U.S. Senator for Alaska Lisa Murkowski (R-AK) has announced new legislation to permanently exempt cruises between the Lower 48 and Alaska from the Passenger Vessel Services Act (PVSA).
The Passenger Vessel Services Act of 1886 requires that foreign passenger vessels stop in a foreign destination while traveling between two U.S. points. For Alaska-bound cruises operated by the world’s largest cruise companies like Carnival, Royal Caribbean and Norwegian, who do not register their vessels in the United States, this has meant stopover in Canada for its West Coast-based ships.
The law has gained a lot of attention during the COVID-19 pandemic after Canada banned passenger vessels from its waters through February 2022 to stem the spread of the virus, complicating the return of cruises to one of the hottest cruise destinations in the country even as operators awaited CDC approval to sail.
While Congress passed surprisingly bipartisan legislation in May to temporarily waive the PVSA for the extent of the Canadian ban, calls have continued for the law to be struck down altogether or modified to allow exemptions for things like large passenger vessels or the U.S. build requirement.
Details of Senator Murkowski’s proposal were released during her keynote speech at the Southeast Conference Annual Meeting in Haines.
“While the PVSA is well-intentioned to protect American jobs and businesses, it had the unintended consequence of putting Alaskan businesses at the mercy of the Canadian government. It nearly wiped out Southeast Alaskan economies as we saw business after business ready to welcome visitors, but unable to because Canadians would not respond to our requests to allow foreign stops at their ports to meet the requirement of PVSA. We cannot let that happen again,” said Senator Murkowski, who plans to introduce the legislation next week.
Specifically, Senator Murkowski’s plan will permanently exempt Alaskan cruises carrying more than 1,000 passengers from the PVSA.
“This legislation will create jobs for American merchant mariners in the cruise industry, and to ensure foreign-built cruise ships do not compete with U.S.-built ships, this waiver will end once there is a U.S.-built cruise ship that carries more than 1,000 passengers. We do not want to compete with U.S. shipbuilders—that’s why this legislation ends once there is an American market. Bottom line, we need to reform the PVSA so that Alaskans’ ability to engage in commerce isn’t derailed by the government of another country,” added Senator Murkowski.
Not everyone is sold on the plan. Dr. Sal Mercogliano, an expert on American maritime policy, argues repealing the PVSA will only benefit Carnival, Royal Caribbean and Norwegian, which are incorporated outside the U.S. and do not pay American taxes.
Like elsewhere in the world, cruising to Alaska ground to a halt in 2020 due to the COVID-19 pandemic, creating economic hardship for the tourism industry in Alaska and elsewhere.