Labor, Human Services ask feds to help deal with HOVENSA's closure

ST. CROIX - The V.I. departments of Labor and Human Services have turned to the federal government as they prepare to deal with the impact that the closure of HOVENSA will have on the territory.

In a press teleconference Tuesday, V.I. Labor Commissioner Albert Bryan Jr. and V.I. Human Services Commissioner Christopher Finch described some of the actions their agencies have taken in response to the refinery's announcement it will be closing.

Finch said that Gov. John deJongh Jr. has instructed all Cabinet members to reach out to the federal government to find out whether the territory may qualify for extra assistance.

"It's too early to have answers, but we've had conversations, and people have asked us to follow up in writing," Finch said of his agency's discussions with the federal government.

Although Bryan and Finch anticipate a large upswing in unemployment filings and, in the case of Human Services, requests for assistance from various programs it offers, both said the severance pay HOVENSA is offering could delay the uptick until later in the year.

HOVENSA officials testified at a Senate hearing Thursday that the majority of workers will be off the payroll by April 20.

The average severance pay for those employed directly by HOVENSA will be $22,000, Bryan said. The severance pay will mean that dislocated workers will not immediately be eligible for unemployment insurance benefits, although they will be eligible for the Labor Department's other programs, Bryan said.

According to a Government House release, Bryan told a Senate committee on Wednesday that the closure of the refinery will result in the termination of 1,018 HOVENSA employees and an estimated 1,200 more who work for the refinery's contractors.

Bryan on Thursday said the government still is analyzing how many more people may be put out of work by the "secondary impact" of the refinery closing as the effects ripple out into the community.

The V.I. Labor Department will apply for an emergency grant through the U.S. Department of Labor's Employment and Training Administration to help deal with the crisis, Bryan said. The Employment and Training Administration administers federal grants to states for public employment service programs and unemployment insurance benefits.

Bryan said he did not know exactly how much the territory could receive but that he had been looking to see how much other jurisdictions had gotten in other situations.

"We are a much smaller jurisdiction, but the impact is much larger," he said.

Bryan said he did not yet know what kinds of positions might be available in the territory for dislocated HOVENSA workers.

He said that the announcement of the impending closure of the refinery already has prompted some employers who had posted jobs with Labor to pull their job postings.

"It's already having an effect," he said.

The Labor Department will offer several sessions in February for workers who will be displaced, to inform them about the services and benefits available, Bryan said. The department will be at Agrifest 2012 with other government agencies, including Human Services, to offer assistance.

Entrepreneurship may be an option, he said, noting that the Economic Development Authority is looking at how it can respond to the refinery's closure as well.

The Economic Development Authority has programs that can assist those interested in that option, he said, adding that he would like to see new companies created and powered by local people receiving Economic Development Authority benefits.

He also said that the Economic Development Authority seems to be seeing a return of new applications, although they are for small companies.

"For awhile, we weren't seeing any new applications," he said. "Next week, we have a hearing with five companies."

Labor will be working with the V.I. Education Department to help displaced workers who want to further their technical skills. Labor also will run an unemployment insurance video on the government channel that explains rights, benefits and what workers are entitled to, Bryan said.

Finch said that Human Services is reaching out to all federal agencies it deals with that may be able to offer assistance.

The Supplemental Nutrition Assistance Program - the federal food stamps program - is an entitlement program, and those who qualify will receive assistance, he said.

Human Services is distributing food stamps at a level that amounts to about $51 million per year, according to Finch. That level has more than doubled since 2007, he said.

"If that number needs to grow as more people become eligible, then it will grow," Finch said.

With the local government already in a financial crisis, the capacity of locally funded Human Services programs to accept a sudden increase in clients "is going to be an extreme struggle if we cannot get outside assistance," Finch said.

It is not yet clear how much assistance the federal government may offer, Finch said.

"We're hoping we're going to have more answers in fairly short order," he said.

- Contact Joy Blackburn at 714-9145 or email jblackburn@dailynews.vi.

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