At a March 4, 2021 meeting of the California Franchise Tax Board’s (FTB) three-member Board, FTB Staff announced on the record that a Board hearing on an alternative apportionment petition is not required to exhaust administrative remedies. The announcement was made during Staff’s recommendation to the Board to begin the formal regulatory process to amend FTB Regulation 25137 and establish detailed procedures for such petitions. The announcement constitutes a surprising reversal of the FTB’s longstanding – but unwritten – policy regarding taxpayer petitions for relief under California’s alternative apportionment statute, California Revenue and Taxation Code section 25137. It remains to be seen if the FTB will issue a written notice in line with FTB Staff’s on the record remarks. Notably, the proposed regulatory amendments are silent on the exhaustion issue. Nevertheless, based on the remarks, taxpayers seeking alternative apportionment may no longer feel pressured to go before the Board in an open hearing prior to bringing an appeal before the Office of Tax Appeals or a refund action in court.