Alaska
Governor to propose lower property tax to support Alaska LNG mega-project
Gov. Mike Dunleavy plans to introduce a bill that would establish a low property tax for the giant Alaska LNG project, a move that would help support its development.
The bill, to be introduced at the start of the session, proposes a rate of 2 mills on the assessed value of the project, Dunleavy said in an interview Friday. That’s one-tenth of the 20 mills, or 2%, that the state levies on oil and gas infrastructure, a portion or all of which can go to local governments with such infrastructure, depending on their rates.
The governor said his bill would cover the length of the project’s lifetime, which has been estimated at 30 years or more.
The governor said his administration is also employing a third-party consultant to study potential sources of additional revenue from the project that could be available to the state and local governments.
Two borough mayors reached for this article raised concerns about the proposed tax rate, including whether local revenue from it would be offset by other benefits, and why the Dunleavy administration has chosen it as a starting point for legislative discussions without their input.
Peter Micciche, mayor of the Kenai Peninsula Borough, said he didn’t think the rate is high enough to win support from local governments that would host project infrastructure.
“We’re all supportive of the AKLNG project,” he said. “But it can’t solely be on the backs of our local taxpayers. I think there’s a fair deal to be had, but a deal that has to be born from facts, real math and local impact data.”
“It has to be transparently and fairly negotiated between the involved parties in good faith, and we’re standing by ready to engage in that process and move Alaska and that project forward,” he said. “But I can’t imagine that a 90% reduction in local revenues associated with oil and gas properties has any chance of moving forward.”
The bill also comes as Alaska legislative leaders have expressed concern about how quickly they can thoroughly consider a long-term plan providing fiscal support for the project, an effort that will include considering potential benefits and risks to the state and other complex questions.
The bill comes after a consultant for the Legislature, GaffneyCline, told the Legislative Budget and Audit Committee last month 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.
Lawmakers say they also plan to weigh whether GaffneyCline faces a conflict of interest, given that its parent company, Baker Hughes, has said it plans to provide key equipment and make a “strategic investment” in the project.
Dunleavy said lawmakers will “need to roll up (their) sleeves, get serious” and pass legislation involving the project.
Alaska LNG, among the largest U.S. infrastructure project proposals in modern history, also faces unanswered questions likely to complicate any efforts by the Legislature, including if the longtime current cost, estimated at $44 billion, is accurate.
The project’s developer, Glenfarne, has said an updated cost estimate will be completed this month. Worley, a global engineering firm, is doing the work.
The estimate won’t be released publicly, but it will be available to the state, Glenfarne said Friday.
“Worley’s work evaluating potential cost increases or reductions, for both pipeline and initial LNG export components, is on track to be completed by year-end as scheduled,” said Tim Fitzpatrick, a spokesperson for Glenfarne, in a prepared statement. “As a private developer, Glenfarne does not publish competitive cost information. We’re in commercial negotiations with contractors, suppliers, and LNG buyers, and cost information will remain confidential. Lenders and investors will be provided necessary and customary information.”
“The state of Alaska will have an investment opportunity and will have access to all necessary information,” Fitzpatrick said.
A 2-mill property tax
Project plans call for construction of an 800-mile pipeline delivering natural gas from the North Slope to Alaskans by 2029, an estimated $11 billion first phase.
In the second and more expensive phase, an export and gas-liquefaction facility would be built in Nikiski to ship much larger quantities of the gas overseas for use in Asian countries. The project has called for gas exports to begin in 2031.
[Previous coverage: Alaska LNG has caught a wave of high-level attention. Is it winning over its skeptics?]
Several similar projects to tap Alaska’s North Slope gas and send it to buyers have failed to be built over the decades.
But Alaska LNG stands out for making progress that others haven’t.
It recently completed the federal permitting process necessary for the project’s construction.
Large gas consumers in Asia, such as Tokyo Gas in Japan and POSCO International Corp. in South Korea, have signed preliminary gas-offtake agreements for more than half of Alaska LNG’s available gas volumes. Those are not binding commitments to buy the gas, though they could lead to final agreements.
“Glenfarne is rapidly progressing toward a final investment decision, as seen through our progress with numerous Asian commercial announcements and strategic partner agreements,” Fitzpatrick said. “We expect additional announcements in the next several weeks. Our overall project schedule, including completing the pipeline in 2028 and delivering first gas to Alaskans in 2029 has not changed.”
Dunleavy on Friday said his property tax bill will not be lengthy.
It’s the only bill he plans to introduce dealing with Alaska LNG, given that early legislation involving the project a decade ago established a strong foundation, he said.
“I’m going to introduce one bill on the gas line, because that’s really the only thing that’s really something worth putting in,” Dunleavy said. “Meaning the bills that enable the gas line that were passed in ’14 and ’15 had everything in there.”
A 2-mill rate would generate $100 million in the project’s first year, if it’s assessed at $50 billion, and lesser amounts as the project’s value depreciates over time.
That is below the $1 billion the project would generate at that value under the state’s 20-mill, or 2%, property tax rate.
At 2 mills, the income represents more income than the “zero” the state will get if the project is not built, Dunleavy said.
“We will still get royalty, we will still get severance taxes,” he said, referring to taxes and royalties from gas production.
Alaska LNG would also create thousands of jobs and lead to lower energy costs, he said.
The administration also plans to hire a “third party to examine any and all methods by which the municipalities and the state could capture revenue, meaning other types of taxes, PILTs, fractional ownership, other types of co-ownership in the pipeline,” he said, using PILT to refer to payments in lieu of taxes.
That co-ownership, 25% of which was reserved by the state’s gas line corporation, could potentially include municipalities, the state, corporations or individuals, he said.
“There are no other bills that we are contemplating, because the structure was put together really well by the Legislature back when the (original) bills were passed,” he said.
‘A jaw-dropping reduction’
The property tax at its current rate could add 9% to the project’s cost to deliver gas, GaffneyCline told the Legislative Budget and Audit Committee last month.
Fitzpatrick, with Glenfarne, said GaffneyCline and other experts have “identified Alaska’s high oil and gas property tax as an impediment to project development for more than a decade.”
“Glenfarne is already moving this project forward in advance of a formal FID (final investment decision) and will continue to work with the Legislature as we approach FID,” Fitzpatrick said in the prepared statement. “A final resolution to this longstanding problem will help Alaskans get lower cost energy as quickly as possible.”
The governor outlined his plans for the proposal in a private meeting with legislative leaders Thursday, the same day he presented his budget draft that called for spending more than $1.8 billion from savings to cover costs in the current and coming fiscal years.
Senate Majority Leader Cathy Giessel, R-Anchorage, said in an interview that the property tax proposal will be very contentious because it will have a significant impact on the state and local communities.
“That is a jaw-dropping reduction in a property tax,” Giessel said. “I know that it will affect the state, but it certainly will affect the municipalities and boroughs that the pipeline will go through. That’s a huge give on the part of the state to make this otherwise astronomical gas pipeline affordable and economic to even do.”
Giessel also said major questions need to be answered by the project developer and lawmakers.
For example, she asked, if North Slope oil producers provide gas for the project, will they be able to deduct expenses associated with that effort from the oil production taxes they pay the state?
“We need to refine the gas lease expenditure deductions and how that impacts oil,” she said.
Other concerns include preventing large cost overruns such as those experienced for the 800-mile trans-Alaska pipeline that began moving North Slope oil to market in 1977, she said.
The Legislature will be hard-pressed to make all the necessary changes this session, in part because Dunleavy provided a budget that will take up much of the discussion, she said.
“The timeline for any deliberation over our oil and gas tax structure typically has taken several years of work,” Giessel said Friday. “We’re now in the second session of a Legislature in an election year, and we have been now handed, yesterday, an incredibly irresponsible budget. We’re going to have to, frankly, put it to the side and write a budget, because this governor did not put the work in to actually do that. I don’t see how we possibly get any kind of tax structure on gas resolved before the middle of May.”
House Speaker Bryce Edgmon, an independent from Dillingham, said the House will look at the issues closely and will need to hire its own third-party consultants.
Setting a long-term property tax rate for the project is “inherently a challenging issue,” he said.
“But we will certainly do our part in terms of considering it,” he said. “Whether it can be prosecuted in a single session, that’s a whole different matter.”
Sen. Elvi Gray-Jackson, D-Anchorage, the chair of the Legislative Budget and Audit Committee, said she’s “looking forward” to seeing the governor’s bill.
“We’ll just take one step at a time,” she said. “Glenfarne claims they’re going to have a final investment decision in early 2026. We’ll see.”
Gray-Jackson said in a recent opinion article that she directed GaffneyCline to provide a report on key issues involving the Alaska LNG project. The report was pubicly released Monday.
Dunleavy said lawmakers can find the time to properly deal with the issue during a 120-day session and reach agreement on a complicated subject, like lawmakers do in other states.
The governor said that if the Legislature focuses on this bill over trivial bills, “such as recognition of tall people’s week or, you know, some of the bills that we do down there, we’ll get some substantial things done just like they do in other states in much less time.”
“We may have grown accustomed over the years, in Alaska in the Legislature, that just about everything is a hard, almost impossible lift,” he said. “But when we look at what they’re doing across the country, we should not be fretting over anything. We should be eager to get to work, roll up our sleeves and get some fantastic legislation done that will be (a) game changer for the state of Alaska.”
Borough mayors raise concerns
Mayors with two boroughs that would encompass Alaska LNG infrastructure, if the project is built, said they were concerned that the governor has moved forward with a specific idea for the property tax without input from the boroughs.
The governor met with those affected boroughs in October, but did not provide specific details of any proposed strategies regarding Alaska LNG, such as the 2-mill property tax, they said.
Micciche, mayor of the Kenai Peninsula Borough where the gas-liquefaction and export facility would be built, said the borough wants to see the gas line project built.
But the borough wants to make sure it can break even under a project that could create additional requirements in the borough for housing, roads, emergency services and other costs, he said.
“I look forward to those discussions so that we can lay out what the actual impact will be and discuss how our costs will be covered,” Micciche said.
Grier Hopkins, mayor of the Fairbanks North Star Borough, said one of the borough’s top priorities is seeing the gas line built.
But the borough needs to make sure the gas it provides is affordable to support the local economy, and it needs time to study the issue.
“I’d be happy to work with the governor and the other municipalities to find an agreement, but he needs to sit down and work with us,” he said. “I hope we can work together and something is not unilaterally moved forward before they can talk to us.”
Josiah Patkotak, mayor of the North Slope Borough where the project would start, declined to comment at this time, a spokesperson said.
Alaska
Hawaiian, Alaska reservation systems merge: Big changes for travelers start April 22
HONOLULU (KHON2) — It’s the biggest milestone yet in the Hawaiian Airlines merger with Alaska Airlines.
Starting Wednesday, April 22, Hawaiian Airlines and Alaska will operate as one, powered by a single passenger reservation system, essentially the technology behind your entire travel experience.
“The system that connects all of the programs that our guests use, things like our websites, our app, our Atmos rewards program, our Huaka’i program, all of those systems, including employee tools, will be updated as of tomorrow to a more modern single passenger service system that will allow a more stream streamlined and seamless guest experience for all those that are traveling on either Alaska or Hawaiian that will allow a more stream streamlined and seamless guest experience for all those that are traveling on either Alaska or Hawaiian,” said Alisa Onishi, Hawaiian Airlines Marketing Manager.
By midnight tonight, the Hawaiian app goes dark, replaced by a new combined Alaska-Hawaiian platform, marking a major shift in how you book and manage your flights.
“If you download our new single Alaska-Hawaiian app, you’ll be able to manage your bookings all in one place, make changes, cancellations and a lot more self-service features that our guests have been asking us for for quite some time now that you couldn’t do on the old app,” said Onishi.
Behind the scenes, this moment has been three years in the making. Alaska announced its $1.9 billion acquisition back in 2023, with approvals and integration steps unfolding through 2024 and 2025.
At the airport, much will look the same, but the process is getting an upgrade. Travelers are encouraged to check in ahead of time, using the new app, then use updated bag tag stations to print tags and drop bags faster.
“You scan your boarding pass, prints out the bag tags. You can pay or prepay online or pay at the stations and then drop your bag, so you’ll get through the airport a lot quicker,” said Onishi.
Airline officials said the goal is a more seamless, self-service experience, something customers have been asking for.
Still, not everyone is convinced.
“Even today, when I was trying to get my boarding passes, there was a Hawaiian-Alaskan app that I went to, and then it referred me back to the Hawaiian app. So I didn’t know what application I was supposed to be using, but ultimately, it worked out to a point,” said Ethan Christensen, who was standing in line at customer service to confirm his flight for tomorrow. “But yeah, we’ll see. Hopefully, it gets better. I mean, I know these things take time, especially when you’re kind of merging two big things like this, but the outlook is positive for me because I know it’s a good airline. Hopefully it stays that way.”
The call centers are not going away, and customer service desks will remain at the airports for those who need one-on-one help.
Airline leaders acknowledge the transition so far hasn’t been perfect, but said this milestone is meant to fix many of those issues.
Alaska
Alaska’s embattled economic development agency approves $700,000 PR budget
The state agency leading some of Alaska’s most polarizing development projects has approved a new communications budget, saying it needs to do a better job telling its own story amid attacks from critics.
The state-owned Alaska Industrial Development and Export Authority is run by a former chief of staff to Gov. Mike Dunleavy and is charged with promoting economic growth and expanding natural resource extraction and exports.
It is leading work to develop state-owned oil leases in the Arctic National Wildlife Refuge and also hopes to build two controversial new roads to access mining prospects in Northwest Alaska and outside of Anchorage.
Those projects have drawn sharp opposition from conservation organizations and other critics, including lawsuits, critical op-eds and campaigns that have labeled the agency “Bad AIDEA” and caricatured its leaders.
At a meeting in Ketchikan this month, board members, with no public discussion, authorized AIDEA’s staff to spend up to $700,000 a year on a new communications budget — formalizing a plan that the agency says was previously budgeted inconsistently through spending on individual projects.
The new communications plan, the agency said in its formal resolution authorizing the spending, will “ensure proper public engagement, transparency, and stewardship of the authority’s mission.” The money could go toward trade shows and conferences, responding to media inquiries and “other communications-related needs,” according to the resolution.
The agency’s executive director, Randy Ruaro, referred questions about the plan to Dave Stieren, an AIDEA employee who ran an advertising agency and hosted a conservative talk radio show before joining the Dunleavy administration.
Stieren said he could not provide exact figures on AIDEA’s past communications spending, but he acknowledged that the new plan should allow the agency to meaningfully boost its public profile.
The $700,000 a year, he added, is a limit, and the agency will set a final budget through a request for proposals process.
“Mothership AIDEA has done, frankly, little to nothing on a consistent basis to tell our story,” Stieren said in an email — particularly when it comes to its loan programs that have helped finance tourism and hospitality businesses, like the Alaska Club fitness chain and Anchorage’s Bear Tooth pizza restaurant and theater.
“We’re far more than roads,” Stieren said. “But since we’ve really not promoted or showcased our efforts in traditional finance areas, I understand the narrative or lack thereof that folks may have.”
Stieren has also personally defended AIDEA on social media, including over the weekend — when he posted a conservative news website’s positive story about an agency-owned shipyard and said that “when commie libs attack AIDEA, they attack projects like this.”
AIDEA’s board chair, Bill Kendig, declined to answer questions about approval of the new communications budget when reached by phone.
At the Ketchikan meeting, one AIDEA critic, Melis Coady, credited the agency with formalizing communications spending as a “step toward accountability.” But she said that the plan doesn’t “deliver the transparency it describes” because it gives Ruaro, the executive director, authority to approve communications spending, and only requires that he report it to the board if asked.
“The authorization is broad, the dollar amount is undefined, and expenditures are approved solely by the executive director,” said Coady, who leads a conservation group called the Susitna River Coalition.
Ruaro, in an email, said AIDEA will issue reports on communications to board members “whether requested or not.”
Nathaniel Herz is an Anchorage-based reporter. Subscribe to his newsletter, Northern Journal, at northernjournal.com.
Alaska
Inside Alaska’s craft beer scene
In exchange for living in what is perhaps the country’s most beautiful state, Alaskans sometimes have to do without: professional sports teams, Trader Joe’s and, well, sunlight for half the year. But we make up for it with the Iditarod, reindeer sausages and chasing the aurora borealis. In other words, we often have to make our own fun. And by “fun” I mean “beer.” Those words are interchangeable, right?
Beer is a big part of life for Alaskans. We hike with it, camp with it, boat with it, cook with it and pair it with foods like the stuffiest of sommeliers. We throw it monthly birthday parties like the First Tap events at Broken Tooth Brewing Co. (otherwise known as Bear Tooth Theatrepub and Moose’s Tooth Pub & Pizzeria), complete with national musical acts like Modest Mouse, Clinton Fearon, and Norah Jones. We even occasionally do yoga with it (at downtown’s Williwaw Social). In other words, we take it everywhere and we take it seriously.
Beers from the state’s biggest brewery, Alaskan Brewing Co. based in Juneau, might already be in your refrigerator if you live in one of the 25 states where it’s available. Established in 1986 by Marcy and Geoff Larson, it was the 67th independent brewery to open in the country. With a steady line of signature brews, including their most recent “Wildness” beer, it’s the most well-established of all the state’s breweries. Expect seasonal specialties that incorporate ingredients like cranberries, raspberries, locally roasted coffee, locally grown white wheat from the Matanuska-Susitna area and even Alaska spruce tips. Ubiquitous around Alaska, this is our Papa Beer, if you will (I’ll show myself out).
But Alaskan Brewing is just one out of the more-than 50 breweries, distilleries, meaderies and cideries in the state (for an excellent list visit brewersguildofalaska.org). And while almost half of them are in Anchorage or within a short drive of our state’s largest city (including the relatively populous communities of Girdwood, Eagle River, Palmer and Wasilla), some of our most remote ports of call and tiniest towns are also in on the brewing action (I’m looking at you, Cooper Landing Brewing Company in Cooper Landing, population 231).
The ever-expanding Denali Brewing Co. in Talkeetna (population 997) may be a small-town hero, but it’s anything but small. Their four signature beers — Mother Ale, Chuli Stout, Single Engine Red and the ever-popular Twister Creek IPA, as well seasonal brews like Slow Down Brown and Flag Stop Milepost #3 — are year-round mainstays of summer barbecues and winter bonfires around the state.
This brewery is also home to the more recently established Alaska Cider Works, Alaska Meadery (featuring “Razzery,” a mead made with raspberries, sour cherries and apples) and Denali Spirits (featuring vodka, gin, whiskey, and “smoke” whiskey), because when you’ve fermented one, why not ferment them all?
(Denali Spirits’ canned cocktails, especially their blueberry mojito, have been so popular in Anchorage that at one time there was a Facebook page largely dedicated to tracking them down. Luckily, supply has since caught up with demand.)
Some breweries are even more remote. Ports of call and island hopping here can be one way to get your fill of hops. Breweries can be found in Ketchikan (Bawden Street Brewing Co.), Kodiak (Kodiak Island Brewing & Still, Double Shovel Kodiak Cidery, and Olds River Inn), Homer (Homer Brewing Co. and Grace Ridge Brewing Co. for beer, and you can also check out Sweetgale Meadworks & Cider House for hard cider and locally sourced meads featuring ingredients like nagoonberry), Sitka (Harbor Mountain Brewing), Seward (Seward Brewing Co. and Stoney Creek Brewhouse), Valdez (Valdez Brewing and Growler Bay Brewing), and Skagway (Klondike Brewing Co. and Skagway Brewing Co.).
Of course, many trips to Alaska begin and end in Anchorage. And if, during your travels, you’ve foolishly left some beers untasted, you can make up for lost time in our state’s biggest city which boasts — let’s face it — a ridiculous number of exceptional craft breweries.
Downtown’s Glacier Brewhouse specializes in oak-aged English and American West Coast-style beers, 13 of them, from blondes to stouts. Beneath the floor of the Brewhouse is a “Wall of Wood” comprised of casks of special release beers that are conditioned in oak barrels once used to age wine and bourbon. The history of the oak imparts “mother tongue” flavor characteristics, like vanilla and coconut, into these limited edition brews. Opt for one of these unique beers or choose from their flagship choices like raspberry wheat, oatmeal stout, imperial blonde, Bavarian hefeweizen or a flight that includes them all.
Down the street is 49th State Brewing Co., which expanded into Anchorage from its original location in Healy, at the edge of Denali National Park and Preserve. If you are unable to visit their flagship location, where you can sip beer while playing bocce or horseshoes on the lawn, you can catch up with them here. There’s a unique selection that includes beers like Smok, a smoked lager, as well as seasonal offerings like the Tiger’s Blood Sour, an homage to shave ice described as ”ferociously fruity.” Or there’s “Apple Fritter Ale,” with hints of cinnamon, icing, caramel, and vanilla. This location also boasts some of the best views in Anchorage and an expansive outdoor rooftop patio.
Just about all of the full-service restaurants in downtown Anchorage proudly feature some variety of Alaskan beers. In the heart of downtown, Humpy’s Great Alaskan Alehouse prides itself on a huge selection of beers, both international and local. Tent City Taphouse offers a diverse and carefully curated list of 24 rotating local brews, including their house beer, Tent City Tangerine IPA brewed by Glacier Brewhouse. Tent City regularly hosts “Taste of the North” beer dinners featuring Alaskan brewers. One, in collaboration with Grace Ridge Brewing Company, featured smoked salmon canapes with Black Pepper IPA, classic beef Wellington with an Oystercatcher stout and roasted honey lamb chops with a Winter Cranberry Ale.
If you have transportation around the city, treat yourself to a brewery tasting-room tour. Found in unassuming little side streets in the more industrial areas of Anchorage, some of our best beers can be sipped and savored at the source. Finding these funky little spots can feel like being invited to a secret party. And it’s a glimpse into Anchorage’s most authentic beer culture.
In midtown, Onsite Brewing Co. has unique, small-batch brews in a funky relaxed environment. Further south, King Street Brewing Co., Turnagain Brewing, Cynosure Brewing, Magnetic North Brewing Company, Brewerks, and one of our newest, Ship Creek Brewing Company are all within a stone’s throw of one another. If you’re lucky, you might run into one of Anchorage’s popular food trucks parked outside, so you’ll have something to wash down with your flights. Depending on the day, you might find reindeer sausages, pad Thai, cheesesteaks or pupusas. On the weekends, Anchorage Brewing Company features a top-notch in-house pop-up restaurant, called Familia, with a rotating menu featuring local Alaskan ingredients.
One of the newest and furthest south breweries, while still in the Anchorage bowl, is Raven’s Ring Brewing Company, which is a brewery/winery and meadery. From a traditional IPA to a Concorde grape wine called Grape Juice to a rotating Vintner’s pour like Sweet Peach Jalapeno mead, this ambitious operation is challenging the notion that you can’t please everyone.
Other Anchorage points of interest for non-hoppy but still home-grown adult beverages include Anchorage Distillery, Zip Kombucha, Double Shovel Cidery and Hive Mind Meadery.
If your travels are over and you still haven’t had your fill, check out the Silver Gulch Brewing & Bottling Co. inside Terminal C at the Ted Stevens Anchorage International Airport on your way out of town. An offshoot of the flagship Silver Gulch brewery in Fox, Alaska (about 10 miles north of Fairbanks), this location has a bar and restaurant, and a retail shop carrying growlers of their own brews as well as those of other Alaskan brewers and distillers. Last-minute souvenir shopping never tasted so good.
Before you start your great Northern beer safari, bear in mind that tasting rooms often have limited and varying hours, so always double-check before planning a visit.
Whether your travels take you to fine-dining restaurants, low-key alehouses or even rustic cabins in the woods, make like an Alaskan and fuel your adventures with one of our beloved, home-grown brews. When in Alaska, drink as the Alaskans do.
Mara Severin is a food writer who writes about restaurants in Southcentral Alaska for the Anchorage Daily News.
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