An increase in Alaska’s port surcharge could increase the price of goods

The cost of shipping goods to Alaska could rise next year due to increased fees at the Port of Alaska.

The Anchorage Assembly voted last month to increase a tariff surcharge for the Port of Alaska Modernization Program that applies to all goods moving through the port. The program was launched last year and helps finance the modernization of the aging port.

Fees will rise from 59 cents to $4.80 per ton. That’s an 800% increase, but city officials said it probably won’t be very noticeable to the average Alaskan.

The price for full containers increases similarly, from $9.50 per container to $75.50.

Bill Falsey, the city’s top administrator, said the impact on the cost of goods sold in the state should be minimal.

“We don’t know the actual dollar amount that will impact Alaskans,” Falsey said. “What we know is that if the entire amount was passed on it would be very small. We’re talking a fraction of a cent per gallon of gas, a fraction of a cent for a loaf of bread, maybe a penny or two for a gallon of milk.”

The port modernization project has an estimated cost of nearly $2 billion.

Falsey said the award is designed to be consistent with federal grant and loan opportunities.

“This increase alone is expected to enable approximately $180 million in borrowing, all of which will go toward the construction of this first major cargo facility,” Falsey said.

The majority of Alaska’s inbound cargo arrives at Don Young Port, Alaska.

Port Director Steve Ribuffo said that without the modernization project, the port is at risk of failure and that the fee increase is an investment in the future.

“We plan this place to last 70 years,” Ribuffo said. “It’s about creating a facility that is modern, meets industry standards, lasts a very long time and can survive the next big earthquake. So it’s a smart investment.”

The new tariff comes into force on January 1st. Port officials expect construction of the cargo terminal to begin in 2026.

Ava White covers business and anchors the statewide morning newscast at Alaska Public Media. Reach her at [email protected] or 907-550-8445. Read more about Ava here.