Juneau Assembly accepts settlement agreement with cruise industry

Cruise ships in port in Juneau in August 2012. (Photo by Heather Bryant/KTOO)

The Juneau Assembly on Friday evening put an end to the three-year legal fight over how it spends money collected from cruise ship passengers.

“Any objections?” Mayor Beth Weldon asked before the final vote. “Seeing and hearing none, Resolution 2852 is passed.”

After a pause, the chambers burst into laughter and applause.

The city announced last week that this agreement with Cruise Lines International Association Alaska, or CLIAA, had been tentatively reached.

The organization is made up of cruise ship companies that do business in Alaska. It filed a lawsuit in 2016 calling Juneau’s $8 tax on passengers unconstitutional, leading to a three-year court battle over how the fees were collected and spent.

A federal judge eventually ruled that Juneau could keep collecting the fees. But the city and CLIAA continued to disagree over how the fees could be spent, leaving open the possibility of an appeal from either side.

Under the terms of the settlement, Juneau will pay CLIAA $1.5 million to cover its legal fees. Eventually, cruise ship passengers will pay for that with the very fee the city and CLIAA have been fighting over.

The city will also pay the remainder of its own $800,000 legal bill with passenger fees.

CLIAA agrees not to object to how the city spends the fees going forward, but both parties will meet annually to discuss those plans. Both parties also agree to continue working together and to settle future disagreements outside of court.

CLIAA Executive Director John Binkley and Juneau City Manager Rorie Watt exchanged thanks at the meeting.

“We’re certainly pleased with the settlement,” Binkley said. “It’s really an opportunity for all of us in the cruise industry and the community of Juneau to move forward. We realize that when we bring visitors here, we are guests in your community, and it’s our primary responsibility to make certain we act as guests and work with you to make certain we sustain and maintain the excellent quality of life for people here in Juneau. So to that end, we want to work together as we go forward. And we’re excited about this, and happy to be turning a new chapter and working together. So thank you.”

“Both parties are relieved to have settled the litigation in such an amicable manner,” Watt said. “While CBJ and CLIAA haven’t agreed on the exact meanings of the law, but both parties recognize solid communication will continue to be necessary to keep the parties together. … I look forward to continue collaboration with cruise ship industry representatives and heartily thank them for their extensive, good-faith negotiations.”

The Assembly unanimously passed the measures Friday allocating the money and authorizing the city manager to execute the settlement agreement.

Read the full settlement agreement between CBJ and CLIA Alaska below:

Jeremy Hsieh contributed to this report.

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