There’s conflict among members of the board set to produce recommendations for a payment-in-lieu-of-taxes agreement with the Alaska LNG project.
The PILT payments would divvy up the tax revenue from the liquefied natural gas project, but the Municipal Advisory Gas Project Review Board is divided on how to split those taxes.
Companies involved in the Alaska LNG would provide an initial $800 million PILT payment to help communities deal with costs like schools, police, and streets during construction. Once in full operation, there would be $600 million annual payments to be divided up for communities and the state.
At that point, Borough Mayor Mike Navarre says he agrees with a municipal revenue sharing proposal that would allocate $100 per capital to help each community in the state, even if the pipeline is not located nearby.
Mayor Navarre: “For example, the pipeline project wouldn’t go through the municipality of Anchorage at all but Anchorage is the hub of Alaska commerce so they would see some impacts from it. Fairbanks has a very small part of the pipeline that goes through the Fairbanks North Star Borough, they wouldn’t get much revenue from the PILT but through a municipal revenue sharing component they would get a per capita sharing that would help them accommodate and help them take care of some of their impacts.”
At the board meeting Wednesday, State Commissioner of Revenue Randy Hoffbeck proposed a 50/50 split for that $600 million between the state and municipalities.
Matanuska-Susitna Borough Mayor Vern Halter disagreed with that split, saying that could leave municipalities on the hook financially.
North Slope Borough Mayor Charlotte Brower suggested each municipality negotiating its own PILT with the companies and take the state out as the middle man.
The board will meet again in January, the meeting date will be announced later.