“We got too many pigs for the tits,” Port and Harbor Advisory Committee chair Terry Pardee said, summarizing the dilemma facing committee members at a joint meeting with the Tourism Advisory Board on Feb. 6.

The two groups had gathered to discuss Port Chilkoot Dock renovations in the broader context of renovations needed at other port and harbor facilities. “We don’t have enough money to pay for everything. We need to target whatever benefits the most people,” Pardee said, a theme central to many Haines Borough capital project discussions.

Those present listed port and harbor facilities in need of renovations including: the Lutak Dock used to ship freight, the Small Boat Harbor which serves pleasure craft and commercial fishing vessels, and the Port Chilkoot Dock which primarily serves the cruise ship industry. The conversation centered on two projects: a drive-down work float in the Small Boat Harbor to allow members of the commercial fleet to more easily load and unload gear and a new lightering float at the Port Chilkoot Dock to better serve the fast ferry and boats carrying passengers to shore from cruise ships that anchor offshore.

According to a borough list of potential capital projects for the next 10 years, Lutak Dock renovations would cost $24 million, a new lightering facility would cost roughly $4.5 million and a drive-down work float would cost $3 million. In an effort to conserve limited funds, harbormaster Shawn Bell suggested that committee members consider combining the lightering float project with the drive-down float to create a year-round, multi-use facility in the Small Boat Harbor.

The prospect of combining the two facilities raised concerns for members of the Tourism Advisory Board. Chair Andy Hedden said he had a problem with the idea of busing passengers coming off large cruise ships to the Small Boat Harbor to board the fast ferry to Skagway. “Part of the appeal of Haines is getting people to Skagway to go on the train efficiently… I understand the idea of joining forces to get something done, but I think it’s a bit of a reach.”

Port and Harbor Advisory Committee vice chair Norm Hughes said his concern was that the current lightering float at the Port Chilkoot Dock was getting use it wasn’t designed for as catamarans have increased in size. “Eventually it’s going to hit the end of its life,” he said. He suggested that commercial passenger vessel tax funds from either the borough or the state could be channeled toward renovations.

According to state law, cruise ships in Alaska must pay $34.50 per passenger per voyage to the state. These funds get deposited in the state’s commercial passenger vessel tax (CPV) account. Subject to appropriation by the legislature, the state then distributes $5 per passenger to the first seven ports of call on a ship’s voyage.

Any leftover funds that remain in the state’s CPV account can be used for projects throughout the state that “improve port and harbor infrastructure, provide services to commercial passenger vessels and the passengers on board those vessels, or improve the safety and efficiency of the interstate and foreign commerce activities in which the vessels and the passengers on board those vessels are engaged.”

The legislative finance division estimates roughly $31 million will be available for appropriation in the state’s CPV account for the fiscal year that begins on July 1, 2020. Of this, $21 million will be distributed to individual communities along cruise routes. The remaining $10 million will be available for use by the state, which could direct it toward any number of projects. The governor’s proposed capital budget for the coming fiscal year includes $3.1 million from the CPV account for a rail-port connection in Seward.

Hedden said he liked the idea of finding a way to channel CPV funds toward Small Boat Harbor renovations, but cautioned against getting too creative, citing a recent lawsuit in Juneau. In 2018, a federal judge ruled that the City and Borough of Juneau could only use cruise ship passenger tax funds for projects that directly support cruise ships.

Haines Borough manager Debra Schnabel said it’s unrealistic to rely on the borough’s share of the CVP tax to fund multimillion-dollar harbor renovations since the borough collects only $200,000 annually.

Tourism Advisory Board member Sean Gaffney introduced another potential harbor project that would benefit from funding: a mooring float at the end of the Port Chilkoot Dock. He said the float should be a priority over a new lightering facility as it would allow smaller, 400-passenger cruise ships to tie up instead of anchoring offshore and shuttling passengers to shore.

Cruise ships don’t like to lighter because it reduces the number of passengers who elect to come ashore, and ships make the bulk of their money from selling shore excursions, Gaffney said. Other ports are moving to these types of floats, he said. “At some point, we will really disadvantage ourselves if we don’t have one. This decision will have a big impact on our economy.”

Gaffney said funding would need to come from CPV funds or other outside sources rather than borough taxpayer revenue. He said other communities in Southeast have used either CPV funds or direct investments from cruise lines to renovate harbor facilities.

The joint meeting was a first step toward prioritizing a list of port and harbor facility capital projects. The Port and Harbor Advisory Committee will meet next on Feb. 27.