Director · Legislative Finance Division
3 transcripts · 19 clips
Alexei Painter is listed on the Alaska Legislative Finance Division staff page as a Legislative Fiscal Analyst. A court affidavit also identifies him as the Director of the Legislative Finance Division for the Alaska State.
“Then that would double, so 4.8 mills, and then double again to 9.6 mills. Of course, property value is not going to be fixed over the life of the project. So it is possible that after 30 years, the project will be worth less because it will be 30 years old or they will have done work and the value will go up. It removes that variable.”
“The other body's version, rather than this, in 2060 had a sunset that returned to the mill rate formula. Instead, this keeps the AVT but at a higher rate. And so again, those earlier shares continue, but as the taxes increase, the increased amount goes to a different place.”
“So the mill rate for the other body's version I think worked out to about 2.4 mills. And so the initial amount here for Phase 2 would be about that 2.4 mills.”
“So in this committee substitute, in Phase 1, as Mr. Eklund said earlier, the tax will be 6.2 cents per 1,000 cubic feet. That was kind of a rounded version of the effective tax rate of the House version during that phase of the project. So that bill had a 6-cent tax on the pipeline component and and then a 13-cent tax on the gas treatment plant. With the smaller gas treatment plant, that blends to a rate of about 6.2 cents, just rounded to the nearest cent of a cent in this bill. And when this tax takes effect, the revenue split is in box A there.”
“So 6% goes off the top to North Slope Borough because that'll be the location of the mini gas treatment plant. And then the remaining revenue is split equally to municipalities by pipeline mileage. And then to community assistance.”
“Starting when this tax takes effect, which would be 5 years after Phase 1 first gas or 500 million per day average throughput. All tax rates grow at a rate equaling CPI, but not less than 1% and not more than 3%.”
“This just fixes that rather than have it vary if capital costs change from what are projected now. And then this, again, these rates will all grow with inflation based on those 1 to 3% sideboards.”
“Starting in Phase 2, the tax rate is 10.6 cents per 1,000 cubic feet. This is the same as the effective tax rate as modeled by DOR under the House version.”
“This initial tax will be— will go through the distribution in Box B. So this provides 48.4% of the tax to Kenai Peninsula Borough, 27% for the North Slope Borough, 9.5% by pipeline mileage. That again includes both of those local governments, but also others in the state. 9.5% To community assistance, and then 5.6% to the state as general fund revenue. And these amounts are again the approximate result of the House version of this bill, just without the weighting.”
“So assuming the capital costs match the DOR projections, then this would make no substantial change, but it doesn't require collecting capital cost data. So then this bill has a couple of new provisions that were not in the House version. So the first is that after 10 years after Phase 2 begins, there is an additional levy. So in addition to the 10.6 cents, there is another 10.6 cents $10.6 million. So essentially, the tax doubles at that point.”
“In 2060, the tax will double again, so going from 21.2 cents to 42.4 cents. And then the additional amount of revenue raised by that, that tax increase will go entirely to the general fund as UGF revenue.”
“revenue begins in FY '31 with just the in-state portion, and then going as the export begins, this higher number.”
“AB 4359-030 provides the municipalities will directly collect the tax for the portion of the project property that's located in that municipality, weighted again by the capital costs.”
“Alaska statutes currently provide the municipalities must contribute the lesser of 2.65 mills of real and personal property or 45% of prior year basic need to schools.. And this section exempts all the property that's getting the AVT or the moratorium— tax moratorium before the AVT kicks in from that required local contribution.”
“it creates Chapter 59 in Title 43. And so the next few slides will use references within Section 18 because that's a very substantive section. So the new Chapter 4359.010 provides a tax abatement, so no taxes at all until the earlier of 500 MCF of daily average throughput for a 30-day period or 5 years after the commencement of commercial operations.”
“The rate for the AVT is a blend of multiple rates, weighted by the capital expenditure weight of each category. So there's a 6 cents per MCF rate for the pipeline component. That's Phase 1. And then there is a 12-cent per MCF rate for the gas treatment plant and carbon capture facility component, which is part of Phase 2, and then a 12-cent per MCF tax component for the LNG plant.”
“The tax rate grows theoretically with CPI each year, but it can't grow less than 1% or more than 2%. So very narrowly bounded within that after that first initial year. And the payments are made monthly like the oil and gas production tax, not annually like the existing property tax.”
“the total AVT collection projected by DOR in that year is $124 million. The state would receive $15 million of that on behalf of the unorganized borough. The municipalities would receive $109 million of that. Most of that is going to the Kenai Peninsula Borough, $55 million, and the North Slope Borough, $40 million”
“For Phase 2, your annual AVT revenue would be 8 cents times 500,000 times 365 plus 10 cents times 2.5 million times 365, and that's $107.3 million. And so that's roughly with that higher end cost estimate, that's a mill rate of about 1.97 mills.”