Hop utilization is the fraction of a hop addition's alpha acid that actually isomerizes into soluble bitterness during the boil — never 100%, and never fixed, since it depends heavily on how long the hops boil and how concentrated the wort is at the time.
The core variable both major IBU formulas are actually estimating
Tinseth and Rager don't disagree about how much alpha acid went into the kettle — that part is simple arithmetic from weight and alpha percentage. They disagree about how to model utilization itself, which is the genuinely uncertain, harder-to-measure part of the calculation, and it's exactly why the two formulas can diverge sharply — and even swap which one reads higher — on identical hop additions.
Two variables that move utilization more than anything else
Boil time is the dominant lever — utilization rises steeply over the first 20-30 minutes of a boil and then levels off, which is why a 5-minute addition contributes so little bitterness compared to a 60-minute one even at identical weight and alpha acid. Boil gravity is the second major lever — a higher-gravity boil reduces utilization (the same hop addition contributes less measured IBU in a big beer's boil than in a smaller one), which is exactly why high-OG styles like Double IPA and Barleywine need disproportionately more hop mass to reach a comparable bitterness level.