The Fairbanks North Star Borough Assembly is considering a significant new investment in its legal fight over the taxable value of the Trans-Alaska Pipeline System. On August 27, the Assembly will consider Ordinance 2026-20-1I, which would appropriate $1.2 million from the Borough’s General Fund fund balance for ongoing legal costs related to the valuation of TAPS. The Borough has already appropriated $200,000 for the project. If the new ordinance passes, at least $1.4 million will have been set aside for the current valuation dispute.
That is a substantial amount of public money, but the amount of taxable value at stake is much larger.
TAPS owners are pushing for a dramatically lower value
For 2026, the Alaska Department of Revenue initially assessed TAPS at about $10.3 billion. The pipeline owners argued the system should be valued at just under $3 billion. The municipalities that receive TAPS property tax revenue, including the Fairbanks North Star Borough, argued the value should be about $20 billion. On May 22, the State Assessment Review Board increased the state’s original assessment and valued TAPS at approximately $13 billion. That was an improvement over the Department of Revenue’s original number, but it was still billions below the value sought by the municipalities. KUAC reported that FNSB outside counsel Robin Brena told the Borough that every additional $1 billion in statewide TAPS valuation is worth roughly $166,000 to the Fairbanks North Star Borough. That means the gap between the municipalities’ roughly $20 billion position and the current roughly $13 billion valuation represents about $1.17 million per year in impact to FNSB.
TAPS should pay their fair share
The most important point for Fairbanks residents is that a lower TAPS valuation does not make the cost of local government disappear, it changes who pays. Because the Fairbanks North Star Borough operates under a property-tax revenue cap, a higher TAPS valuation means a larger share of the local tax burden is carried by the pipeline owners. A lower valuation means more of that burden can fall on homeowners and other local property owners. That is why the Northern Alaska Environmental Center supports the Borough continuing to defend a fair valuation of TAPS. It is disappointing that TAPS owners are fighting for a valuation that would significantly reduce their property-tax responsibility.
Local residents already face high costs for housing, heating, energy, food, transportation, and other basic needs. They should not be asked to carry more of the tax burden because one of Alaska’s largest industrial assets is trying to reduce the value on which it is taxed.
The Borough has already moved into the legal fight
The current $1.2 million request is not the beginning of the Borough’s involvement, after the State Assessment Review Board issued its May 22 decision, the Assembly held a special meeting on June 11 specifically to discuss the TAPS valuation. Borough Attorney Jill Dolan and outside counsel Robin Brena provided a public update. The Assembly then went into executive session to discuss the case, including whether to pursue an appeal in Superior Court or possible mediation. The Borough’s meeting record also shows that the Assembly unanimously agreed to enter executive session to discuss the issue with counsel. The ordinance now before the Assembly states that the 2026 assessed value of TAPS is being contested in Alaska Superior Court and that additional funding is needed for ongoing litigation and any resulting appeal.
Is the legal cost worth it?
The Assembly is being asked to spend another $1.2 million to continue the fight, that is a serious expenditure, but the financial stakes are also serious. Using the Borough attorney’s estimate, the difference between the municipalities’ roughly $20 billion valuation and the current roughly $13 billion valuation amounts to about $1.17 million per year for the Fairbanks North Star Borough. In other words, one year of the local tax impact associated with that valuation gap is roughly the same size as the entire $1.2 million appropriation now before the Assembly. That does not mean litigation is guaranteed to pay for itself. Court cases can take years, outcomes are uncertain, and additional costs may arise.
But it does show why the Borough is fighting.
It is a fight over who should carry the local tax burden.
Fairbanks should stand its ground
The Northern Alaska Environmental Center supports the Fairbanks North Star Borough continuing to defend a fair TAPS valuation. Major industrial property owners should be expected to pay their fair share of local taxes just like everyone else. Fairbanks homeowners should not be left carrying more of the burden because TAPS owners are trying to dramatically reduce the taxable value of the pipeline. At the same time, residents deserve transparency about how much the litigation will cost, how long it may continue, and what outcome the Borough is seeking. The Borough should keep fighting for accountability and keep the public informed along the way.
How to get involved
The Fairbanks North Star Borough Assembly is scheduled to consider the TAPS funding ordinance on Thursday, August 27 at 6:00 p.m.
Residents can attend in person at the Mona Lisa Drexler Assembly Chambers, 907 Terminal Street in Fairbanks, submit written comments, or sign up for telephonic testimony.
Find FNSB Assembly meeting information
Find public testimony and participation information
Residents can also email written comments to Assembly@fnsb.gov.
A simple message is enough: Support the Borough’s efforts to defend a fair TAPS valuation. TAPS owners should pay their fair share of local property taxes instead of shifting more of the burden onto Fairbanks homeowners and other local property owners.
Fairbanks residents should not be expected to subsidize one of Alaska’s most valuable pieces of infrastructure through higher local tax burdens.
Photo by Rashah McChesney/Alaska’s Energy Desk