Let's say, just hypothetically, that Washington was facing a ginormous budget shortfall to the tune of maybe $6 billion. And let's also say that the state had made an ambitious -- but mostly unfunded -- commitment to cleaning up Puget Sound. That would be a real pickle.
You know what I'd do?
I'd levy a tax on the cruise ship industry, that's what.
Washington's cruise ships are only lightly regulated -- by barely enforceable agreements -- sometimes to the detriment of our local marine environment. Low-grade diesel from the smokestacks fouls urban air on the waterfront and cruise ships have had some nasty "accidents" that resulted in dumping tons of raw sewage straight into the Sound.
Adding insult to injury, cruise ships visiting Washington do not even pay head taxes as they do in Alaska, which means that during the worst fiscal crisis in recent history Washington is missing out on badly-needed revenue -- revenue that could fund valuable environmental protection and oversight programs.
Consider how cities do it up north. The city of Ketchikan, in southeast Alaska, levies a $7 per passenger tax on cruise ships that visit the port. And the capital city of Juneau levies an $8 per passenger tax.
By contrast, Seattle -- which recently edged out Vancouver, B.C. to become the most popular point of departure in the Northwest -- levies exactly nothing. If the Emerald City were to charge an Alaskan-type fee on the roughly 886,000 cruise passengers?that left Seattle in 2008 it would have netted around?$7?million. Now, granted, that's not going to fund the complete restoration of Puget Sound, but it might fully fund an important program or two -- the very kind of small-caliber but high value programs that are now on the chopping block of budgetary constraints.
That's not the half of it. The state of Alaska also levies a $50 per passenger tax. What would happen if Washington did that?
At $50 per passenger, Washington would pull down $44 million?per year?even if you?count only the passengers that embark from Seattle. Once again, $44 million won't cover the whole price tag for Puget Sound clean-up, but now we're talking about real money that could be put to good use in shoreline restoration, contaminated sediment clean up, spill response teams, or dozens of other important uses.
How would a cruise ship charge work? For a variety of reasons it might make sense to structure Washington's charge as a fee rather than a tax. Among other things, a fee could keep the money out of the state's general fund, though it would likely also necessitate using the fee revenue on projects related to the cruise ship industry. Given the serious environmental impacts of the ships, finding a nexus between the fee and using the revenue for environmental protection shouldn't be difficult. Puget Sound has many dire financial needs, and a cruise industry tax can at least plug a few holes.
Better yet, a tax isn't regressive. In fact, it's explicitly a tax on the well-heeled: on those who can afford to splash out on a cruise vacation. It doesn't discourage small businesses or homeownership and it doesn't annoy property owners, as other fees and regulations are sometimes alleged to do. In fact, a cruise fee would mostly be paid by people from out of state.
It's possible, I suppose, that a cruise ship fee could result in some cruise lines diverting to Seattle's main competitor, Vancouver, B.C. But given the similar funding needs for marine protection in British Columbia and a history of cross-border collaboration, there's no reason why the state and the province couldn't work out some mutually agreeable solution. Here's an idea: BC could follow suit with its very own $50 per passenger fee. That would keep the playing field level for economic competitiveness while boosting environmental efforts in the shared waters of Puget Sound and the Strait of Georgia.
Alaska's cruise ship tax, which was originally the product of a citizens initiative, does even more. It also levies a corporate income tax on cruise line earnings; it even taxes the gambling profits that are earned while the ships are in Alaska waters. That's yet more revenue for Alaska and a tighter leash on an industry that sometimes has trouble playing by the rules. Washington may want to consider those as alternative sources of revenue.
It's not often that the Evergreen State takes environmental cues from Alaska. But when it comes to cruise ships, we're way behind our northern neighbors.