Alaska Policy Commentary  ·  May 31, 2026

Rep. Schwanke's Own Evidence Undermines HB 381

She says Alaska must compete with Louisiana and Texas. She's right. But those states knew what their deals were worth before they signed them. Alaska doesn't.

By Tom Lamb  ·  HB 381 · Special Session 2026

Rep. Rebecca Schwanke published a commentary today asking whether Alaska LNG needs property tax breaks. It's a fair question. Her answer, unfortunately, makes the case against HB 381 better than its opponents could.

Her argument is straightforward: Louisiana and Texas gave massive tax abatements to LNG projects, British Columbia is moving fast, and Alaska needs to compete. She's not wrong about any of that. The problem is what she leaves out.

"Louisiana and Texas knew exactly what they were giving up when they gave it up. Alaska doesn't."

The Comparison She's Making — and What It Actually Shows

Schwanke cites Louisiana's Industrial Tax Exemption Program (ITEP) — an 80–100% property tax abatement for up to 10 years — and notes that Sabine Pass received a break worth ~$4.9 billion, Cameron LNG ~$3.7 billion. These are real numbers. They're also the problem with her argument.

Those dollar figures exist because Louisiana knew the asset values. ITEP is a formula-based program applied after construction, once costs are established and property is assessed. Companies apply project-by-project with disclosed capital investment figures. The exemption scales automatically with actual cost. The legislature that created ITEP didn't need to know Sabine Pass's budget in advance — the formula handled it.

HB 381 works nothing like that.

The Structure of HB 381

Sets a fixed volumetric tax of $0.06 per thousand cubic feet — before construction, before costs are known, before assets are assessed.

Permanently replaces all ad valorem property taxes on the project.

Locks in this rate with a 1% annual escalator that likely trails inflation.

Does not require cost disclosure as a condition of the tax structure taking effect.

The Four Tests — Louisiana Passed All of Them. HB 381 Fails All of Them.

Criteria	Louisiana ITEP	HB 381
Cost known before structure set	Yes — applied post-construction	No — set before any cost disclosure
Formula-based on asset value	Yes — % of assessed value	No — fixed volumetric rate
Time-limited	Yes — 10 years maximum	No — permanent replacement
Public cost disclosure required	Yes — per application	No — Glenfarne refuses to release updated estimate

The Number Nobody Will Release

This is where it gets hard to ignore. Glenfarne commissioned engineering firm Worley to update the project's cost estimate in 2025. When asked about it, Glenfarne's president told Alaska Public Media the updated figure is "most likely not going to be made public."

The official figure still being cited — $46.2 billion — is based on a 2018 AGDC estimate. Independent analysts at Rapidan Energy Group put the export phase alone at up to $60 billion, suggesting a total well above $70 billion.

Ad valorem property taxes are calculated as a percentage of asset value. If the true cost is $70 billion rather than $46 billion, Alaska is surrendering billions in property tax revenue — permanently — in exchange for a volumetric rate that was set without knowing that number.

"The Legislature is being asked to consider enabling legislation while the developer declines to disclose the figure that determines whether any of this works."
— Anchorage Daily News, April 2026

Cheniere Disclosed Everything. Glenfarne Is Disclosing Nothing.

Proponents keep pointing to Sabine Pass as the model. Let's take that seriously and look at how Cheniere actually handled cost transparency.

Cheniere was a publicly traded company. Every financing round, every construction milestone, every cost overrun or on-budget completion was disclosed in SEC filings and press releases — because federal securities law required it. When the first four trains were financed between 2012 and 2017, the financing totaled over $20 billion drawn from 19 international commercial banks. Every dollar was public record. When all six trains were completed, Cheniere issued a formal press release confirming each train had been delivered ahead of schedule and within budget.

That public cost record is precisely what allowed Louisiana to calculate the $4.9 billion ITEP exemption with confidence. The state wasn't guessing. It was applying a formula to a certified, publicly verified asset value.

Cheniere vs. Glenfarne: The Disclosure Gap

Cheniere (Sabine Pass): Publicly traded. SEC disclosure required. $20+ billion in construction financing disclosed train by train. All six trains certified on-budget at completion. ITEP applied to verified final costs.

Glenfarne (Alaska LNG): Private company. No SEC disclosure obligation. Updated cost estimate commissioned from Worley in 2025 — actively withheld. Legislature asked to set a permanent tax rate based on a 2018 number while the developer holds the current one in confidence.

This is not a minor procedural difference. Cheniere's transparency was structural — baked into its corporate form. Glenfarne's opacity is also structural, and deliberate. The Legislature has no mechanism to compel disclosure. HB 381 doesn't create one. It simply trusts that $46.2 billion is close enough.

It may not be. And unlike Sabine Pass, Alaska won't find out until it's too late to renegotiate.

What About Texas? They Knew Costs When They Signed — And Built In an Exit If Promises Weren't Kept.

Proponents may point out that Texas isn't as transparent as Louisiana upfront. They'd be partly right. Under Texas Chapter 312, project cost details can be kept confidential during negotiations — closed-door talks between the developer and the county. That's worth acknowledging as a legitimate criticism of Texas practice.

But here's what's critical to understand: Texas Chapter 312 is a negotiated bilateral contract between the developer and the county. Both parties sign it. Both parties know what it says. And Texas law requires that once executed, all cost information becomes public record. The county signed knowing the costs. Texans could see what their county gave up the moment the ink dried.

HB 381 is not a contract. It's a statute — a unilateral act of the Legislature that restructures the tax code in Glenfarne's favor. There is no signing moment. There is no bilateral negotiation. There is no point at which costs must be disclosed to anyone. The Texas transparency trigger never exists at all under HB 381's structure.

But the disclosure gap is only half the Texas story. The more important difference is what Texas kept after signing: the right to walk away.

Texas Chapter 312 is explicit on this. The local government can modify the agreement, reassign it, or cancel it entirely at any time before it expires. If the developer fails to make agreed improvements, the county can recapture every dollar of lost tax revenue. If the project doesn't hit its agreed assessed value, taxes are recaptured with penalties and interest. If jobs aren't created, same result. Texas wrote performance conditions and clawback teeth directly into statute — and required every agreement to include them.

How All Three Compare to HB 381

Louisiana ITEP: Costs certified via affidavit at completion. Formula tied to assessed value. Public record throughout. Time-limited to 10 years.

Texas Ch. 312/313: Bilateral contract — county signs knowing costs. Costs public at execution. Tied to assessed value. Cancellable at any time. Recapture with penalties if performance targets missed. Time-limited to 10 years.

HB 381: Unilateral statute — no bilateral contract, no signing moment, no cost disclosure ever. Fixed volumetric rate with no connection to asset value. No cancellation right. No recapture. No clawback. No performance conditions. Permanent.

Texas signed contracts knowing costs and retained the right to cancel if promises weren't kept. Louisiana applied its formula to certified final costs. Alaska is being asked to pass a permanent law, blind to costs, with no exit, no recapture, and no performance conditions whatsoever. That isn't a variation on what Louisiana and Texas did. It's a different instrument entirely — one that protects only one party.

· · ·

The Competitive Argument Supports Disclosure, Not This Bill

Rep. Schwanke is right that Alaska faces competition. British Columbia's LNG Canada facility in Kitimat is operational and expanding. Asian buyers are signing deals now. The window is real.

But none of that justifies this particular structure. It justifies offering a competitive incentive — which Alaska absolutely should do. The question is whether this incentive, set at this rate, structured this way, is the right one. And that question cannot be answered without knowing the cost.

Louisiana didn't guess at what Sabine Pass was worth and hope the formula worked out. They built a system that automatically calibrated the benefit to the investment. Alaska should do the same — or at minimum, require Glenfarne to disclose the Worley estimate before the Legislature votes on anything.

· · ·

There Is No Adjustment Mechanism. None.

Proponents sometimes argue that companies need certainty of an incentive before breaking ground — and that's fair. ITEP itself acknowledges this: companies factor the program into their investment decisions before construction starts, even though they don't collect the exemption until costs are final.

But there's a critical distinction ITEP preserves that HB 381 abandons entirely: ITEP gives advance certainty of a formula. HB 381 gives advance certainty of a specific number. Those are not the same thing.

Under ITEP, Louisiana could pass its incentive framework without knowing what Sabine Pass would cost, because the formula — a percentage of final assessed value — self-corrects automatically. The state never had to guess. The math did the work.

Read HB 381 carefully and ask: is there anything that adjusts the $0.06/Mcf rate once final construction costs are certified? The answer is no. Here is what the bill actually contains:

What HB 381 Is Missing

No affidavit of final cost. Louisiana requires one before the exemption takes effect. HB 381 has no equivalent.

No formula tied to assessed value. The rate is a fixed number in statute — $0.06 — not a percentage of anything.

No agency authority to recalculate. No board, no Department of Revenue trigger, no mechanism that reopens the rate if actual costs diverge from the $46.2 billion assumption.

No cost-based reset clause. The only adjustment in the bill is a 1% annual escalator — automatic, inflation-blind, and completely disconnected from what the project actually costs to build.

The 2040 sunset is the only leverage point, and it's a blunt instrument: if the project hasn't reached commercial operations by then, the special tax status terminates entirely. That's a binary cliff — not a recalibration mechanism. And as the deadline approaches, it creates pressure on Alaska to extend rather than renegotiate, further weakening the state's hand.

ITEP's genius is that the formula does the work so the legislature doesn't have to. HB 381 has no formula. It has a guess — and Alaska will live with that guess permanently.

A Simple Ask

Nobody opposing HB 381 is opposing the Alaska LNG project. The energy security argument is real. North Slope reserves need a route to market. The geopolitical moment may be genuine.

But a deal structured around withheld information favors the party with more information. That party is not Alaska.

The Legislature should require full cost disclosure before any vote on HB 381. If the project pencils out at $70 billion, set the incentive accordingly. If it pencils out at $46 billion, set it accordingly. Either way, set it with your eyes open.

Rep. Schwanke's evidence makes the case for competing. It doesn't make the case for signing a blank check. Those are very different things.

Tom Lamb  ·  May 31, 2026  ·  Alaska Policy Commentary