Commissioner of Revenue
: Brooke Miles
for advisory opinion regarding public outreach process preliminary
to fiscal interest finding for a fiscal contract under the
Stranded Gas Development Act (AS 43.82)
Mr. Corbus asked whether he could enter
into a professional services agreement with a gubernatorial
campaign to provide issues-related services such as writing
position papers, speeches, talking points, letters, and
messages for the gubernatorial campaign. In our telephone
conversation of August 28, 2006, you stated that your position,
although untitled, would be that of “issues coordinator.”
You further stated that the campaign does not have a campaign
manager at this time.
The Commissioner of Revenue is not required
to report to APOC expenditures made to fulfill the notice
and public comment provisions of the Alaska Stranded Gas
Development Act. An expenditure that is made for the purpose
of informing the public about the potential fiscal impact
of the gas pipeline contract as required by the Alaska Stranded
Gas Development Act is not made for the purpose of influencing
the gas reserves tax initiative election. Only spending
“for the purpose of . . . influencing the outcome
of a ballot proposition or question” is an “expenditure”
subject to reporting under AS 15.13.140(b). AS 15.13.400(6).
Any discussion of the gas reserves tax outside of the context
of the department’s preliminary fiscal interest finding,
however, would likely constitute election-related activity
and related expenditures would have to be reported to APOC
and paid for with funds specifically appropriated for such
advocacy unless the expenditure qualified as a purely non-partisan
educational activity under AS 15.13.150 and 2 AAC 50.379.
. Independent expenditures
for or against ballot proposition or question.
(a) This chapter does not prohibit a person from making
independent expenditures in support of or in opposition
to a ballot proposition or question.
(b) An independent expenditure for or against a ballot
proposition or question
(1) shall be reported in accordance with AS 15.13.040
and 15.13.100 - 15.13.110 and other requirements of this
AS 15.13.145. Money of the state and its political subdivisions.
(2) may not be made if the expenditure is prohibited by
(a) Except as provided in (b) and (c)
of this section, each of the following may not use money
held by the entity to influence the outcome of the election
of a candidate to a state or municipal office:
(1) the state, its agencies, and its corporations;
(2) the University of Alaska and its Board of Regents;
(3) municipalities, school districts, and regional educational
attendance areas, or another political subdivision of
the state; and
(4) an officer or employee of an entity identified in
(1) – (3) of this subsection.
(b) Money held by an entity identified
in (a)(1) – (3) of this section may be used to influence
the outcome of an election concerning a ballot proposition
or question, but only if the funds have been specifically
appropriated for that purpose by a state law or a municipal
(c) Money held by an entity identified
in (a)(1) – (3) of this section may be used
(1) to disseminate information about the time and place
of an election and to hold an election;
(2) to provide the public with nonpartisan information
about a ballot proposition or question . . . .
(d) When expenditure of money is authorized
by (b) or (c) of this section and is used to influence
the outcome of an election, the expenditures shall be
reported to the commission in the same manner as an individual
is required to report under AS 15.13.040.
AS 15.13.400(6). Definitions.
(A) means a purchase or a transfer of money or anything
of value, or promise or agreement to purchase or transfer
money or anything of value, incurred or made for the purpose
Sec. 36(a) ch 82 SLA 2006
* * *
(iv) influencing the outcome of a ballot
proposition or question . . . .
Section 20(e) ch 3 FSSLA 2005, is amended
(e) The sum of $7,100,000 is appropriated from the general
fund to the Department of Revenue, commissioner’s
office, for work related to the state gas pipeline and
to bringing North Slope natural gas to market.
AS 43.82.400. Preliminary findings
and determination regarding the contract.
(a) If the commissioner develops a proposed
contract under AS 43.82.200 – 43.82.270, the commissioner
(1) make preliminary findings and a determination that
the proposed contract terms are in the long-term fiscal
interests of the state and further the purposes of this
(c) In conjunction with the making of preliminary findings
and determination required by (a)(1) of this section,
the commissioner shall describe the principal factors,
including the projected price of gas, projected production
rate or volume of gas, and projected recovery, development,
construction, and operating costs, upon which the determination
made under (a)(1) of this section is based. . . .
AS 43.82.410. Notice and comment
regarding the contract.
The commissioner shall
(1) give reasonable public notice of the preliminary findings
and determination made under AS 43.82.400;
(2) make copies of the proposed contract, the commissioner’s
preliminary findings and determination, and, to the extent
the information is not required to be kept confidential
under AS 43.82.310, the supporting financial, technical,
and market data, including the work papers, analyses,
and recommendations of any independent contractors used
under AS 43.82.240 available to the public . . .
(4) establish a period of at least 30 days for the public
and members of the legislature to comment on the proposed
contract and the preliminary findings and determination
made under AS 43.82.400.
2 AAC 50.356. Use of public money.
(a) Funds are specifically appropriated
for the purposes of AS 15.13.145(b) if the appropriating
body provides notice on the public record that the funds
will be used to influence the outcome of an election.
(b) In the absence of a specific appropriation,
an officer or employee of an entity who is identified
in AS 15.13.145(a)(4) may use money held by that entity
to communicate about a ballot proposition or question
if the communication is made in the usual and customary
performance of the officer’s or employee’s
(c) For the purposes of AS 15.13.145(c)(2),
information is nonpartisan if it does not advocate a position
in an election. Nonpartisan information includes the official
language of a ballot question, a neutral ballot summary,
if provided for all candidates seeking a particular office,
the candidates’ names, contact information, or statements.
(d) If an entity or individual identified
in AS 15.13.145(a)(1) – (4) uses money held by the
entity to make an election-related expenditure, the expenditure
must be disclosed on a report of contributions or independent
expenditures under AS 15.13.040(d) and (e) unless the
expenditure is made only to disseminate information about
the time and place of an election or to hold an election.
2 AAC 50.379. Election educational
Election-related communications and activities
are educational if they
(1) do not favor particular candidates or a position on
a ballot measure; or
(2) provide an opportunity for the expression of views
of all candidates or both sides of a ballot measure.
The Commissioner of Revenue has certain
responsibilities under the Stranded Gas Development Act
(AS 43.82) (SGDA). These responsibilities include making
preliminary findings and determination; preparing a proposed
contract; describing the principal factors upon which
the determination was based; giving reasonable public
notice of the findings and determination;
and making available to the public copies of the proposed
contract, the preliminary findings and determination,
and, to the extent allowed by law, the supporting documents
and materials; and allowing at least a 30-day period for
In fulfilling those responsibilities,
you are holding a series of public hearings at state expense
in locations around Alaska. At those hearings appointed
state officials and state-hired private consultants will
explain the anticipated effects of the contract. According
to your letter, there will also be documents prepared
for public dissemination.
You anticipate that one issue that will
be raised by the public is the effect of a gas reserves
tax on the feasibility of the gas line project. A gas
reserves tax is currently the subject of a ballot initiative.
At the public hearings, the state’s representatives
will explain the rationale for including gas reserves
tax provisions in the contract, and will explain “why
the reserves tax would create an unfavorable investment
climate for the gas line project.” 1
The cost of the hearings and prepared
documents will be paid for with already enacted legislative
appropriations. Sec. 36(a) ch 82 SLA 2006. To date, the
cost associated with the public outreach effort has not
been reported to the Alaska Public Offices Commission.
The Alaska Public Offices Commission is
responsible for administering AS 15.13, State Election
Campaigns. AS 15.13.140 and AS 15.13.400(6) require the
reporting of spending to influence a ballot proposition
election. AS 15.13.145 further regulates how the state
and its political subdivisions may spend money to influence
the outcome of an election by prohibiting such spending
unless money is specifically appropriated for that purpose.
APOC has implemented these sections in 2 AAC 50.356 and
In your letter 2.
In order to properly educate the public
as to the contents of the fiscal contract and to answer
any questions that the public might have about the effect
of that document, a series of public hearings will be
held at state expense in various locations throughout
* * *
I believe that the administration’s
remarks and documents pertaining to the reserves tax are
intended to educate the public concerning the effect of
the fiscal contract and are not intended to influence
the outcome of the election.
Alaska law requires that money held by
the state may be used to influence the outcome of a ballot
proposition only if the funds were specifically appropriated
for that purpose by state law. AS 15.13.145(b). Funds
are specifically appropriated if the appropriating body
provided notice on the public record that such funds were
to be used to influence the outcome of an election. 2
AAC 50.356(a). The appropriating language of Sec. 36(a)
ch 82 SLA 2006 does not on its face provide the required
notice that the funds will be used to influence the outcome
of an election. 3 Thus, there does
not appear to be any authorization for the expenditure
of public money to influence the gas reserves tax initiative
However, the Commissioner of Revenue is
required under the SGDA to provide a period of public
comment on the preliminary fiscal interest finding. Therefore,
those state officials and employees who act on behalf
of the commissioner by participating in the public hearings
where they inform the public about the effects of the
gas reserves tax proposition on the fiscal impact of the
proposed gas line contract, would presumably satisfy this
purpose. Presumably such actions would not be for the
purpose of influencing the gas reserves tax initiative
election. Similarly, providing, as part of the public
hearings, copies of the proposed contract, the preliminary
findings and determination, and supporting documentation
and data, including that of the state’s independent
contractors, would also satisfy this purpose. AS 43.82.410(2).
So long as the discussion of the gas reserves
tax takes place in the context of the larger question
of the fiscal impact of the proposed gas line contract,
thereby fulfilling the notice and public comment provisions
of the Alaska Stranded Gas Development Act, it is not
for the purpose of influencing the outcome of the gas
reserves tax ballot initiative and expenditures need not
be reported to APOC. Comments on the gas reserves tax
initiative outside the context of the gas line contract
and related expenditures, however, are likely not authorized
by the appropriation in section 36(a) ch 82 SLA 2006;
and, only if money were appropriated elsewhere for this
purpose, could such expenditures be made. Any such expenditures
would have to be reported to APOC unless the expenditures
satisfied the very strict requirements of AS 15.13.150
and 2 AAC 50.379 for educational activity. 4
The appropriation in section 36(a) ch
82 SLA 2006, does not appear to provide specifically for
the Department of Revenue to spend the money to influence
the outcome of the gas reserves tax initiative.
However, state funds can be used to pay
for the costs associated with discussing the gas reserves
tax in the context of the public hearings on the gas line
contract preliminary fiscal interest finding if such discussion
is for the purpose of informing the public of the gas
pipeline contract under the Alaska Stranded Gas Development
Act. Discussion of and dissemination of documents regarding
the gas reserves tax outside of this context would likely
constitute election-related activity, which would require
a specific appropriation and reporting of expenditures
The Commission approved the advice in this letter
by an affirmative vote of 5-0 on October 31, 2006. The advice
in this opinion applies only to the specific activity for
which the advice was requested.
A copy of the original letter requesting the above
advisory opinion is available upon request at the Alaska
Public Offices Commission. 907/276-4176.
1.Letter of July 17, 2006, from Commissioner Corbus.
3. Evidence from the public record constituting the requisite
notice would change this analysis.
4. State money may be used to provide the public with nonpartisan
information about a ballot proposition. AS 15.13.145(c)(2).
Information is nonpartisan if it does not advocate a position.
2 AAC 50.356(c). In your letter, you state that administration
officials and hired consultants participating in the public
hearing process will “explain why the reserves tax
would create an unfavorable investment climate for the gas
line project.” Such an explanation does not fall under
the legal definition of nonpartisan.