DOR schedules workshop on depreciation
The Alaska Department of Revenue is considering a change in its regulations to address depreciation issues raised in recent litigation over the assessment of pipeline properties.
The department said in a June 30 public notice that it is seeking input from industry, municipalities and other members of the public on its depreciation methodology, and will hold a public workshop July 11 from 1:30 to 4:30 p.m. in the East Hearing Conference Room of the Regulatory Commission of Alaska. Both written and oral comments will be accepted, but the department said those who wish to provide comment of either variety at the workshop must be in attendance no later than 2:30. Participation by teleconference is available at 1-800-315-6338, access code 40720#.
The department said for several years it has been applying depreciation under a certain methodology for production and pipeline properties, and for “clarity and transparency reasons” is considering implementation of regulations to clarity the specific methodology in the Alaska Administrative Code.
It would like to present the methodology and gather comments, but is not proposing any specific changes.
Any revisions would “subsequently be publicly noticed, and made available for public review and comment,” the department said.
“Recent litigation regarding the assessed value of pipeline transportation properties has resulted in determinations from the Alaska Supreme Court that a use value standard is a proper premise under which to apply assessment methodology in administering AS 43.56.060(e),” the department said. That section is titled, “The full and true value of taxable property used or committed by contract or other agreement for pipeline transportation of gas or unrefined oil or in the operation or maintenance of facilities for the pipeline transportation of gas or unrefined oil.” The department said it believes section (d) of that statute, covering production property, should be treated consistently.
It said it is holding the workshop “to present and discuss an appropriate methodology under the use value criteria that is efficient, transparent, and easily verifiable by interested parties, and is both stable and predictable for use in future assessments by the DOR.”
- PETROLEUM NEWS
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