[{"_1":2,"_88":-5,"_89":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,76],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},"mediaId",6321569,"mediaKeyId","2349857-e23dc742dd7c7eb0e698d0db922359a7","parentId",2349857,"title","Senate hearing begins on bill to tax oil and gas \"pass-through\" entities; Department of Revenue provides preliminary revenue estimates","audioSeconds",4020,"startMs",1518000,"endMs",5538000,"viewUrl","/Search/View?dp=1&key=2349857-e23dc742dd7c7eb0e698d0db922359a7&start=1518&end=5538","thumbnailUrl","https://assets.pipeline.soar.com/2349857-e23dc742dd7c7eb0e698d0db922359a7/thumbnail_1518000.jpg","articleUrl","/articles/6321569/Alaska/Senate-hearing-begins-on-bill-to-tax-oil-and-gas-pass-through-entities-Department-of-Revenue-provides-preliminary-revenue-estimates","mediaUrl","https://secure.pipeline.soar.com/6321569-5350e3c814bce8dacdc7c38cc86cfb99/orig.mp4?Expires=1770921448&Signature=T2a-66KTQLJzDfVlpb3o0WIaRd1P-~um0D~CXal9Jy~Y-9rBoiNxOMpCC4uMRv9ADcZd6ePF41u4rrElnwCSEiy5mrof4CDlQXLKkHzAUYamBauORt~ur0KBauIii4HV94K3wAqyz36ehFExc2T47pZ7Ye~9BeTZ2uvlrUca9Ctx2u--CUT2E-lsACgdsk-~ZFlqKnhN276mjUf~SbSAqqktEGavO3tEZLsz~iVs0IYpgkJtobbE0iMUU4Aze8u-XidUA3Y1j99E0qXNKHBeChaU5RF9EizwGlFgjX~2CdZdhLunQ43Hj0lJPRos3gbbKVVBJM4v-MVICw9jxhc~ww__&Key-Pair-Id=KUT5TJCACFTXG","author","Alaska Legislature","date","2025-02-19T00:00:00Z","article","Senate Bill 92, sponsored by Senator Robert Yount, received its first public hearing Feb. 19 before the Senate Resources Committee. The bill would impose a 9.4% tax on profits attributable to petroleum production and pipeline transportation earned by entities that currently file federal returns as pass-throughs (sole proprietorships, partnerships or S corporations) when those entities report more than $5,000,000 in qualified taxable income for a tax year.

Senator Yount said the measure \"works to level the playing field and ensure that all oil and gas companies who operate in Alaska are charged at the same rate regardless of whether they're designated as a c corporation or an s corporation.\" The bill targets only oil- and pipeline-related activity and would not, as drafted, extend to pass-through entities that do not derive profits from oil or pipeline operations.

The bill's key provisions, as summarized in a sectional by Ryan McKee (staff to Senator Yount), include:

- A tax at an effective rate mirroring current corporate income tax rates (9.4%) on profits from petroleum production and pipeline transportation for qualified entities that are not taxed as C corporations; the tax applies only to profits above $5,000,000 in a tax year.

- An aggregation provision that allows the commissioner of revenue to aggregate income of two or more entities when their income could be reasonably attributable to a single entity.

- Direction that revenues be deposited into a fund for energy and electrical grid projects or upgrades.

- Conforming changes across existing income-tax provisions to replace the word \"corporation\" with \"taxpayer\" or \"entity\" where needed, plus uncodified sections on applicability, transition and retroactivity. The bill sets a retroactive date of Jan. 1, 2025, for taxable years beginning on or after that date.

Department of Revenue officials (Dan Stickel, chief economist; Dale Yancey, tax director; and Michael Williams, corporate tax manager) answered questions from the committee and described the fiscal-note approach. Stickel said the department treated the bill as retroactive to Jan. 1, 2025 for modeling: revenues associated with calendar-year 2025 would largely be collected as true-up payments when affected taxpayers file their 2025 annual returns.

Stickel and the department's technical staff reported a ballpark fiscal estimate of approximately $133 million for FY2026 under the bill's baseline assumptions, plus an additional roughly $53 million for the January'to'June 2025 retroactive period that the department expects could be captured as part of FY2026 receipts if the bill is enacted with retroactivity, producing a larger FY26 impact in the fiscal-note presentation. The department described its methodology as extrapolating a taxable base (roughly $1.4 billion in the FY26 estimate) and applying an effective rate to arrive at the estimate; staff repeatedly noted they could not disclose company-level details because of taxpayer confidentiality rules.

Committee members pressed the department on several policy and technical questions, including:

- Which entities would be affected: Department of Revenue staff said the bill targets entities filing under 26 U.S.C. Subchapter S and similar pass-through structures but declined to name specific taxpayers because of confidentiality.

- Production and investment shares: Revenue staff said roughly two'thirds of Alaska oil and gas production (about 65% in the FY26 forecast) comes from entities currently subject to the corporate income tax; the remaining roughly one'third is produced by non'C-corporation entities. The department estimated total allowable lease expenditures statewide of about $8.2 billion in the FY26 forecast horizon, without attributing an exact share to S corporations.

- Timing and forecast shape: The FY26 estimate is larger because the bill is drafted with retroactive application to Jan. 1, 2025; staff said this timing produces a one-time increase in FY26 receipts that then declines over the forecast horizon as a share of total revenue in the department's model.

- Interaction with federal tax rules: Committee members asked whether state taxes paid by entities would reduce owners' federal liabilities; Revenue staff said entities would deduct state taxes on federal returns and that state tax deductions typically reduce federal taxable income, but the federal reduction would not be a dollar'for'dollar offset.

Several senators and stakeholders requested further analysis: independent CPA modeling of company- and owner-level tax impacts, detailed Prudhoe Bay unit revenue and investment data, analysis of how converting to or from C corporation status would change behavior, and broader economic modeling of effects on production, investment and jobs. Senator Hughes also raised technical concerns that differences in allowable federal deductions could make the change less neutral across entity types; Senator Wilikowski and others emphasized a constitutional duty to capture maximum benefit from resource extraction and urged more transparency on who would be affected.

No committee vote or formal action on SB 92 was taken at this hearing; the bill remains in committee. Members set expectations for follow-up materials from Department of Revenue and for additional modeling before further committee action.

","mediaType","Video","parentTitle","Senate RESOURCES 02/19/2025","oneSentenceSummary","Senate Bill 92, sponsored by Senator Robert Yount, had its first hearing Feb. 19. The bill would subject certain pass-through entities that earn more than $5,000,000 from Alaska petroleum production or pipeline transportation to a 9.4% tax, with revenue directed to energy and electrical grid projects.","taxTitle","2025 Legislature Alaska, Alaska","taxId",78559,"location","Alaska","headline","","shortSummary",{"_33":77,"_35":36,"_37":38,"_39":78,"_41":79,"_43":80,"_45":81,"_47":82,"_49":83,"_51":84,"_53":85,"_55":56,"_57":58,"_59":86,"_61":62,"_63":64,"_65":87,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6321574,"Senate Resources Committee sends resolution on governor's Department of Agriculture order to finance committee after public testimony",1179,322000,1501000,"/Search/View?dp=1&key=2349857-e23dc742dd7c7eb0e698d0db922359a7&start=322&end=1501","https://assets.pipeline.soar.com/2349857-e23dc742dd7c7eb0e698d0db922359a7/thumbnail_322000.jpg","/articles/6321574/Alaska/Senate-Resources-Committee-sends-resolution-on-governors-Department-of-Agriculture-order-to-finance-committee-after-public-testimony","https://secure.pipeline.soar.com/6321574-468800e12ea2b76ffc1ba1b1e1f47ebf/orig.mp4?Expires=1770921448&Signature=NIXJBms4-FFnz22M91VQIA8jV8NtCo8GNw~KzOhU-vXeq8adVYXBXfRA3X9Fv5ol05u11Z8bhbt4WQ5~NST~c3i-E1yNuwD6t3LBD9GTmmUZOyxWo~fVAyyXYK1enrx38b9KnLiM0gFexPh0YOHjLDlO5CS-dpB5DzzIibXf9mB~NYWr0v07VpF9CK7wFqWjbnIBCEqskmAVFwrZ6wvWA~0SM8da-reAY0Ozjo37A-LV3ua3zzW-zYEaltMEMuRN~Q-aCS1C63vUjYYKHUv527xg1Gwd4j6yNVfsDSE-UaN7lf6NbOyAKotGk1mywx1S8yD1i15WMYDf-V7PZ3AyEA__&Key-Pair-Id=KUT5TJCACFTXG","Senate Resources Committee Chair Senator Giesel on Feb. 19 moved Special Senate Concurrent Resolution 1, a disapproval resolution tied to Governor's Executive Order 136 proposing a standalone Department of Agriculture, to the Finance Committee following public testimony and committee debate.

The resolution would disapprove Executive Order 136, which the governor issued under Article 3, Section 23, of the Constitution of the State of Alaska and which would create a Department of Agriculture by transferring agriculture functions now in the Department of Natural Resources (DNR) to a new cabinet-level agency. Senator Giesel read the resolution aloud at the start of the hearing so the record would show the legislature had considered the matter and could convene a joint session to vote on the order.

Supporters told the committee a separate department could raise the profile of agriculture and direct more resources to producers, while opponents raised fiscal and implementation concerns.

Duncan Fields, president of the Kodiak Livestock Co-op, testified in favor of the governor's proposal. Fields said the co-op, which operates a Kodiak slaughter facility, had generally received good service from the division of agriculture but believed a standalone department would secure more consistent funding and attention to producers statewide. \"We support the governor and ... we think it would be good for our industry and good for agriculture throughout Alaska to develop or establish a department of agriculture rather than keep the division of agriculture within the Department of Natural Resources,\" Fields said.

Members debated the merits and costs. Senator Hughes registered an objection to moving the matter out of the committee and urged not to reject the department's creation, calling it a \"once in a multi-generational opportunity\" and arguing a commissioner at the cabinet table would help shepherd recommendations from the Alaska Food Strategy Task Force (created by HB 298, 2022). Senator Wilikowski, who made the motion to refer the resolution to Finance, stressed that a yes vote to move the measure does not itself reject the executive order; it sends the question to a committee that can evaluate the fiscal and administrative details.

Committee members noted differences between the procedural resolution before them and the governor's underlying proposal. Chair Giesel clarified that the fiscal note attached to the legislative resolution is zero dollars but that the actual Department of Agriculture proposal carried a fiscal note of $2,700,000 to stand up the department. Senator Wilikowski also read aloud an administration summary that listed 13 new full-time positions the department proposal would initially create (including accountants, IT staff and administrative positions) and said additional funding requests could follow in subsequent years.

On a roll call requested by Chair Giesel, Senators Dunbar, Klayman, Wilikowski, Kawasaki and Giesel voted yes to move the resolution to Finance; Senators Myers and Hughes voted no. The committee recorded the motion as passing, 5 yeas to 2 nays. The committee will sign and transmit the referral paperwork and the matter will proceed to the Finance Committee for more detailed fiscal review and, if scheduled, later consideration in joint session.

What happens next: The resolution will be reviewed by the Finance Committee, which the Resources Committee identified as the next committee of referral. Committee members and supporters requested that Finance review the startup costs, the list of proposed positions, and the Alaska Food Strategy Task Force recommendations (the white paper passed to members during the hearing). Public testimony on the resolution at Resources consisted of one in-room speaker; Chair Giesel closed the public record after that testimony. The Resources Committee recessed its business and moved on to the first hearing on Senate Bill 92.

","The committee voted 5-2 to move Special Senate Concurrent Resolution 1, which would disapprove Executive Order 136 establishing a Department of Agriculture, to the Finance Committee for further review after one public testimony and extended committee discussion about funding, staffing and timing.","actionData","errors"]

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Senate hearing begins on bill to tax oil and gas "pass-through" entities; Department of Revenue provides preliminary revenue estimates

Senate Resources Committee sends resolution on governor's Department of Agriculture order to finance committee after public testimony