Alaska Senate advances measure requiring greater oversight of oil and gas tax data

Yahoo

07-05-2025

May 7—JUNEAU — The Alaska Senate on Monday unanimously advanced a measure requiring greater legislative oversight of the state's oil and gas tax collections.
Since 2019, the Alaska Department of Revenue has declined to provide the Legislature's auditor with oil and gas tax data in the format requested. Lawmakers have been frustrated that they don't have a full picture of those tax collections that can total hundreds of millions of dollars per year.
Senate Bill 183 would require agencies to provide tax information in the "form and format" requested by the auditor. The measure clarifies that failing to do so could incur a fine of up to $5,000.
The Senate unanimously approved the measure on Monday, sending it to the House for its consideration.
Kris Curtis, the Legislature's auditor, told lawmakers last week that the Department of Revenue audits oil and gas tax returns to ensure the state is getting all of the revenue it is owed.
"When an underpayment is identified, this group sends an assessment letter to the taxpayer identifying additional tax due. This is referred to as tax assessments. A taxpayer may also be required to pay interest," she said.
The information requested by the auditor includes additional taxes, interest and penalties paid by oil and gas companies each year. Between 2006 and 2011, the total tax and interest assessed by the Department of Revenue added up to $1.3 billion.
Gov. Mike Dunleavy took office in late 2018. Curtis said the Department of Revenue stopped providing that information in the format requested around 2019. Instead, the agency has provided a "data dump" that lawmakers say is unusable.
The Department of Revenue first said the requested data was confidential, despite being routinely provided in the past, Curtis told lawmakers. More recently, revenue officials have said they were not required by law to provide the data in the format requested, she said. That has led Curtis to issue "qualified" reports on the state's oil and gas tax collections, reflecting that incomplete information was provided.
"Reluctance on behalf of the Department of Revenue to provide information from an audit perspective raises a lot of red flags," Curtis said in testimony on the bill. "And I have concerns from the audit perspective as to why. And I would like to help determine that, not just for you, but for the public."
Before Monday's vote, Anchorage Democratic Sen. Bill Wielechowski said the Department of Revenue is responsible for reviewing oil and gas tax returns, and ensuring that the state of Alaska is receiving every dollar owed to it. He said the agency's refusal to provide "usable information" for the legislative auditor and lawmakers "sets a dangerous precedent" that could obscure future audits.
"That's not theoretical. That's real money resulting from real audits, directly affecting the state's bottom line," he said.
Aimee Bushnell, a spokesperson for the Department of Revenue, said by email Tuesday that "nothing is blocked" by the agency and that "legislative auditors have access to all information" on oil and gas tax collections.
Bushnell said that previously, the legislative auditor created various tables based on data provided by the agency. But the auditor updated those tables around 2017, she said. The state agency "spent many hours trying to plug information" into those tables "that do not reflect how the tax system compiles and maintains its data," Bushnell said.
Management at the state Tax Division determined there were more efficient ways to report the oil and gas collection data, she said. Additionally, it was "overly cumbersome" to compile the information in the format requested by the auditor, and "by producing these tables on a regular basis, we could not maintain taxpayer confidentiality," Bushnell said.
Legislators have long been frustrated that the auditor is not getting the data in the format requested.
Anchorage Democratic Sen. Elvi Gray-Jackson, chair of the Legislative Budget and Audit Committee, sent a letter in February asking that the Dunleavy administration "fully cooperate" with the legislative auditor.
"If executive branch agencies can pick and choose what information to provide or what format, they can intentionally, or not, obstruct the Legislature's ability to perform independent oversight on behalf of the public, effectively hiding billions of dollars from public view," she said.
SB 183 was supported by all senators present in Juneau on Monday.
Wasilla Republican Sen. Mike Shower, the Senate minority leader, said he was initially concerned the auditor would be granted too much undue influence over the executive branch. But he said the measure does not expand the auditor's authority. Instead, it helps ensure the Legislature has "appropriate oversight and authority over the budget," he said.
After passing the Senate, the bill now heads to the House, where it is being fast-tracked through the committee process. A first hearing has been scheduled on Thursday with two weeks left in the regular legislative session.