How The Fair Share Act Works
The Fair Share Act Summary: The Fair Share Act is a ballot initiative that would increase the
State of Alaska’s (State) share of revenues from the production of oil.
Why We Need the Fair Share Act: The Fair Share Act will give the State an increased and more
transparent share of oil production revenues. The additional revenues from the Fair Share Act
could be used by the Legislature to fund essential government services such as education,
universities, health care, public safety, rural electric equalization, and marine highway
transportation, as well as to fund capital projects, the permanent fund, and permanent fund
dividends. As such, the Fair Share Act provides the Legislature with additional revenues to support
common sense solutions to the major issues currently facing Alaskans.
How the Fair Share Act Works:
Applies to Larger North Slope Fields: The Fair Share Act would apply to oil produced
from fields north of 68 degrees north latitude that have produced a minimum of 40 thousand barrels
of oil per day on average in the last calendar year and 400 million barrels of oil cumulatively
(larger North Slope fields). For all other oil fields, the current law would continue to apply.
Greater of the Gross or Net Production Tax. The Fair Share Act determines the State’s
share of production revenues for the larger North Slope fields as the greater of the gross production
tax or the net production tax based on oil prices and the monthly revenues and costs for each
producer for each field.
Gross Production Tax: The Fair Share Act increases the gross minimum production tax
for the larger North Slope fields from 4 percent to 10 percent and increases the 10 percent
minimum by 1 percent (up to a maximum of 15 percent) for each $5 per-barrel increase in the price
of oil beginning at $50 per barrel (Alaska North Slope crude oil, West Coast).
Net Production Tax: The Fair Share Act increases the net production tax for the larger
North Slope fields by eliminating the $8 per-barrel credit and adding an additional 15 percent tax
on producers’ profits beginning at $50 per barrel of profit.
Requires Transparency: The Fair Share Act would require producers’ production tax returns
and supporting information for the larger North Slope oil fields to be public.
Additional Revenues Raised: If the Fair Share Act were in effect during FY2018, it would have
increased the State’s share of production revenues by approximately $1.1 billion compared to