The Juneau Assembly will pursue a downtown cruise ship dock expansion despite warnings the cruise industry doesn't support it.
Monday's decision positions the city to request cruise ship head tax collections from the state Legislature to help pay for the $40 million project.
The industry, suing the state over the head tax, warned city officials through several letters that cruise lines do not support port expansions at this time due to the poor economy and the increased cost of doing business in Alaska.
Voters put the head tax and other fees in place in 2006. Cruise lines have said the initiative made doing business here so expensive that some companies pulled ships out of the market.
Reed Stoops, managing partner of Franklin Dock Enterprises, was expected on Monday to promote his company's plan with the Assembly to privately develop a Panamax cruise ship dock at Gold Creek, but he instead told the body that it's the wrong time to expand the Port of Juneau.
"Wait until the economy recovers and we commit ships back into the market before we launch into the process of building," Stoops said, also reminding board members that a port expansion is not supported by the industry.
He did not convince a majority of the Assembly.
"I am skeptical of the assertion that the cruise industry is down," said board member Bob Doll, citing figures from what he called a "rosy" Carnival Cruise Lines financial report.
"A strong cruise season in the face of a recession, (and) the company decided to pull out of a market," Doll said. "That suggests a motive other than profit."
Carnival is one of four companies that redeployed ships in 2010. Two companies announced new sailings to Southeast Alaska in 2011, but the overall effect is expected to be fewer tourists in the next two seasons compared to this year.
Stoops' cruise ship dock project had been in competition with the Assembly's chosen proposal to expand the city-owned Steamship docks. A third proposal by Goldbelt Inc. near the Merchants Wharf was dropped when the company did not come forward with a presentation this week.
Stoops said he works closely with cruise lines because they are his customers at the Franklin dock, located just south of the Steamship docks.
When Assembly members pressed him with questions, Stoops said the industry trend is toward larger docks that accommodate Panamax ships, and that if the economy rebounds, he expects a demand for additional berth capacity in Juneau.
The Assembly voted 6-1 to start planning its dock expansion. The project will move two existing docks further into the channel so they can be lengthened to accommodate Panamax ships and free up parts of the seawalk that are blocked by security fencing.
The expansion plan is contingent on the city receiving state funding during the upcoming Legislative session. The city is expected to ask for $10 million, but Mayor Bruce Botelho suggested more might be available for Juneau. Fees the city already collected would pay another $10 million, and the remaining 50 percent would be paid for through revenue bonds. Fees would not need to be increased to pay the bonds, Port Director John Stone said.
Neighbors on both sides of the city's docks already expressed concern about the city's dock expansion plans.
Wings Airways, which operates float planes in the port, said cruise ship bow thrusters could damage planes and docks, and large ships would in general be too close to their airplanes.
Stoops said his customers at the Franklin dock might have a harder time getting in and out and therefore need tug assistance.
Assembly member Randy Wanamaker voted against Monday's decision. He said it's not clear the economy will support the dock expansion, and he did not feel comfortable that the industry does not support it.
Wanamaker also questioned finances, citing concerns about cost increases he predicted with the project.
The city owns two shoreside cruise ship berths downtown. Two more are privately owned.
Panamax ships are so named because they are largest ships that can pass through the Panama Canal.
• Contact reporter Kim Marquis at 523-2279 or email@example.com.
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