If you stop and review the past 25 years of discussions between the Alaska Tourism Industry and the Alaska legislature you might be surprised at how many times industry leaders tried to find a balanced and equitable funding mechanism to provide basic infrastructure for communities throughout the State. Several special task force groups over those years comprised of industry professionals and legislators met dozens of times around the State only to conclude that any tax method applied to the industry failed one way or the other in being fair to some or equitable to others. At the same time those discussions were taking place the Cruise industry was at the table contributing millions of marketing dollars on an annual basis to support the States generic marketing efforts to bring new travelers to our State. The contribution was voluntary, everyone participated, but the cruise industry was never given credit or recognition that they were helping to fund the growth of this important statewide economic generator of business.

Once the voter initiative passed there was little discussion about the negative economic impacts it might have to Alaska businesses and the jobs created each year in the tourism industry.  No one thought the tax burden might force the cruise lines to reposition ships to other countries where they are allowed to operate in a healthy growing business atmosphere. The reposition of these ships was a giant win for the other destinations in this highly competitive market that are begging for the economic stimulus these ships can bring.  The initiative since its implementation two years ago has caused the major cruiselines historically traveling in Alaska waters to move their ships out of Alaska where they operate by meeting accepted global standards and negotiate their payment of infrastructure costs directly with those countries.  The field of play there is fair and equitable for both sides.

This fall the cruise industry filed suit against the State of Alaska challenging the legal basis of some of the initiatives tax provisions. Knowing that itinerary changes for the major cruise lines can take as long as two years to implement, every day the State of Alaska studies this case or fails to move forward and negotiate an acceptable compromise the negative trend will continue. The downward turn in visitor business growth in Alaska, the unprecedented drop in local sales taxes state wide, and loss of visitor industry jobs will continue.

The Alaska ACT organization will be speaking directly with all levels of our State government leaders to encourage a quick resolve or settlement of this litigation. The only jobs growth created by a lawsuit will be with attorneys working both sides of the issue. The hundreds of Alaska visitor industry businesses will continue to suffer with no possible change in the industry downturn until this initiative challenge is settled. Our common sense appeal will encourage the Alaska leadership to take action and reverse the economic crisis that is currently infecting our industry.