Supreme Court affirms pipeline value decision

Headline Legal News

The Alaska Supreme Court on Wednesday handed Alaska municipalities a victory in a dispute over the value of the trans-Alaska pipeline, affirming that the structure for 2006 should have been valued at nearly $10 billion, not the $850 million claimed by pipeline owners.

The justices backed a Superior Court ruling that based the value of the pipeline on replacement costs, not fees paid to the owners for use of the pipeline.

The higher value means more tax revenue for municipalities through which the pipeline runs, especially the North Slope Borough, the Fairbanks North Star Borough and the city of Valdez, the parties in the lawsuit. The municipalities have long argued that pipeline owners have undervalued the 800-mile pipeline and tanker-loading facilities in Valdez.

"I've got a smile on my face today," Fairbanks North Star Borough Mayor Luke Hopkins said. "The Supreme Court validated what our position has been all along."

State Rep. Dave Guttenberg, D-Fairbanks, in a prepared statement praised the municipalities for seeking additional revenue and faulted the state for not intervening.

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