Tourism

At the Model Arctic Council, tomorrow’s Arctic leaders are already having an impact with helping shape today’s Arctic policy.

The Arctic Council returns to Alaska with meetings in Juneau this week and in Fairbanks in May. Representatives from eight Arctic countries and six indigenous groups work on shaping Arctic policy.

To understand the work of the Arctic Council first-hand, a group of university students met in Fairbanks last spring to form a model council with real-world impacts.

The Model Arctic Council is a simulation where future leaders in Arctic and international affairs hone their negotiation, communication, leadership, critical analysis and research skills. It’s much like the Model United Nations in high school. But, this time, its college students role-playing representatives from circumpolar countries as they tackle problems together in a rapidly changing Arctic.

Sixty-three college students from 13 countries, ranging from Iceland to Venezuela, compressed as much as two years’ worth of work into a little over a week.

Veronica Guido, an indigenous student with a degree in political science from York University in Toronto, said they either represented the Arctic Council’s member states or non-voting representatives of the various circumpolar indigenous groups.

“You have the indigenous groups from Russia. You have the Saami Council, Inuit Circumpolar Council, Aleut, and you have the Arctic Athabaskan,” Guido said. “Then I represented Gwich’in which is more of First Nations from Alaska and Canada. That was my role.”

Mary Ehrlander, director of the Arctic and Northern Studies Program at the University of Alaska Fairbanks, was a faculty adviser to the group. She said they tried to match indigenous students to a role that was close to their ethnic background.

“Because we wanted to have authenticity in that way,” Ehrlander said. “On the other hand, some of the students seem to have the greatest experience with trying to play a role that wasn’t them at all. It was really a learning experience for them to take on that identity and try to perform it.”

Students prepared research papers on topics such as sustainable cruise tourism in the Arctic, managing maritime traffic for marine resource development, and human health and well-being in the Arctic.

Eva Wu, an undergrad from McGill University in Canada studying the interplay between health and environment, said she was impressed by the level of preparation and critical analysis demonstrated by her fellow students.

“It was really amazing the amount of people and the variety of people who were in the room,” Wu said. “They provided numerous different aspects and perspectives of each situation. That really was able to provide the entire program with a holistic focus. People would have expertise in various different areas.”

The Model Arctic Council came up with list of priorities that could be considered by their real world counterparts this week in Juneau.

They include advocating for ratification of an international convention controlling vessel ballast water, the hiring of indigenous people for tourism activities, alternative fuel use in the Arctic, sharing updated hydrographic maps for safe navigation, protecting water sources for communities affected by climate change, and reducing suicide among indigenous groups.

.@USArcticYouth Amb Jonas Mackenzie shares story of his 1st whale hunt w/ #MAC2016 delegates @uafairbanks #ASSW2016 pic.twitter.com/cnzPjnX8sy

— US Arctic (@USArctic) March 14, 2016

Some students play the role of each country’s representative to the Arctic Council, while others represent the various indigenous groups, called Permanent Participants, as they all discuss and debate the projects.

“I took my role very personally,” said Guido, reflecting on her role as the Gwich’in representative. “It was really great to see other people respect that and stay in their role while still getting over the shock factor of having the actual Permanent Participants speak just as loudly or louder than the actual nation states. I enjoyed that part, that’s for sure.”

Piotr Graczyk, a faculty adviser from University of Tromsø The Arctic University of Norway, said most of the work and consensus building usually happens at the lowest level of the Arctic Council.

“The structure is quite different. And from one level, you go to another level. On the first level, working groups work on the projects,” Graczyk said. “When they’re approved and when there is consensus, you go to the next level, the level of the senior Arctic officials.”

Once consensus was reached, students role-playing SAOs or each country’s representatives to the Council vote on the proposals, but the Permanent Participants don’t get to vote.

@UAFairbanks student delegate, Adam Zamudio, provides the US position regarding Northern suicide challenges#MAC2016 pic.twitter.com/Ur88LS4iLU

— Troy Bouffard (@ArcticTroy) March 11, 2016

Rhiannon Klein, who’s studying public policy at the University of Saskatchewan, said it works much like the real world Arctic Council.

“The Arctic Council is not legally binding, necessarily,” Klein said. “They don’t have direct influence on making the policies at the government level in each of the countries, but they truly have an impact on shaping the policies that happen. I believe that the Arctic Council has quite a bit of sway within decision-makers in each of the Arctic state countries.”

After 2016 Model Arctic Council, @saochair Amb Balton requested copy of students’ Fairbanks Declaration @Arctic2016 pic.twitter.com/8RNnAz8Ytn

— Melody Brown Burkins (@mbbvt) March 15, 2016

Last spring’s meeting of the Model Arctic Council coincided with the real Arctic Council meeting. Guido said Council members grabbed copies of their final document called the Fairbanks Declaration, as well as her fellow student’s research.

“People approached them from the actual Arctic Council asking to read them further,” Guido said. “So, I know a lot of students didn’t expect anyone to read our position papers either.”

Students were also approached by the Canadian Department of Foreign Affairs, Klein said.

“They’ve asked to see all the student’s position papers as well, to pass them around the Ministry,” Klein said. “It’s just incredible to see that people are actually interested, too.”

Students’ proposals are now expected to show up on the agenda in future meetings of the real Arctic Council, including in Alaska this spring.

Juneau is moving toward exempting transactions aboard docked cruise ships from local sales tax. The initiative is touted as bringing the city in line with other Southeast communities.

There’s been little public discussion about the proposed sales tax exemption since it was introduced at an Assembly Finance Committee meeting.

“It behooves us to try and be good neighbors with the folks that like to come here and do business and try and continue to keep them coming here and doing business,” Juneau Deputy Mayor Jerry Nankervis said at Jan. 11 the meeting.

The exemption would still levy sales tax for tours sold by local operators aboard ships. But onboard services like food and drink, and services like spa time or hair cuts and massages would be exempt. The city hadn’t been collecting the tax until Disney Cruise Line filed with the city in 2011. The city won’t say how much the company’s paid since because it’s proprietary information.

Ketchikan already has an exemption on the books. And it seems to be standard practice for many cities and boroughs not to collect sales tax from onboard sales.

Juneau’s Finance Director Bob Bartholomew said Juneau is, “trying to be consistent among the ports. So that for the industry they’re kind of having to try to have similar rules.”

He stresses that state and local fees are levied on all passengers who pass through Juneau’s waters.

“Whether they disembark or stay onboard, we receive $12.50 and that is covering the cost of using the port, the building of the facilities and some of the direct city services,” Bartholomew said.

The city’s finance department last year analyzed the issue at the industry’s request, and concluded that cruise ships are legally liable to charge their passengers local sales tax.  And if it did, the industry would be on the hook for between $50,000 to $100,000 annually.

Juneau’s business groups have stayed out of the debate. Neither the Downtown Business Association nor the Chamber of Commerce have taken a position. The city estimates it collects about $8 million in sales tax from cruise ship passengers who come ashore — an indicator of the amount of cash injected into the local economy.

Not all business owners are comfortable with the exemption.

“I think there are some business owners who are so intertwined with the cruise ship companies that it’s difficult for them to speak out on something like this. And there are a lot of businesses that have this perception of ‘don’t bite hand that feeds you,'” said  Pat Race, who co-owns a comic shop and video production company in Juneau. “And I can absolutely understand that. But I think that we need to have a sense of fairness on how the city deals with businesses and the people who remit sales tax.”

He’s written to the Assembly questioning the wisdom of carving out an exemption for a large industry while aggressively enforcing sales tax on small fry.

“One of the goofy local events I host is a comic convention and when I brought people to town, I went to the sales tax office and got paperwork and I handed it out to all the people who were visiting town,” Race said. “So we’ve got these people who are guests to our community coming into town and making like $10 to $20 worth of sales who are remitting sales tax and then we’ve got these giant cruise ships that are doing the essentially the same thing on a much larger scale but they don’t have to remit a sales tax.”

Even so, if the emails written to the Assembly in recent weeks are an indicator, the sales tax exemption does have support within the community. So far just one Assembly member has gone on record to oppose the exemption.

“If I go to the barber, I’ve got to pay sales tax and the barber has to send it in. So it’s just fair and equitable tax treatment to apply the same rules to everybody,” said Assemblyman Jesse Kiehl. He notes that cruise ship companies make millions in commissions on tours sold on board – so fears that local taxes would drive them away are overblown. “I think this is not an exemption that makes economic or policy sense.” 

If Juneau seems like it’s playing favorites, it is. Bartholomew said incentivizing key industries is not unknown in Juneau.

“We have in other areas tried to recognize the importance of certain industries,” the finance director said. “So we provide exemptions for manufacturing locally. We provide exemptions for housing, and so this is kind of a standard practice where we’re recognizing the significant value of the industry.”

The Juneau Assembly is scheduled to hold a public hearing and vote on the ordinance at its March 6 meeting.

The Eaglecrest Ski Area’s outgoing manager made a pitch to the Juneau Assembly to allow alcohol sales at the public ski area.

“It adds to the community feel of the ski area,” Matt Lillard said in an interview after the meeting. “People are looking for places to meet, places to get together and a beer and wine venue of that sort is just a good place for adults to meet either after the ski day or during the ski day and enjoy a beer.”

The Eaglecrest board added possible beer and wine sales to its master plan in 2012. Lillard has said on-site beer and wine sales won’t solve the ski area’s budget challenges, it could make the ski area more attractive as a destination.

None of the Assembly members spoke for or against the proposal. Assembly member Loren Jones said he’d sought legal advice from the city attorney’s office over any liability issues for the city and would present its findings to the Eaglecrest board when it meets on Thursday.

The Assembly would need to amend an ordinance to allow beer and wine to be sold in lodges. Nothing has been drafted and any decision is still at least several weeks away.

Lillard’s last day at Eaglecrest is Thursday. He’ll be taking the helm of a small cooperatively-run ski area in Vermont.

Alaska National Parks can hire the hundreds of seasonal employees they need to keep up with summer operations.

Seasonal staffing was thrown into limbo when President Donald Trump ordered a federal hiring freeze in January. After about a month of questions and waiting,

Alaska national parks can now get to business hiring summer staff.

Mike Tranel is superintendent of the Klondike Gold Rush National Historical Park in Skagway. In December and January, the Klondike Park was interviewing summer job applicants and checking references, as usual.

But before they were able to make final job offers:

“We just had to tell them that it’s on hold for now until we get final approval,” Tranel said.

That’s because the parks weren’t sure how their summer hires would be impacted by a federal hiring freeze Trump announced shortly after he took office.

The Pentagon announced Jan. 31 exemptions to the freeze, including seasonal and temporary staff “necessary to meet traditionally recurring seasonal workloads.”

It wasn’t until late last week that national parks got the final green light.

The park service needed to get seasonal hiring plans approved by the Federal Office of Management and Budget.

A park service spokesperson said Friday, Feb. 17, the federal budget office granted its approval.

“So now we’re able to go back to (job applicants) and officially offer them the job,” Tranel said.

The Klondike Parks’ operations in the winter versus the summer are like night and day, which is true for a lot of national parks.

In Skagway, nearly a million cruise ship visitors come to town each summer.

The park is a big piece of the infrastructure that educates and entertains visitors, giving tours of historic Skagway and overseeing the popular Chilkoot Trail. It takes about 30 seasonal staff and 30 year-round employees.

“We have about half or slightly more than half of our employees overall are seasonal,” Tranel said. “It’s obviously a very important part of our staff and we’re looking forward to having them be here on time, ready to go so we’re ready for that first ship day.”

Glacier Bay National Park is about 70 miles south of Skagway.

The superintendent there, Philip Hooge, found out Monday that he would be able to hire about 70 summer employees.

“It was exciting to see that,” Hooge said. “Exciting to see that we’re going to be open for business this summer, our quite large operation.”

Glacier Bay also serves hundreds of thousands of cruise ship visitors during the summer.

But the interaction is different – instead of the ship docking and passengers going on land, park rangers are shuttled on board the ships to give talks there.

Hooge thought the seasonal workers would be approved eventually because they are so vital to national parks’ operations.

The delay caused by the hiring freeze may mean some of their top candidates took jobs elsewhere, he said.

“We know that when we go out to do offers, some of the people that we would have liked to catch will have found other positions because of the delay,” Hooge said.

Both Hooge and Tranel said the month of uncertainty caused by the hiring freeze was inconvenient, but it won’t hurt their ability to hire enough staff for the summer.

The same goes for Denali National Park.

Public Information Coordinator Katherine Belcher said the park’s plan to hire about 200 seasonal staff has not been disrupted.

The budget for state-funded tourism marketing has been cut by nearly 80 percent, but Alaska’s tourism industry continues to grow. Visitor counts for 2016 aren’t available yet, but in 2015, the state attracted a record 2 million visitors.

The Alaska Travel Industry Association, or ATIA, is pushing for millions in state funding, as well as something it calls a Tourism Improvement District, or TID.

Industry consultant John Lambeth explained the concept of a TID to the Senate Finance Committee on Jan. 24.

“You have special assessment districts and business improvement districts here in Alaska. It is based on that model,” he said. “It is an industry self-assessment. Industry comes together, sets the rate, decides how this money is gonna be spent, and ensures the efficient, effective spend of these dollars to promote more travel and tourism.”

Prior to the release of the governor’s budget, ATIA requested that the $9.7 million collected from the state’s car rental tax in 2015 be redirected to tourism promotion. They repeated their request during the hearing, calling their plan for funding tourism promotion a “partnership with the state.”

One casualty of the budget cuts was a Alaska’s Official State Vacation Planner. a 51-page, full-color magazine that goes out to about 470,000 people each year, according to the Department of Commerce. The association says it costs about $3 million to create, produce and distribute. The magazine is still available online.

Sen. Anna MacKinnon, co-chair of the Senate Finance Committee, expressed interest in the idea of a Tourism Improvement District, but was not optimistic about additional funding given the state’s budget crisis.

“My comment to you is that expecting $9.5 million out of the general fund is probably unrealistic,” she said.

The TID and direct state funding are separate policy calls, but MacKinnon was able to read between the lines of what the industry was asking for.

“To just put it very bluntly, you believe you have a higher likelihood of Alaska businesses moving forward and taxing themselves to create a destination marketing plan, if the state had some sort of contribution into that,” she said.

Industry leaders like Lambeth say that Alaska’s economic situation is precisely why lawmakers should consider reinvesting in tourism.

“If you invest in travel promotion marketing, that creates additional demand, that demand creates visitor spending, and that in turn creates tax revenues and jobs,” he said.

Sen. Peter Micciche said that the low energy prices that have otherwise devastated Alaska’s economy are one of the driving forces behind the high visitor numbers in Alaska.

“We’re suffering from low fuel prices; we’re enjoying a higher visitor rate. So there is a benefit there directly. I don’t think you’re going to see a reduction,” Micciche said. “I think you’re going to continue to see an increase in visitors in the tourist industry. What’s difficult to quantify is how much higher the growth would have been with higher funding.”

While it’s true that Alaska hasn’t seen a decline in visitor numbers, some argue that state dollars are necessary for local communities to benefit from tourism.

Colleen Stephens, who owns a wildlife cruise company in Valdez, says that state dollars are vital for small businesses like hers.

“You will see large ships, large cruise ship companies or large corporations. … They have the financial backing to fill their assets,” she said. “They do get support from the state program, but it is your Alaskan-owned businesses that are going to feel the larger impact from diminished marketing dollars to drive traffic to the state.”

The industry hasn’t come forward with a TID bill, but says that it could quickly draft legislation.

A $54 million project to add a pair of floating cruise ship berths to Juneau’s downtown waterfront is within months of completion.

The project will expand the port’s capacity to accommodate larger vessels. That’s because cruise ships in Alaska are getting bigger.

Juneau’s Docks and Harbors has been working to expand its terminal to keep up with industry requirements.

The city’s Deputy Port Engineer Erich Schaal said the downtown Alaska Steamship Dock was limited to tying up ships greater than about 800 feet. And the southern Cruise Terminal or CT dock, was not much longer.

“The original max length that we could receive at our southern CT dock was 960 feet and now we’ll be able to receive a 1,000-foot vessel and an 1,100-foot vessel at the same time,” he said.

Seattle-based Manson Construction is the lead contractor working to expand the cruise ship berths.

A 25-strong crew from the firm has been working double shifts drilling and driving piles in the daytime and welding in the evenings.

The final work should be wrapped up by May 7, project manager Monica Blanchard said.

Given all the activity on the water there’s not a lot of extra space for different ships to get in and out of the harbor.

Schaal said there was a lot of back and forth between different interests in settling on the final design.

Gastineau Channel has a busy summer season mixed with fishing boats, private yachts and cruise ships all competing for dock access in the summer.

“This side of the dock is closer to shore than the south side and that’s because back in the design and we were working with stakeholders, especially the fishing fleet, they needed more access to the Taku Dock,” he said. “The original design was more parallel with the dock and there was going to be a kind of smaller area between the two.”

The cruise ship industry says the new dock still isn’t as big as it should be.

“We felt that the best design would be a new dock that handled two of the larger class ships,” said John Binkley, president of the Cruise Lines International Association Alaska, which represents companies sailing state waters. “The new class ships will be over 1,000-feet long. And we felt that it was wise to — in terms of an investment of this size — to have a dock that could handle two of those ships and leave the existing dock in place.”

Alaska is projected to receive larger vessels because bigger liners are now able to transit an expanded Panama Canal to arrive from the Carribean in the summertime, Binkley said, as well as a response to consumer demand.

“They like bigger ships, there’s more amenities, more variety of things to do on the ships and it’s also an economic reason,” he said. “The larger the ship just like with a bus or a car or an airplane, the more passengers you can get on, the better the economics are.”

The final project wasn’t without other local controversies.

For a quarter-decade the Blessing of the Fleet has been held at a dockside monument maintained by the Alaska Commercial Fishermen’s Memorial. The group challenged the city’s design in court  but its legal efforts were ultimately unsuccessful.

Memorial President Carl Brodersen said the court fights are over and now the board is focused on trying to find it a new home.

Until that time, the blessing ceremony is scheduled to go ahead in the midst of the expanded cruise ship terminal.

“It is very hard for the two elements to co-exist and for both to function perfectly for their individual purposes. I mean we essentially do have an enormous wall of cruise ship in front of the memorial right now,” Brodersen said. “But the ceremony is over 25 years old — we can’t just stop doing it.”

Standing next to the new floating berths under construction, Assembly member Jesse Kiehl attended a recent tour to see the progress.

He said the new cruise ship terminal will aid the local economy.

“I really like that we’re replacing this infrastructure for the next 50 years of this piece of Juneau’s economy,” Kiehl said. “Of course, the added benefit is that Juneau sales tax and property taxpayers aren’t footing this bill. This is coming from taxes that the industry and the passengers pay for the services that we provide.”

The first cruise ships are scheduled to arrive on May 1 in Juneau. They are the Nieuw Amsterdam and the Eurodam, both 935-foot-long, Signature-class vessels operated by Holland America Line.