Tag: Alaska Legislature

By: Max Graham, Northern Journal

This is a short update to an ongoing story about a dispute over the taxable value of the trans-Alaska pipeline system. The previous story, with more context, by Northern Journal is here. 

A high-stakes feud between Alaska’s major oil companies and three municipalities that collect taxes from those companies is now headed to court.

The fight is over the value of the trans-Alaska pipeline — a calculation that determines how much the companies owe in property taxes each year. Tens of millions of dollars are at stake.

In May, a state tax board set the pipeline’s value at $13 billion. Both the oil companies and the municipalities then filed appeals to the Alaska Superior Court this month.

The municipalities say the taxable value is much higher — about $20 billion. The oil companies say the pipeline’s value is significantly lower — some $2 billion.

Both parties appealed an initial $10 billion assessment by Gov. Mike Dunleavy’s administration. Then, the tax board raised the value by $3 billion.

The municipalities think the value was “improperly determined” by the board and is “considerably higher,” Robin Brena, an Alaska attorney who has long represented the municipalities in pipeline property tax matters, said in a brief phone interview last week.

In its 18-page appeal, lawyers for Alyeska Pipeline Service Co., which is owned by affiliates of the state’s three biggest oil companies and operates the pipeline, also said the state board erred, but for different reasons.

The board’s determination and the Dunleavy administration’s earlier decision were “excessive” and “grossly overstate” the pipeline’s value, the appeal said.

Northern Journal contributor Max Graham can be reached at max@northernjournal.com. 

This article was originally published in Northern Journal, a newsletter from Nathaniel Herz. Subscribe at this link. Northern Journal is merging with the Anchorage Press! Read our announcement and other information here, and support us with a subscription here.

By: Corinne Smith, Alaska Beacon

The Alaska Supreme Court on Monday ordered the Alaska Division of Elections to include Dan J. Sullivan of Petersburg on the primary ballot as a candidate for U.S. Senate.

The ruling upholding a lower court’s decision came just hours after oral arguments in a fast-tracked case ahead of the division’s deadline to certify and print primary election ballots at noon on Tuesday.

A full opinion on the case will be issued at a later date, the court said. 

The decision ends a weekslong saga between the state and the challenger with the same name Republican incumbent Sen. Dan Sullivan. The two Sullivans are among 16 primary candidates for the seat, including former Democratic U.S House Rep. Mary Peltola. 

The primary election is Aug. 18. The general election in November determines who will hold the seat for a six-year term.

On Friday, an Anchorage Superior Court ruled that the division’s decision to strike Sullivan from the ballot was unlawful. The judge determined that the division did not have the authority to add additional requirements for candidates beyond what is outlined in the U.S. Constitution. He ruled Sullivan, a retired teacher from Petersburg, is eligible to run for U.S. Senate.

The state appealed that ruling, and the case went before the Alaska Supreme Court on Monday. 

Reached by phone Monday afternoon, Sullivan of Petersburg expressed relief. “I’m glad it’s over. It was pretty stressful. I’ve got to admit that,” he said.

On the criticisms and questions about his campaign, Sullivan said they were “challenging” to hear. 

“It’s all because of my name, and you know, there’s nothing I can do about my name,” he said. “I was frustrated, I felt it’s time for a change, and so I wanted to jump into the race and make my feelings and my thoughts known. So there’s not a whole lot more to it than that. They tried to make it more than that, and you know, that’s their prerogative.”

Sullivan said he would agree to be listed as “Dan J. Sullivan” on the ballot. He said he now plans to regroup and make plans to visit Alaskan communities, hear from voters, and continue the campaign for Senate. 

Nate Adams, a spokesperson for Sen. Sullivan, said they were disappointed in the court ruling but encouraged by the fact that the division director can “use her expertise” to distinguish the candidates on the ballot in an emailed statement on Monday. 

In the decision, the justices wrote the division will determine how the candidates will appear on the ballot. 

“This matter is remanded for the Division of Elections to determine, in the first instance, how appellee Sullivan shall be listed as a candidate within the confines of existing Alaska ballot design law,” they wrote. 

An official with the Alaska Department of Law on behalf of the division did not immediately respond to a question about how the two candidates would appear on the ballot. 

“The State appreciates the court’s quick ruling and will work to implement the order,” said Sam Curtis with the Department of Law. 

Alaska Supreme Court hears oral arguments 

Sullivan from Petersburg appealed the division’s unprecedented June 15 decision to disqualify him from the U.S. Senate ballot. The Alaska Division of Elections cited complaints filed by the incumbent and Republican groups that his similar name, Republican party affiliation and campaign materials were evidence he was running in “bad faith” and mimicking the Republican incumbent, U.S. Sen. Dan S. Sullivan.  

Challenger Dan. J. Sullivan has defended his campaign as authentic and genuine. In court, his attorney argued that he met all the constitutional requirements for candidacy, and the division had unlawfully added a subjective criteria. 

In oral arguments before the Alaska Supreme Court on Monday, attorney Chris Murray argued on behalf of the division and its appeal of the lower court’s decision. He argued that the authority to administer the manner of elections includes disqualifying the challenger, as they deemed his intention in filing was to “frustrate the purpose” of the election and confuse voters.

Justices questioned that authority cited by the state. “A lot of the times people run for office for different reasons, to highlight an issue, to see what the process is like, and maybe start garnering support over time,” said Justice Aimee Oravec. “These are not necessarily candidates that are seeking office so much as attention for other reasons that are not necessarily bad faith, and there’s no limiting principle.”

“It seems amorphous, frankly,” said Justice Jennifer Henderson. “A broad, amorphous concept of what a candidate’s intent needs to be. So it seems like it’s very appropriate for us to worry about what is encompassed by that.”

Murray argued that the division has the authority, under current state regulations, and a duty to protect voters from confusion. “Because again, what’s the division trying to do? Protect the right to vote,” he said. “The division’s job is to make sure that people who want to vote for one candidate actually get to vote for that candidate, and their intent is reflected on the ballot.”

Justice Oravec questioned that position when the division has the authority to administer and design the ballot in a way that reduces confusion. 

“You control the ballot,” she said. “So I think you’re conflating the potential for confusion when you have the authority to mitigate the confusion.”

State statute already prescribes how candidates with identical names should appear on the ballot. Candidate’s middle initials would be included — in this case “Dan J. Sullivan” for the candidate from Petersburg, and “Dan S. Sullivan” for the incumbent senator. 

But in the state’s appeal filed over the weekend, Alaska Acting Attorney General Cori Mills requested that if the court upholds the ruling restoring the Petersburg Sullivan to the ballot, then the division could list him as “nonpartisan” instead of Republican like the incumbent senator.

Justices questioned whether that affiliation would be within the division’s authority. Jeffrey Robinson, arguing on behalf of Sullivan on Monday, objected to that listing. “There’s no authority for the proposition that in order to avoid confusion the director can change the party affiliation,” he said.

Robinson argued that the division adding unwritten, subjective criteria for candidates is unlawful. He again cited the case where the Alaska Democratic Party sought to remove Eric Hafner, a U.S. House candidate imprisoned out of state, and the division did not investigate his motives but found he met the qualifications to run for office.

“When would there be a better time to question the motives of someone’s intent to run for office than a convicted felon living out of state who has no potential to come back, or virtually no potential to come back and serve?” Robinson said. 

The division has argued that there was no complaint filed against Hafner’s candidacy, and so no reason to investigate him.

Justice Oravec asked Robinson whether Sullivan and his legal team also dispute the division’s findings in their decision to disqualify him from the ballot. Robinson said the division’s points were “unconstitutional and frivolous” and they did not have the authority to make those findings. 

In an unusual move, 14 Republican controlled states filed an amicus brief, or “friends of the court” brief, with the state Supreme Court expressing support for the division and its authority to remove Sullivan from the ballot.

By: Corinne Smith, Alaska Beacon

A board member with the state-owned Alaska Gasline Development Corporation, which is a part owner of the proposed AKLNG gas line project and pushing for lawmakers to provide a multibillion dollar tax break, likened state legislators to mosquitoes  — “irritating, relentless, and somehow always present” — at a board meeting on Thursday. 

The “tongue-in-cheek” comparison came from Fairbanks-based secretary and treasurer of the board Dennis Michel as the corporation grapples with lawmaker scrutiny after the leak of a confidential document revealing potential state financial liability in the project. 

Some legislators found the comparison to be demeaning as they continue to debate the specifics of a state tax break for the project that is estimated by the developer to cost up to $55 billion, which would include a 807-mile gas line and gas treatment facilities. The comment and some lawmakers’ reaction highlights the tension in the working relationship between the groups.

Lawmakers are now in a second special session called by Gov. Mike Dunleavy. A conference committee of six legislators are negotiating a compromise bill from competing House and Senate proposals.

Lawmakers have been largely supportive of the AKLNG project that would deliver natural gas from the North Slope. But Senate lawmakers and Dunleavy have split on details of the plan. Lawmakers are weighing provisions to provide increased protections for Alaskan gas consumers, a community impact fund, labor-related provisions, disclosure agreements for foreign investors and provisions to protect the state if the project fails to move forward, among others.

The state-owned Alaska Gasline Development Corporation is a 25% owner of the project, while Glenfarne, a private developer, is a 75% owner, after AGDC handed over ownership last year. 

The AGDC board includes seven members, including five members appointed by Dunleavy and two commissioners with the Alaska Department of Transportation and Public Facilities and the Alaska Department of Commerce, Community, and Economic Development. 

The mosquito-themed remarks came one day after the Alaska Beacon reported on a confidential draft analysis of an agreement between AGDC and Glenfarne that shows if the project failed to move forward under some conditions, the state could be required to pay in order to take back the project. 

The document was shared with some lawmakers, but not others or the public, and it informed some Senators in questions to the developer and their push for further protections on the proposed tax break proposal.

At Thursday’s virtual board meeting, officials with AGDC said they had launched an internal investigation into how the confidential document was shared. AGDC President Frank Richards called the disclosure “bad for AGDC” and its relationship with private investors. 

On Thursday, AGDC board members expressed strong support for a state approved multibillion dollar tax break to benefit the project, and heard a detailed update on the current negotiations and proposed provisions being debated in the Legislature. 

At the end of the nearly two-hour meeting, Michel, the Fairbanks-based board member, made the comments in what seemed like prepared remarks. He prefaced the remarks as “tongue in cheek” before he likened lawmakers to mosquitoes seen in the Interior. 

“A mosquito can turn a peaceful evening into a defensive operation. A Legislature can turn a straightforward issue into a long campaign of hearings, amendments, delays and procedural buzzing,” Michel said. “Both are persistent, too. A mosquito can keep circling until it finds bare skin. Lawmakers circle around taxes, amendments, compromises until it finally lands, or at least until someone, everyone in the room, has been bitten by the process.”

Michel said he hoped the legislative conference committee would “stop hovering” and agree to a workable tax cut for the developers. 

“So, yes, mosquitoes in the Legislature are both part of life in Alaska, irritating, relentless, and somehow always present just when people are trying to get something done,” he said. 

“But even mosquitoes can be a sign of something good ahead,” he added. “More mosquitoes often mean more blueberries here in the Interior. And in the same spirit, I hope that the legislators and their sessions produce more than welts and frustrations, but ultimately deliver something of value to the citizens of Alaska.”

No other board members responded to the comments, and the meeting ended shortly after. 

Several lawmakers were on the call, including Sen. Cathy Giessel, R-Anchorage, who chairs the Senate Resources Committee. She has been highly involved in drafting legislation around the AKLNG project and serves as a non-voting senate representative to the board. 

She called the comments “outrageously demeaning.”

“He is an unelected person who has been appointed as a political favor to a board with no oversight by any elected individuals in the Legislature, and he was demeaning representatives of the people who have been elected,” Giessel said in an interview on Friday.

“(The comments) demonstrate to me the cavalier attitude that this board has toward the governing body of the Legislature, the one of the branches of government, and that concerns me a great deal,” she said. “This is a generational change project and we need to be working together.”

Rep. Donna Mears, D-Anchorage, who serves on the House Resources Committee also attended the hearing. She said the comments were “not acceptable.”

“The Legislature has got a duty that is larger than the AGDC board. We have a responsibility to our communities, we have a responsibility to rate payers. Yes, this project can bring a lot of benefit to the state, but we also have to make sure that we’re not running over our communities and our ratepayers in the process,” she said in an interview Friday. 

During a break in the conference committee hearing, AGDC president Richards said in an interview he did not want to speak for Michel. “He was trying to identify that as tongue in cheek,” Richards said. “And really I think maybe expressing some frustration about the lengthy process, and about what’s been happening, the back and forth.”

“There’s this, sounds like tension, you know, that in the arena of the legislature that we want to be able to get through and achieve an economic project,” he added. “And that’s really the goal of what we’re going to do with the property tax, alternative volumetric tax provisions.”

When asked about lawmakers’ reaction, Richards said he did not have a comment, but added: “I certainly can see the perspective of hearing the words that were said and their personal reaction.” 

Both Giessel and Mears noted ongoing concerns about a lack of transparency from AGDC and Glenfarne on the proposed gas line project, amplified by the reporting on the confidential draft agreement this week. 

Lawmakers have been asking Glenfarne and AGDC for more detailed financial information for months. Glenfarne released an updated estimate for the project’s cost earlier this month at up to $55 billion, but state lawmakers say they still don’t have all the financial information they’ve been seeking, including estimates about the project’s profitability.

Giessel said she’s particularly concerned about confidential agreements with foreign investors. She authored provisions approved by the Senate to provide more state oversight of foreign entities and cost overruns.

“I think there’s been such distrust sown in this project that I don’t see how we can proceed forward at this point,” Giessel said. “It almost feels like there needs to be a restart where everybody comes to the table and stops hiding the ball, stops hiding the information, and the disrespect and demeaning language stops, and we start over with mutual respect and mutual collaboration.”

Mears said the legislators with the conference committee currently working on a final bill have an “enormous burden” to hammer out a compromise. She said if lawmakers still need more information, they should get more time to do their work. 

“I think the information coming out this week is exactly why rushing a process is unacceptable,” she said, referring to the information in the confidential draft analysis. 

“Maybe the thought that the Legislature is annoying is true,” Mears said. “Because the truth sure seems to be inconvenient. We would have a much better process starting from what we know now, and those of us that have been asking for more information for months are not wrong.”

Members of the conference committee are scheduled to meet publicly on Friday and Saturday. The Legislature is scheduled to reconvene on Wednesday July 1, but it’s uncertain whether a compromise bill will be finalized by then.