IRS & Alaska Railroad

Dear Alaskan, sick and tired of abuse & fraud by state officials? The following “Complaint” has been filed with the IRS for investigation.

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In lieu of an Internal Revenue Service/Code official FORM 3949A/Information Referral, please except the following:

Name & Address of Taxpayers: 
Flint Hills Resources
(Subsidiary of Koch Industries)
1100 H & H Lane
North Pole, Alaska 99705

Koch Industries, LLC
4111 East 37^th Street N
Wichita, Kansas 67220

Name & Address Parties of Interest this Referral:
Alaska Railroad Corporation
327 W. Ship Creek Avenue
Anchorage, Alaska 99510

Alleged Violation of Income Tax Law: 
False Exemption, Kickback.

WHO/WHAT/WHERE/WHEN/HOW

Since 2006, the Alaska Railroad(ARR) has aided and abetted what appears to be tax fraud for another corporate entity. The Alaska Railroad is an instrumentality of the state of Alaska, incorporated, and is exempt from taxation. Due confidentiality its customers, the entity that the ARR is assisting in such fraud is assumed to be Flint Hills Resources(FHR), a subsidiary of Koch Industries(KI), as the perpetrator this criminal activity. FHR operates a refinery in North Pole, Alaska and utilizes the ARR to transport refined products to and from that refinery. Since the Alaska Railroad is exempt from taxation, it cannot enjoy the benefits of IRC §45G(Railroad Track Maintenance Credit). Therefore, the ARR “assigns” its entire track miles of record in Alaska(presently defined at 685-miles) as “Qualified Track Miles” to this private entity, again assumed to be aligned with Koch Industries. The “assignment” is allowed under §45G, as the ARR is a Class II Railroad by definition. Following the “assignment” the ARR then receives approximately $4.8-Million yearly for such “assignment” allowing the “assignee”(FHR/KI) to benefit the maximum credit allowed under §45G, or approximately $2.4-Million(685.7 miles x $3500). The ARR then affords this same entity an additional $2.7-Million “Transport Credit”, negotiated as part of the “assignment” for the money it receives for the track maintenance program, the original $4.8-Million expenditure. This “Transport Credit” appears to be nothing short a “kickback” that is allowing the perpetrator to take the maximum “limit” advantage of §45G based on the ARR track miles of record and at the same time receive an additional transport credit that undermines the §45G program and the merits of such, as the “kickback” in reality makes the original obligation for maintenance fall short its intended goal and providing a tax credit incentive based on false pretense. It is not known how the entity(FHR/KI) reports this “Transport Credit”, if reported at all, but it amounts to around $18-Million in “kickbacks” since the time this scam began. It is with this correspondence as a request that the Internal Revenue Service investigate what is presented herein to see if this scam is nothing short a “false exemption” with “kickback” and an attempt to harass the tax code wherein the ARR is used as a front - due its coveted status under state as a corporation and a ways and means for another entity to take advantage the existing IRC through its business affiliation with the ARR. Since the ARR receives grant money under the Federal Transportation Authority, the seriousness this crime is elevated as such grants are entered as “revenue” for purposes of the ARR’s financials and that could place the U.S. Taxpayers at risk, as the “Transport Credit” afforded the “assignee” is considered a revenue loss to the ARR, in essence, that “Credit” could be considered paid for by the U.S. Taxpayers. At minimum, the “assignee” should be demanded to re-access the “Credit” afforded under §45G from 2006 through present based on the true worth the “Qualified Track Maintenance Expense” fronted the ARR minus the “Transport Credit” afforded by the ARR for this maintenance expense, as this demonstrates the true merit of the §45G tax break incentive, not initiated with an end result intent as a monetary gain “above & beyond” as is demonstrated herein the relationship between the ARR and the “Assignee”(FHR/KI). Note, due the already mentioned “confidentiality” afforded the ARR through virtue its status as a “corporation”, it is assumed that the present “assignee” and perpetrator this fraud is FHR/KI but could very well be another ARR customer.

Year: 2006 thru 2009 – 651 “Qualified Track Miles” assigned.
$4.6M/Yr received by ARR for “Qualified Track Maintenance”
$2.3M/Yr “Track Maintenance Credit” provided(50%,w/maximum at $2.3M or 651 x $3500)under IRC §45G.
$2.6M/Yr “Transport Credit” allowed assignee(Kickback)

Year: 2010 thru 2012 – 685 “Qualified Track Miles” assigned.
$4.8M/Yr received by ARR for “Qualified Track Maintenance”
$2.4M/Yr “Track Maintenance Credit” provided(50%,w/maximum at $2.4M or 685 x $3500)under IRC §45G.
$2.7M/Yr “Transport Credit” allowed assignee(Kickback)

Totals to Date:
$32.8 received by ARR for “Qualified Track Maintenance”
$18.5 “Transport Credit” allowed to assignee(FHR/KI)
$16.4 “Track Maintenance Credit” allowed assignee under §45G.

Information Provider: 
S. Pam Magee
3DBB Phineas J. Whoopee Dive
Fairbanks, Alaska
99709

Information this referral was acquired through “public records”, research, ARR financials and limited correspondence with personnel at the Alaska Railroad. Efforts to acquire a copy of the “contract” between the ARR and the “Assignee” with respect to §45G and the “Transport Credit” negotiated was denied.