Alaska
Dunleavy proposes alternative tax for LNG project in place of property taxes
Gov. Mike Dunleavy on Friday introduced a bill in the state Legislature that would eliminate property taxes for the Alaska LNG megaproject, but create an alternative tax that would generate a smaller amount of revenue.
Lawmakers said Friday that they were still reviewing the bill, but one said it appears to be a “massive tax cut” that could exceed $1 billion in lost potential revenue to the state.
A borough mayor also indicated that municipalities that would host project infrastructure would lose out on significant property taxes and don’t currently support the measure, though they are working with the governor’s office and project officials on options.
Dunleavy said in an interview Friday that the goal is removing a financial barrier for the project so that it can be built.
At that point, it will provide an array of long-running benefits that the state does not currently receive from the North Slope’s vast but long-stranded natural gas, he said.
That includes a large number of jobs and affordable gas for Alaskans and businesses, including to support potential new undertakings such as data farms or fertilizer manufacturing, he said.
Also, even if his bill is passed, the project still would bring in significant royalties and production taxes, he said.
Over 30 years, the project still will generate $26 billion for state and local taxes and royalty revenue, Dunleavy said, referring to figures from the Alaska Department of Revenue. An oil and gas analyst interviewed for this article questioned those numbers.
Jeff Turner, a spokesperson for the governor, said in an email that the Department of Revenue is updating its Alaska LNG analysis “to incorporate spring modeling” and will share information on those figures next week.
Dunleavy said that if nothing is built, the state gets nothing from the project.
Recent events involving the U.S. war on Iran, including Israel and Iran bombing major gas infrastructure, underscore the need for a project that can safely export gas to meet strong demand in Asia, he said.
“So it’s a catalyst to billions upon billions upon billions of dollars and decades of future (revenue), not to mention the thousands of jobs and the other economic benefits from that,” Dunleavy said of the project.
Awaiting a final investment decision
The state has unsuccessfully pursued a version of Alaska LNG for generations.
Government agencies, private developers and major oil companies have never been able to get it built. The huge price tag has been a key impediment.
Under the current plan, majority owner Glenfarne is working with the Alaska Gasline Development Corp., a state agency and 25% project owner.
Alaska LNG has preliminary but nonbinding deals in hand with gas producers and buyers. Many observers say this project is farther along than past ones that failed.
Dunleavy said he recently met with the Taiwanese ambassador, Alexander Tah-Ray Yui.
“The country is very excited about moving ahead on hard agreements, especially now,” he said, following events in the Middle East.
Glenfarne has not yet made a final investment decision to build the project, a step originally expected in December.
Phase one calls for building an 800-mile pipeline to deliver natural gas from the North Slope to Southcentral Alaska, starting in 2029.
Phase two includes construction of a plant and shipping terminal in Nikiski. At that point, vast quantities of liquefied natural gas, or LNG, can be shipped overseas to Asian companies. That would start in 2031.
Glenfarne has recently updated an old cost figure of $44 billion for the project. But the company, based in New York, has not disclosed the new estimate, as well as other financial details.
Dunleavy said it’s common for a privately led project seeking investors and customers to hold on to proprietary information.
“I think there’s going to be enough information that can be shared publicly that will give legislators enough comfort that Alaska is better off with a massive project such as this, as opposed to better off without it,” he said.
Some Alaska lawmakers, who must decide what fiscal terms they should provide the project, if any, have said Glenfarne has not given them the financial information to judge the project’s potential benefits and risks.
A big ‘buzz cut’
The governor’s new measure proposes taxing the volume of gas flowing through the pipe, rather than taxing the assessed value of the oil and gas infrastructure, the governor’s office said in a prepared statement.
The alternative tax would be 6 cents per every thousand cubic feet of gas. That tax rate would increase 1% annually.
The alternative tax would not kick in until the project reaches an average flow of 1 billion cubic feet daily or 10 years after gas starts flowing, whichever comes first.
The project, once in full production with exports to Asia, is expected to move 3.5 billion cubic feet daily.
The bill removes the front-end tax burden for the project, reducing risks for potential investors, the governor’s office said.
It creates a predictable revenue stream, unlike property tax assessments that can be challenged, his office said.
Those benefits can help result in cheaper natural gas prices for Alaskans, the statement said.
Larry Persily, an oil and gas analyst and former Alaska deputy commissioner of revenue, said the alternative tax would provide a little over $75 million in the tax’s first year, if the project moves 3.5 billion cubic feet of gas daily.
In comparison, the property tax currently on the books would bring in $1 billion annually, for a project assessed at $50 billion.
“The bill today is not even a hair cut,” Persily said.
“It’s like a buzz cut on property taxes. It’s pretty substantial,” he said.
About a decade ago, when Persily was chief of staff to former Kenai Peninsula Borough Mayor Mike Navarre, he worked with a group of municipalities that tried to determine a fair property tax for an earlier, failed version of the project.
The group realized property taxes needed to be reduced to help make the project economic against global competitors.
But they still believed some property taxes were needed to support services provided by the state and boroughs.
They looked at a reduction that would still bring in about $630 million annually in property taxes, he said.
“The question is, how much of a discount should you provide and how should you structure it, to cover costs to the municipalities for all the services they will need to provide in association with the project,” he said.
Persily also said he doesn’t think the project will generate $26 billion in state and local taxes and royalties over 30 years.
He said a key source of revenue, production taxes and royalties, are based on the sale of gas as it first comes out of the ground, when its value is expected to be low compared to what it finally sells for.
“It seems a little gold-plated,” he said of the long-term revenue estimate. “Many Alaskans feel like this will be next Prudhoe Bay. But it’s not the same as oil in terms of profitability and tax revenue.”
Sen. Bill Wielechowski, a Democrat and vice chair of Senate Resources, said early Friday that his office is still reviewing the bill.
It appears the proposal could remove more than $1 billion in annual taxes from the state, compared to current statutes, he said.
“The rough look so far is that is a massive tax cut,” he said.
Glenfarne calls for swift action
GaffneyCline, a consultant for the Alaska Legislature, has said that legislative action will likely be needed on issues such as property taxes and “fiscal stability” before the project developer can make a final decision on investment.
The consultant has said property tax relief can provide critical savings early in the life of the project when costs are high.
Adam Prestidge, president of Glenfarne Alaska LNG, said in a prepared statement Friday that the state is facing a growing energy crisis, as natural gas production from the aging Cook Inlet basin near Anchorage continues to wane.
Glenfarne has been discussing property taxes with state and local leaders with the idea of minimizing energy costs for Alaskans, Prestidge said.
“State and local policymakers including members of the legislature, independent analysts, and the legislature’s own oil and gas consultants have all recognized that reforming Alaska’s current system is a key step in advancing a North Slope natural gas project,” Prestidge said.
“Acting swiftly on this measure is the most important step the Legislature can take to ensure that Alaskans will finally benefit from bringing Alaska’s North Slope natural gas to market,” he said of the bill.
Grier Hopkins, mayor of the Fairbanks North Star Borough, said in an interview Friday that officials from his borough and others that would host some of the project’s infrastructure do not agree with the terms of the bill.
The borough officials have been meeting regularly with officials from the governor’s office, the Alaska Gasline Development Corp. and Glenfarne, he said.
“The conversations have gone well, but this is not what we agree on, and I don’t support this specifically for Fairbanks,” he said.
Only 2 miles of the pipeline will travel through the Fairbanks borough. But the proposed bill will remove about $350,000 in annual property tax revenue, based on his own rough estimate, he said.
Other boroughs would see larger reductions, such as the North Slope and Kenai Peninsula boroughs, whose boundaries would encompass some of the project’s major facilities.
The Fairbanks borough is focused on getting affordable gas from the project, he said.
“So we still need to keep working with the governor and the Legislature to come up with something that’s going to work for the municipalities, which all have really different needs,” he said.
Lawmakers looking for more project details
Senate Majority Leader Cathy Giessel, a Republican and chair of the Senate Resources Committee, told reporters this week that lawmakers have not received enough information from Glenfarne about the costs of the project.
That makes it hard to know what steps should be taken to support it, she said.
The Senate Resources Committee has introduced a bill that proposes new guidelines on the project, including allowing the Legislative Budget and Audit Committee to conduct annual audits of the Alaska Gasline Development Corp.
Among many other steps, it would allow legislators to sign non-disclosure agreements in order to receive critical financial information.
Giessel said in an interview Friday that the members of the committee support Alaska LNG. They want to make sure it’s properly structured to benefit Alaskans, she said.
She plans to soon call on the borough mayors to appear before the committee to provide input on the bill.
She’ll also be looking to hear from GaffneyCline and other experts about their views on the bill, she said.
“It’s great that the public can now see what the governor is proposing,” she said. “These are local taxes that are being curtailed.”
“This affects their revenue to manage a large increase in their population and a huge increase in their property use” that will come with the project, she said.
Wielechowski, the Senate Resources vice chair, said the Dunleavy administration also needs to provide details to lawmakers about the project and the bill.
“The burden is on him to come forward and explain to the people of Alaska why he needs to give away a billion dollars a year,” he said.
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/adn/T4D3KOYHQNFWPEOJZIRG5OTW6Q.jpg?w=400&resize=400,240&ssl=1 "Opinion: Here are my priorities for Alaska in the proposed state budget")
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/adn/T4D3KOYHQNFWPEOJZIRG5OTW6Q.jpg?w=80&resize=80,80&ssl=1 "Opinion: Here are my priorities for Alaska in the proposed state budget")
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/adn/EKP5Z5LH4VCKXDOBO4BFYJ2N44.jpg?w=400&resize=400,240&ssl=1 "For Alaska politicians, embracing renewable energy is about the economy — not the environment")
:quality(70)/cloudfront-us-east-1.images.arcpublishing.com/adn/EKP5Z5LH4VCKXDOBO4BFYJ2N44.jpg?w=80&resize=80,80&ssl=1 "For Alaska politicians, embracing renewable energy is about the economy — not the environment")
A plane belonging to the Alaska National Guard appears to have been damaged during operations connected to Operation Epic Fury as part of American military efforts against Iran, according to online reports. Defense officials have so far declined to confirm whether Alaska National Guard personnel or equipment are taking part in the campaign.
Last week, defense industry news outlet The War Zone published photos of a KC-135 Stratotanker transiting through a British airbase. In the pictures, made by photographer Andrew McKelvey, the rear bottom of the fuselage and wing stabilizers are “peppered with temporary shrapnel damage repairs‚“ according to The War Zone’s article. The plane also appears to be missing its refueling boom, the proboscis extending from under the tail to pump off fuel to other aircraft.
In the photographs, the Stratotanker’s tail number is visible, identifying the refueling plane as belonging to the Alaska Air National Guard’s 168th Wing, based at Eielson Air Force Base outside of Fairbanks. The wing’s mission includes aerial refueling. That’s the tactic of large planes unloading vast quantities of fuel to aircraft, ranging from fighter jets to rescue helicopters, in midair.
Pictures from a different photographer published last week by another blog, The Aviationist, show the same plane. The tail includes the letters “AK” painted above a white polar bear.
In addition to the photographs, the reporting from The War Zone is based on publicly available flight data and social media posts scraped from a variety of sources.
According to information from Flight Radar 24, the Stratotanker left Eielson on March 5, just days after the U.S. and Israeli militaries began bombing Iranian targets on Feb. 28. Through March, according to public flight records, the plane was based at Ben Gurion Airport southeast of Tel Aviv, where, according to The War Zone, dozens of American refueling aircraft were staged as part of Operation Epic Fury.
There are no public flight records connected to the Stratotanker through April and most of May, until it appeared to fly through England on the way to the United States at the end of last month.
It is not clear how many Alaska Air National Guard planes, personnel or units are currently deployed in connection to the war effort against Iran.
A spokesperson for the Alaska National Guard referred all questions about Operation Epic Fury to the U.S. Central Command.
A spokesperson for CENTCOM, headquartered at MacDill Air Force Base in Florida, declined to answer questions on the record or provide any specific information about Alaska National Guard units deployed as part of ongoing military operations, citing the need to protect service members and operational security.
The Alaska National Guard has posted no informational releases or pictures connected to an overseas deployment during the last few months.
Much of Operation Epic Fury has been waged by military aircraft, and aerial refueling is critical to keeping planes supplied during long flights. A May 12 report from the Congressional Research Service composed of public damage reports to U.S. military aircraft noted that among the 42 records of damage or losses were seven KC-135 Stratotankers, though the findings were published before photos emerged of the Alaska-based plane. The report noted that the Defense Department “has not published a comprehensive assessment of combat losses” from Operation Epic Fury.
The tail number is associated with a Stratotanker manufactured in 1964, the year before Boeing ceased making them. All of the nearly 400 KC-135s currently in operation within the American military date back to that era of the Cold War.
The aircraft has the word “Tetlin” painted on the top of its tail. The name is an homage to the Interior Alaska village, one of several selected to honor longstanding bonds between military aviators and Alaska Native communities, according to photographs of a dedication ceremony posted by the Alaska National Guard last summer.
The 168th Wing currently has 12 Stratotankers attached to the unit. That number bumped up in April after a long campaign by Alaska Republican U.S. Sen. Dan Sullivan to allocate more tankers to the state’s portfolio given its vast geography and high number of advanced fighter jets.
- Alaska Airlines is opening its newest Lounge at Portland International Airport, featuring thoughtfully designed spaces with twice the square footage and seating of the current space
- The new Lounge reflects the airline’s appreciation for its loyal guests and comes as Alaska continues to expand its service in Portland, offering more flights and more options for guests
- The investment to modernize the Portland Lounge is part of Alaska’s growing portfolio to elevate its global guest experience and expand its Lounge footprint, including new spaces in Seattle, San Diego and Honolulu
PORTLAND, Ore., June 2, 2026 /PRNewswire/ — Alaska Airlines is set to welcome guests to its newest Lounge at Portland International Airport (PDX) when it officially opens on June 4, underscoring its continued investment in premium travel and one of the carrier’s key West Coast hubs.
After more than two years of construction, the approximately 14,000-square-foot Lounge will welcome guests with a warm, thoughtfully designed Pacific Northwest aesthetic, featuring an inviting fireplace and a striking wooden Mt. Hood mural by artist Ben Butler. At twice the size of the current Portland Lounge, it offers more than 230 seats, including Alaska’s Signature Loungers, along with high, open ceilings that bring in natural light and views of PDX’s new terminal. Guests can relax, enjoy fresh, regionally inspired food, sip barista-crafted beverages or cocktails from West Coast partners, or take advantage of ample power plugs and privacy booths for calls and meetings.
“Portland guests have chosen Alaska for years and played an important role in our growth in the Pacific Northwest,” said Shane Jones, senior vice president of fleet, products and guest experience. “This new Lounge is our way of thanking them and a reflection of our growing portfolio of premium guest experiences. We look forward to opening our doors this week and welcoming guests with the signature hospitality and thoughtful touches Alaska is known for.”
Alaska is the largest carrier serving Portland, operating more flights than any other airline, including more than 100 daily departures. Portland is a critical hub in Alaska and Hawaiian’s network with expanding service to over 60 destinations across North America and beyond. This summer, Alaska will launch year-round service to Everett/Paine Field and Pasco–Tri-Cities, along with seasonal service to Jackson Hole. Last month, new service began to Baltimore, Bellingham, Idaho Falls, Philadelphia and St. Louis. By this fall, Alaska will offer 50% more seats in Portland than just two years ago, reflecting strong demand for travel and the airline’s continued investment in the market.
“Our strong partnership with Alaska has helped to elevate the new PDX as a world-class destination that showcases the Pacific Northwest and makes everyone feel at home,” said Chris Czarnecki, PDX business and properties director. “We’re thrilled their new PDX Lounge is here for the long-haul, offering travelers a stunning spot to relax, recharge, and experience a taste of our region.”
The nearly $18 million investment in the Portland Lounge is part of Alaska’s growing Lounge footprint and broader commitment to enhancing the guest experience as it expands globally. Building on this investment, Alaska just announced its plans to open a landmark, more than 41,000-square-foot Lounge in 2027. The Lounge, which will be located in Seattle – home to the airline’s main hub – will be the largest in its network and among the largest airline lounges in the country. The airline is also designing its first Lounge in San Diego along with a new, expanded Lounge in Honolulu, both slated for early 2028.
Alaska Airlines Lounge members can access eight premium Lounges across the Alaska and Hawaiian Airlines network, including its largest Lounge in Seattle and additional locations at its hubs in Anchorage, Los Angeles and San Francisco. Alaska Lounge+ membership unlocks access to all Alaska Lounges, plus nearly 90 partner Lounges worldwide, including select oneworld and partner Lounges. To learn more or sign up to become an Alaska Lounge member, click here.
Frequently Asked Questions:
What is Alaska Airlines opening at Portland International Airport?
A: Alaska Airlines is opening a newly redesigned Lounge at Portland International Airport (PDX) on June 4, 2026, offering a larger, more modern space with premium amenities, regional food and beverage options, and enhanced comfort for guests.
How big is the new Alaska Lounge in Portland?
A: The new Lounge is approximately 14,000 square feet—about twice the size of the previous Portland Lounge—and features more than 230 seats.
What amenities are available in the new Alaska Lounge at PDX?
A: Guests can enjoy:
- Barista-crafted coffee and specialty beverages
- West Coast-inspired cocktails
- Fresh, locally inspired food
- Signature Lounge seating and private booths
- Ample power outlets and workspaces
- Relaxation areas with premium finishes
Who can access Alaska Airlines Lounges?
A: Access is available to:
- Alaska Lounge members
- Alaska Lounge+ members
- Eligible First Class guests
- Eligible oneworld and partner airline passengers
What is the difference between Alaska Lounge and Lounge+ membership?
A: Alaska Lounge+ membership includes access to all Alaska Lounges plus nearly 90 partner Lounges worldwide, while standard Alaska Lounge membership provides access to all eight Alaska-operated Lounges.
Why is Portland important to Alaska Airlines?
A: Portland is one of Alaska Airlines’ key West Coast hubs, with more than 100 daily departures and nonstop service to over 60 destinations across North America. By this fall, Alaska will offer 50% more seats in Portland than just two years ago, reflecting strong demand for travel and the airline’s continued investment in the market.
How is Alaska Airlines expanding its Lounge network?
A: Alaska Airlines is investing in multiple new and expanded Lounges, including:
- A 41,000+ square feet landmark Lounge in Seattle opening in 2027
- A new Lounge in San Diego
- An expanded Lounge in Honolulu
How much did Alaska Airlines invest in the new Portland Lounge?
A: Alaska Airlines invested nearly $18 million in the new Portland Lounge as part of its broader investment in premium travel as the airline continues to grow globally.
About Alaska, Hawaiian and Horizon
Alaska Airlines, Hawaiian Airlines and Horizon Air are subsidiaries of Alaska Air Group, and McGee Air Services is a subsidiary of Alaska Airlines. We are a global airline with hubs in Seattle, Honolulu, Portland, Anchorage, Los Angeles, San Diego and San Francisco. We deliver remarkable care as we fly our guests to more than 140 destinations throughout North America, Latin America, Asia, the Pacific and Europe. Guests can book travel at alaskaair.com and hawaiianairlines.com. Alaska and Hawaiian are members of the oneworld alliance. Members of our Atmos Rewards loyalty program can earn and redeem points with oneworld airlines and our additional global partners that serve over 1,000 worldwide destinations. Learn more about what’s happening at Alaska and Hawaiian at news.alaskaair.com. Alaska Air Group is traded on the New York Stock Exchange (NYSE) as “ALK.”
SOURCE Alaska Airlines
Anchorage Mayor Suzanne LaFrance told the state House Finance Committee on Monday that the Alaska LNG megaproject could cost the municipality up to $173 million over nine years because of the city’s current tax structure, citing a new report.
The project’s 800-mile pipeline, which would move gas from the North Slope to Southcentral Alaska, would not pass through Anchorage. As a result, the city would not receive direct property tax or gas-volume tax from the project, she said.
But thousands of workers associated with construction and related activity would be based in Anchorage, she said.
“Our community will serve as a logistical, operational, transportation, and administrative hub throughout the life of the project,” she said. “That will bring important economic benefits, but it will also create real demands on local government services.”
“Since we rely on property taxes, we don’t get new tax revenues from an influx of people until new homes and commercial properties are built and added to our tax rolls,” she said. “That takes years, but there will be immediate pressure on public safety, emergency response, roads, schools, and other municipal services.”
Gov. Mike Dunleavy called the Legislature into special session to weigh his proposal to cut property taxes to support the LNG line and replace them with a much smaller tax based on gas volume moving through the project.
Proponents say it would deliver long-term natural gas to Alaska, lowering energy costs, and after exports begin, it could provide billions of dollars in revenue for three decades even with the tax cut.
Skeptics fear that too large a rate cut could saddle municipalities and the state with high, uncovered costs to deal with the influx of workers and their demand on roads, police, housing and hospitals.
LaFrance said the municipality supports a community impact fund that would provide some revenue to Anchorage and other communities to help offset costs, she told the House Finance Committee. That idea, and a revenue sharing measure, are currently included in an amended version of the governor’s bill before the committee.
The concerns come as the LaFrance administration takes aggressive steps to build thousands of new homes in the coming years to address a tight housing market in Anchorage.
The report, prepared for the Anchorage Community Development Authority by economist Jonathan King with Halcyon Consulting, found that the project will “create a significant structural fiscal gap for the municipality.”
Lacking a sales tax that would provide immediate revenue as workers arrive, the city would instead lose large amounts of money during construction even if new housing is built, the report says.
But even in the most optimistic scenario, with new housing built in Anchorage for 100% of the workers, the city “will face a structural deficit” several years into the project, the report says.
With no new housing built for the workers, the city will face a cumulative deficit of $173 million over nine years, the report says. If new housing is built for all the workers, the city faces a nine-year deficit of $23 million.
“Avoiding a deficit likely means seeking new tax revenue outside the tax limit calculation, modifying the tax limit calculation, or receiving project impact payments from the state or project owners,” the report says.
Rep. Jeremy Bynum, a Ketchikan Republican, said that there would also be positive long-term effects, including from low energy costs that can support the economy and new industries, and population growth that can shore up dwindling school enrollment.
Nolan Klouda, policy director for LaFrance, said that once exports to foreign countries begin, the project’s gas price can be very affordable for Anchorage and other communities.
“We’re always very concerned about anything that could cause the cost of living to go up,” Klouda said. “So I think that having low-cost heating and power from that natural gas is really critical for our economy.”
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