City puts off cruise ship tax hike

Measure to be sent to committee, then slated for public hearing in March

Posted: Tuesday, January 25, 2005

The Juneau Assembly delayed voting on a measure to increase taxes on cruise ships to pay for future waterfront projects on Monday night after facing strong opposition from cruise line operators.

The Assembly voted unanimously to send the controversial proposal to its Committee of the Whole, which will take up the matter at its Feb. 9 meeting. The tax increase then will go to a public hearing at the Assembly's first regular meeting in March.

The proposed tax increase would raise the city's current port development fee of 18 cents-per-day, per-passenger by one dollar in 2005 and 2006. If their cruise ships docked or lightered in a Juneau harbor, cruise lines would pay an additional $2 per day.

At present, cruise line passengers pay the city a $5 per-passenger fee.

The Juneau Docks and Harbors Board charges the cruise lines fees for lighting, dock access and other cruise ship services. The proposal to increase the port development fee would generate an estimated $900,000 in 2005 and $950,000 in 2006, city officials said.

The city's recently approved waterfront plan is expected to cost much more, and could require other funding sources as well. The project includes a dock extension, a sea walk along the harbor and new green spaces in downtown Juneau.

In a memo sent Monday, Mayor Bruce Botelho told the Assembly that he agreed, at the end of recent discussions with cruise ship industry representatives in Seattle, to consider increasing the port development fee by one dollar in 2005 and 2006 but leave the fee structure in later years undefined.

But Botelho said he was "comfortable" with designating future fees because, although the city hasn't defined specific costs in the waterfront plan, "we do know that there are multimillion-dollar projects that are high priorities and that will be used by cruise ship passengers."

Representatives from Princess Tours, Cruise West, the North West Cruiseship Association and Royal Caribbean objected to setting fees for projects that haven't been defined yet. They also said that the proposal didn't allow enough input from industry.

"It's a huge departure from industry-community relations," said Don Habeger, director of government and community relations for Royal Caribbean International and Celebrity Cruises.

Chris Wyatt, executive director of the Juneau Chamber of Commerce, said her board hasn't looked at the proposal but the chamber supports a more collaborative approach.

Tourism industry representatives did not raise any objections to specific proposals in the waterfront plan.

Mike Windred, director of operations for Alaska Travel Adventures, said, "As a taxpayer ... just raising money for the sake of raising money .. I have an issue with that."

He said the city hasn't used about $2 million from the current fees on the cruise industry.

Assembly member Marc Wheeler proposed delaying action on the tax increase to allow the committee of a whole to take a look at it.

"These are pretty difficult issues and may take a while to resolve," he said.

• Elizabeth Bluemink can be reached at elizabeth.bluemink@juneauempire.com.



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