City staff to look at financing for new downtown cruise ship dock

Posted: Thursday, March 01, 2007

The city got a green light Wednesday night to find a way to pay for a proposed $48 million cruise ship dock project downtown.

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The Juneau Assembly Committee of the Whole gave its approval for the Docks and Harbors department to move forward with financial planning for the project.

To fund the project - which includes constructing two docks to accommodate cruise ships up to 1,000 feet, a small boat dock and some upland work - the department will need to rework the fees it charges the luxury liners, Stone said. The cruise ship docks would be built a couple hundred feet off the existing docks running parallel to South Franklin Street to address security concerns.

"Basically we'll start, in detail, discussing the financial package to pay for it," Port Director John Stone said.

The project is expected to be completed in late 2010, if given the Assembly's go-ahead, and if bonds are approved, Stone said.

"What we'll do is we'll look at the construction cost associated with that facility and the operating cost and determine what those costs are and we'll develop a tariff, which is basically a charge to the cruise ships to finance the project," he said.

Docks and Harbors presently generates about $1.1 million annually in dock fees and would probably need an additional $3 million per year to finance the project, Stone said.

"We'll have to make some assumptions as to what size ships we'll get (in port), how many ships per year, and we'll have to work with the industry to come up with a very good projection," he said.

"Basically, it's just taking the money we need and converting it into a fee based on how many ships we have, but it's likely to be significantly more than it is now."

The city charges cruise ships using the docks a $3-per-foot fee in addition to 5-and-a-half cents per net registered ton.

Kirby Day, director of shore operations for Princess Cruises, said it appears to be a "good project" but he said there is still quite a bit of work to be done to settle how to pay for the project.

"Certainly that is going to be a key discussion that will involve the North West CruiseShip Association and the city to try and come up with a funding mechanism that makes sense to fund such a project."

Committee of the Whole Chairman Merrill Sanford said the downtown dock replacement project is beneficial to the community because future high security alerts could potentially close off sections of the port to pedestrians. The city should do what it can to help keep access to the docks for local citizens, he said.

Assembly member Bob Doll was the lone vote against moving forward with financial planning for the project because he said the Docks and Harbors Board should be focusing more attention on the needs of the local fishing fleet, which has been dissipating in recent years.

"I think it's mis-timed," Doll said.

Sanford said it was like comparing "apples and oranges" because cruise ship fees, not those generated by fishermen, would pay for the project.

Assembly members David Stone and Jonathan Anderson were not present.

The committee has given the Docks and Harbors department until April 30 to report back with its financial plan for the project.

The committee also voted 5-2 on a motion to further explore the construction of the controversial Gold Creek Dock project, estimated to cost an additional $27 million. Assembly member Jeff Bush, who along with Doll voted against the "exploration" of this project, said he has concerns because it does not have community consensus.

Doll referenced a 2004 survey conducted by the McDowell Group that said 55 percent of the public opposed the creation of a Gold Creek cruise ship dock.

"We are opening up a hornet's nest if we open up Gold Creek," he said.

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