It’s a topic of discussion at every borough assembly and port commission meeting: how can Skagway get a floating dock? But a second question comes to mind as assembly members discuss mitigation, fault and looming deadlines: what will happen if Skagway doesn’t get one in time?
Norwegian Cruise Line’s Breakaway Class and Breakaway Plus ships are rumored to arrive in the next year or two–some say 2017, others say 2018. NCL’s Public Relations Specialist Christina Baez said while no Breakaway class ships are currently scheduled to set sail in Alaska, “our Alaskan itineraries are certainly very popular with our guests, therefore any port enhancements would be well-received.”
One year or two, the timetable is tight. The municipality has a year to spend $7 million of a state port improvement grant, seven years until the White Pass and Yukon Route railroad’s lease is through, and layers upon layers of contamination to clean up in between now and then. Can it be done? If not, what picture does that paint for the Port of Skagway?
NCL’s largest Breakaway Plus Class ship is the Escape, boasting a guest capacity of 4,248 at double occupancy. Currently the ship sails to the Caribbean, Bahamas and Florida. But for the sake of numbers, let’s say it comes to Alaska.
Currently NCL sails three ships into port: the Jewel, Pearl and Sun. The Pearl is the largest of the three, bringing 2,394 passengers to port 20 times this summer. The Jewel is only slightly smaller, carrying 2,376 and also visiting 20 times. Were each ship to arrive full, they would bring a combined 95,400 visitors to town.
A 2012 Juneau and Southeast Alaska Economic Indicators report says a typical port-of-call passenger spends an average of $150 during their visit to Skagway. For the Pearl and the Jewel, that’s an estimated $14.3 million in revenue during the course of one summer.
Comparatively, should the Escape visit 20 times, it would bring in $12.7 million–$2 million shy of the other two ships combined. This summer, an estimated 791,260 visitors are coming to town. At $150 a head, that’s $118.7 million over the summer, making the Escape’s $12.7 million, or the Jewel and Pearl’s combined $14.3 million, nearly 10 percent of the summer’s profits.
WP&YR Executive Director of Human Resources and Strategic Planning Tyler Rose said while it’s purely projection, the trend tends toward economies of scale.
“This ship is going to replace two ships that you’ll take somewhere else and eventually cycle out of the market,” he said. “The bigger you can build them, you cut down on your crew size, you cut down on your fuel expense, you cut down on everything.”
The inability to accommodate a Breakaway ship could mean the loss of 10 percent of Skagway’s traffic.
It would also mean a loss of $424,800 in Commercial Passenger Vessel excise tax. The municipality receives $5 from the state for every person that comes to port via cruise ship.
The lack of a floating dock equals big losses for Skagway. How does the municipality prepare?
The Ore Basin is out of the question until it can be cleaned up. The Alaska Department of Transportation has made it clear that partnering on a floating dock isn’t in the near future. But what about the Railroad Dock?
WP&YR President John Finlayson said he’s not sure if building a floating dock at the end of the Railroad Dock would even work, adding that White Pass hasn’t gone down that road yet.
“Right now we’re hopeful we can work out something with the city,” he said. “I think doing the floating dock on the Ore Dock is the best possible solution for everybody involved.”
In an interview, borough assemblyman Steve Burnham Jr. agreed that it’s likely one large ship will replace two smaller ones.
“I’ve always looked at it like getting a floating dock for the Breakaway class ship is important to sustain the current economy, not necessarily improve it,” he said.
Despite talks among the assembly of meeting with White Pass, Burnham said nothing has been scheduled, and it’s largely due to the lack of a negotiator. While it should be someone the community trusts, he said it really doesn’t matter who is negotiating, as the direction will come straight from the assembly.
“If we make the wrong decision, the public should be looking at us,” he said.
But at the end of the day, discussions must be had with the railroad.
“I’m not necessarily saying that cutting another negotiating deal with the railroad is what we need to do, but I think it’s the only way that we can feasibly do a floating dock in the timeline necessary and be a partner on it,” he said.
If a year goes by and the municipality has not utilized the $7 million, and Burnham is not optimistic they will, he said everything would ride on someone else paying for the infrastructure.
Now both the assembly and White Pass need to decide what they want and how they are willing to compromise to get it. Will White Pass do as the municipality asks and clean up the contamination in the Ore Basin? Will the municipality negotiate a new lease?
In spite of the hurdles, Burnham said Skagway has successfully attracted visitors for years, even before cruising was all the rage. And for years to come, people will continue visiting the Gateway to the Klondike.
“We’re not closing the doors because we don’t get a Breakaway class dock,” he said. “But if we can get one we should. It’s not an easy thing.”