Unalaska, AK – The city council discussed a proposed increase to port tariffs and fees at last week's meeting. The proposal was based on a study produced by Northern Economics, which recommended increasing all tariffs and fees by 4.8 percent each year for the next three years. The tariffs would apply to all cargo moving across the city docks, including goods being brought in as well as shipped out. Ports Director Alvin Osterback said that the tariffs and fee schedule haven't changed in 10 years.

"I really don't see a lot of questions about why we are doing this now or why is it necessary," he said. "The infrastructure for the port over time has been aging and some of it is quite a bit older than others and it's just come to the point where there are maintenance issues that have to be taken care of."

Osterback said that the study shows that increasing the tariff would only have a minor effect on the overall cost of shipping a container in or out. The extra income would help with the maintenance issues as well as compensate for some of the $1.5 million of revenue the city has lost since last year.

At Tuesday night's council meeting, the council was split over tariff adjustments. Council member Dennis Robinson said that raising tariffs would drive away business and increase the cost of living for residents.

"You're going to have a hard time convincing me to raise the rates when we haven't looked at all the other opportunities, all the other avenues for increasing the amount of cargo coming across that dock," he said.

Robinson said the city should look into all other options for increasing business at the city docks, including trying to increase the amount of containerized cargo that goes across them and considering the proposal to hand over operations of the city docks to Horizon Lines.

Councilmember Dave Gregory said the city should try to attract more business, but that raising the tariffs is also a necessary step at this time.

"I am generally in favor of the proposal. I think it's been such a long time since we've raised that port tariff, I think that inflation has certainly eaten up any of the money that we've put in the bank so I think we need to raise it a little bit so that we have a little bit more operating funds for the port department."

All council members seeming in favor of raising the fee schedule by 4.8 percent across the board.

The council voted to move both the tariff increase and the fee schedule increase to second readings and public hearings at the June 23 meeting.