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Inside Passage Towns Implore CDC To Reopen Cruises: Just Back From Alaska

Executive Editor, U.S.
Chris Gray Faust

Apr 13, 2021

Read time
11 min read

The cruise piers in downtown Juneau stand empty, save for a person or two walking their dog. While Alaska's capital city is always quiet in April, different emotions now flow among the residents who run the closed storefronts and restaurants, who manage the fleets of now-dormant sightseeing vessels and fishing charters, helicopters and flight planes.

Desperation. Anger. And a sense that even after following COVID-19 lockdown rules and leading the country in vaccination rates, Alaskans -- particularly those who live in the small Inside Passage communities that depend on the cruise industry directly and indirectly -- are being forgotten.

The state put out a report April 9 that dives into the statistics of revenue and business lost. It estimates that Juneau has lost $33.7 million in taxes related to the cruise industry, Ketchikan city and borough is down $27.2 million. Skagway's losses exceed 100 percent of its operating budget.

But the figures don't tell the true impact. The people do. Throughout our week in Sitka and Juneau in early April, here's what we heard from them.

Two Years Without Customers

The COVID-19 pandemic, with the resulting lockdowns and cruise industry closures by the Centers for Disease Control & Prevention, began in March 2020.

But the 2019 cruise season in Alaska ended, as it always does, in September. That means that many businesses haven't had a significant customer base for 19 months -- and counting. If the cruise industry doesn't return to Alaska until May 2022 -- a distinct possibility based on current restrictions from the CDC as well as a Canadian cruising ban -- these companies face a full 32 months without revenue.

It's unsustainable -- and devastating, said Shannon Hasty, general manager of North Star Helicopters, a business that developed 23 years ago from a small trekking company. Before the pandemic, she ran glacier flightseeing and trekking tours with 10 helicopters, from two Juneau-area bases, and had 105 employees. Now she only has three helicopters in service, with 14 workers.

"We flew over 20,000 guests in 2019. In 2020, we flew about 200," she said. "We flew as many guests in five months as we do in one day at one base."

During the pandemic, people in Juneau came together to fight the virus, Hasty said. The state went through some lockdowns and has emerged to have some of the best vaccination rates in the U.S. Juneau itself still has stringent mask requirements. (During my time in Alaska in April 2021, everyone I met in the tourism sector was already fully or partially vaccinated, or had an appointment within next few weeks.)

"We were all in this together," she said. "Now we're the only part of the country that isn't opening back up. We're still stopped ... the devastating part is that it's continuing."

Knowing that cruise ships have pent-up demand for 2022 is appreciated but doesn't mitigate the problems caused by being down for another year, Hasty said. It takes time to build a workforce and create a culture. It doesn't happen overnight.

"The cruise ships have to come back for us to get on our feet," she said. "It's more challenging the longer they are not here."

What needs to happen? "The CDC treating the cruise industry the same as every other part of the travel sector would be a good step," she said. "It would be much appreciated."

Small Ships Not Enough

Allen Marine is an institution among the southeast Alaska cruise industry. The Sitka-based company has run shore excursion tours for the major cruise lines since the early 1970s. If you're on a whale watching or glacier sightseeing shore excursion, look at the vessel; chances are it's either built or operated (or both) by Allen Marine.

The Allen family are beloved in Sitka; with Tlingit ancestry, a philanthropic spirit and successive generations taking over the business, they represent the archetypical Alaskan homegrown success story. Their footprint has grown to encompass their own shipyard and their own small Alaskan cruise line, Alaskan Dream Cruises, as well as several tourist lodges.

But even institutions are not immune from the shortfall caused by the cruise line ban.  The company lost 98 percent of its business in 2020. While Alaskan Dream Cruises, which can operate this year (check out Cruise Critic's report from its first sailing of the season), is setting weekly records for reservations, it's simply not enough.

"ADC is only a fourth of our business," Dave Allen tells me from the line's headquarters, in a room full of Seahawks-bedecked chairs. "(Tour operators) have fallen through the cracks."

Before the pandemic, expansion was the main mode. Sitka is in the process of expanding Halibut Point, a new cruise terminal capable of taking Royal Caribbean's Quantum Class ships. Quantum of the Seas, as well as Ovation of the Seas, had been slated to go to Alaska in 2021; now Quantum is sailing in Singapore, one of the few countries where cruising has returned.

In total, 220,000 passengers came to Sitka in 2019, and that number was expected to rise to 320,000 for 2021, said Chris McGaw, the terminal's general manager.

"Since 2018, there has been all this talk, 'You guys need to be able to handle that'," he said, as we toured the renovation site during an April snowstorm. "We've been building boats, getting buses, planning for all of this, and then everything shuts down."

But what doesn't stop is the constant maintenance and care of vessels -- and that's what's making Allen so nervous. Sure, you can cut down your fleet. But what happens when it's 2022 and suddenly the cruise ships come back with all those passengers?

"If you're leaving hundreds of people on the bank because you don't have enough seats, the cruise lines will find someone else," he said.

Pivots Can't Replace Cruise Ships

The pandemic has forced many businesses to pivot. The owner of Juneau Food Tours, Midgi Moore, now sells Taste Alaska quarterly subscription boxes, where people receive treats and gifts made by small businesses in the state.

She still runs a handful of tours and was able to get a storefront and open up a small shop with local gifts. She can end her tours there with a tasting or hold a themed cocktail party. She also co-authored the book, "100 Things To Do In Alaska Before You Die", with Cruise Critic contributor Fran Golden.

Do those new revenue streams replace the income that came from the cruise ships? Moore laughs, bleakly.

"My tours were sold on eight different cruise lines," she said. "We were in a growth stage. We were growing exponentially. My prebookings for 2020 were up 200 percent ... And then it just all went away."

"(The new business is) great, and it keeps my doors open and food on the table. But it's like any new business ... with the cruise ships coming, the customers were coming right to my front door. Now it's like starting over."

Independent travelers will be coming in 2021; the governor is putting extra money into tourism marketing for the summer. Several small ship cruise lines such as UnCruise Adventures, Lindblad, American Cruise Lines and Alaskan Dream Cruises are visiting Juneau. But Moore, who is president of Juneau's Downtown Business Association, says those visitors won't make up for a continued cruise shutdown.

And Alaskans now feel like it's not just the CDC that's against them. Southeast Alaska is at the mercy of Transport Canada, thanks to the Passenger Vessel Services Act that forces cruise ships to stop in a foreign port. Due to a slow vaccine rollout, the Canadian government continues to take a restrictive view toward travel that doesn't seem to be lifting anytime soon. What if Canada decides to keep borders closed beyond February 2022?

"If the ships don't come in 2022, I'm very fearful for small businesses not surviving this," Moore said. "I don't know if I can survive another summer."

Part of the problem lies with people not understanding who is actually hurt by the shutdown, she said.

"When people think of the cruise industry, they think of these massive companies and these big ships. But they don't realize that every one of those ships contract with small independent operators all over the world. Juneau is no different. All of the tour operators -- the whale-watching boats, the fisherman, me -- they are all owned by people who live here.

"I don't think people get that."

Trickle-Down Effect

It's impossible to tell how many cruisers have bellied up to the famed Red Dog Saloon in Juneau, but at least some of them are responsible for the names and sayings written in magic marker over every inch of the restaurant's walls, tables and surfaces. The restaurant has an entire shop of themed merchandise, which is usually bustling with customers.

Red Dog does have people coming in, mostly locals, government employees and people passing through Juneau on business. Still, 2020 saw a 92 percent decrease in business from 2019, general manager Eric Forst said, and without the cruise ships, 2021 will not be much better. He's gone from 50 employees to six.

"If you add up all the independent travelers we'll get, it makes for an average Tuesday," he said. "It's been devastating. There's no other way to put it."

Forst describes the cruise industry shutdown as a "slow-motion car accident." Every month, the cancellations kept getting moved back, until finally the entire season was erased by the Transport Canada ban. "It just never got any better."

The shutdown has trickled down in ways that many people don't realize, Forst said. His daughter's soccer team relied on sponsorships from local businesses. Those are now gone.

"The longer this goes on, the more effects there are," he said. "It's really crucial that we get the CDC to understand the impact that their decisions -- or lack of decisions -- are making."

What Happens Next?

Alaskan officials have been trying to make that happen.

The Alaskan congressional delegation has pressed the CDC in hearings to give a timeline for the industry reopening. Legislation to bypass the PVSA with a temporary waiver has been introduced.

So far, nothing.

On April 9, Alaska Governor Mike Dunleavy held a news conference in Juneau at the hangar for Wings Airways, a seaplane company that usually brings thousands of cruise tourists on different flightseeing trips, including one that ends with a salmon feast at their Taku Glacier Lodge.

The main purpose of the event was to implore the CDC to lift its conditional order so cruising could resume in enough time that Alaska could at least have a partial season. Dunleavy did not mince word: It's time for the CDC to let cruise lines operate, particularly in Alaska.

"The message that we want to send to the world and officials that are making the decisions impacting Alaskans is that we're leading the nation in the vaccination rollout. We've done a really good job of mitigating this virus and doing everything that we're supposed to do -- distancing and restricting businesses at times, especially at first. And we're paying a heavy price for it."

The seasonality of Alaskan tourism is what makes the situation dire, he said, and the continued ban is not considering what the state has already achieved in terms of keeping the state safe with vaccinations.

"A lot rides on this," he said. "You might be able to take a cruise in the Caribbean at any time during the year ... when I say right now make an exception, it's because we're performing exceptionally."

Dunleavy stopped short of suing the CDC, as Florida Governor Ron DeSantis has done. But he didn't rule it out either.

"Our cruise ship season needs to have an answer now. We're running out of time," he said.

"We're going to do anything and everything we can to encourage the CDC to come up with some decisions that make sense for this state. We'll see where it goes. We have a few days left to continue to work with the CDC.

"We're not going to let any tool available lie on the table. We're going to deploy everything.

"I don't want to say that we're desperate. But we're in a situation where good decisions need to be made now so that there can be planning, so we can gear up for the season, so we can hire people."

Updated April 13, 2021
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