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City proposes higher cruise-ship tariffs with discounts for low-sulfur fuel
Summary
Portland staff proposed a sizable increase in passenger and infrastructure fees at the cruise terminal and a $2 discount for ships that use ultra-low-sulfur marine gas oil, aiming to incentivize cleaner fuels while increasing revenue for waterfront infrastructure and future shore-power work.
Portland staff presented a proposed revision to published tariffs for cruise ships that would raise base passenger and waterfront infrastructure fees while offering a discount for vessels that use ultra-low-sulfur fuel.
Ethan Hippel, director of parks, recreation and facilities, told the committee the city currently charges large cruise ships $18 per passenger plus a $3 waterfront infrastructure fee (total $21) and proposed raising the passenger fee by $3 to $21 and the infrastructure fee by $1 to $4. "So for the passenger rates alone, it's going to be a 16% increase to our base rate going from 18 to $21," Hippel said, adding the city would offer a $2 discount to ships that use compliant marine gas oil (MGO).
Hippel framed the change as an "innovative middle ground" intended to encourage cleaner fuels while allowing the city to make a larger contribution to a waterfront infrastructure fund that could later finance sustainability measures such as shore power. He said revenues from passenger and infrastructure fees, together with other charges, yield roughly $3 million to $4 million annually in direct revenue to the city.
Committee members asked about enforcement and verification of fuel use. Hippel and Director Troy Moon said the city would require documentation from cruise lines about fuel used while in port; ships already log fuel changes to meet international maritime standards, and the Coast Guard has inspection and enforcement authority. "We would require documentation from the cruise line what type of fuel they were using," Hippel said; city staff said they do not plan to board ships to check fuel gauges and would rely on records and existing inspections.
Members also asked about industry and public reaction. Hippel said the city had notified cruise lines and discussed the concept with Cruise Lines International and local groups including Cruise Control and Portland Climate Action Team; staff reported no line had yet indicated it would pull out of Portland because of the change. He warned the city will watch the 2027 season to see whether ships accept the discount or continue using scrubbers (which are currently legal and used at some ports).
The committee discussed the interplay between tariff changes and a pending federal law often called the Vessel Incidental Discharge Act (VIDA). Staff said VIDA will create uniform federal rules and that the city considered the timing and preemption risk when designing the tariff-based approach.
This item was presented for committee discussion; no vote was taken. Staff said they will continue outreach and return with additional materials as needed.
