By Win Gruening
Juneau receives about $13 million annually from marine passenger fees — around $5 million coming from a statewide tax and the rest from the CBJ’s own head tax and port fee. By some accounts, Juneau has more money than it can legitimately spend, and like some other cities it has pushed the envelope for years by funding projects with dubious connections to cruise ship impacts.
According to federal and state law, regardless of what they’re called or their origin, marine passenger fees may only be used to fund projects or activities directly related to ship or passenger impacts. The fees cannot be used to fund things we may like or need, whether they increase our quality of life or beautify our city, if they don’t directly benefit the cruise industry or its passengers.
It stretches the imagination to see how creating a park with a sculpture — claiming future passengers will walk miles to see it — legally qualifies an island and connecting seawalk to receive $10 million in head tax funding. No one objects to the existing seawalk adjacent to downtown docks but is this new seawalk being built because of the whale attraction or is “Bridge Park” being built and the whale located in it to justify the seawalk?
The way projects are identified and qualified for head tax dollars is another consideration. The city points to the years of public input that have taken place. But the process used to derive the “head tax list” rarely involves the general public. The city manager drafts the list after receiving proposals from interested parties followed by a 30-day comment period and then forwards the final recommendations to the Assembly Finance Committee. Historically, there are few comments. This year there were none.
The seawalk/island project has generated a fair amount of concern among some people outside Juneau — enough concern to spark a legislative budget amendment to re-evaluate the status of the statewide marine passenger fee fund. Presumably, this was aimed at auditing the fund but there were indications some legislators wanted to tinker with the formula, perhaps reducing Juneau’s share to send to other cities that have more serious projects.
Cruise industry objections have fallen on deaf ears and eventually legal action may be taken. And who could blame them? If CBJ can make cruise passengers pay for any project they deem “worthy,” why not have them fund an unrealistic $60 million electric streetcar idea as proposed by CBJ mayoral candidate Greg Fisk to transport people around downtown? You might not think it’s possible, but $150,000 in head taxes was requested for studying the “circulator” streetcar idea along with improving visitor signage.
It’s time to re-evaluate the entire bridge park/seawalk/island concept. Unfortunately, the current system of identifying and funding head tax projects invites ideas that wouldn’t be considered otherwise. Locals aren’t paying for it so the interest level is low when projects are publicly vetted, but do you really think Juneau would be building this seawalk and island if we were the ones paying for it?
At best, whether the cruise industry takes legal action or not, the Legislature is primed to change the head tax formula and we may lose precious dollars for future projects. At worse, Juneau taxpayers could be on the hook for millions of dollars to complete a project that has no funding source.
The city has finally gone one island too far.
Win Gruening retired as the senior vice president in charge of business banking for Key Bank in 2012. He was born and raised in Juneau and is active in community and statewide organizations. This commentary appeared in the April 16, 2015 issue of the Juneau Empire.