Ketchikan City Council to consider head tax tweak aimed at freeing up port revenue

Ketchikan may change how it levies its $9 head tax on visiting cruise ship passengers. Ketchikan’s City Council is scheduled to take up a proposal to reconfigure the city’s biggest source of port-related revenue Thursday.

 

The proposal would tweak how the city levies a $9 tax on cruise ship passengers.

As it stands, the city bills the cruise lines directly. The city’s proposal would reword language in the law to apply to passengers. Cruise lines would be responsible for collecting that tax and sending it to Ketchikan.

“The idea of levying a fee on the passengers that’s collected by the cruise lines makes absolute sense,” said Joe Geldhof in a phone interview Wednesday. He’s an attorney in Juneau, and he knows a thing or two about head taxes — he wrote the initiative that created Juneau’s local head tax in 1999.

Cruise passengers already pay Alaska’s head tax. It’s baked into their cruise packages. But the change in wording is a workaround due to a federal ruling that limits how city head tax money can be spent locally.

That’s because the cruise industry challenged Juneau’s head tax in 2016. A federal judge upheld the fees but ruled it could only be applied narrowly to services tied to the ships themselves.

Ketchikan has retained attorney Bob Blasco, who defended the City and Borough of Juneau in that case, says there’s a legal workaround. In a legal opinion commissioned by the city, he argues that by levying the fee directly on passengers, those restrictions would be looser.

Blasco couldn’t be reached for comment Wednesday afternoon.

But Juneau attorney Joe Geldhof says rewriting the ordinance won’t remove all the strings attached to head tax money.

“But they will have, relatively speaking, more ability to target the money collected, the fees collected, to mitigate and offset the impacts of having large numbers of tourists involved in what’s still a relatively small town,” Geldhof said.

So that money could, in theory, go towards restrooms, parks, lighting — amenities used by the passengers that pay the fee. It follows the model set by the state’s own head tax, which Gedlhof helped craft in 2006.

Ketchikan’s City Council is scheduled to take up the proposal at its next meeting, Thursday at 7 p.m. at the Ted Ferry Civic Center. The full agenda is available online, and the meeting is broadcast on local cable channels live-streamed at the city’s website. Public comment will be heard at the beginning of the meeting.