The Port of San Francisco has lost $15 million in tariffs from passengers due to the cancellation of nearly 200 cruises since March 2020. (Jordi Molina/Special to S.F. Examine

The Port of San Francisco has lost $15 million in tariffs from passengers due to the cancellation of nearly 200 cruises since March 2020. (Jordi Molina/Special to S.F. Examine

Return of cruise industry could bring much-needed revenue back to Port of SF

Cruise ships, which may be allowed to set sail in U.S. waters as early as mid-July for the first time in more than a year, could bring some much needed economic activity back to the Port of San Francisco — if they show up.

The Port has 27 cruise arrivals remaining on its schedule this year between July and December, but there is still much uncertainty around the resumption of the industry and it is unclear if they will materialize.

Hopes were raised this week when the Centers for Disease Control and Prevention said it may approve passenger cruises sailing into U.S. ports as soon as this summer. Cruise lines would need to adhere to a number of COVID-19 restrictions including signing agreements with ports and respective local health authorities where they plan to dock.

“CDC remains committed to the resumption of passenger operations in the United States following the requirements in the [Framework for Conditional Sailing Order] by mid-summer, which aligns with the goals announced by many major cruise lines and travelers,” Scott Pauley, CDC spokesperson, said in a statement. “CDC looks forward to continued engagement with the industry and urges cruise lines to submit Phase 2A port agreements as soon as possible to maintain the timeline of passenger voyages by mid-July.”

A return of the cruise industry could bring much needed financial relief to the cash-strapped Port of San Francisco, which has seen its revenues plummet by nearly 50 percent during the pandemic and is looking at a revenue shortfall of about $100 million over the next five years. The agency relies largely on tourism, retail and commercial rents for funding.

The revenue shortfall has the Port even considering taking out a $20 million loan from San Francisco International Airport or The City’s general fund to avoid layoffs next fiscal year and meet other demands like much-needed capital repairs.

The return of cruises could also help the local economy through passenger spending, and give more work to dockworkers.

Port spokesperson Randy Quezada said the cruise industry provides a vital revenue stream for the waterfront and each ship “brings thousands of passengers and crew to San Francisco that shop and dine at local businesses and attractions.”

“The Port is committed to working with all federal, state and local health authorities and our terminal operator and cruise industry partners to ensure a safe resumption of cruises this year,” Quezada said.

In 2020, the Port of San Francisco was scheduled to host a record 117 cruise calls, or cruise ship arrivals, comprising about 380,000 passengers. Only 12 arrivals occurred, however, after the CDC issued a “no sail” order for the industry in March 2020 as the pandemic took hold in the U.S. The order came after deadly outbreaks on cruise ships including the Grand Princess, which made an emergency docking in the Port of Oakland after initially being quarantined at sea.

The “no sail” order for cruise ships has meant the cancellation of 198 cruise arrivals in San Francisco since March 2020 and so far in 2021, Andre Coleman, the Port of San Francisco’s deputy director of maritime, told the Port Commission earlier this month.

For the 198 canceled cruises, the Port lost “$15 million in tariff passenger revenue alone,” Coleman said, referring to the fee cruises must pay per passenger. Each cruise ship also results in about $500,000 in direct spending by passengers and crew, Coleman added.

In 2022, the Port has requests for 118 cruise ship arrivals for a total of about 300,000 passengers, an estimate which assumes selling at reduced capacities.

San Francisco cruise routes historically include Alaska, Mexico and Hawaii.

jsabatini@sfexaminer.com

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