TESTIMONY OF
AMY POWERS, DIRECTOR
CRUISEMAINE COALITION
SPEAKING IN SUPPORT OF THE CRUISE INDUSTRY
(LD1158)

BEFORE THE JOINT STANDING COMMITTEE ON
NATURAL RESOURCES

DATE OF PUBLIC HEARING:
February 10, 2004

Senator Martin, Representative Koffman and the Members of the Natural Resources Committee, my name is Amy Powers, I am the Director of CruiseMaine. CruiseMaine is a marketing coalition of coastal communities and several major businesses who work together to attract cruise ships to their respective areas. The Coalition currently has thirteen community members, they are:

1. Kennebunkport
2. Portland
3. Freeport
4. Bath
5. Boothbay Harbor
6. Bangor
7. Belfast
8. Bucksport
9. Camden
10. Rockland
11. Bar Harbor
12. Searsport
13. Eastport

These ports are all very different in the size of vessels that they have the ability to attract. Of these thirteen ports, two-Portland and Bar Harbor have traditionally had the most success with attracting the larger cruise ships. For the past few summers, the communities of Belfast, Camden, Rockland, Bucksport, and Bar Harbor have enjoyed a weekly visit from one of the vessels owned by the American Cruise Line. This cruise line now bases their homeport operation in the city of Bangor, along the banks of the Penobscot River. Who ever would have thought?

Although these thirteen ports are very different in their own attributes, they all have this in common; If you were to look at them individually on a map, you would notice 2 things: they are all geographically bound on one side by the Atlantic Ocean or a tributary of the Atlantic Ocean and secondly, there is usually only one major access road leading in to and out of the community. This combination of factors results in fantastic occurrences of traffic congestion on the arteries which flow through these boutique coastal communities. These traits greatly limit their draw market for potential tourists. To be able to bring tourists in to these areas via the water is no doubt a major advantage and can play a pivotal role in opportunities to revitalize and reinvent the waterfronts in these areas.

Everyone understands the cost to maintain waterfront infrastructure to be enormous. With the fishing industry facing devastatingly uncertain times ahead, it’s crucial that we maintain a diverse mix of industry on our waterfronts to help ensure that we at least have a chance of realizing a return on our public investment where redevelopment and infrastructure improvements are concerned.

The 2004 ship schedule for the state currently includes over 150 port of call visits by cruise lines; these visits take place over a six month period, from May to the end of October. Bar Harbor currently has eighty-seven ships scheduled for this summer, and Portland thirty. The majority of the cruise calls occur in September and October, giving our local economies a much needed boost in the traditionally deprived shoulder season. As previously mentioned, the economic impact of a port call is estimated to be around $ 180,000.00 per call. The economic impact of this business can be measured in several ways of the following ways:

• Municipal Port Fees-Dockage, Head Tax, Security Fees.
• Fuel-bunkering while in port is common.
• Ship provisions-underwater diver fees, miscellaneous mechanical/marine ship repair services, piano tuning, soda machine line cleaning, miscellaneous other services.
• Rubbish removal services.
• Sewage removal services.
• Fresh water.
• Chandler Services-provisions and supplies.
• Ship Agency Fees-Agents act as business representatives for the ship while they are in port.
• Government Fees-Homeland Security (US Customs/INS)
• Pilotage Fees-Local ship pilots guide the vessels into and out of the harbors.
• Docking Master and Tugboat Fees-majority of large ships require tug assistance upon docking at piers.
• Equipment Rental-on occasion, cruise lines may rent the gangway systems, fork lifts, etc. from the port.
• Crew Spending-the crew often spends money on entertainment, restaurants, staples, phone cards, internet access, etc.

In 2002, the University of Maine Department of Resource Economics and Policy conducted an economic impact report detailing passenger spending that tells an incredible story of good fortune.

The key findings were:

• The cruise industry accounted for 10% of the total revenues earned by the retail stores and restaurants in all of 2002, but a full 64% of retail and 26% of restaurants in the month of October.
• Passenger and crew spending accounted for 12.1 million in sales in Bar Harbor in 2002 including multiplier effects and supported over 275 full and part-time jobs.

That’s staggering. And they came by sea.

The market outlook for Maine ports is very good and with the right combination of efforts coastal Maine can begin to realize cruise business in areas that have not traditionally been considered viable cruise destinations. The cities of Bath, Portland, Rockland and Bangor are currently embarking on aggressive waterfront redevelopment plans that will enhance the tidal approach to their communities.

Post 9/11, the cruise lines took initiative to reposition their vessels closer to “drive to markets” in untraditional ports in order to eliminate the need for passenger’s to fly. This move has actually proved to be very successful for them. We have seen several new ports emerge on the eastern seaboard that can become new anchor ports for Canada/New England cruises. In turn, this has provided Maine with some new strategic partners in the Mid-Atlantic such as Baltimore and Philadelphia. In addition, the City of New York’s Economic Development Department recently pledged to invest $250 million to miscellaneous infrastructure improvements that will continue to nurture the cruise industries’ future homeport operations and deployment of their expanding fleets.

The members of CruiseMaine ask that you please take all of these factors into consideration when deciding the future of the cruise industry in Maine. Sporadically located pockets of regulation will create an unfriendly sailing atmosphere and will negatively impact the potential growth of the industry to our ports. CruiseMaine and its members cannot support legislation that limits the ability for some of these communities to benefit from the opportunity to produce sales and tax revenues from this industry.

The very thought of burdening these communities with strict regulations would be devastating from a marketability standpoint. The coalition urges the committee to consider the option of the state entering into a Memorandum of Understanding with the cruise industry that would allow for the necessary commitment from the cruise lines not to discharge within certain areas of our shores, yet provide the desired protection of Maine’s coastal waters.

In closing, the CruiseMaine coalition members would like to thank the Maine Department of Environmental Protection for hosting the stakeholder committee meetings, for their consideration of the industry’s needs and for their willingness to work towards a reasonable compromise. And I thank you for the opportunity to speak to you today. I would be happy to answer any questions that you may have.