Sitkans looking at taxing cruise ships

City administrator, resident generate head-tax proposals

Posted: Sunday, June 26, 2005

Plans to tax cruise ships $4 to $5 per passenger may be gaining ground in Sitka, irking cruise industry officials and surprising the company bidding to build a dock for the ships outside of town.

Sitka's administrator, John Stein, said Friday that he plans to introduce an ordinance at the city Assembly's next meeting to charge cruise ships a $4-per-passenger wharf fee. The fee would raise about $1 million a year, he said, based on last year's tally of 230,000 cruise tourists.

Meanwhile, resident Mary Magnuson said she is planning her own cruise passenger tax proposal - as a ballot initiative. Her proposal is based on Juneau's $5-per-passenger tax, she said. She plans to submit the proposal for certification on Monday and begin collecting signatures after it is approved.

"Somebody has to do it. The Assembly wasn't going to bring it up on their own. The cruise ship industry wasn't going to volunteer to give Sitka money," Magnuson said.

She needs to collect 664 signatures by the end of August to put it on the October ballot.

If the Assembly accepts Stein's $4 head tax proposal, Magnuson said she'll drop the petition. If not, she'll go ahead.

Juneau charges $5 per head and Ketchikan $6 for cruise ships docking downtown. The money generated from those fees go to projects directly related to the cruise ships and the tourists they bring, said John Hansen, president of NorthWest Cruise Ship Association in Vancouver, British Columbia.

Hansen's association is challenging a statewide initiative for a $50-per-passenger tax, filing a lawsuit questioning the validity of the signatures collected.

Hansen said whenever projects are needed in Sitka, such as docks or facilities, industry representatives meet with city officials to find a solution.

"I would worry that if a tax or a new fee comes in that doesn't fit with that kind of model in Sitka, that wouldn't be a positive thing in the relationship," he said.

Last year, more than 800,000 cruise ship tourists sailed Alaska waters. But Sitka's port traffic dropped 9 percent between 2003 and 2004, according to data from the Sitka Economic Development Association's Web site.

Ships headed to Sitka must moor offshore. Tourists are lightered into town with smaller boats.

The city recently sent out a request for proposals to develop an old timber mill dock about seven miles away into a deep-water dock for cruise and cargo ships.

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