U.S. Senator Dan Sullivan Lobbied Alaska Senate to Kill S-Corp Tax Provision

Legislative sources in Juneau confirm that U.S. Senator Dan Sullivan has actively urged state lawmakers to pass a "clean" version of the massive tax cut legislation for Glenfarne and AKLNG that the Legislature is currently debating. To be clear, "clean" in this context is a convenient political euphemism for completely gutting the proposed S-Corp tax provision.

This highly unusual intervention by a federal representative into state tax code points to potential outside corporate influence. The S-Corp provision carries major implications for corporate entities operating in Alaska. Texas billionaire Jeff Hildebrand is the founder of Hilcorp, which is structured as an S-Corporation and would directly benefit from killing the tax provision.

The ties between Sullivan and Hilcorp are well-documented. Sullivan served as DNR Commissioner from December 2010 to September 2013. Hilcorp entered the Alaska market in late 2011 by acquiring aging Cook Inlet basin assets from Union Oil Company of California (Chevron) and Marathon.

Because oil and gas unit operations on state land require government approval, the transfer of these assets to Hilcorp had to be authorized by the DNR. Records show that Sullivan's department officially approved Hilcorp as the successor operator for major Cook Inlet assets, such as the Trading Bay Unit, in late December 2011 (effective January 1, 2012).

While the routine approval of a corporate transfer is a standard function of the DNR, as the head of the agency, Sullivan was the ultimate authority overseeing and authorizing Hilcorp's initial establishment in Alaska.

In October 2025, Senator Dan Sullivan voted to confirm Jeff Hildebrand’s wife, Mindy Hildebrand, as the U.S. Ambassador to Costa Rica. She had been appointed to the position by the Trump administration. The Senate confirmed her in a tight 51-47 vote, with Sullivan providing one of the critical "yes" votes.

Noteworthy is that Jeff and Mindy Hildebrand are documented mega-donors to Republican candidates and conservative political action committees. While a search of immediate federal records does not surface a direct, massive individual campaign check from either Hildebrand specifically to Sullivan's personal campaign committee, they are part of a primary financial engine for the broader GOP infrastructure that supports Sullivan. Hildebrand has previously funneled large sums into Alaska politics, such as a $25,000 donation to an independent expenditure group supporting Governor Mike Dunleavy.

To be clear, the S-Corp tax provision belongs in the gas line tax bill because it provides essential fiscal balance and basic corporate fairness. While the underlying gas pipeline bill hands out a massive, multibillion-dollar tax break to developers to spur construction, Alaska is simultaneously facing a half-billion-dollar revenue shortfall that threatens school funding and the Permanent Fund Dividend. By attaching the S-Corp provision, lawmakers can ensure that massive, privately owned oil and gas producers like Hilcorp pay the same state corporate income tax as their publicly traded competitors, such as Exxon Mobil and Conoco Phillips.

If the state is going to subsidize future energy development with sweeping tax cuts, it must simultaneously close a glaring, hundred-million-dollar loophole that currently allows the state's largest gas producer to operate essentially tax-free.

Hilcorp has become a dominant force in Alaska's energy sector. Sullivan's personal effort to protect S-Corporations from state taxation directly benefits the very same company he helped establish in the state. State lawmakers should clarify why a U.S. Senator is working to dictate state tax policy and whether donors orchestrated the effort.