Vendors hoping to cash in on the record numbers of cruise ship visitors next year in Sitka are going to have to pay for the privilege. The Sitka Assembly on Tuesday adopted a new fee system for outfitters and tour operators, requiring them to bid on the limited commercial space at Harrigan Centennial Hall.

Some vendors complained that bidding – which could run into the thousands of dollars – would ruin the “friendly” spirit among competitors who previously had to pay only $400 to set up shop at the building.

For the last twenty years, the vendor spaces at Sitka’s downtown tourist hub, Harrigan Centennial Hall, have been available to local tour operators and businesses on a first-come-first-serve basis, with a flat rate for permits. But not anymore. When the Sitka Assembly met on December 13 it approved a new policy: Now those businesses will have to secure their spots through a sealed bidding process with a minimum bid of $2,500 for vendors, and $5,000 for outfitters. And commercial vehicles will be required to pay for an annual permit in order to pick up and drop off passengers at the building.

With the number of cruise passengers growing, Sitka’s city administrator John Leach said it was important for the city to account for the added costs to maintain the building, which, in its current setup, is operating in the red. 

But some local tour operators who run their businesses at the city building pushed back. Andy Nye owns one of the tour companies that would be impacted. He worried that the new process would make the vendors competitive and favor outside competition. Right now he said the businesses work together well, and called them the “friends out front.” 

“You pit us against each other with this closed bid. Now we’re all trying to outbid each other. There’s only gonna be 10 spots out there. Last year there were 13 or 14 people, so you’re automatically gonna cut three people out,” he said. “I don’t think we’re quite ready for this, I don’t think this is ready, so what I’m asking you is please don’t vote this tonight. We’re not in a rush.”

“Sitka is a special place,” he added. “And I think this is the first step in turning it into those other places. Don’t ruin the friends out front. Because we like each other. We like working together.” 

Several other operators voiced opposition to the sealed bid process. Some said they should change the permit time from one year to three years, with a lower flat fee. And some said they should open up 20 spaces, not 10. 

Tony Rosas, who manages the building, said they decided to open up 10 spaces next year after observing pedestrian traffic snarls last summer, with a record number of tourists and vendors sharing space in front of the building at the bus pick-up location. 

“What was happening late morning and early afternoon was, at that point, they were starting to line up to get back to the ships,” Rosas said. “And because of the big numbers of people that we had, that whole east side of the building was just jam-packed with people.”

City administrator John Leach pushed back on the idea that larger out of town businesses would swoop in and outbid local vendors. 

“I know some of the argument has been brought up that the larger out of town businesses may come in and outbid,” Leach said and then asked Rosas what the current price is for a space out front. Rosas replied that right now a space costs a $400 flat rate.

“So is there anything preventing one of those larger businesses right now from coming in? First day of opening and paying the $400? And taking that space?” Leach asked. Rosas said there wasn’t.

“Not only am I a business supporter, but I understand at the seat I need to look out for the best interests of the city and all citizens and covering our expenses at this facility. And giving maximum value to the citizen is very important,” said assembly member Chris Ystad of the ordinance. “So I’m conflicted. All in all, I’m very conflicted. It’s not an easy one.”

Ystad and other assembly members were open to the concerns voiced by business owners and said they would consider making changes to it, and member Thor Christianson said he’d be open to making the lease multi-year or changing the bidding process from sealed to open, and he said he may even bring ordinances to amend the legislation in the coming weeks. 

“I expect this not to be the final answer,” said assembly member Tim Pike, who said he’d vote yes to start the process, but hoped to see some changes by the summer. “I think that it’s important for us to put out [that] it’s for sure the framework, so that people understand where we’re headed. And we can adapt it so that it fits the needs of our community,” he said.

Ultimately the assembly passed the ordinance, as written, on a 5-1 reading with Chris Ystad opposed.

If assembly members do bring amendments to the table, however, it’s unlikely they’ll impact the permit process for next summer’s cruise season. City administrator Leach said that staff were planning to move quickly once the ordinance passed, and he wasn’t optimistic that any big changes to the ordinance, which would require at least two readings at the assembly table, would be finalized in time to go into effect this summer.

On the biggest days of the cruise season this summer, Sitka could double in size. Last spring, Sitka Sound Cruise Terminal owner Chris McGraw announced the recent expansion of his private cruise ship dock meant a very big tourism year was in the works. The community could see around 480,000 cruise ship passengers from the end of April to early October.

And the mad dash to prepare began. The city’s Planning Department is focusing primarily on triage this season, with more long term plans to come next year. Commissioners presented the document to the Assembly during a work session on Thursday (1-13-21). 

View the short-term tourism plan here

Listen to our interview with Planning Director Amy Ainslie here

Assembly member Crystal Duncan wondered how Sitka’s tourism boom will compare to other Southeast communities’.

“There are other cruise ports that are anticipating numbers similar to ours,” Duncan said. “Have we been able to touch base with those planning departments or those municipalities to figure out what they’re going to do to accept this type of traffic this season?”

Planning Director Amy Ainslie said that while most communities are seeing growth this year, none are seeing an increase comparable to Sitka’s. 

“In the last couple of years, we’ve been at about 200,000. So for us to go to 480,000 is, you know, more than doubling sort of what we’ve had as the norm,” Ainslie said. “Whereas, you know, communities like Juneau are going from maybe like 1.1 million to 1.3 [million passengers]. So as a percentage change, as like what is kind of normal life and how much they can absorb? Places like Juneau, Ketchikan, and Skagway are positioned very differently than Sitka.”

And with that staggering increase come a lot of questions about everything from traffic to toilets and cell phone service, and right now not all of those questions have clear answers.

The biggest change is a possible Lincoln Street closure on ship days of 3000 or more passengers, which is nearly half the cruise season. That’s what the Planning Commission is recommending, but another option is making the street one-way all summer long. Ainslie asked which option the Assembly preferred. But several Assembly members, including Kevin Mosher, said he wanted more community feedback before making a decision. 

“My only concern is, I’m just hung up on how we handle Lincoln Street,” Mosher said. “I don’t know which way I’m going to vote, you know. I might end up going one, complete closure… [it’s] just a hard pill to swallow it, you know, to think about that.”

Assembly member Thor Christianson, the planning commission liaison, said the one-way option was the “worst of both worlds” for traffic and safety. 

“We’re still going to have a lot more congestion. And we’re throwing in a safety aspect. And it won’t be very easy to drive down there. I mean, it’ll be hard to drive through,” Christianson said. “So I don’t know…I guess it would be better than not closing it at all. But it would it would be rough.”

Closing Lincoln Street is further complicated by the state’s plan to resurface a section of Sawmill Creek Road, widen its sidewalks and add bike lanes- making sections of two of Sitka’s main corridors inaccessible to vehicles for a large portion of the summer.

What the Assembly ultimately decides about Lincoln Street will affect the overall budget. While the city could profit tremendously from a boom tourism year, it will cost anywhere from $1.2 to $1.5 million to prepare for this summer. The plan’s budget includes everything from $300,000 for temporary bathrooms to $100,000 for an ATV ambulance for use at the cruise ship dock. The Assembly will likely draw from the $1.6 million held in the city’s Cruise Passenger Excise Tax fund –  that’s money collected by the state from cruise ship head taxes that must be spent on items and services for cruise tourists.

Since the meeting was a work session, no public comment was taken on the draft plan. The Assembly will consider the plan on first reading at its next regular meeting on January 25.

When the Sitka Assembly met on Tuesday (3-9-21), it voted to develop a tourism master plan.

With Canada’s cruise ship ban in effect through the beginning of next year, it’s looking like 2022 will be the next big year for Sitka tourism. And it could be really big. The vote directed the city’s Planning Commission to develop a plan that could address the logistical challenges a booming cruise ship season might pose for the city.

Assembly member Rebecca Himschoot said the hope is to develop a plan that works for tourists and for residents. 

“We have heard we may have a major influx of visitors as soon as 2022,” she said. “I’m thinking of questions like transportation for visitors, transportation for Sitkans…I envision something that would address what we do when there are 1000 visitors in town and when there are 10,000 visitors in town.”

Member Valorie Nelson wondered if the information was already available in the city’s comprehensive plan. City administrator John Leach said the plan would serve to address more of the “tactical” concerns that the comprehensive plan doesn’t tackle. 

“We want this plan to focus on things like, where if we get two or three cruise ships in town at the same time, and we have this large influx of people, should we consider, you know, shutting down Lincoln Street for a period of time so pedestrians can visit the stores and walk?” he said.

City Planning Director Amy Ainslie said projections for 2022 are looking very promising.

“I remember growing up and having three, four ship days and it was busy downtown but it didn’t seem to be unmanageable,” she said. “So I went and pulled as many passenger numbers I could from the Chamber of Commerce…and the largest passenger year we’ve had is around 280,000 passengers  in a single season. The forecast that we’re starting to see right now is upwards of 400,000 passengers.” 

Ainslie said that while it isn’t unusual for Sitka to host two cruise ships in a day during the summer season, Alaska is expecting the arrival of bigger vessels like “Neopanamax” cruise ships in 2022, which can hold upwards of 4000 passengers. Two of those in a day is very different from two smaller Holland America boats, Ainslie said. 

The assembly unanimously voted to direct the planning commission to begin developing a tourism master plan.

In other business, the Sitka Assembly:

– Approved a purchase agreement for raw water in bulk for export between the city and borough of Sitka and Arctic Blue Waters Alaska Inc. on a 4-3 vote with members Valorie Nelson, Kevin Mosher and Mayor Steven Eisenbeisz opposed

-Unanimously appointed Stephane Hawney to an unexpired term on the Health Needs and Human Service s Commission and Geraldine Laux to a three-year term on the LEPC

-Unanimously reappointed Chris Ystad to a two-year term on the Gary Paxton Industrial Park Board, and Robert Sam to a three-year term on the Historic Preservation Commission

-Unanimously approved the minutes of the Feb 18, 23 and 25 assembly meetings

-Unanimously approved a new standard marijuana cultivation facility license application for AKO Farms

-Unanimously approved a transfer of ownership application from Anne Cleaver Weed Dudes to Weed Dudes Incorporated 

-Unanimously approved a liquor license renewal application for The Channel Club