Where Alaska's gas-line tax deal stands, and what's still stuck

Lawmakers spent the past several days in conference committee hammering out HB 381, the tax deal meant to finally get the Alaska LNG pipeline built. Nothing's final until the committee agrees and both chambers vote, but the July 1 working draft shows where things stand — and the headline is how much of it is aimed at shielding ratepayers.

The core move is a swap: instead of taxing the pipeline as property, the state would tax the gas that flows through it, a predictable structure Senate Republicans say developers need to line up tens of billions in financing.

Most of the recent work went to protecting consumers. The draft caps what utilities can charge customers for pipeline gas at $16 per million BTU — notable because Enstar's president told lawmakers the utility was already paying $16 for Cook Inlet gas this spring, so the cap is pitched as a ceiling against a Southcentral supply that's running short. It also bars utilities from passing construction overruns to ratepayers.

For the Interior, the committee attached a demand: the entire tax break now hinges on the developer committing to build a spur line to Fairbanks, where residents pay $24 to $26 per thousand cubic feet for trucked-in gas. The break comes with other strings too — a $40 million upfront payment, union-labor commitments, and an equity option for the state.

Two things remain unresolved. The Legislature's own attorneys flagged possible constitutional problems in the Senate version, though those are advisory opinions, not rulings. And Sen. Jesse Bjorkman is fighting a provision that could raise Kenai Peninsula Borough's school-funding bill by up to $9.4 million — "that simply wasn't the deal," he said — though analysts say a sunset likely means the cost never actually comes due. The committee meets on, with no deadline set.