Chilkat Valley News - Serving Haines and Klukwan, Alaska since 1966

 
 

Chamber: Dock fees will hurt retail trade

 

March 10, 2011



Haines business leaders say they’re afraid that a proposed jump in fees at the borough-owned Lutak Dock would be passed directly to local businesses, forcing up local retail prices and driving shoppers out of town.

Haines Chamber of Commerce president Ned Rozbicki said he’d be meeting with borough manager Mark Earnest Thursday to discuss concerns. "For businesses, it’s no different than an increased sales tax or a mill rate. It makes it harder for them to compete against out-of-town businesses."

One of the issues is the town has only one shipper, Alaska Marine Lines, he said. "We’ve got no negotiating capacity."

Rozbicki said he understands the borough has to charge a reasonable rate for use of the dock. "I don’t know what that reasonable rate should be. It’s a balancing act" between the borough’s needs and the cost to consumers, he said.

Rozbicki said he was hoping talks with the borough would provide some numbers for discussion, including the cost of maintaining the dock. "If you double the dock rates, what does that do to the amount businesses pay for freight? Those are the kinds of things we’re trying to figure out."

Earnest has said the dock fees haven’t been raised in years, and that additional revenues are needed to shore up the facility, which sees virtually all the town’s marine-shipped freight.

Don Reid, vice-president of operations for AML, said the company would increase its charges in proportion to their cost increase. "Whatever increase in cost we experience will ultimately be passed on to the consumer."

The borough’s wharfage cost of $2 per ton is comparable to $2 or $2.50 per ton charged at other public-owned docks in Southeast, he said. An increase to $3.50 instead of $8 as proposed by the borough wouldn’t hurt consumers as much, he said.

Haines’ situation – municipal maintenance of a dock built by the state or federal government – isn’t unusual in Southeast. And docks are expensive to maintain, he added. "From our standpoint, (Lutak Dock) is a pretty nice facility. It works well."

Northland Services, a competing shipper, served Haines for about a decade, stopping in 2007. "There wasn’t enough business or market in Haines to support two, full-time carriers and (AML) already had the infrastructure in place," said operations manager Mike Highley. For the company’s last five years here, Northland shipped aboard AML vessels, he said.

"I understand (freight rates) took quite a jump when we weren’t there anymore," Highley said, adding that competition is good for the consumer.

He said Rozbicki’s fears about the increase being passed on are founded. "I’d say that’s exactly what’s going to happen. The (increased) costs have to come from somewhere and, unfortunately, they would go directly on the consumer."

Highley said Northland might resume service here if Haines were to become a hub for the natural gas pipeline or if a road were built from Juneau. "We’d certainly entertain trying to come in there."

The company currently serves Haines-sized communities in southern Southeast, but costs there are relatively less because Juneau-bound barges from Seattle already are passing by those towns, he said.