Alaska Cruise Visitors Top 1 Million 2016

By ,   August 11, 2016 ,   Cruise Industry

For the first time in 7 years, the cruise industry boasts over 1 million passengers to Alaska.

Numbers indicate the industry has emerged from a slowdown in Alaska. Passenger numbers rebounded from a 10-year low of 878,000 in 2010 to a projected 1,014 million in 2016.

Passenger numbers stayed above 1 million annually throughout the late 2000s, when cruise companies slashed fares worldwide to keep as many berths full as possible during the worst years of the global recession, and the introduction of a state head tax in 2007 cut into bottom lines.

In 2010, cruise companies cut capacity by about 14%, saying the USD 50 per-passenger tax was too much to bear. A lawsuit filed by the cruise industry association in Alaska resulted in a reduction of the tax in time for the 2011 season. Since then, the companies have been adding berths to their Alaska itineraries nearly every year with the exception of 2014, when they diverted capacity to the fast-growing China cruise market.

Between May and September of 2015, 56 percent of Alaska's 1.78 million visitors were cruise ship passengers, according to the Alaska Visitor Statistics Program. The vessels bring with them air pollution, sewage waste and crowds. But they also bring tax revenue, inject outside money into local economies and provide jobs to Alaskans and non-Alaskans alike.

Bob Bartholomew, finance director for the city and borough of Juneau, said Alaska's capital city has seen a 3% increase in passengers as of July 31 over the same period in 2015. Sales tax revenue generated by cruise passengers is on pace to hit $7.7 million this year. The head tax will likely bring in the same amount, he said.

Juneau sees more cruise ship passengers than any other Alaska community, but Bartholomew said their USD 250,000 additional contribution to local government coffers this year will not make up for the loss of close to USD 4 million in state funding resulting from budget cuts.

Alaska is competing on a global scale against Caribbean, Asia, Antarctica, also European river cruises.

With cruise companies building bigger and bigger vessels, Port Juneau recently installed a new cruise dock for ultra-large vessels. A second dock is set to be completed by 2017.