You've got it backwards.  The Fangs have a history of using valuable property in Anchorage as bargaining chips for tax breaks so they can make more money on other projects.  The Northern Lights hotel is just the latest of these.  The reason it hasn't been torn down yet is because the city denied their last extortion attempt.  They wanted city taxes waived for a 4th avenue renovation in return for the demolition of the Northern Lights Hotel.  This application is their attempt to retaliate against the city for calling their bluff.