Juneau Assembly to take up 10% tax on vehicle rentals that start near cruise docks

The Juneau Assembly will consider an ordinance Monday, Nov. 16, that would add a 10% excise tax to vehicle rentals that begin in a mapped zone around the downtown cruise docks.

Renters would pay the tax when they pay for the rental. Rental companies and online platforms that connect car owners with renters would collect it and list it separately on receipts. The city's agenda packet says the tax has two goals: to push rental activity outside the zone, reducing tourism-related traffic downtown, and to help cover the cost of providing and maintaining public parking there. The ordinance cites the increased number of rental vehicles taking up public parking near the docks.

The zone covers public and private property around the AJ Dock, Franklin Dock, Cruise Ship Terminal, Alaska Steamship Dock and Marine Park/Intermediate Vessel Float. A rental would count if the vehicle is parked in the zone when the rental begins. The ordinance says the zone could grow if new cruise docks are built.

The tax would apply to total rental charges, including mandatory fees, but not to government taxes, fines or refundable deposits.

The city already treats platforms such as Turo as marketplace facilitators that collect tax for sellers.

Assembly members discussed the proposal at a Feb. 23 Lands, Housing and Economic Development Committee meeting and at Committee of the Whole sessions March 16 and Sept. 21. Combined with existing taxes, the new tax would push the total charge on some rentals to 24%.

Public comment to the city's Visitor Industry Task Force has split on downtown congestion. In a Nov. 4 email, Steve Behnke urged the city to reconsider downtown rental car locations. Laura Martinson wrote in February that congestion falls in predictable periods and that downtown conditions have improved.

City Manager Katie Koester recommends introducing the measure Monday and setting a public hearing at the next regular meeting. The tax would take effect 30 days after adoption.