Royal Caribbean International’s decision to reduce the number of ships it deploys in Alaska next year from three to two is the loudest indication so far that cruise lines are disinclined to accept the state’s head tax of $50 per passenger.

Royal Caribbean cited the high cost of doing business in the state when it said it would not send the 2,100-passenger Serenade of the Seas to Southeast Alaska ports in 2010.

The cruise industry organization in the state, the Alaska Cruise Association, estimates that the elimination of the Serenade’s 19 departures from Vancouver will mean 42,000 fewer visitors to Alaska in 2010, resulting in an estimated loss of $55 million in tourism revenue.

"There is a tremendous amount of concern," said John Binkley, president of the Alaska Cruise Association.

Dave Kasser of the Anchorage Convention and Visitors Bureau told the Seattle Times that the move could be a harbinger of future decisions by other lines.

"We need to make a concerted effort to make our destination as attractive as possible," Kasser said.

In explaining the decision to pull its vessel out of Alaska, Royal Caribbean said that the state has "among the highest tax/cost structure of any destination."

The company cited several examples of costs imposed by Alaska on its ships, specifically the $50 head tax that was voted into law in a citizen referendum in 2006. The tax added $50 million to state coffers in 2007.

"Alaska has traditionally been a higher-cost destination, but it has also been able to generate higher per diem and higher revenues to offset that," said Binkley. "As other destinations compete around the world and there is demand for other destinations, it has been more difficult for companies and cruise lines to get proportionally better revenue from Alaska cruises."

In its fourth-quarter earnings call, Royal Caribbean cited weakness in Alaska. Pricing there is down considerably for all major cruise lines.

According to Binkley, Alaska’s share of the cruise market has not grown with the industry since 2006.

"I’ve been concerned for some time, as I’ve seen cruise traffic level off over the past three years," he said. "I think we need to embrace the industry and encourage the industry and be reasonable with our regulations."

So far, no other major cruise line has announced a big reduction in capacity. Earlier this year, small-ship line Cruise West removed one vessel, the Spirit of ’98, from its 2009 Alaska deployment. The line will keep the ship in the Pacific Northwest.

"We have seen a strong demand for our Columbia and Snake river itineraries, and feel that this is where the Spirit of ’98 will be best utilized at this time," said Cruise West CEO Dietmar Wertanzl.