Weird, because he told me that "it could be related to break material" instead of wort gravity. Palmer told me the same thing.
Ive been looking through my notes, and I think the confusion is in terminology. From some podcasts with both Palmer and Tinseth, I think they agree that hop utilization is affected by break material rather than dissolved sugar. But break material is also related to wort boil gravity, so hop utilization is related indirectly to wort boil gravity. The formulas were developed empirically, and are still valid, but not for the reasons that were once thought.
Podcasts:
http://www.beersmith.com/blog/2011/02/10/beer-bitterness-and-ibus-with-glenn-tinseth-bshb-podcast-9/
http://hw.libsyn.com/p/3/0/4/30433c...31834041&hwt=a1babd357d2d091bbf481fb8c715d1b4
http://beersmith.com/blog/2012/02/2...-beers-with-john-palmer-beersmith-podcast-33/
http://s125483039.onlinehome.us/archive/bs_020711.mp3