City approach on Cruise Ship Docks Headed in Wrong Direction
By Chris Parks
November 02, 2019
In April 2018, the Cruise Line Association (CLIA-AK) wrote the City Manager expressing the need for 2 docks which could accommodate the larger ships and committed to help provide funding for the projects. The industry met their commitment by working with the Legislature to secure millions in new money which could be used to upgrade any of the berths.
But look at where we are now. Alaska’s largest cruise ship, the Ovation of the Seas, bypasses Ketchikan for a full day in Victoria. The second and third largest ships, the Norwegian Bliss and Joy, are heading out to Ward Cove, along with all the other NCL ships.
There is no question, the city’s inaction in moving forward to secure larger berths will impact many local businesses downtown and cost the city millions of dollars in docking fees and sales taxes which support our harbors and other government services. For me, it was frustrating to watch many other ports such as Juneau, Hoonah, and even Skagway add infrastructure to meet the demand of the larger ships, at the same time our community was paralyzed with inaction.
As a result, the private sector stepped up an we now have the Ward Cove project moving forward, constructing two large cruise ship berths. It is no wonder the city opposed the Corp permit, as the city stands to lose $9.50 for every passenger that lands outside the city boundaries.
It’s not just about losing the revenue; the city is in a much more precarious position. Ward Cove will have 2 berths, which can accommodate up to 14 ships per week. Project owners are already working hard to fill as many of those spots as possible.
Unfortunately, the city is still acting as if they are the only game in town. This is not the case. The city has real competition and must carefully consider its position going forward. The recent tax increase to the highest of any public dock in the State of Alaska seems to dare other ships to take a serious look at the Ward Cove project. Also, the misguided RFP process is being sold to the public as a way to secure substantial financial resources. In reality, it adds extra uncertainty and costs for our remaining customers. Think about it; if someone else manages our port, they will increase costs to the remaining vessels docking in order to recoup the millions committed to the city for the privilege of managing the docks. In my view, we should not be giving over control of our city docks downtown, we should not be increasing costs and making our docks less competitive with other public docks, and we should not be giving money to third party in return for a short-term lump of cash.
It’s time to take a step back from the advice of consultants and others who have put the city in this position. We must acknowledge where we are at and reset our strategy going forward. At the very least, we much reach out to our remaining cruise line customers to build a partnership in developing a healthy and attractive cruise industry for years to come. We might be surprised how much help they might be.
Received October 31, 2019 - Published November 02, 2019
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