Pipeline communities near TAPS tax settlement

Trans-Alaska Pipeline System. (Photo by Alaska Department of Natural Resources)
Trans-Alaska Pipeline System. (Photo by Alaska Department of Natural Resources)

There is a tentative settlement in long-running series of court actions between local government and the owners of the Trans-Alaska Pipeline System, or TAPS. The Fairbanks Borough and other governmental entities in Barrow and Valdez have been wrangling for years about the tax-value of the pipeline. The tentative agreement not only settles outstanding cases but also stems future appeals for five years.

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The taxation value of the Trans-Alaska Pipeline has seen a long life in the courts. Last year the Alaska Supreme Court affirmed a lower court’s valuation of the pipeline from 2007 through 2009. That ruling gave the Fairbanks North Star Borough some $10 million in back-taxes.

Fairbanks Borough attorney Rene Broker says the tentative deal worked out between local governments and pipeline owners would not bring in additional monies, but would settle several issues.

“The assessed values for 2010 through 2015 are still being litigated, and this resolves that litigation — and we get to keep the money that’s been paid. And then in addition it resolves five years forward.”

Broker says by resolving current litigation and keeping the issue out of court for the next five years, the borough is relieved of additional costly legal fees.

The settlement is contingent on the North Slope and Valdez resolving separate tax issues over the pipeline, but both parties have agreed in principle to the settlement. If the agreement is approved by the Fairbanks Borough Assembly, Broker expects the matter to be fully resolved in the near future. The Assembly briefing is scheduled for 5:30 p.m. Thursday in Fairbanks.