Section 3.188.050. Award of tax credits.

	(a)  Within 60 days after the end of the 24-month period set out in AS 44.33.233(a)(1), as that period is determined under 3 AAC 188.020(b), the producer must submit an application to the film office, on a form or in a format provided by the film office, for the award of a film production tax credit under AS 44.33.235.  
	(b)  Before the film office makes a determination under AS 44.33.235 with respect to the award of a film production tax credit, the producer must submit a rough assembly of the film to the film office for review. The film office will refuse to award the producer a tax credit if the rough assembly of the film does not bear a reasonable resemblance to what was proposed in the documents that the producer provided under AS 44.33.234, and if the film production is contrary to the best interests of the state under AS 44.33.233. In this subsection, "rough assembly of the film" means a sequencing of scenes that will eventually be refined into the final cut of the film.  
	(c)  The verification of qualified expenditures required under AS 44.33.235(d) must be prepared by a certified public accountant who  
		(1) holds a current license issued under AS 08.04  by the Board of Public Accountancy;  
		(2)  holds a current business license issued under AS 43.70; and  
		(3) is an independent third party, not related to the producer or involved in any way with the production.  
	(d)  A producer may apply under AS 44.33.235 for a tax credit that exceeds the estimated film production tax credit provided in the notice of qualification issued for the production under AS 44.33.234. The film office will grant a larger tax credit if  
		(1) all the expenditures claimed by the producer  
			(A) are qualified expenditures under AS 44.33.236 and this chapter; and  
			(B) were incurred during the 24-month period set out in AS 44.33.233(a)(1), as that period is determined under 3 AAC 188.020(b); and  
		(2)  at the time the determination is made, the sum of the following amounts does not exceed the $100,000,000 in-the-aggregate limit established in AS 43.98.030:  
			(A) the total amount of the tax credits estimated for all producers in outstanding notices of qualification issued under AS 44.33.234(b);  
			(B) the total amount of tax credits already provided under AS 43.98.030 to all producers;  
			(C) the amount of the increase that the producer requests under this subsection.  
	(e)  With the items required by AS 44.33.235(d) and this section, a producer must also submit a sworn certification that the producer and the production have fully complied with all applicable state laws and regulations during the production and have complied with all state permit requirements, that neither the producer nor the production is the subject of an investigation or administrative proceeding concerning alleged violations by the producer or the production of the laws or regulations of this state, and that neither the producer nor the production is involved in a legal action filed in a federal court or a court in this state concerning alleged violations by the producer or the production of the laws or regulations of this state. If the producer or the production, after submission of the sworn certification, becomes the subject of an investigation or administrative proceeding described in this subsection, or becomes involved in a legal action described in this subsection, the producer shall immediately notify the film office. Failure to comply with this subsection may result in a tax credit not being awarded to the producer. If the producer or the production is or becomes the subject of an investigation or administrative proceeding described in this subsection, or is or becomes involved in a legal action described in this subsection, the film office will suspend determination of eligibility for a tax credit pending resolution of that investigation, administrative proceeding, or legal action.  
	(f)  A producer who receives notice from the film office that it will not award all the tax credits for which the producer applied may request an administrative hearing by filing a notice of appeal within 30 days after the date of the denial notice. The notice of appeal must be in writing and will be considered filed on the date it is received by the film office. The notice of appeal must clearly state each objection to the denial, the justification for each objection, and the reasons why the producer is entitled to the amount of the tax credit for which the producer applied. Appeals will be referred to the office of administrative hearings. A hearing will be conducted under AS 44.64.060(c) - (e) and 2 AAC 64.100 - 2 AAC 64.370.  
	(g)  Upon a final determination under AS 44.33.235 on the award and amount of a film production tax credit, the film office will notify the Department of Revenue and request the issuance under AS 43.98.030 of a transferable tax credit certificate in that amount.  
	(h)  If a transferee purchases a film production tax credit certificate in an arm's length transaction, and the department seeks, after the transfer, to recover an amount of the credit under AS 44.33.237, the department will not hold the transferee liable for any portion of the credit that the department seeks to recover, and will seek recovery from the producer to whom the tax credit certificate was originally provided.  

Authorities

44.33.233;44.33.234;44.33.235;44.33.236;44.33.237;44.33.238

Notes

Authority

AS 44.33.233 AS 44.33.234 AS 44.33.235 AS 44.33.236 AS 44.33.237 AS 44.33.238

History

Eff. 6/18/2009, Register 190