Looking out for the borough’s interests

  • Thursday, February 13, 2014 3:14pm
  • Opinion

At its Tuesday meeting, the Kenai Peninsula Borough Assembly made an important decision to protect the borough’s financial interests.

The assembly approved a measure brought forward by Borough Mayor Mike Navarre to work with other municipalities to hire a consultant to analyze the potential impact a natural gas pipeline would have on municipal tax revenues.

While a gas pipeline project, especially one with a terminus and gas liquefaction plant in Nikiski, would no doubt be a boon to the borough’s economy, the borough administration has some concerns, especially with a part of the proposed agreement that would allow producers to make a payment in lieu of taxes, instead of ad valorem taxes, on oil and gas property. In other words, the state could negotiate a payment in lieu of taxes from the oil and gas industry that’s significantly less than revenues collected under the current tax structure based on the assessed value of oil and gas property.

According to a memo to the assembly from Navarre, the agreement with producers could apply the payment in lieu of taxes to existing oil and gas property as well as future development, regardless of whether a pipeline is ever built. Bills up for consideration in the Legislature would authorize the commissioner of the state Department of Natural Resources to engage in confidential negotiations to develop terms for a natural gas pipeline.

Navarre is working with mayors from other affected municipalities, including the Fairbanks North Star Borough, the North Slope Borough, and the city of Valdez to ensure that municipalities are able to participate in discussions that would significantly impact local tax revenue.

Fiscal concessions may be necessary to get a pipeline built, but those impacted should have a voice in how far concessions go. With the state and producers finally moving forward on the project, the action by the borough assembly and administration is a smart and prudent move.

More in Opinion

Dick Maitland, a foley artist, works on the 46th season of “Sesame Street” at Kaufman Astoria Studios in New York, Dec. 15, 2025. (Ariana McLaughlin/The New York Times)
Opinion: Trump’s embarrassing immaturity Republicans won’t acknowledge

Sullivan should be embarrassed by the ignorance and immaturity the president is putting on display for the world to see.

Rep. Justin Ruffridge, R-Soldotna, speaks in support of debating an omnibus education bill in the Alaska House Chambers on Monday, Feb. 19, 2024 in Juneau, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Capitol Corner: Choosing our priorities wisely

Rep. Justin Ruffridge reports back from Juneau.

Sen. Jesse Bjorkman, R-Nikiski, speaks in support overriding Gov. Mike Dunleavy’s veto of House Bill 69 at the Alaska Capitol in Juneau, Alaska, on Tuesday, April 22, 2025. (Mark Sabbatini/Juneau Empire)
Capitol Corner: As session nears end, pace picks up in Juneau

Sen. Jesse Bjorkman reports back from Juneau.

Alaska Department of Education and Early Development Commissioner Deena Bishop and Gov. Mike Dunleavy discuss his veto of an education bill during a press conference March 15, 2024, at the Alaska State Capitol. (Mark Sabbatini/Juneau Empire file photo)
Opinion: Strong policy, proven results

Why policy and funding go hand in hand.

Former Gov. Frank Murkowski speaks on a range of subjects during an interview with the Juneau Empire in May 2019. (Michael Penn / Juneau Empire File)
Opinion: The Jones Act — crass protectionism, but for whom?

Alaska is dependent on the few U.S.-built ships carrying supplies from Washington state to Alaska.

Cook Inlet can be seen at low tide from North Kenai Beach on June 15, 2022, in Kenai, Alaska. (Photo by Erin Thompson/Peninsula Clarion)
Opinion: Solving the Cook Inlet gas crisis

While importing LNG is necessary in the short term, the Kenai Peninsula is in dire need of a stable long-term solution.

Sockeye salmon caught in a set gillnet are dragged up onto the beach at a test site for selective harvest setnet gear in Kenai, Alaska, on Tuesday, July 25, 2023. (Jake Dye/Peninsula Clarion)
Capitol Corner: Creating opportunities with better fishery management

Sen. Jesse Bjorkman reports back from Juneau.

The ranked choice outcome for Alaska’s U.S. Senate race is shown during an Alaska Public Media broadcast on Nov. 24, 2022. (Alaska Division of Elections)
Opinion: Alaska should keep ranked choice voting, but let’s make it easier

RCV has given Alaskans a better way to express their preferences.

The Alaska State Capitol on March 1. (Ashlyn O’Hara/Peninsula Clarion)
Opinion: Keep Alaska open for business

Our job as lawmakers is to ensure that laws passed at the ballot box work effectively on the ground.

Most Read