Revenue opposes information system

The administration does not support Senate Bill 192, believing it does not do enough to incentivize production, but also has another concern.

A petroleum information management system, or PIMS, was a feature of the bill crafted in Senate Resources, housed at the Alaska Oil and Gas Conservation Commission.

AOGCC objected, saying housing PIMS would interfere with its primary mission, and in Senate Finance PIMS was moved to the Department of Revenue.

Revenue Commissioner Bryan Butcher told Senate Finance April 6 that the department has been overwhelmed with regulatory changes required by the two new oil taxes the Legislature has enacted recently, Petroleum Profits Tax in 2006 and Alaska’s Clear and Equitable Share in 2007.

Butcher said the department was just digging out from the work of implementing regulations for the tax changes and beginning work on a $35 million tax system. PIMS “would likely cost millions of dollars,” compete with the core mission of Revenue’s Tax Division to assess and collect taxes and likely delay completion of core duties, he said.

Much of the information to be included in PIMS is already gathered by various departments, Butcher said, and most of what Revenue gathers is confidential. He said millions of data elements would have to be manually uploaded and a determination would have to be made as to confidentiality.

He projected that PIMS could delay implementation of the tax revenue management system and said PIMS wouldn’t be a wise use of state resources.

In addition Revenue, information for the system would be provided by the Department of Natural Resources and the Alaska Oil and Gas Conservation Commission.

In fiscal notes on the bill, all agencies indicated additional staffing would be required for PIMS: one contract position at AOGCC; eight positions in DNR’s Division of Oil and Gas; and four positions in Revenue.

—Kristen Nelson