Statewide cruise-ship tax measure resurrects

$5 of $50-per-passenger tax would go to each port where a ship docks

Posted: Wednesday, April 30, 2003

Cruise ship passengers would pay a $50 tax and the industry would be held to tighter environmental standards under a ballot initiative proposal submitted to the state on Tuesday.

The revenue generated by the tax would be deposited into a "Commercial Vessel Passenger Tax Account" within the state General Fund.

"I think all of us that live in coastal communities are tired of subsidizing the cruise ship industry. The free ride is over," said Joe Geldhof, a member of the Juneau-based Responsible Cruising in Alaska and a sponsor of the initiative.

Geldhof estimated that with more than 700,000 cruise ship passengers headed to Alaska this year, the tax would raise about $34.5 million for the state.

The initiative, if passed into law, would divide $46 of the tax between the various ports of call, sending $5 of each passenger's tax to each community where a cruise ship docks.

That money would be split between the cities and boroughs of each community. Geldhof said the revenue would be used to improve port and harbor facilities.

Communities that host cruise ship passengers without the ship's docking at those communities would receive 25 percent of the revenue generated by the tax, which would be used for non-port improvements.

The remaining $4 of the tax would be used to place independent licensed marine engineers on each cruise ship. Geldhof is a Juneau lawyer who represents the marine engineers union.

The monitors would observe wastewater treatment practices and inspect pollution control equipment and heating and ventilation systems on the ships.

In addition, the cruise ship industry would prevent cruise ships from dumping plastics, metals and hydrocarbons in Alaska waters. The ships also would have to be permitted by the state before entering Alaska waters.

The proposed initiative also would impose a corporate income tax as well as a 33 percent tax on onboard gambling. Geldhof estimated the corporate income tax could raise between $8 million and $15 million a year for the state, but it is uncertain how much would be generated from the gaming tax.

The initiative was sent to the lieutenant governor's office Tuesday. If the initiative language is approved by the Department of Law, the sponsors will have to gather 23,285 signatures to certify the initiative petition in time for the 2004 election.

John Hansen, president of the North West CruiseShip Association, said he has not seen the initiative but said the industry already pays dock and harbor fees to municipalities in Alaska and that there already is a system of environmental oversight in place to prevent illegal wastewater dumping.

Hansen said the industry is subject to strong environmental oversight by the U.S. Coast Guard and noted cruise ships keep thorough logs on all wastewater emissions.

He acknowledged there have been instances of illegal cruise ship wastewater dumpings since state laws were passed in 2001.

"Accidents will happen from time to time, but there is no deliberate evasion of the law," Hansen said.

He said adding a couple of hundred dollars to the cost of a family's vacation would dissuade tourists from visiting the state.

"(The tax) would impact businesses other than the cruise ship industry," Hansen said, noting that restaurants and gift shops also would suffer a loss of revenue.

But Gershon Cohen, a sponsor of the initiative and national project director for the Campaign to Safeguard America's Waters, said about 9-10 percent of the industry's worldwide revenue comes from cruise ships that visit Alaska.

He said that until tension in the Middle East settles down, more tourists will choose safe destinations like Alaska.

Hansen said if the initiative language is approved by the Alaska Department of Law, the industry will mount a public relations campaign to inform the public about the economic impacts of the proposal.

Timothy Inklebarger can be reached at

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