COVID-19 crisis demonstrates why U.S. maritime law needs updating

COVID-19 crisis demonstrates why U.S. maritime law needs updating

The 1886 Passenger Vessel Services Act has always hurt Hawaii tourism;
a new Grassroot article tells how it is now devastating Alaska tourism
HONOLULU, March 9, 2021 >> A 135-year-old federal law adopted before there were airplanes has become a major problem for the modern tourism industry in Hawaii and Alaska — especially in Alaska, according to a new article posted by the Grassroot Institute of Hawaii.

The law is the 1886 Passenger Vessel Services Act, and its lack of flexibility during the COVID-19 crisis has highlighted why it needs to be reformed or repealed, according to the article “Alaska cruising crisis shows need for flexibility in U.S maritime law,” by institute research associate Jonathan Helton.

Helton explains that the PVSA was intended to protect America’s maritime industry. But without living up to its goals, the law instead has long limited Hawaii’s tourism potential and now is absolutely sabotaging Alaska’s tourism industry, which is far more reliant on cruise ships than Hawaii.

In the Aloha State, he writes, cruise ships accounted for about 1% of all visitor arrivals in 2018, while in Alaska it was more than half. Before the coronavirus pandemic and government lockdowns manifested in early 2020, the tourism industry had employed one in 10 Alaskans and annually served almost 1.2 million visitors, generating about $2.2 billion.

Craig Dahl, executive director of the Greater Juneau Chamber of Commerce, told Helton last week that cruise tourism makes up about 32% of the Alaska capital’s economy, and the loss of another cruise season would cause the “most dire economic situation we’ve ever faced in our area.”

Should nothing be done to save the cruise season, Dahl said, it would be “almost mathematically impossible for most small businesses” to survive what would amount to almost two years without normal cruise tourism revenue.

Dahl’s reference to two years has to do with Canada’s ban since March 2020 on cruise ships carrying more than 100 passengers from landing at any Canadian ports through February 2022, due to concerns about COVID-19.

That is a problem for Alaska, Helton says, because the PVSA forbids foreign-flagged and built cruise ships from transporting passengers between U.S. ports unless they also call on a foreign port, which in this case would be Canadian ports such as Vancouver or Prince Rupert.

Worse, all of the largest vessels that bring in the bulk of the visitors to Alaska are foreign flagged and built, but relying on large U.S.-flagged and -built ships to fill in the gap is not an option because there exists only one large PVSA-qualified cruise ship — the 2,500-passenger, mostly foreign-built MS Pride of America — and it is restricted to serving only Hawaii under the exemption that allowed it to operate in U.S. waters at all.

Smaller PVSA-qualified U.S. ships are planning to continue their cruise season, but collectively they would bring about only 17,000 visitors to Juneau all season, which is about the number of visitors Juneau used to receive each day before the COVID-19 lockdowns.

Helton writes that, “As a practical matter, the simplest option would be for the federal government to issue Alaska a PVSA waiver, thus allowing non-U.S. cruise ships to skip the stop in Canada.”

That’s what groups such as the Greater Juneau Chamber of Commerce, the Resource Development Council for Alaska and the Alaska Travel Industry Association had been seeking even before Canada extended its ban. As the pandemic continued, however, and the U.S. Centers for Disease Control kept its “No Sail Order” in place, these pleas fell on deaf ears.

Then in October 2020, the CDC issued its “Framework for Conditional Sailing Order,” which provided a path for resumption of the cruises, and the pleas for a PVSA exemption became louder.

Canada, however, remained a significant hurdle. And since extending its cruise ban last month for another year, Alaska’s devastated tourism industry is virtually howling for relief.

“If there was any time in the history of the PVSA that an exception should be granted, it is now,” cruise industry insider Rod McLeod told Travel Weekly.

Perhaps most important, Federal Maritime Commissioner Louis Sola has urged the Biden administration to grant Alaska cruises “limited exception to the PVSA,” noting that “another lost [cruise] season represents a potentially devastating blow to the livelihoods of thousands of Alaskans.”

Absent diplomatic resolution of the ban, which seems unlikely, it will fall to the president through an executive order, or to Congress through legislation, to exempt Alaska from the PVSA.

At the state level, Alaska’s Legislature is considering a joint resolution, SJR 9, to ask Congress for a PVSA exemption until Canada lifts its ban. The Grassroot Institute of Hawaii and the Alaska Policy Forum submitted joint testimony on March 5 in support of the resolution.

At the federal level, U.S. Sens. Lisa Murkowski and Dan Sullivan have introduced the “Alaska Tourism Recovery Act” in the Senate, and U.S. Rep. Don Young has introduced companion legislation in the House.

“All Alaskans are asking for is the opportunity to open their doors and make an honest living this summer, and we must give them a fighting chance,” Young stated.

Meanwhile, says Helton, “Alaskans are caught between a rock and a hard place — or rather, Canada and the PVSA.”

He notes that PVSA reform or repeal would help Hawaii as well, though the state has different issues to deal with in trying to get Hawaii back on its feet. Being such a small part of Hawaii’s tourism market, ocean cruising is not a high priority for most Hawaii politicians, though in the long run it should be.

Says Helton: “Maybe Alaska’s more immediate crisis, will prove to be the window of opportunity for those in Hawaii and elsewhere who wish to remove legal impediments to vibrant ocean cruising in U.S. waters.”