Business coalition says revised HB 381 drifts further from gasline mission as Legislature nears adjournment

By SUZANNE DOWNING

July 16, 2026 – With just days remaining before the Alaska Legislature’s scheduled July 19 adjournment, a coalition of the state’s leading business and resource organizations says the latest conference committee version of House Bill 381 moves even farther away from its original purpose of helping advance the Alaska LNG Project.

The Alaska Support Industry Alliance, Alaska Chamber of Commerce, Alaska Oil and Gas Association, and Resource Development Council for Alaska issued a joint statement Thursday criticizing the conference committee substitute, arguing that it layers new taxes onto a bill that was originally intended to create a predictable tax structure for the multibillion-dollar gasline project.

“The conference committee bill misses the mark,” the organizations said. “Rather than focusing on advancing the Alaska LNG Project, it injects targeted industry and income taxes that threaten the very companies producing energy for Alaska’s homes and businesses.”

The groups urged lawmakers to strip the unrelated provisions and return the bill to its original focus.

“The Alaska Oil and Gas Association, Alaska Support Industry Alliance, Alaska Chamber of Commerce, and Resource Development Council urge the Legislature to reject these counterproductive provisions and pass a clean bill focused on getting the gasline built and delivering lower energy costs for Alaskans,” the statement said.

The criticism comes after weeks of negotiations that have steadily transformed HB 381 from a narrowly focused gasline tax measure into a broader tax package.

The House originally passed a clean version of the bill designed to replace local property taxes during the Alaska LNG construction phase with a volumetric tax collected once gas begins flowing. Supporters argued the change would make financing the project more attractive while preventing construction-period tax costs from being passed on to future gas customers.

But the Senate Majority Coalition amended the bill to include a corporate income tax on S corporations and other pass-through entities. More recently, lawmakers reportedly explored exempting certain Cook Inlet natural gas producers and the Alaska LNG developer while continuing to apply the tax to North Slope producers, a proposal that immediately raised concerns about whether Alaska would be singling out specific companies for taxation.

The latest conference committee version appears to retain tax provisions that business organizations argue have little to do with constructing an 807-mile natural gas pipeline from the North Slope to Southcentral Alaska.

That has united much of Alaska’s business community against the revised legislation.

The four organizations represent hundreds of Alaska businesses spanning oil and gas production, mining, construction, transportation, engineering, manufacturing, and local chambers of commerce. Their message echoes concerns raised throughout the special session that adding unrelated tax policy could jeopardize the very investment the legislation was originally intended to encourage.

Time is rapidly running out. The Legislature is constitutionally scheduled to adjourn July 19. Unless lawmakers can agree on a final version of HB 381 and send it to Gov. Mike Dunleavy before then, the state’s effort to provide a stable tax framework for the Alaska LNG Project could once again be delayed.

The latest developments underscore how much more complicated the legislation has become since the House first approved its straightforward version earlier this summer. What began as a narrowly tailored bill to improve the economics of a long-awaited energy project has evolved into a broader debate over Alaska’s tax policy, one that business leaders say risks undermining investor confidence at the very moment the state is seeking to move its largest infrastructure project toward construction.

Whether lawmakers simplify the bill before adjournment—or allow the dispute to carry beyond this special session—could determine whether Alaska presents a unified, predictable tax framework to potential project investors or sends another signal that the rules remain unsettled.