Category: Alaska News

Alaska Gov. Mike Dunleavy has named a former state legislator and longtime owner of a North Pole tourist destination known as the Santa Claus House to the council in charge of vetting and nominating state judges, among other duties. 

Dunleavy appointed Mike Miller on Apr. 28 to serve a five year term on the council, which oversees screening and nominating judges, evaluating their performance, making information available to voters and making recommendations to improve the administration of justice.

Miller’s appointment is subject to confirmation by the Alaska Legislature in a vote scheduled for Thursday morning. 

The appointment follows the resignation of another appointee, John Woods, last month amid controversy and legal challenges of his eligibility for a seat on the seven-member council.

The Alaska Judicial Council includes three non-attorneys appointed by the governor and confirmed by the Alaska State Legislature, three attorneys appointed by the Alaska Bar Association and the Chief Justice, Susan Carney. The council manages screening and listing candidates for the governor’s final approval for the offices of the supreme court justice, court of appeals, superior court judge, district court judge, public defender or administrative tax law judge. 

Miller, age 74, was appointed to a public seat for non-attorneys. He has been the owner and operator of the Santa Claus House, a tourist destination in North Pole, roughly 14 miles southeast of Fairbanks, since 1966. It boasts the world’s largest Santa statue, reindeer tours and a gift shop that sells personalized letters from Santa.

Miller was elected to the North Pole City Council in 1972, and went on to be elected to seats in the Alaska House and Senate, serving from 1982 to 2000. He served as Senate President from 1997 to 1998, according to his resume. More recently, he served on the Interior Gas Utility Board of Directors from 2019 to 2025. 

At a confirmation hearing by the Senate Judiciary committee on Wednesday, Miller answered questions from lawmakers by phone. He said he’s interested in the position as an opportunity for public service in Alaska.

“It’s been my belief that Alaska has had a very strong judiciary in the past,” he said. “I view it as, to try to, as we get the applications for the new judgeships, or the judgeships that have become available, to send the most qualified people to the governor for appointments so that we can continue to keep a long and very vibrant judiciary in the state of Alaska.”

Senate President Gary Stevens, R-Kodiak, referred to previous political attempts to change the council, and asked Miller about his thoughts on maintaining the independence of the council.

“I think it’s very important to keep the council very independent. And I think that the framers of the Constitution, you know, were pretty wise, and I’ve been fortunate that I actually knew a couple of them,” Miller said, referring to the delegates of the Alaska Constitutional Convention in 1955. “That’s what makes the system work, in my opinion, that we try to keep politics out of it and try to be things based on the law, and what the law says.”

Sen. Löki Tobin, D-Anchorage, asked Miller on his perspective in selecting judges that represent diverse ethnicities and genders, “to ensure we have breadth of experience and fair representation.” 

“I like to see the best people come forward. And I think our current law schools are turning out a lot of individual candidates who are very qualified across all ethnic groups and different diversities,” he said. “I think the guiding factor to me is, will this person in the judgeship, will they decide on issues, not necessarily on personal opinions, but what does the law say?”

Miller said it’s the role of the council to advance the most qualified candidates, and the governor will make the final decision. 

Sen. Matt Claman, D-Anchorage, asked Miller about his participation in a 2004 federal lawsuit with a political action committee that challenged Alaska rules requiring judges to be impartial. The group, Alaska Right to Life, polled Alaska judges seeking retention about their political views, including abortion and assisted suicide. Judges declined to answer the questionnaire. Alaska Right to Life claimed that impartiality rules prevented judges from answering the survey and thus suppressed their First Amendment rights. Miller was named as plaintiff in the lawsuit, which was later thrown out.

“I’ve since changed that position,” Miller said. “If they come down with a position that I disagree with, well, if they judge upon the law — so be it. Then it’s incumbent on people like myself to come to you, the Legislature, to change the law, and then you might have had a different outcome. But I have backed off from that position 25 years ago.”

One of the judges involved, Patricia Collins, who declined to answer the questionnaire, is now retired and sits on the current Alaska Judicial Council. “Would you, having been a plaintiff against her in a lawsuit, cause any difficulty for you to serve on the council with her?” Claman asked.

“No, not at all,” he said. “From my time in the political world… you’ve got to be careful about making enemies this way because — and I certainly would have no problems serving with her — because on one issue, the person debating against you on a certain issue, on the next issue may be your strongest ally. So you’ve got to be careful that, ‘Oh, just because you did this, I can’t talk to you.’ That’s ridiculous.”

Claman asked if Miller would ask about judge candidates’ positions on abortion. 

“I may have an opinion one way or the other,” Miller said. “The only concern I have: Will the person going forward judge on the law as it is written or as interpreted? I’ll be honest … I don’t think personally, that’s not an appropriate question coming from me. I would not ask that question.”

The Senate Judiciary committee advanced Miller’s confirmation without endorsement, to a vote by the joint session of the Legislature, scheduled to take place on Thursday.

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Two Wasilla residents have been accused of a record-setting number of felonies and misdemeanors in connection with an alleged identity-theft spree that affected 41 people in multiple states.

Alaska prosecutors filed 426 misdemeanor and felony charges on Saturday against Qalgilan Miller and 425 charges against Demi Rae McDonald, his alleged partner. 

According to records kept by the Alaska Court System, those combined charges represent the most filed against any one person in a single criminal case in Alaska since 2011, when modern recordkeeping began. The previous record was 372 charges in a case opened in 2013. 

Miller and McDonald have been assigned public defenders and are being held on more than $200,000 bond apiece. Preliminary hearings are scheduled for May 19 and May 20 at the Palmer courthouse.

According to a lengthy packet of charging documents filed this week, the case against Miller and McDonald began in October, when Troopers conducted a routine traffic stop in Wasilla and found their car contained “drug paraphernalia and a large quantity of stolen identification documents, forged checks, controlled substances, and other items linked to financial and identity crimes.”

The items within the car were seized for investigation, work that ultimately uncovered “41 confirmed victims across Alaska and other states.”

One of the alleged victims was former state Representative Eldon Mulder; others included people whose credit cards, passports, driver’s licenses, ID cards and checkbooks were stolen. In one case, a check given as a school graduation gift was stolen. 

According to the charging documents, Miller and McDonald remained free while the investigation took place. On Nov. 4, they were pulled over again during a different routine traffic stop, and their car was searched.

“During the search, multiple items belonging to other individuals were found … scattered throughout the vehicle. However, they were not connected to the cases at that time,” the document states. 

The case was investigated by the Troopers’ Crime Suppression Unit in the Matanuska-Susitna Borough, a group that deals with investigations that are more complicated than a patrol officer’s work but which don’t rise to the level of a major crime to be handled by the Alaska Bureau of Investigation.

According to court documents, CSU officers spent weeks interviewing fraud victims, requesting security camera footage and linking documents from the October traffic stop with reported fraud cases in Anchorage, the Kenai Peninsula, the Mat-Su and elsewhere.

On April 16, troopers visited a home listed as the address for Miller and McDonald, but their housemates said they were no longer allowed to be at the house. Some mail left behind was linked with people whose identity documents had been previously stolen and reported to police.

Troopers tried tracing Miller and McDonald to a home in Eagle River and then a separate home in Anchorage after obtaining a warrant that allowed them to track the couple’s cellphones.

At the home in Anchorage, Troopers found another vehicle with more allegedly stolen mail and identity documents.

They continued tracing Miller and McDonald via cellphone and on May 2 traced the signal to an Anchorage park and a vehicle with a false Montana license plate.

When Troopers tried to pull the vehicle over, it sped away down city streets at more than 70 miles an hour, occasionally driving into oncoming traffic and onto trails. 

Police discontinued the chase because of the danger to pedestrians and later found the vehicle abandoned, but not before identifying Miller as the driver.

On May 8, they traced the pair to a Fred Meyer store in Anchorage and arrested them, allegedly as they were in the act of stealing items from the store.

Trooper Trenton Harris wrote in an affidavit submitted to the court that Miller and McDonald exhibited a “prolonged, deliberate, and escalating pattern of criminal conduct” despite “open investigations, outstanding warrants, and repeated opportunities to cease their behavior.”

“Their conduct was organized, intentional, and persistent, and their actions present an ongoing threat to the public, financial institutions, and the integrity of victims’ identities,” he wrote.

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A 53-year-old former Haines resident, Brian Kurtzman, was convicted late last month on 11 counts of sexual abuse and sexual assault of a minor.

Kurtzman sexually abused a child he met while he was a raptor handler at Haines’ American Bald Eagle Foundation Raptor Center in 2013 and 2014. His conviction carries a minimum 32.5 and maximum 495 years in prison, according to the Alaska Department of Law. He is scheduled to be sentenced in September in Juneau Superior Court.

The now-adult survivor was interviewed but asked to remain anonymous for this story. She reported the abuse to Juneau police in 2022. During her testimony at the trial, she described years of grooming and abuse by Kurtzman, beginning when she was 12-years-old and continuing on for nearly a decade.

The two first met when the survivor was enrolled in the Bald Eagle Foundation’s junior raptor handler program, and Kurtzman was working at the foundation.

Kurtzman was fired from his position at the Bald Eagle Foundation in 2014, days after private communication between him and the survivor were made public on social media and the survivor’s father filed a police report, then foundation-director Cheryl McRoberts said in court testimony this year.

But Kurtzman and the survivor remained in contact, even after protective orders in 2014 and 2015 prohibited him from contacting the survivor, and Kurtzman moved to Juneau.

According to the survivor’s testimony during the two-week trial, community members saw indications of the abuse during the period of time covered by the convictions. She described “a lot of suspicion” following the social media post, including sports coaches not allowing her to travel to Juneau.

She also said while staying with family in Juneau in 2013, she met up with Kurtzman and Chilkat Bakery owner Miki Atkins, telling family she was only seeing Atkins. She said the three of them were briefly in Atkins’ hotel room together, before Atkins left and she was assaulted by Kurtzman in his hotel room.

The survivor also described frequently meeting with Kurtzman at a trailer on Fourth Avenue that he was renting from Atkins while living in Haines.

In testimony at the trial, Atkins denied ever traveling to Juneau with Kurtzman, and said she “didn’t remember” but “did not think” she ever rented her Fourth Avenue trailer to him. She also testified that she did not have significant knowledge of the extent of Kurtzman’s contact with the survivor, saying she had “heard people in town talking and [telling] me about that, but I didn’t see anything.”

When the Chilkat Valley News contacted Atkins this week she would not comment on Kurtzman or the conviction.

In testimony, McRoberts said she had confronted Kurtzman prior to the social media post, telling him it “wasn’t part of his job to be that close with a junior raptor handler,” but didn’t know the extent of their contact outside of Kurtzman’s work.

McRoberts this week also declined to comment, saying only in a written message that “justice had been served” and “495 years is what (Kurtzman) deserves.”

New Bald Eagle Foundation director Aaron Cleveland, who started the job after previous director Kathy Benner stepped down earlier this spring, said this week the foundation no longer has any youth programming. Cleveland said the foundation now has a policy of doing criminal background checks of new employees, which Benner said was not the case during her tenure. The background checks, along with a new human resources consultant, are part of an effort to “get the foundation to procedures that follow current standards,” Cleveland said.

While he said the changes were not spurred by the Kurtzman trial, he described the new policies as “following standards that are in place to prevent these kinds of things from happening.”

Both Cleveland and Benner said they were told little about Kurtzman’s employment and firing. Benner said she was told informally only midway through her time at the foundation. Cleveland said he was told about the criminal case against Kurtzman by an employee, but said he hadn’t heard about it as director prior to that, or in previous work as a consultant for the foundation.

“No one ever mentioned it when I was being hired,” Cleveland said. “I was pretty shocked when I heard.”

The foundation’s current board president Sue Chasen said she had only learned the details of Kurtzman’s firing this spring. Like Cleveland, she pointed to policy changes in recent months as a positive improvement for the organization.
suddenly has gifts from unknown sources.”

If adults have suspicions, they should immediately report to law enforcement and the state’s Office of Children’s Services, Olson said.

When considering reporting, adults should “listen to their gut instinct, even if they don’t have the facts – even if they just have a suspicion,” she said. Multiple reports from adults can be particularly important because perpetrators frequently make children feel like they’ll be “in trouble,” or that “blame them for what’s occurring,” to prevent the abuse from being reported, Olson said.

One obstacle to reporting is that grooming behavior, like Kurtzman’s, affects community members, not just victims, Olson said.

“It’s important to note that as long as a person is grooming a child, they’re also grooming other adults around the child that might be reporting to try to dissuade them from doing so, and to create a level of distrust of the child,” she said.

“A report is not an accusation, it’s a request for a professional service to be done, for professionals to follow up and figure out what the truth is,” said another advocate, Natalie Watson, violence prevention manager at Juneau-based advocacy organization AWARE.

According to court testimony from former Haines Police Chief Josh Dryden, police reported Kurtzman to the Office of Children’s Services in 2014 after they found the survivor at Kurtzman’s house. But no charges came of the report, and current chief Jimmy Yoakum said he could not make time this week to talk about police records related to the case or current Haines Police Department reporting procedures.

Investigating and prosecuting child sexual abuse cases can be difficult, Olson said, particularly if a child is afraid to speak to investigators. Olson emphasized prevention measures, like early education in schools and by trusted adults about body autonomy and boundaries.

Juneau-based advocacy organizations AWARE and the Juneau Child Advocacy Center, along with STAR Alaska, all offer free, confidential hotlines to assist survivors in seeking resources and reporting. While reports can be made confidentially, advocates are mandatory reporters, meaning they are legally required to report to law enforcement information about abuse of children under 18 years old if given the name of the child.

Advocates may explain options to survivors, offer support in contacting law enforcement, and offer emotional support and counseling resources.

“A lot of it is focusing on making sure a child can really incorporate that it was not their fault (the abuse) occurred, and they cannot hold themselves responsible for the criminal actions of an adult,” Olson said.

Juneau also has a Child Advocacy Center, which in addition to providing resources and information, partners with law enforcement and the Office of Children’s Services to interview children in instances of suspected abuse.

STAR Alaska 24-hour free confidential crisis line: (800) 478-8999

AWARE 24-hour care line: (800) 478-1090

Juneau Child Advocacy Center: 907-463-6100

The post Man convicted in Haines child sexual abuse case appeared first on Chilkat Valley News.

The Haines Borough has been awarded a million dollars in federal money for childcare, but some say spending restrictions may prevent it from addressing the most pressing childcare needs.

The funding has been specifically granted for an “early childhood education building,” according to an April 28 letter to the borough from the United States Department of Housing and Urban Development. The funding was provided through the federal earmark process, where requests are made to members of the congressional delegation — in this case Senator Lisa Murkowski — who then may decide to advocate for the requests in federal budgeting.

The award follows months of discussion about how to address a childcare shortage in the Chilkat Valley.

The original earmark request was made in February 2025, mayor Tom Morphet said, soon after he got the idea from regional childcare expert Blue Shibler. Because the deadline to request funds was only a week after his conversation with Shibler, Morphet said, the request did not go before the borough assembly.

Elected officials, local providers, and experts like Shibler have all described challenging economics of childcare, with revenue unable to keep up with rising costs of staffing and permitting requirements.

In theory, the new million dollars should be a boon: it dwarfs the amount of money the borough currently has to support childcare businesses, with the assembly spending hours this winter discussing a $17,000 injection of cash to local providers.

Mayor Tom Morphet said the million dollar award could fill a need for more space. That’s half of a two-part equation — “more cash and more room,” he said — for increasing total childcare slots.

Morphet’s ideas for the money included refurbishing the current SEARHC clinic as a Haines Borough School District-run childcare facility, or partnering with the Chilkoot Indian Association to refurbish a CIA-owned building on Main Street as a general community childcare center.

There’s disagreement about whether those ideas are possible, and if so, whether they would be effective. On the intergovernmental partnership, Morphet said CIA officials had discussed the idea with borough officials and had “expressed interest,” but didn’t have the money for the project. Those discussions, he said, served as the main impetus for the funding request.

Sheri Loomis, who had been a part of a working group on childcare in the Chilkat Valley, said the partnership idea had been discussed by the working group and the mayor. But it was her understanding that there was confusion over whether the grant, as it had been received, could fund such a partnership. oMorphet this week maintained that the grant could be used for those purposes, and said he believed the grant language “was pretty broadly worded.”

But in a statement Tuesday, CIA tribal administrator Harriet Brouillette wrote that “the grantor does not allow the funds to be ‘passed through’ to another organization.’”

“The mayor may have found a way around that provision,” Brouillette added.

Brouillette also said that CIA has partnered with the borough on a grant to fund childcare planning meetings in June, but “has no formal agreement beyond that.”

Borough staff seem to have less clarity than either Brouillette or Morphet.

At an April assembly meeting, assembly member Eben Sargent asked borough staff about what kinds of limitations were on the funds — whether they were limited only to constructing a new facility or whether they could be used more broadly.

“I’m hopeful that we don’t have to build anything new, and we can use it for at least maintenance on a building. I’d love to use it for childcare services, like funding salaries, because that’s the need,” Sargent said.

Assembly member Alekka Fullerton responded that the limitations on the funds wouldn’t be clear until the borough received a grant agreement.

In an interview this week Fullerton said the borough still needs to officially apply for the funds even though they’ve been awarded, and that the grant agreement wouldn’t come until that application was approved. Fullerton said she did not know the deadline for the application.

As for whether new facilities would be an effective solution to the childcare shortage, Chilkat Valley Preschool executive director Tammy Iund said she had “real frustration when the discovery was made that the million dollars was for a building and not for the logistics of helping create childcare opportunities.”

The current shortage, as it’s been described, has a specific chokepoint. Chilkat Valley Preschool in fact has been suffering from low enrollment, not overenrollment, at the 3-7 year-old age range it currently serves. The preschool has had no more than 9 students enrolled this year, even though it has capacity for up to 18, Iund said.

Rather, many, including both Morphet and Iund, say the shortage lies in care for babies and toddlers, which requires different licensing and facilities than the preschool currently has.

The preschool is currently “pivoting,” Iund said, to providing that care, including acquiring the new licensing and required equipment. Supplementing the costs of those changes, as well as general startup costs for new providers, would be a more effective use of funds, she said.

All the different parties on the issue, including borough officials, CIA officials, and providers like Lund, are set to come together during the June meetings jointly hosted by the two governments.

While there may be disagreement now, there’s hope that those meetings will offer some path forward. Morphet said he sees those meetings as a time to decide how to use the million dollar grant.

“That’s going to be a topic of the meetings in June, seeing if we can get everyone on the same page for how to spend that money,” he said

Iund said something similar. “I do appreciate all the support from the borough,” she said. “Everyone’s working hard on this problem, we just have to figure out some way to come together and get consensus.”

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Haines High School hosted its annual activities awards assembly this week. It celebrated the more than 70 students who participated in activities throughout the year. Graduating senior Maddox Rogers’ Drama, Debate, and Forensics points were big news during the event. Rogers took seventh place on a locally maintained list of all-time top earners with the 698 points he earned. DDF Coach Hannah Bochart, who said the list dates back to the 1990s, said nobody locally has cracked the top ten earners since 2007. In earning 698 points, Rogers actually took Bochart’s spot at seventh on the list. Bochart had 665 points. Fun Chilkat Valley DDF fact, Hannah Bochart’s brother Micah Bochart holds fourth place on that list. The first place all time top earner in Haines remains Iris Holmes, with 1,230 points.

Nolan Woodard is celebrating his 10-year Haines-aversery this week. His mom, Tammy Iund, is also celebrating her arrival in Haines. One year for her. Iund said she disembarked from the ferry a year ago and planned to visit for 10 days. Her plans to move on to Fairbanks were tossed not too long after. She said she is staying.

Dearest parents of school-aged children, please encourage your kids to pay a visit to the lost and found at school. The right hand side of the entry way is a giant display of long lost clothing. You might find the sparkly high tops that have been missing. They are tucked in between the four different styles of Xtra Tuffs, 21 water jugs, multiple lunch boxes, upwards of 75 jackets and sweaters, ducky boots, flip flops, earrings and snow pants. Take a look.

Regi Johanos was in town for a whirlwind visit with Aly Zeiger and visited Mark and Michelle Zeiger at their place across Mud Bay. Johanos is no stranger to Haines. The former resident did not have the time or weather for the traditional Riley and Ripinsky hikes that she and Aly would have preferred. They made up for it with town walks and a Kelgaya Point visit. Johanos enjoyed A Night on the Steinway at the Chilkat Center and the annual plant sales in the Haines that make springtime so special. She also discovered an unknown skill at the card game, Sushi Go.

The community garden at Mosquito Lake has finally taken its weekly garden work party outside. Volunteers have been planting since mid-March and this past Sunday, they finally got their hands in the dirt at the 8000 square foot garden. The work crew changes weekly, as different volunteers show up and new projects are created and distributed by garden coordinator Sarah Ammons. This week featured planting onion sets and using the broad fork for soil prep, which uncovered some very healthy earthworms. Vermiculturist Erika Merklin said the worms are feasting on decomposing brassicas stems from last year’s gardening season. Merklin said if you really want to be impressed by some worms, visit the compost pile at the community garden. She is confident that they will knock your socks off.

Kathleen Menke can plan one heck of a ‘clipboard of fun’. Her granddaughter Skyler Menke’s recent visit was an action-packed two weeks that hit all the high points of watching spring unfold in the Chilkat Valley. Skyler was thrilled to see humpbacks, orcas, baby whales, sea lions, and seals. She learned about the Chilkoot eulachon run, got to dip a few herself, and went to Charlie Moody’s laser class and First Friday at the Haines Sheldon Museum. The two enjoyed bird watching and can now spot sparrows, warblers, jays and raptors, feeding her ornithology interests. Skyler also had the opportunity to make Mother’s Day breakfast for her grandmother before wrapping up her visit.

The Clayton family recently visited Cave Creek, Arizona. Piper Carlson celebrated her 12th birthday during the visit and also took horseback riding lessons. Her favorite horse was named Honey. Honey was a little stubborn but spunky, just like her rider. Callahan Clayton skinny-dipped in a neighborhood pool. They went bee hunting nightly. Bee hunting is done with a black light, while looking for scorpions; no bees were harmed. In an exciting turn of events Cal Clayton jumped in a duck pond, while chasing a duck. Ramie Clayton pulled him out by his golden locks. But not before his grandma, Pattie Carlson jumped in after him. The family visited with Kyle Clayton’s brother Troy Wingert, known to frequent Haines every summer. The family also spent time with grandparents Rich and Patti Carlson and found time for a two day trip to Prescott, Arizona.

The Dermott O’Toole Memorial Library in Tenakee Springs got a helping hand from Beau Bradley and The Book Store. The Tenakee Springs library’s book order made it as far as Haines. But its order of children’s nonfiction books was purchased using the Book Hook Fund grant and did not cover the shipping. The books arrived with Bradley’s book order. He had to do a little bit more leg work to get the books to Ruth Underhill, the librarian in Tenakee Springs. Bradley called the ferry terminal and they arranged for a person to escort the precious cargo to the proper ferry in Juneau. The new reading material arrived safely.

Mike Ward announced the winners of the Quick Shop’s grand opening prizes. Shoppers added their name and contact information to their receipts in hopes of winning the $250 digital gift card associated with the rewards program. The winners were Fred Lopez, SJ Durand, Sarah Bishop and Nate Baker.

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The Foundation for the Chilkat Center for the Arts wishes to thank everyone who helped make “A Night on the Steinway” such a rousing success.  Thank you to the performers for sharing their talent.  Thank you to the cooks and lobby crew for creating a beautiful and delicious reception.  Thank you to Molly Dwyer and Michael Marks for the lights and sound. Thank you to Krystal Lloyd for the decorations, to Keith Giles for tuning the pianos, and to Deina Davis at the Aspen Hotel for a room for Keith. Thank you, Annette Smith, for everything you do.  And a special thank you to Sam McPhetres for videotaping the performance, which is already on YouTube.  I’ve watched the video, and it’s great!  If you are not one of the lucky people who saw the show, check it out.  If you are one of those lucky people, I want you to know, Haines, that you are a wonderful audience.

Lorrie Dudzik, Foundation for the Chilkat Center for the Arts President

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Thank you to all who attended and participated in the Haines Health Fair on April 25. This event was made possible by a grant from the Chilkat Valley Community Foundation, an Affiliate of The Alaska Community Foundation. Hospice of Haines would particularly like to thank Alaska Health Fair and those who traveled to Haines to help us host the affordable blood screenings and health education including Wendy Carpenter, Denise Schmidt, Kate Slotnick, and Wendy Pangburn.  We would also like to thank our local organizations and businesses that participated.  Thank you to the volunteers who helped with the blood draw.  We appreciate your expertise.  Thank you to the many volunteers who assisted with setup, registration, health education, vision screening, blood pressure checks, health exits, snacks and cleanup.  We are grateful for your time and dedication to your community.  And, a special thanks to Susan Weerasinghe  for co-chairing this event.  

Much thanks,

Shannon McPhetres, Hospice of Haines director and volunteer coordinator

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Is the value of the trans-Alaska pipeline system $2.8 billion, or $10.3 billion? Or is it $20 billion?

This week, a state review board will hold a formal hearing to determine which figure is the right one — with major financial implications for state government and the three municipalities along the pipeline system’s route.

At stake are hundreds of millions of dollars in property taxes, equal to 2% of the pipeline system’s value, that its oil company owners could owe each year to the state, the North Slope and Fairbanks boroughs and the city of Valdez.

The pipeline’s value had been set at $8 billion by a five-year settlement reached in 2016, which the parties extended through the end of 2025. But before that, the municipalities and the system’s owners spent a decade feuding over annual assessments in the courts — with appeals to the Alaska Supreme Court and one trial that lasted more than two months.

The pipeline system property taxes, in past years, have represented more than half of Valdez’s regular recurring revenue, according to city budget documents, as well as a significant contribution to the state’s yearly unrestricted revenues.

A decision setting the system’s value at the municipalities’ preferred value of at least $20.083 billion would result in pipeline owners paying at least $400 million a year in property taxes — compared to the $56 million that would be owed if the value is set at $2.8 billion, the value favored by the owners.

This week’s hearing, before the governor-appointed State Assessment Review Board, is unlikely to be the last word on the matter. While the board can consider arguments from all sides, its decisions are ultimately appealable to the courts.

The pipeline system’s owners include affiliates of ConocoPhillips, ExxonMobil and Hilcorp, the North Slope’s major oil-producing companies.

With the expiration of the settlement at the end of 2025, the state Department of Revenue’s assessment for 2026 — based on the estimated cost to replace the system, minus depreciation — actually boosted the pipeline system’s value from the settled figure, to $10.3 billion.

Discussions had been underway about a new settlement, Fairbanks finance officials wrote in a letter to borough policymakers in January. But no such deal has been announced.

A spokesperson for Alyeska Pipeline Service Co., which operates the pipeline system for the owners, declined to comment on those companies’ behalf, citing the pending review by the state board. A spokesperson for the Department of Revenue also declined to comment.

Robin Brena, a longtime Alaska attorney who for decades has represented the municipalities in their fights over the pipeline system’s value, said he hopes that the parties can mediate their differences and strike a new agreement.

He stressed that historically, the pipeline system’s owners have argued for aggressively low valuations of the property that the courts have rejected. In 2006, the owners argued for an $850 million valuation, before the Alaska Supreme Court ultimately affirmed a lower court judge’s ruling that the value was actually $9.98 billion.

Brena’s clients, the municipalities, wrote in their recent appeal to the board that the state revenue department made a legal mistake in its $10.3 billion valuation by ignoring updated estimates from the municipalities that say replacing the pipeline system today would cost some $40 billion.

Instead, the municipalities say, the state relied on a court decision that set the 2009 replacement cost of the system at $19.1 billion, then made inflation adjustments to produced a 2026 replacement cost of $28.6 billion.

The courts and the state assessment board have preferred new cost estimates to inflation adjustments, the municipalities said, because they better capture updates in the pipeline system’s designs and allow mistakes to be corrected.

A second major error by the revenue department, the municipalities said, was that it used an inappropriate new technique to calculate depreciation: comparing the current flow of oil through the pipeline system, some 460,000 barrels a day, to its peak flow of 2 million barrels, which came in the late 1980s.

That depreciation technique, the municipalities argued, ignores legal precedent that says the calculation should account for the quantity of oil not just actively flowing from, but also available for future production at, Alaska’s big oil fields — a figure known as proven reserves.

A calculation based only on current production neglects the value contained in two huge new oil fields, Willow and Pikka, that are still under construction, according to Brena. Those fields are set to help boost the daily flow through the pipeline system to some 650,000 barrels at a new peak in 2034, according to state projections.

“The department’s calculation completely ignores proven reserves that are not in production,” Brena said.

The oil companies, meanwhile, say in their appeal that the pipeline system is a “depreciating asset” with a value that declines each year. The state, they say, is now proposing to assess a higher value for the pipeline than the $9.25 billion the Alaska Supreme Court affirmed for the 2009 tax year.

“It is fundamentally unreasonable to conclude that a pipeline that is now 17 years older — with 17 fewer years of proven reserves to transport and 17 years of additional depreciation — has an assessed value significantly greater than the value assessed in tax year 2009,” the oil companies wrote.

The companies also say that the state’s assessment fails to account for “operational and economic realities” of the pipeline system — including that the flow of oil is eventually projected to resume its longstanding decline after a “short-term spike.”

The revenue department, the companies said, also ignored the companies’ own “comprehensive” report on the pipeline system’s replacement cost that they shared for the 2026 tax year.

“The owners furnished the department with a significant volume of information relevant to the proper assessment of the subject property,” the companies said. “The department’s assessment ignores all of it in favor of reliance on a 17-year-old appraisal report that is outdated, unsupportable, and fundamentally flawed.”

The board’s hearing on the pipeline system’s value is set to begin Wednesday and finish by the end of the week. Decisions are expected within seven days afterward, according to the board’s support staff.

Nathaniel Herz welcomes tips at natherz@gmail.com or (907) 793-0312. This article was originally published in Northern Journal, a newsletter from Herz. Subscribe at this link.