The Senators working on a final version of a bill amending the tax on oil and gas today asked the Parnell administration to get them information on what the governor says needs to be changed.
The legislature has complained for the last five years about not having revenue data to support their decisions on oil taxes. The system first underwent major changes in 2006 – and it was revamped in 2007.
Revenue Commissioner Bryan Butcher told the Senate Finance Committee that rewriting the working side of the law – the regulations and the filing documents -- has been a huge job. He says he expects the mid-2013 reports – based on work going on now – will likely be up to date. However, He says catching up with old data and reconciling it has been a problem.
We’ve been more restricted in being able to get information in that because we’ve been given the information in years the companies have given the information to the department in particular categories and sub-categories that they have always done it; and it’s not so easy to go after the fact and try to break it down into the kind of detail we would like.
The Committee didn’t want to hear of more delays in getting information relating to the oil taxes they are working on. The immediate questions concern the use of credits against taxes – specifically the incentives to encourage exploration. Co-Chair Lyman Hoffman (D-Bethel) said he voted against the last tax change because information was lacking.
We’re not talking about millions, we’re talking about Billions in the past, and we’re talking about Billions in the future. We need to be on top of this game because those are our credits and we should know if they are working or not working. And it should be a very high priority.
And Bert Stedman (R-Sitka), the other co-chairman, said the Senate’s financial consultants have cautioned about the credits, saying they are too much. He cites early estimates of work on existing fields that projected costs of about $60-million. He says that was off by about $2-Billion.
Commissioner Butcher agreed that more information is always better. However, he says he cannot produce historical information on the results of previous statutory changes until the auditing systems are in place, working, and verifiable.
Do I feel comfortable with where we are with the initial audits being done on a year-to-year basis and giving up an accurate view of where we are? Yes I do.
Golovin Democrat Donnie Olson does not share Butcher’s view of the situation.
When the governor starts asking for more tax credits for the oil companies out there and we don’t have the information, I don’t have the comfort that you feel.
Hoffman reminded Butcher of the votes lost on the last tax change before the legislature because the administration did not have information to support it. The bill is still before the Senate Finance Committee.