THE SENATE RULES COMMITTEE BY REQUEST OF THE GOVERNOR
 Introduced: 6/20/26
 Referred: Finance
                                           A BILL
                                  FOR AN ACT ENTITLED
  "An Act relating to the taxation of certain natural gas project property and related
  facilities; relating to local contributions for public school funding; relating to municipal
  property taxes; relating to the Alaska Gasline Development Corporation and funds of
  the Alaska Gasline Development Corporation; relating to reporting requirements for
  natural gas pipeline projects; creating the Alaska affordable heating fuel fund; relating
  to approval of contracts by the Regulatory Commission of Alaska and inflation
  adjustment of the maximum price of natural gas; relating to an alternative volumetric
  tax on natural gas throughput; relating to a municipal impact grant program and fund;
  relating to agreements and a payment related to a natural gas project; and providing for
 an effective date."
 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
   * Section 1. The uncodified law of the State of Alaska is amended by adding a new section
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  to read:
LEGISLATIVE FINDINGS AND INTENT. (a) The legislature finds that the tax
  treatment in sec. 26 of this Act is necessary to advance a major natural gas project and to
  ensure that
(1) the project maximizes the benefit to the state by ensuring direct and
  affordable access to natural gas to the residents of the state; and
(2) communities affected by the natural gas project are protected from the
  negative effects of the project.
(b) Nothing in this Act is intended to establish, modify, impair, waive, or otherwise
 affect the tax treatment, assessment methodology, valuation, taxing authority, or applicability
 of taxes imposed under AS 29.45 or AS 43.56 with respect to any other property, project,
 facility, infrastructure, or taxpayer. It is the intent of the legislature that this Act be narrowly
 construed and not serve as precedent, guidance, or interpretive authority for the taxation of
 any other property subject to taxation under AS 29.45 or AS 43.56.
  * Sec. 2. AS 14.17.410(b), as amended by sec. 7, ch. 22, SLA 2026, is amended to read:
(b) Public school funding consists of state aid, a required local contribution,
and eligible federal impact aid determined as follows:
(1) state aid equals basic need minus a required local contribution and
90 percent of eligible federal impact aid for t hat fiscal year; basic need equals the sum
obtained under (D) of this paragraph, multiplied by the base student allocation set out
in AS 14.17.470; district adjusted ADM is calculated as follows:
(A) the ADM of each school in the district is calculated by
applying the school size factor to the student count as set out in AS 14.17.450;
(B)    the number obtained under (A) of this paragraph is
multiplied by the district cost factor described in AS 14.17.460;
(C)    the ADMs of each school in a district, as adjusted
according to (A) and (B) of this paragraph, are added; the sum is then
multiplied by the special needs factor set out in AS 14.17.420(a)(1) and the
secondary school vocational and technical instruction funding factor set out in
AS 14.17.420(a)(3);
(D)     the number obtained for intensive services under
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AS 14.17.420(a)(2) and the number obtained for correspondence study under
AS 14.17.430 are added to the number obtained under (C) of this paragraph or
under (H) and (I) of this paragraph;
(E) notwithstanding (A) - (C) of this paragraph, if a school
district's ADM adjusted for school size under (A) of this paragraph decreases
by five percent or more from one fiscal year to the next fiscal year, the school
district may use the last fiscal year before the decrease as a base fiscal year to
offset the decrease, according to the following method:
(i) for the first fiscal year after the base fiscal year
determined under this subparagraph, the school district's ADM adjusted
for school size determined under (A) of this paragraph is calculated as
the district's ADM adjusted for school size, plus 75 percent of the
difference in the district's ADM adjusted for school size between the
base fiscal year and the first fiscal year after the base fiscal year;
(ii) for the second fiscal year after the base fiscal year
determined under this subparagraph, the school district's ADM adjusted
for school size determined under (A) of this paragraph is calculated as
the district's ADM adjusted for school size, plus 50 percent of the
difference in the district's ADM adjusted for school size between the
base fiscal year and the second fiscal year after the base fiscal year;
(iii) for the third fiscal year after the base fiscal year
determined under this subparagraph, the school district's ADM adjusted
for school size determined under (A) of this paragraph is calculated as
the district's ADM adjusted for school size, plus 25 percent of the
difference in the district's ADM adjusted for school size between the
base fiscal year and the third fiscal year after the base fiscal year;
(F) the method established in (E) of this paragraph is available
to a school district for the three fiscal years following the base fiscal year
determined under (E) of this paragraph only if the district's ADM adjusted for
school size determined under (A) of this paragraph for each fiscal year is less
than the district's ADM adjusted for school size in the base fiscal year;
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(G) the method established in (E) of this paragraph does not
apply to a decrease in the district's ADM adjusted for school size resulting
from a loss of enrollment that occurs as a result of a boundary change under
AS 29;
(H) notwithstanding (A) - (C) of this paragraph, if one or more
schools close and consolidate with one or more other schools in the same
community and district and, as a result of the consolidation, basic need
generated by the district's ADM of the consolidated schools as adjusted under
(A) - (C) of this paragraph decreases, the district may use the last fiscal year
before the consolidation as the base fiscal year to offset that decrease for the
first four fiscal years following consolidation according to the following
method:
(i) for the first two fiscal years after the base fiscal year,
the district's ADM of the consolidated schools as adjusted under (A) -
(C) of this paragraph is calculated by dividing the sum of the district's
ADM of the consolidated schools as adjusted under (A) - (C) of this
paragraph for the base fiscal year by the sum of the district's ADM of
the consolidated schools for the base fiscal year without adjustment,
and subtracting the quotient obtained by dividing the district's ADM of
the consolidated schools for the current fiscal year as adjusted under
(A) - (C) of this paragraph by the sum of the district's ADM of the
consolidated schools for the current fiscal year without adjustment,
multiplying that number by the sum of the district's ADM of the
consolidated schools for the current fiscal year without adjustment, and
adding that number to the sum of the district's ADM of the consolidated
schools for the current fiscal year as adjusted under (A) - (C) of this
paragraph;
(ii) for the third fiscal year after the base fiscal year, the
district's ADM of the consolidated schools as adjusted under (A) - (C)
of this paragraph is calculated by dividing the sum of the district's
ADM of the consolidated schools as adjusted under (A) - (C) of this
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paragraph for the base fiscal year by the sum of the district's ADM of
the consolidated schools for the base fiscal year without adjustment,
and subtracting the quotient obtained by dividing the sum of the
district's ADM of the consolidated schools for the current fiscal year as
adjusted under (A) - (C) of this paragraph by the sum of the district's
ADM of the consolidated schools for the current fiscal year,
multiplying that number by the sum of the district's ADM of the
consolidated schools for the current fiscal year without adjustment,
multiplying that number by 66 percent, and adding that number to the
sum of the district's ADM of the consolidated schools for the current
fiscal year as adjusted under (A) - (C) of this paragraph;
(iii) for the fourth fiscal year after the base fiscal year,
the district's ADM of the consolidated schools as adjusted under (A) -
(C) of this paragraph is calculated by dividing the sum of the district's
ADM of the consolidated schools as adjusted under (A) - (C) of this
paragraph for the base fiscal year by the sum of the district's ADM of
the consolidated schools for the base fiscal year without adjustment,
and subtracting the quotient obtained by dividing the sum of the
district's ADM of the consolidated schools for the current fiscal year as
adjusted under (A) - (C) of this paragraph by the sum of the district's
ADM of the consolidated schools for the current fiscal year,
multiplying that number by the sum of the district's ADM of the
consolidated schools for the current fiscal year without adjustment,
multiplying that number by 33 percent, and adding that number to the
sum of the district's ADM of the consolidated schools for the current
fiscal year as adjusted under (A) - (C) of this paragraph;
(iv) to calculate the district's basic need for each fiscal
year, the number obtained through the calculation in (i), (ii), or (iii) of
this subparagraph is added to the number obtained under (C) of this
paragraph for the remainder of the district;
(I)   if the basic need calculated under (H)(i) - (iii) of this
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paragraph for one of the first four fiscal years after consolidation is less than
the basic need calculated under (A) - (C) of this paragraph for that fiscal year,
the basic need may not be adjusted under (H) of this paragraph for that fiscal
year;
(J)     a district may not offset a decrease under (H) of this
paragraph if
(i) a new facility is constructed in the district for the
consolidation; or
(ii)   the district offset a decrease under (E) of this
paragraph in the same fiscal year;
(K) a district that offsets a decrease under (H) of this paragraph
may not reopen a school that was closed for consolidation in the district until
(i) four or more years have passed since the school
closure; and
(ii) the district provides evidence satisfactory to the
department that the schools affected by the consolidation are over
capacity;
(L) a district may not reopen and reconsolidate a school that
was consolidated in the district more than once every four years for purposes
of the calculations made under (H) of this paragraph;
(M) a district offsetting a decrease under (H) of this paragraph
shall provide the department with the list of schools participating in the
consolidation and the corresponding ADM;
(2) the required local contribution of a city or borough school district
(A) is calculated by combining
(i) the equivalent of a 2.65 mill tax levy on the full and
true value of the taxable real and personal property in the district as of
January 1 of the second preceding fiscal year, as determined by the
Department of Commerce, Community, and Economic Development
under AS 14.17.510 and AS 29.45.110, not to exceed the amount
calculated under this sub-subparagraph for the preceding fiscal
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year by more than four percent; and
(ii)   if the city or borough of the school district
collects an alternative volumetric tax under AS 43.59.030, or if the
state collects an alternative volumetric tax on behalf of the city or
borough of the school district under AS 43.59.030, an amount equal
to a portion of the alternative volumetric tax collected, calculated
by multiplying the alternative volumetric tax collected by or on
behalf of the city or borough under AS 43.59.030 by 2.65 and
dividing the product by the mill rate set out in AS 43.56.010(a);
(B) [; THE REQUIRED LOCAL CONTRIBUTION] may not
exceed [(A)] 45 percent of a district's basic need for
(i) the preceding fiscal year as determined under (1) of
this subsection; or
(ii)   [(B) THE AMOUNT OF THE DISTRICT'S
REQUIRED LOCAL CONTRIBUTION FOR] the second preceding
fiscal year as determined under (1) of this subsection by more than
four percent.
  * Sec. 3. AS 14.17.510 is amended by adding a new subsection to read:
(d) In this section, the full and true value of the taxable real and personal
property does not include property subject to tax abatement under AS 43.59.010 or the
alternative volumetric tax levied under AS 43.59.020.
  * Sec. 4. AS 29.45.030 is amended by adding a new subsection to read:
(o)   Property of a natural gas project subject to tax abatement under
AS 43.59.010 or to the alternative volumetric tax under AS 43.59.020 is exempt from
taxation under AS 29.45. In this subsection, "natural gas project" has the meaning
given in AS 43.59.100.
  * Sec. 5. AS 29.45.080(c) is amended to read:
(c) A municipality may levy and collect a tax on the full and true value of that
portion of taxable property taxable under AS 43.56 as assessed by the Department of
Revenue which value, when combined with the value of property otherwise taxable by
the municipality, does not exceed the product of the percentage determined in (f) of
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this section of the average per capita assessed full and true value of property in the
state multiplied by the number of residents of the taxing municipality. Property
subject to tax abatement under AS 43.59.010 or to the alternative volumetric tax
levied under AS 43.59.020 is not included in the value of property for the purpose
of making the calculation under this subsection.
   * Sec. 6. AS 31.25.010 is amended to read:
Sec. 31.25.010. Structure. The Alaska Gasline Development Corporation is a
public corporation and government instrumentality acting in the best interest and as a
fiduciary of the state for the purposes required by AS 31.25.005, located for
administrative purposes in the Department of Commerce, Community, and Economic
Development, but having a legal existence independent of and separate from the state.
The corporation may not be terminated as long as it has bonds, notes, or other
obligations outstanding. The corporation may dissolve when no bonds, notes, or other
obligations of the corporation or a subsidiary of the corporation are outstanding and
the corporation or a subsidiary of the corporation is no longer engaged in the
development, financing, construction, or operation of an in-state natural gas pipeline
or an Alaska liquefied natural gas project. Upon termination of the corporation, its
rights and property pass to the state.
  * Sec. 7. AS 31.25.040(b) is amended to read:
(b) The board shall by regulation adopted under AS 44.62 (Administrative
Procedure Act) adopt and publish procedures to govern the procurement by the
corporation of supplies, services, professional services, and construction. The
procurement procedures must
(1)   reflect competitive bidding principles and provide vendors
reasonable and equitable opportunities to participate in the procurement
process;
(2)    include procurement methods to meet emergency and
extraordinary circumstances;
(3) comply with the five percent preference under AS 36.30.321(a);
and
(4) provide for an Alaska veterans' preference that is consistent with
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the Alaska veterans' preference in AS 36.30.175.
   * Sec. 8. AS 31.25.080(a) is amended to read:
(a) In addition to other powers granted in this chapter, the corporation may
(1) determine the form of ownership and the operating structure of an
in-state natural gas pipeline developed by the corporation and may, subject to
AS 31.25.120(b), enter into agreements with other persons for joint ownership, joint
operation, or both of an in-state natural gas pipeline or an Alaska liquefied natural gas
project;
(2) plan, finance, construct, develop, acquire, maintain, and operate a
pipeline system and other transportation mechanism, including pipelines, compressors,
storage facilities, and other related facilities, equipment, and works of public
improvement, in the state to facilitate production, transportation, and delivery of
natural gas or other related natural resources to the point of consumption or to the
point of distribution for consumption;
(3) lease or rent facilities, structures, and properties;
(4) exercise the power of eminent domain and file a declaration of
taking under AS 09.55.240 - 09.55.460 to acquire land or an interest in land that is
necessary for an in-state natural gas pipeline or an Alaska liquefied natural gas project;
the exercise of powers by the corporation under this paragraph may not exceed the
permissible exercise of the powers by the state;
(5) acquire, by purchase, lease, or gift, land, structures, real or personal
property, an interest in property, a right-of-way, a franchise, an easement, or other
interest in land, or an interest in or right to capacity in a pipeline system determined to
be necessary or convenient for the development, financing, construction, or operation
of an in-state natural gas pipeline project or an Alaska liquefied natural gas project or
part of an in-state natural gas pipeline project or an Alaska liquefied natural gas
project;
(6) subject to AS 31.25.120(b), transfer or otherwise dispose of all or
part of an in-state natural gas pipeline project, an Alaska liquefied natural gas project,
or an interest in an asset of the corporation;
(7) elect to provide transportation of natural gas as a contract carrier,
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common carrier, or otherwise;
(8) provide light, water, security, and other services for property of the
corporation;
(9) conduct hearings to gather and develop data consistent with the
purpose and powers of the corporation;
(10) advocate for new pipeline capacity before the Federal Energy
Regulatory Commission;
(11) make and execute agreements, contracts, and other instruments
necessary or convenient in the exercise of the powers and functions of the corporation
under this chapter, including a contract with a person, firm, corporation, governmental
agency, or other entity;
(12) sue and be sued in its own name;
(13) adopt an official seal;
(14) adopt bylaws for the regulation of its affairs and the conduct of its
business and adopt regulations and policies in connection with the performance of its
functions and duties;
(15) employ fiscal consultants, engineers, attorneys, appraisers, and
other consultants and employees that may, in the judgment of the corporation, be
required and fix and pay their compensation from funds available to the corporation;
(16) procure insurance against a loss in connection with its operation;
(17)     borrow money as provided in this chapter to carry out its
corporate purposes and issue its obligations as evidence of borrowing;
(18) include in a borrowing the amounts necessary to pay financing
charges, to pay interest on the obligations, and to pay the interest, consultant, advisory,
and legal fees, and other expenses that are necessary or incident to the borrowing;
(19)     receive, administer, and comply with the conditions and
requirements of an appropriation, gift, grant, or donation of property or money;
(20) do all acts and things necessary, convenient, or desirable to carry
out the powers expressly granted or necessarily implied in this chapter;
(21) invest or reinvest, subject to its contracts with noteholders and
bondholders, money or funds held by the corporation, including funds in the [IN-
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STATE NATURAL GAS PIPELINE FUND (AS 31.25.100) AND THE] Alaska
liquefied natural gas project bond fund (AS 31.25.150 [AS 31.25.110]), in obligations
or other securities or investments in which banks or trust companies in the state may
legally invest funds held in reserves or sinking funds or funds not required for
immediate disbursement, and in certificates of deposit or time deposits secured by
obligations of, or guaranteed by, the state or the United States;
(22) enter into, as it determines to be necessary or appropriate, any
swap or hedge, cap, or other contract providing for payments based on levels of or
changes in interest rates or indices or in the cost or price of any commodity, supply, or
expense expected to be used or incurred in connection with the acquisition,
construction, or operation of any facility or property owned, leased, or operated by the
corporation, or an option with respect to any of the foregoing;
(23) except as provided in (g) of this section, acquire an ownership or
participation interest in an Alaska liquefied natural gas project, natural gas treatment
facilities, natural gas pipeline facilities, liquefaction facilities, marine terminal
facilities related to the infrastructure of an Alaska liquefied natural gas project, or an
entity or joint venture that has an ownership interest in or is engaged in the planning,
financing, acquisition, maintenance, construction, and operation of an Alaska liquefied
natural gas project;
(24)    after consultation with the commissioner of revenue and the
commissioner of natural resources, enter into contracts relating to an Alaska liquefied
natural gas project, including contracts for services related to operation, marketing,
transportation, gas treatment, marine terminal operation, or liquefaction.
  * Sec. 9. AS 31.25.080 is amended by adding a new subsection to read:
(h) The corporation shall, to the maximum extent possible, use contractors and
suppliers in the state in order to benefit from the experience of workers and businesses
in the state in arctic engineering and construction.
  * Sec. 10. AS 31.25.090(f) is amended to read:
(f) Subject to the restrictions in this section, the [THE] corporation may
enter into confidentiality agreements necessary to acquire or provide information to
carry out its functions. If a state agency determines that a law or provision of a
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contract to which the state agency is a party requires the state agency to preserve the
confidentiality of the information and that delivering the information to the
corporation would violate the confidentiality provision of that law or contract, the state
agency shall
(1) identify the applicable law or contract provision to the corporation;
and
(2) obtain the consent of the person who has the right to waive the
confidentiality of the information under the applicable law or contract provision before
the state agency transfers the information to the corporation.
  * Sec. 11. AS 31.25.090 is amended by adding new subsections to read:
(j) A confidentiality agreement entered into under (f) of this section may not
(1)    prevent compliance with an administrative or court order
mandating disclosure;
(2) make confidential contract terms, or prospective contract terms,
that could extend to or encumber the state with fiscal or performance liability,
obligation, or risk, either directly or indirectly;
(3)   except as provided in (k) of this section, make confidential
information that may lead to
(A) a significant fiscal liability, obligation, or risk to the state;
or
(B) appropriations or other state funding or in-kind payments
or services from the state;
(4) make confidential the ownership or management structure of a
subsidiary of the corporation; or
(5) make confidential information related to the existence of a state
interest option under AS 31.25.125.
(k) A confidentiality agreement entered into under (f) of this section may
make confidential specific known or reasonably anticipated project economics or costs
related to the Alaska liquefied natural gas project only if
(1) one or more parties to the agreement reasonably assert that release
of the project economics or costs would cause commercial or competitive harm to an
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entity involved in the Alaska liquefied natural gas project; and
(2) the parties to the contract agree to release reasonable estimated
ranges or a summarization of project economics and costs sufficient for a legislator or
a public agent to assess the fiscal liability, obligation, or risk to the state, to the extent
that the ranges or summarization does not cause commercial or competitive harm to an
entity involved in the Alaska liquefied natural gas project.
(l) In this section,
(1) "public agent" means
(A) a public agency, as defined in AS 40.25.220, or an agent or
contractor of a public agency;
(B) an agent or contractor of a member of the legislature or of a
legislative committee;
(2)     "revenue-generating project" has the meaning given in
AS 31.25.125(i).
  * Sec. 12. AS 31.25.120 is amended to read:
Sec. 31.25.120. Creation of subsidiaries. The corporation may create
subsidiary corporations for the purpose of developing, constructing, operating, and
financing in-state natural gas pipeline projects or other transportation mechanisms; for
the purpose of aiding in the development, construction, operation, and financing of in-
state natural gas pipeline projects; or for the purpose of acquiring natural gas from the
North Slope, and natural gas from other regions of the state, including the state's outer
continental shelf, and making that natural gas available to markets in the state,
including the delivery of natural gas, including propane and other hydrocarbons
associated with natural gas other than oil, to coastal communities in the state, or for
export. Subject to the limitations for the use of money appropriated to [THE IN-
STATE NATURAL GAS PIPELINE FUND (AS 31.25.100) AND] the Alaska
liquefied natural gas project bond fund (AS 31.25.150 [AS 31.25.110]), the
corporation may transfer assets of the corporation to a subsidiary created under this
section. A subsidiary created under this section may borrow money and issue bonds as
evidence of that borrowing and has all the powers of the corporation that the
corporation grants to it. Unless otherwise provided by the corporation, the debts,
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liabilities, and obligations of a subsidiary corporation created under this section are not
the debts, liabilities, or obligations of the corporation.
   * Sec. 13. AS 31.25.120 is amended by adding a new subsection to read:
(b) The corporation may transfer, sell, or otherwise dispose of an ownership or
management interest in a subsidiary of the corporation only after the legislature has
had the opportunity to disapprove the issuance of the transfer, sale, or disposition.
Legislative disapproval under this subsection must be by law. The corporation shall
notify the presiding officer of each house if the corporation intends to transfer, sell, or
otherwise dispose of an ownership or management interest in a subsidiary of the
corporation. The legislature shall have 90 days to consider the transfer, sale, or
disposition. If the legislature does not disapprove the transfer, sale, or disposition of an
ownership interest within 90 days, the corporation may move forward with the
transfer, sale, or disposition.
  * Sec. 14. AS 31.25 is amended by adding a new section to read:
Sec. 31.25.125. Involvement in revenue-generating projects. (a) If the
corporation negotiates with another entity for participation by the corporation in a
revenue-generating project, the corporation shall negotiate an option for the state or,
subject to (h) of this section, a municipality to acquire an interest in the project. The
corporation shall immediately notify the president of the senate, the speaker of the
house of representatives, and the chairs of the finance committee of each house of the
legislature on each occasion that an option for the state is available for consideration
by the legislature under (b)(1) of this section.
(b) An option exercisable under this section
(1) by the state must, before being exercised, be approved by the
legislature by law; and
(2) must allow the state or a municipality at least 180 days to exercise
the option after notification of the legislature under (d) of this section.
(c) At the request of the legislature, a state agency shall cooperate with and
assist the legislature in determining whether to approve under (b)(1) of this section the
terms of an option for the state negotiated under (a) of this section.
(d) The corporation shall immediately notify the president of the senate, the
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speaker of the house of representatives, and the chairs of the finance committee of
each house of the legislature on each occasion that the state may exercise an option
negotiated under (a) of this section.
(e) The state may not acquire an interest in a revenue-generating project under
this section unless the interest is approved by the legislature by law. When making an
investment decision under this section, the legislature shall act as a prudent investor.
(f) The Department of Revenue shall cooperate with and assist the legislature
in determining whether to acquire an interest in a revenue-generating project under (e)
of this section by exercising an option negotiated under (a) of this section, including
by identifying potential funding sources for exercising the option and potential fiscal
effects on the state. If requested by the legislature, another state agency shall cooperate
with and assist the legislature with making a determination under (e) of this section.
(g) The corporation, and any other entity participating in a revenue-generating
project, shall
(1) cooperate with and assist the legislature in determining whether to
approve the terms of an option negotiated under (a) of this section or to acquire an
interest in the project by exercising an option negotiated under this section;
(2) provide information requested by the legislature related to the
project, including
(A) information necessary for the legislature to act as a prudent
investor; and
(B) financial records of or related to the revenue-generating
project; and
(3) ensure that at least one representative of the corporation and of
each participating entity are available to testify during public hearings of legislative
committees requesting testimony.
(h) If the corporation negotiates with another entity for participation by the
corporation in a revenue-generating project under (a) of this section, the corporation
shall provide an opportunity for municipalities in the state to purchase a portion of the
corporation's right to acquire additional equity interest in the natural gas project not
exercised by the corporation, through an entity managed by the corporation. A
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municipality may not acquire a direct interest in a revenue-generating project under
this subsection.
(i) In this section,
(1) "corporation" includes a subsidiary of the corporation;
(2) "revenue-generating project" means a project, entity ownership,
legal business arrangement, partnership, joint venture, or other commercial endeavor
expected to generate revenue.
   * Sec. 15. AS 31.25.130(a) is amended to read:
(a)    Except as otherwise provided in this chapter and except for
AS 44.62.310 - 44.62.319 (Open Meetings Act), AS 44.62 (Administrative Procedure
Act) does not apply to this chapter. The corporation shall make available to members
of the public copies of the regulations adopted under (b) - (e) of this section.
  * Sec. 16. AS 31.25.140(c) is amended to read:
(c) To further ensure effective budgetary decision making by the legislature,
the board shall
(1) annually review the corporation's assets, including the assets of
[THE IN-STATE NATURAL GAS PIPELINE FUND UNDER AS 31.25.100 AND]
the Alaska liquefied natural gas project bond fund under AS 31.25.150
[AS 31.25.110], to determine whether assets of the corporation exceed an amount
required to fulfill the purposes of the corporation as defined in this chapter; in making
its review, the board shall determine whether, and to what extent, assets in excess of
the amount required to fulfill the purposes of the corporation during the next fiscal
year are available without
(A) breaching an agreement entered into by the corporation;
(B) materially impairing the operations or financial integrity of
the corporation; or
(C) materially affecting the ability of the corporation to fulfill
the purposes of the corporation as defined in this chapter;
(2) specifically identify in the corporation's assets the amounts that the
board believes are necessary to meet the requirements of (1)(C) of this subsection; and
(3) present to the legislature by January 10 of each year a complete
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accounting of all assets of the corporation, including assets of [THE IN-STATE
NATURAL GAS PIPELINE FUND UNDER AS 31.25.100 AND] the Alaska
liquefied natural gas project bond fund under AS 31.25.150 [AS 31.25.110], and a
report of the review and determination made under (1) and (2) of this subsection; the
accounting shall be audited by an independent outside auditor.
   * Sec. 17. AS 31.25 is amended by adding new sections to article 1 to read:
Sec. 31.25.145. Accounting. (a) The corporation shall deposit into separate
accounts in the general fund revenue
(1) generated by a subsidiary of the corporation; and
(2) resulting from an option negotiated under AS 31.25.125.
(b) The legislature may appropriate the annual estimated amount necessary for
the payment of obligations associated with bonds issued by the corporation to the
Alaska liquefied natural gas project bond fund (AS 31.25.150).
Sec. 31.25.150. Alaska liquefied natural gas project bond fund. The Alaska
liquefied natural gas project bond fund is established in the corporation and consists of
money appropriated to the fund. The corporation shall determine fund management
and may contract with the Department of Revenue for fund management. The
corporation may use money in the fund without further appropriation for the purpose
of paying obligations associated with bonds issued by the corporation.
  * Sec. 18. AS 31.25.160 is amended by adding a new subsection to read:
(g) The corporation shall immediately notify the president of the senate, the
speaker of the house of representatives, and the chairs of the finance committee of
each house of the legislature on each occasion on which the corporation intends to
issue bonds. The corporation, or a subsidiary of the corporation, may issue bonds only
after the legislature approves the issuance of the bonds by law. The legislature shall
have 90 days after the notification under this subsection to approve the issuance of the
bonds. If the legislature does not approve the issuance of the bonds within 90 days, the
corporation may not issue the bonds. The limitation in this subsection does not apply
to refunding bonds. Refunding bonds may be issued without further approval by the
legislature in a principal amount sufficient to provide funds for the payment of all
bonds to be refunded by the refunding bonds and, in addition, for the payment of all
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other amounts that the corporation considers appropriate in connection with the
refunding, including expenses incident to the redeeming, calling, retiring, or paying of
the outstanding bonds, the funding of reserves, and the issuance of the refunding
bonds.
   * Sec. 19. AS 31.25.270 is amended by adding new subsections to read:
(d) By February 15 and August 15 of each year, the board shall deliver a
report on natural gas pipeline projects in the state to the commissioner of revenue,
notify the governor and the legislature that the report is available, and publish notice to
the public on the Alaska Online Public Notice System under AS 44.62.175 that the
report is available on the corporation's Internet website. The board shall prepare the
report regardless of whether the corporation owns or operates the projects. The report
must
(1)   provide a current status of natural gas projects in the state,
including construction status, projected timeline for completion, and a
description of any remaining phases of construction;
(2) provide a qualitative assessment and update of the timeline, budget,
and cost containment progress since the last report;
(3) provide an assessment of the effect of the projects on the state labor
market, including
(A) the number of jobs created or affected, listed by region of
the state;
(B)    the total estimated payroll dollars attributable to the
projects since the last report; and
(C) the proportion of resident and nonresident employees or
contractors working on the projects;
(4) set out secured intake and offtake contracts, by annual volume; and
(5) provide total capital expenditures for each major component of the
projects; an entity invested in a project with the corporation shall provide to the
corporation the information necessary to meet the requirements of this paragraph; in
this paragraph, "capital expenditure" means a cost that is properly chargeable to a
capital account under federal income tax principals, as determined at the time the
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property is paid for.
(e) The corporation shall maintain on the corporation's Internet website a
publicly accessible dashboard for project accountability for each natural gas pipeline
project. The dashboard must
(1) show the status of each major phase of the project, including front-
end and preliminary front-end engineering design, permits, financing, final investment
decision, notice to proceed, procurement, construction, startup, commercial
operations, phase two final investment decision, expansion, and decommissioning
planning;
(2) if the state exercises an option to invest in the natural gas pipeline
project, include the public cost estimate range, estimate class if available, schedule
baseline, current forecast, and summary explanation of material changes or variances;
(3) include a material risk register and mitigation status;
(4) provide the status of permitting and rights-of-way;
(5) include information on
(A) gas supply and offtake status by aggregate annual volume;
and
(B) in-state gas delivery and ratepayer protection status;
(6) include the status of the spur line, as defined in AS 42.05.438;
(7) include the status of community impact grants and mitigation;
(8) provide information regarding the number and proportion of state
resident hires and resident contractor or supplier participation;
(9) be updated at least monthly before commencement of commercial
operations of the natural gas pipeline project and at least quarterly thereafter; and
(10) be updated within 10 business days after the corporation becomes
aware of a material change affecting cost, schedule, financing, permitting, in-state gas
delivery, ratepayer protection, community impacts, state fiscal exposure, or other
public-interest issue affecting the natural gas pipeline project.
(f)    The corporation may use reasonable redactions, estimated ranges,
summaries, or status indicators to protect confidential or commercially sensitive
information on the dashboard required by (e) of this section.
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(g) The corporation shall preserve dashboard updates made under (e) of this
section in a public archive on the corporation's Internet website, with date-stamped
changes and version history.
(h)      A project developer shall provide to the corporation the information
required for the dashboard under (e) of this section. In this subsection, "project
developer" means an entity responsible for coordinating the financing and construction
of a natural gas pipeline project.
(i) In this section,
(1) "natural gas pipeline project" includes the Alaska liquefied natural
gas project or a similar project;
(2) "major component of the project" means a natural gas treatment
facility, carbon capture or underground storage facility, liquefaction facility, import or
export facility, or any other major facility associated with a natural gas pipeline
project.
  * Sec. 20. AS 31.25 is amended by adding a new section to read:
Sec. 31.25.285. Legislative notification of ownership change. (a) The
corporation shall promptly notify the president of the senate, the speaker of the house
of representatives, and the chairs of the finance committee of each house of the
legislature if
(1) the corporation becomes aware that an entity in a legal relationship
with the corporation, or a subsidiary of the corporation, plans to make a significant
change in ownership structure; or
(2) an entity in a legal relationship with the corporation, or a subsidiary
of the corporation, has a significant change in ownership structure.
(b) In this section, "legal relationship" means a partnership, joint venture, joint
ownership agreement, or other legally binding business arrangement
(1) of which the corporation, or a subsidiary of the corporation, has at
least a 10 percent interest; or
(2) that has an interest in a third entity in which the corporation, or a
subsidiary of the corporation, also has at least a 10 percent interest; and
(3)   that formed for the purpose of shared ownership or shared
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management of, or pooling of resources for, an entity in which the corporation, or a
subsidiary of the corporation, has an ownership or management interest.
   * Sec. 21. AS 31.25.390 is amended by adding a new paragraph to read:
(8) "subsidiary of the corporation" means a subsidiary controlled by
the corporation.
   * Sec. 22. AS 37.05 is amended by adding a new section to article 6 to read:
Sec. 37.05.615. Alaska affordable heating fuel fund. (a) The Alaska
affordable heating fuel fund is created as a separate fund in the state treasury. The
fund consists of the amount determined and deposited in the fund under (b) of this
section and interest earned on the fund balance.
(b) The amount to be deposited in (a) of this section is 20 percent of the
revenue received from the state's royalty gas transported in an Alaska liquefied natural
gas project that remains after the payment to the Alaska permanent fund under
AS 37.13.010. The deposit made under this section may not interfere with the deposit
to the Alaska affordable energy fund (AS 37.05.610) or the contribution to the public
school trust fund (AS 37.14.150).
(c)   The legislature may make appropriations from the Alaska affordable
heating fuel fund to fund programs that will reduce the cost of heating fuel in areas of
the state that are not expected to have or do not have direct access to a North Slope
natural gas pipeline.
(d) Nothing in this section creates a dedicated fund.
(e) In this section,
(1) "Alaska liquefied natural gas project" has the meaning given in
AS 31.25.390;
(2)     "North Slope natural gas pipeline" has the meaning given in
AS 42.06.630.
  * Sec. 23. AS 42.05 is amended by adding new sections to read:
Sec. 42.05.435. Alaska liquefied natural gas project gas supply contracts.
(a) The commission may not approve a gas supply contract between a public utility
and an owner or operator of a gas pipeline advanced, operated, or owned, in whole or
in part, by the Alaska Gasline Development Corporation, or a subsidiary of the
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corporation, that obligates the utility to pay more than $16 for each 1,000,000 British
thermal units of natural gas.
(b) The dollar amount in (a) of this section shall be adjusted each year for
inflation under the agreed-on escalation factor in the terms of the gas supply contract.
(c) In this section, "gas pipeline" has the meaning given in AS 31.25.390.
Sec. 42.05.438. Alaska liquefied natural gas project utility contract
requirements. (a) In addition to other approval requirements under this chapter, a
public utility must obtain the approval of the commission to recover costs related to a
contract with a duration of more than one year that reserves capacity in a gas pipeline
or liquefied natural gas plant. In this subsection, "contract" includes any agreement
that contains conditions that must be satisfied before the agreement becomes effective.
(b) The commission may not approve a gas supply contract for natural gas
transported by a gas pipeline, or a contract that requires approval under (a) of this
section, that
(1)   requires the utility's customers to assume cost overruns from
construction of an Alaska liquefied natural gas project; or
(2) increases a commission-approved rate if throughput decreases.
(c) In this section,
(1) "Alaska liquefied natural gas project" has the meaning given in
AS 31.25.390;
(2) "gas pipeline" and "liquefied natural gas plant" mean a gas pipeline
or liquefied natural gas plant associated with an Alaska liquefied natural gas project;
"gas pipeline" does not include a spur line;
(3) "spur line"
(A) means
(i)    a natural gas transmission or lateral line that
branches from the main gas pipeline for the primary purpose of
delivering natural gas to a local community or utility distribution
system; and
(ii)     compressing and metering equipment and
interconnection facilities related to the transmission or lateral line
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described in (i) of this subparagraph;
(B)    does not include infrastructure used for the export of
natural gas or lateral lines not necessary for delivering natural gas to a local
community or utility distribution system.
   * Sec. 24. AS 43.56.010(a) is amended to read:
(a) Except as provided in AS 43.59.010 and 43.59.020, an [AN] annual tax
of 20 mills is levied each tax year beginning January 1, 1974, on the full and true
value of taxable property taxable under this chapter.
   * Sec. 25. AS 43.56.020(d) is amended to read:
(d) Taxable property subject to tax abatement under AS 43.59.010 or the
volumetric tax imposed under AS 43.59.020 [OF A NATURAL GAS PIPELINE
PROJECT       OWNED  OR   FINANCED  BY       THE    ALASKA    GASLINE
DEVELOPMENT CORPORATION OR A JOINT VENTURE, PARTNERSHIP, OR
OTHER ENTITY THAT INCLUDES THE ALASKA GASLINE DEVELOPMENT
CORPORATION] is exempt from state taxes levied or authorized under
AS 43.56.010(a) and municipal taxes levied or authorized under AS 43.56.010(b)
[BEFORE THE COMMENCEMENT OF COMMERCIAL OPERATIONS OF THAT
NATURAL  GAS       PIPELINE       PROJECT.  IN    THIS   SUBSECTION,
"COMMENCEMENT OF COMMERCIAL OPERATIONS" MEANS THE FIRST
FLOW OF NATURAL GAS IN THE PROJECT THAT GENERATES REVENUE
TO THE OWNERS OF THE NATURAL GAS PIPELINE PROJECT].
  * Sec. 26. AS 43 is amended by adding a new chapter to read:
   Chapter 59. Natural Gas Project Temporary Tax Abatement and Volumetric Tax.
Sec. 43.59.010. Temporary tax abatement. Property of a natural gas project
is not subject to the taxes levied under AS 29.45.080, AS 43.56.010, or AS 43.59.020
during the temporary tax abatement period. The abatement period begins on the
effective date of this section and ends on the earlier of
(1) the first day of a consecutive 30-day period in which the natural
gas project achieves a throughput of 500,000,000 cubic feet of natural gas a day,
calculated as a rolling average over the 30-day period; or
(2)    five years after the date of commencement of commercial
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operations of phase one of the natural gas project.
Sec. 43.59.020. Imposition of alternative volumetric tax. (a) The owner of
property subject to tax under this section shall pay an alternative volumetric tax on the
throughput of the property. The alternative volumetric tax applies beginning on the
day after the expiration of the abatement period under AS 43.59.010.
(b) The volumetric tax is
(1)      $0.062 for each 1,000 cubic feet of natural gas before
commencement of commercial operations of a liquefied natural gas plant related to the
natural gas project;
(2)     $0.106 for each 1,000 cubic feet of natural gas on and after
commencement of commercial operations of a liquefied natural gas plant related to the
natural gas project;
(3) beginning 10 years after commencement of commercial operations
of a liquefied natural gas plant related to the natural gas project, in addition to the
amount collected under (2) of this subsection, an additional $0.106 for each 1,000
cubic feet of natural gas;
(4) beginning January 1, 2060, in addition to the amounts collected
under (2) and (3) of this subsection, an additional $0.212 for each 1,000 cubic feet of
natural gas.
(c) Beginning after the first year the tax applies to throughput of a natural gas
project under (b)(1) of this section, the tax rates under (b) of this section shall be
adjusted on January 1 of each year for inflation, using 100 percent of the average of
the annual change over the preceding five calendar years in the Consumer Price Index
for all urban consumers for urban Alaska, as determined by the United States
Department of Labor, Bureau of Labor Statistics. However, the annual adjustment
under this subsection must increase the rates by at least one percent and not more than
three percent. Each tax rate under (b) of this section shall be adjusted for inflation
under this subsection even if the tax rate does not yet apply.
(d) An owner of property subject to tax under this section shall, on or before
the last day of each month, file a return with the department and with each
municipality collecting tax under this section. The return must state the throughput, in
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cubic feet of natural gas for each day, of property subject to tax for the month
preceding the month in which the return is due and include an installment payment for
the month of the return. An installment payment is considered delinquent if the
payment is not received by the department on or before the last day of each month.
(e) The tax levied under this section is due annually, on the calendar year. The
owner of the property shall, on or before April 30 each year, pay any remaining tax
due under this section for tax accruing from throughput in the previous calendar year.
A tax payment under this subsection is considered delinquent if the payment is not
received by the department on or before April 30 each year.
(f) Notwithstanding AS 43.05.220, if a tax payment or installment payment
required under this section is delinquent, the department or a municipality shall assess
a penalty of 15 percent of the amount of delinquent taxes and interest on the
delinquent taxes, exclusive of penalty, at the rate specified in AS 43.05.225.
Sec. 43.59.030. Collection and allocation of alternative tax. (a) The
department shall levy and collect the alternative volumetric tax imposed by this
chapter that is allocated to the state. Unless otherwise elected by the municipality
under (h) of this section, a municipality that is not in the unorganized borough may
levy and collect the portion of the alternative volumetric tax imposed by this chapter
that is allocated to the municipality. The amount of tax allocated to each municipality
and to the state is determined under (b) - (f) of this section.
(b) Before commencement of commercial operations of a liquefied natural gas
plant related to a natural gas project,
(1) six percent of the tax under AS 43.59.020(b)(1) is allocated to the
North Slope Borough;
(2) 47 percent of the tax under AS 43.59.020(b)(1) is allocated to the
areas of the state through which a gas pipeline runs; and
(3) 47 percent of the tax under AS 43.59.020(b)(1) is allocated to the
state for community assistance payments.
(c) On and after the commencement of commercial operations of a liquefied
natural gas plant related to a natural gas project,
(1) 48.4 percent of the tax under AS 43.59.020(b)(2) is allocated to the
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Kenai Peninsula Borough;
(2) 27 percent of the tax under AS 43.59.020(b)(2) is allocated to the
North Slope Borough;
(3) 5.6 percent of the tax under AS 43.59.020(b)(2) is allocated to the
state;
(4) 9.5 percent of the tax under AS 43.59.020(b)(2) is allocated to the
areas of the state through which a gas pipeline runs;
(5) 9.5 percent of the tax under AS 43.59.020(b)(2) is allocated to the
state for community assistance payments;
(6) 100 percent of the tax under AS 43.59.020(b)(3) is allocated to the
state for community assistance payments; and
(7) 100 percent of the tax under AS 43.59.020(b)(4) is allocated to the
state.
(d) For purposes of (b)(2) and (c)(4) of this section, the portion allocated to
the state is equal to the proportion of the gas pipeline in the unorganized borough, and
the portion allocated to each municipality that is not in the unorganized borough is
equal to the proportion of the gas pipeline in the municipality. To determine the
proportional distribution under this subsection, the length of pipeline in the
unorganized borough or a municipality that is not in the unorganized borough is
divided by the total length of the pipeline.
(e) Each year, the legislature may appropriate the amount allocated to the state
under (b)(3), (c)(5), and (c)(6) of this section to the municipalities, communities, and
reserves in the unorganized borough, distributed as community assistance payments in
accordance with AS 29.60.855 and 29.60.860.
(f) The amount of tax allocated to the state under (c)(3) and (7) of this section
shall be deposited into the general fund.
(g) Each month, the department shall report to a municipality collecting tax
under this section the amount of tax allocated to the municipality for the preceding
month.
(h) A municipality may by ordinance elect for the department to collect, on
behalf of the municipality, the portion of the tax levied under this chapter that is
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allocated to the municipality.
Sec. 43.59.040. Administrative appeals; distraint of property. (a) A
decision by the department regarding the imposition or calculation of the tax levied
under AS 43.59.020 may be appealed to the department for an informal conference
under AS 43.05.240, and a final decision may be appealed to the office of
administrative hearings under AS 43.05.405.
(b) The remedy of distraint of property set out in AS 43.20.270 applies to the
tax levied in this chapter. However, only the property subject to tax under
AS 43.59.020 may be distrained.
Sec. 43.59.050. Termination of status; application. (a) The tax abatement
under AS 43.59.010 and the alternative volumetric tax under AS 43.59.020 do not
apply to a natural gas project if, by
(1) January 1, 2028, a final investment decision has not been made on
phase one of the natural gas project;
(2) January 1, 2037, at least one major component of the natural gas
project has not been completed and commencement of commercial operations of that
component has not occurred.
(b) If, under (a) of this section, neither the tax abatement under AS 43.59.010
nor the alternative volumetric tax under AS 43.59.020 applies to property of a natural
gas project, the property is subject to all other state and municipal taxes on taxable
property, including taxes levied under AS 29.45.080 and AS 43.56.010.
(c) In this section,
(1) "commencement of construction" means the
(A)    laying and welding together in an excavated trench
multiple sections of steel pipe that are intended for use as part of the gas
pipeline; and
(B) establishment of at least one work camp along the gas
pipeline route that is intended to provide crew quarters and services during
construction of the gas pipeline;
(2) "final investment decision" means a final affirmative decision of a
natural gas project developer or a subsidiary of the primary project owner to proceed
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from the planning phase to the implementation and construction phase of phase one of
the natural gas project; a final investment decision has not been made until the project
developer or a subsidiary of the primary project owner has
(A)   obtained firm commitments for all debt and financing
required to construct phase one of the project;
(B)    entered into binding engineering, procurement, and
construction agreements for construction of phase one of the project;
(C) entered into offtake agreements sufficient to underwrite
construction and operation of phase one of the project;
(D) completed a cost estimate for phase one of the project;
(E)   completed a final resource report of phase one of the
project.
Sec. 43.59.060. Reporting; regulations. (a) The owner of property subject to
tax under this chapter shall, at the request of the department, provide to the department
the information necessary to calculate the tax under this chapter. Notwithstanding
AS 40.25.100(a) and AS 43.05.230, the department shall hold confidential proprietary
information provided to the department under this subsection at the request of the
owner. In this subsection, "proprietary information" means information that, if
publicly disclosed, would adversely affect the competitive position of the owner or
materially diminish the commercial value of the information to the owner.
(b) The department shall adopt regulations under AS 44.62 (Administrative
Procedure Act) to implement this chapter, including procedures for
(1) measuring throughput;
(2) throughput reporting;
(3) calculating the rolling average of throughput; and
(4)    allocating the tax levied under this chapter to the state and
municipalities under AS 43.59.030.
Sec. 43.59.100. Definitions. In this chapter,
(1) "commencement of commercial operations" means the first flow of
natural gas through a natural gas project or a component of a natural gas project, as
applicable, that treats, transports, or processes a commercial amount of natural gas;
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(2) "gas pipeline"
(A) means a main natural gas pipeline from the outlet flange of
the gas treatment plant on the North Slope to
(i) for purposes of phase one of the project, the inlet
flange of infrastructure providing natural gas to the Southcentral region
of the state;
(ii) for purposes of phase two of the project, the inlet
flange of the liquefied natural gas plant located in the Kenai Peninsula
region of the state;
(B) does not include any gas lines downstream of any offtake
point between a gas treatment plant and a liquefied natural gas plant;
(3) "gas treatment plant" means a facility and the related activities
required to receive natural gas from a Prudhoe Bay unit gas transmission line, a Point
Thomson unit gas transmission line, or other facilities, to treat the natural gas to
pipeline specifications, to dispose of or deliver byproducts, to deliver liquid products
for further transportation, and to deliver treated natural gas for transportation through a
gas pipeline;
(4) "liquefied natural gas plant" means a facility for liquefying natural
gas and includes structures, equipment, underlying land rights, and other associated
systems, storage, and facilities for off-loading liquefied natural gas;
(5) "natural gas project" and "project" means a natural gas project that
includes, collectively, a Prudhoe Bay unit gas transmission line, a Point Thomson unit
gas transmission line, a gas pipeline, a gas treatment plant, a liquefied natural gas
plant, and a marine terminal; in this paragraph,
(A) "marine terminal" means a terminal and those facilities
required to receive liquefied natural gas from the boundary of the liquefied
natural gas plant for marine transportation, including auxiliary vessels used in
the operation of the terminal;
(B) "Point Thomson unit gas transmission line" means a natural
gas transmission line from the outlet flange of the Point Thomson unit
production facility to the inlet flange of the gas treatment plant; and
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(C) "Prudhoe Bay unit gas transmission line" means a natural
gas transmission line from the outlet flange of the Prudhoe Bay unit central gas
facility to the inlet flange of the gas treatment plant;
(6) "phase one" means a phase of a natural gas project that includes a
gas pipeline and other related infrastructure required for the transportation of natural
gas from the North Slope to the Southcentral region of the state;
(7) "phase two" means a phase of a natural gas project that includes a
gas treatment plant, a marine terminal, a liquefied natural gas plant, and other related
infrastructure required for the export of natural gas;
(8) "throughput"
(A) means
(i) the volume of natural gas measured by summing all
volumes sold or otherwise delivered at each outlet or offtake point
along the gas pipeline; and
(ii) natural gas consumed as fuel for the operation of a
liquefaction facility;
(B) does not include natural gas consumed as fuel for pipeline
compression.
  * Sec. 27. AS 44.33 is amended by adding a new section to read:
Article 13A. Natural Gas Project Municipal Impact Grant Fund.
Sec. 44.33.850. Natural gas project municipal impact grant fund. (a) The
natural gas project municipal impact grant fund is established in the department. The
fund consists of money received by the state from a project developer of an Alaska
liquefied natural gas project and appropriated to the fund by the legislature.
(b) The department shall use the money appropriated to the fund to timely
distribute grants to impacted municipalities for activities, services, or facilities that
offset verified actual or reasonably expected effects of construction of a gas pipeline.
When administering grants under this subsection, the department shall prioritize grant
awards based on the needs of the impacted municipality, the severity of the effects
caused by construction of the pipeline, and the correlation of the effect to the
construction of the pipeline. The department shall adopt regulations governing the
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distribution of grants under this subsection.
(c) In this section,
(1) "department" means the Department of Commerce, Community,
and Economic Development;
(2) "fund" means the natural gas project municipal impact grant fund
established in (a) of this section;
(3) "gas pipeline" has the meaning given in AS 31.25.390;
(4)    "impacted municipality" means the North Slope Borough,
Fairbanks North Star Borough, Denali Borough, Municipality of Anchorage,
Matanuska-Susitna Borough, and Kenai Peninsula Borough;
(5) "project developer" means an entity responsible for coordinating
the financing and construction of a natural gas project.
  * Sec. 28. AS 31.25.100 and 31.25.110 are repealed.
  * Sec. 29. The uncodified law of the State of Alaska is amended by adding a new section to
 read:
REQUIRED REPORT: PHASE TWO OF THE ALASKA LIQUEFIED NATURAL
 GAS PROJECT. (a) Before a final investment decision is made on phase two of the Alaska
 liquefied natural gas project, the Alaska Gasline Development Corporation shall deliver a
 report to the senate secretary and the chief clerk of the house of representatives and shall
 notify the legislature that the report is available. The report must include
(1) a discussion and review of the effects and effectiveness of this Act on the
 Alaska liquefied natural gas project;
(2) if applicable, suggestions for additional changes to law related to the
 Alaska liquefied natural gas project, before implementation of phase two.
(b) In this section,
(1)   "Alaska liquefied natural gas project" has the meaning given in
 AS 31.25.390;
(2) "final investment decision" means a final affirmative decision of a natural
 gas project developer or a subsidiary of the primary project owner to proceed from the
 planning phase to the implementation and construction phase of phase two of the Alaska
 liquefied natural gas project; a final investment decision has not been made until the project
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  developer or a subsidiary of the primary project owner has
(A) obtained firm commitments for all debt and financing required to
construct phase two of the project;
(B) entered into binding engineering, procurement, and construction
agreements for construction of phase two of the project;
(C)     entered into offtake agreements sufficient to underwrite
construction and operation of phase two of the project;
(D) completed a cost estimate for phase two of the project;
(E) completed a final resource report of phase two of the project;
(3) "phase two" means a phase of the Alaska liquefied natural gas project that
 includes a gas treatment plant, a marine terminal, a liquefied natural gas plant, as defined in
 AS 31.25.390, and other related infrastructure required for the export of liquefied natural gas.
   * Sec. 30. The uncodified law of the State of Alaska is amended by adding a new section to
 read:
APPLICABILITY:  ALASKA  GASLINE      DEVELOPMENT  CORPORATION
 CONFIDENTIALITY AGREEMENTS, SUBSIDIARIES, NOTIFICATIONS, LEGAL
 RELATIONSHIPS. (a) AS 31.25.080(a)(1) and (6), as amended by sec. 8 of this Act, apply to
 a transfer or disposition occurring on or after the effective date of sec. 8 of this Act.
(b) AS 31.25.090(j) and (k), added by sec. 11 of this Act, apply to a confidentiality
 agreement entered into on or after the effective date of sec. 11 of this Act.
(c) AS 31.25.145(a), added by sec. 17 of this Act, applies to revenue generated on and
 after the effective date of sec. 17 of this Act.
(d) AS 31.25.285, added by sec. 20 of this Act, applies to a legal relationship entered
 into on or after the effective date of sec. 20 of this Act. In this subsection, "legal relationship"
 has the meaning given in AS 31.25.285(b), added by sec. 20 of this Act.
   * Sec. 31. The uncodified law of the State of Alaska is amended by adding a new section to
 read:
TRANSITION: EXISTING OPTIONS. (a) Within 30 days after the effective date of
 sec. 14 of this Act, the Alaska Gasline Development Corporation shall notify the president of
 the senate, the speaker of the house of representatives, and the chairs of the finance committee
 of each house of the legislature of any existing options to invest in a revenue-generating
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  project, as required under AS 31.25.125, added by sec. 14 of this Act.
(b) An option for state participation in a revenue-generating project negotiated by the
  Alaska Gasline Development Corporation agreed to before the effective date of sec. 14 of this
  Act must allow the state to exercise the option for at least 180 days after the corporation
  notifies the legislature under AS 31.25.125, added by sec. 14 of this Act.
   * Sec. 32. The uncodified law of the State of Alaska is amended by adding a new section to
  read:
CONDITIONAL EFFECT: BILL; NOTIFICATION TO THE REVISOR OF
  STATUTES. (a) Sections 1 - 5 and 24 - 26 of this Act take effect only if, before January 1,
 2032, the commissioner of revenue determines that
(1)    the project developer of a natural gas project has paid the state
 $40,000,000 within 60 days after a final investment decision is made on phase one of the
 natural gas project and contractually agrees to pay an additional $40,000,000 to the state
 within 60 days after a final investment decision is made on phase two of the natural gas
 project; the legislature may appropriate amounts required to be paid under this section to the
 natural gas project municipal impact grant fund, established in AS 44.33.850, added by sec.
 27 of this Act; neither the state nor a corporation of the state may be responsible for the
 payment or a portion of the payment required by this paragraph;
(2) the primary owner of property that could be taxable under AS 43.59.020,
 added by sec. 26 of this Act, has entered into a project labor agreement for the construction of
 the gas pipeline; in this paragraph, "project labor agreement" means a comprehensive
 collective bargaining agreement between the owner of the gas treatment plant, carbon capture
 facility, liquefied natural gas plant, or gas pipeline and the appropriate labor representatives to
 ensure expedited construction with labor stability by employing qualified residents of the
 state; and
(3) the project developer of a natural gas project who would be responsible for
 constructing a spur line has committed to construct the spur line that serves the City of
 Fairbanks and the Fairbanks North Star Borough; to meet the requirement of this paragraph,
(A) the project developer shall commit to, on or before completion of
phase one of the project, timely and in good faith begin all necessary permit
applications and take action on any other regulatory requirements necessary for the
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construction of the spur line, including, if the Regulatory Commission of Alaska has
jurisdiction over the tariffs,
(i) initiating a tariff proceeding; and
(ii) filing with the commission for systemwide tariff treatment
for the spur line with an economically viable gas sales contract;
(B) the project developer shall commit to begin construction on a spur
line within one year after receiving all permits and meeting the necessary regulatory
requirements described in (A) of this paragraph; and
(C) the spur line must
(i)      have sufficient capacity to serve reasonably projected
residential, commercial, and industrial demand in the Interior area of the state;
(ii) be scheduled to begin operations within two years after the
commencement of commercial operations of a major component of the natural
gas project;
(iii)      be designed to connect with local distribution
infrastructure capable of delivering natural gas to the City of Fairbanks and the
surrounding urban area;
(iv) be designed and operated to deliver gas at the lowest
reasonable cost consistent with safe and reliable service; and
(v) allocate costs, including capital, financing, and construction
costs, justly, reasonably, and not unduly discriminatorily, across all consumers
systemwide, including consumers in the area from the North Slope to the
Southcentral regions of the state and, to the extent allowed under federal law,
export consumers; costs related to financing or construction of the spur line
may not be allocated solely to the Interior area of the state.
(b) If the commissioner of revenue determines that the conditions in (a) of this section
 have been met, the commissioner of revenue shall notify the revisor of statutes in writing
 within 30 days after making the determination.
(c) In this section,
(1)   "economically viable gas sales contract" means a contract, precedent
 agreement, memorandum of understanding, tariff-supported sales arrangement, or other
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  commercially reasonable arrangement for the sale, delivery, transportation, or distribution of
  natural gas to serve current or reasonably projected residential, commercial, institutional,
  utility, or industrial demand in the City of Fairbanks, the Fairbanks North Star Borough, or
  the surrounding Interior area of the state, including demand aggregated by a public utility, gas
  distribution utility, local government, state agency, or other entity serving customers in the
  Interior area of the state; the gas sales contract need not demonstrate that the spur line alone
  will recover all capital, financing, construction, operation, or maintenance costs solely from
  customers in the Interior area of the state;
(2) "final investment decision" means a final affirmative decision of a natural
 gas project developer or a subsidiary of the primary project owner to proceed from the
 planning phase to the implementation and construction phase of the applicable phase of the
 natural gas project; a final investment decision has not been made until the project developer
 or a subsidiary of the primary project owner has
(A) obtained firm commitments for all debt and financing required to
construct the applicable phase of the project;
(B) entered into binding engineering, procurement, and construction
agreements for construction of the applicable phase of the project;
(C)     entered into offtake agreements sufficient to underwrite
construction and operation of the applicable phase of the project;
(D) completed a cost estimate for the applicable phase of the project;
(E) completed a final resource report of the applicable phase of the
project;
(3) "gas pipeline" means a gas pipeline, as defined in AS 31.25.390, that is
 expected to be subject to the alternative volumetric tax under AS 43.59.020, added by sec. 26
 of this Act;
(4) "phase one" means a phase of a natural gas project that includes a gas
 pipeline and other related infrastructure required for the transportation of natural gas from the
 North Slope to the Southcentral region of the state;
(5) "phase two" means a phase of a natural gas project that includes a gas
 treatment plant, a marine terminal, a liquefied natural gas plant, and other related
 infrastructure required for the export of natural gas;
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(6) "spur line"
(A) means
(i) a natural gas transmission or lateral line that branches from
the main gas pipeline for the primary purpose of delivering natural gas to the
City of Fairbanks and the Fairbanks North Star Borough; and
(ii) compressing and metering equipment and interconnection
facilities related to the transmission or lateral line described in (i) of this
subparagraph;
(B) does not include infrastructure used for the export of natural gas or
lateral lines not necessary for delivering natural gas to a local community or utility
distribution system;
(7) "systemwide" means the area from the North Slope to the Southcentral
 regions of the state.
   * Sec. 33. If, under sec. 32(a) of this Act, secs. 1 - 5 and 24 - 26 of this Act take effect, they
 take effect on the day after the date the commissioner of revenue determines that the
 conditions in sec. 32(a) of this Act have been met.
   * Sec. 34. Except as provided in sec. 33 of this Act, this Act takes effect immediately under
 AS 01.10.070(c).
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An Act relating to the taxation of certain natural gas project property and related facilities; relating to local contributions for public school funding; relating to municipal property taxes; relating to the Alaska Gasline Development Corporation and funds of the Alaska Gasline Development Corporation; relating to reporting requirements for natural gas pipeline projects; creating the Alaska affordable heating fuel fund; relating to approval of contracts by the Regulatory Commission of Alaska and inflation adjustment of the maximum price of natural gas; relating to an alternative volumetric tax on natural gas throughput; relating to a municipal impact grant program and fund; relating to agreements and a payment related to a natural gas project; and providing for an effective date.

Sponsors

Sen. Rules sponsors SB 3001 alone.

Rules

Sen. · Sponsor

Committees

SB 3001 went before 1 committee: Finance.

Finance
Finance
Referred to · Jun 20, 2026

History

SB 3001 has taken 7 actions since Jun 20, 2026.

ChamberAction
Jun 20, 2026
Senate
READ THE FIRST TIME - REFERRALS
Jun 20, 2026
Senate
FIN
Jun 20, 2026
Senate
FN1: (CED)
Jun 20, 2026
Senate
FN2: (CED)
Jun 20, 2026
Senate
FN3: (REV)

Votes

SB 3001 has not gone to a roll call.

Source: akleg.gov · legiscan.com