EDITOR, Daily News:
The Ketchikan City Council on Jan. 6 discussed a sales tax cap as another option to garner revenue for the 2022 General Budget. It didn’t receive enough votes to proceed. With a small population contributing to various taxes, fees, and citation penalties, it’s becoming increasingly clear the topic is beating a dead horse. So what are the options?
Approval of a state sales tax or personal income tax only directs revenues into the state budget with municipalities waiting in line for funds to construct or repair infrastructure projects.
Municipalities must find ways to tap commerce trends and popularity of travel industry. The Ketchikan Gateway Borough joined Alaska Remote Sellers Sales Tax initiative to collect sales tax on remote sales into Alaska. Independent travel made a respectable showing last summer and cruising projections look promising for 2023. It’s time the council establishes a Tourism Enterprise Fund within a Tourism and Economic Development division.
Why? Cruise industry sponsoring, donating or gifting funds for community projects should be acknowledged through TEF accounting ledger. Depositing NCL $2 million gift into TEF would have given council the option to approve “loan with terms” to Port Enterprise Fund with Reserves Fund payback loan within five years. Tourism and Economic Development division becomes a lender and no longer a borrower. TEF also should support tourism manager payroll and expenses.
City of Juneau will be getting more unrestricted revenue from the cruise industry as sales tax is collected on board every ship arriving in Gastineau Channel until departure (4-8 hours). It met with no resistance. World-class ships known for retail and attractions, Juneau will be collecting sales tax on specialty restaurants, bars, massage, hair stylist, premium activities, and sales of shore excursions; benefiting from ships’ competitive advantage. The quandary: Will that make us more eager to get more or bigger cruise ships or be less greedy by supporting smaller number of cruise ships/passengers who support an eco-friendly carbon-footprint?
There are examples of seaports, state parks and land trusts collecting entry fee upon arrival or usage. It would be easy to acquire a template and customize legality. Precedent set now with Ward Cove Group-NCL using city upland property for bus parking will carry over to Saxman Seaport in need of parking. Usage fee should be deposited in Tourism Enterprise Fund first before reassigning to community projects, in my opinion.
Another revenue source would be a statewide initiative collecting impact fee on all ticket sales entering seaport (cruise ship/AMHS) and airport. Similar to CPV collection, fees divided equally; city portion deposited into TEF. A complex subject addressed at another time.
As Seattle, Vancouver and Victoria, Bristish Columbia, are affecting cruise regulations applied to ships arriving in Ketchikan and Juneau spearheading ‘local marketer’ efforts, it is timely Southeast seaports join the class-action efforts for 1) self-preservation and 2) protecting our number one asset — Alaskan wilderness and lifestyle.
MARY L. STEPHENSON