Senate clears path for Crown Bay dredging
Published: July 24, 2014
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ST. THOMAS - At a special session called by the governor, senators approved two measures Wednesday to help the V.I. Port Authority move ahead with a critical dredging project and finance $29 million in capital projects.
While some senators were peeved about the governor calling them into special session twice in two weeks - particularly because they have a session already scheduled for Monday - all 14 senators present voted in favor of both measures.
Sen. Craig Barshinger was absent from Wednesday's session.
Once the session convened, Senate President Shawn-Michael Malone broke into Committee of the Whole to hear testimony from V.I. Port Authority officials. Each senator had two minutes to ask questions of the testifiers, which several senators said was not enough time. Malone said the Committee on Economic Development, Agriculture and Planning on July 8 already heard and approved the Coastal Zone Management permit for the dredging of Crown Bay.
The second measure discussed and approved Wednesday by the Legislature was in regard to amending language in the V.I. Code regarding the V.I. Port Authority's ability to reissue bonds for capital projects.
Dredging Crown Bay
More than one year ago, several cruise lines told the Port Authority that the East Gregorie Channel that leads into the Crown Bay harbor needs to be dredged, according to Port Authority Executive Director Carlton Dowe.
Dredging, scooping up the material on the bottom of the ocean floor and removing it from the water, clears the way for larger cruise ships to come into the harbor and dock at Crown Bay.
The St. Thomas Coastal Zone Management Committee already approved the permit required for the dredging work, but the permit must be ratified by the Legislature.
The permit was sent in April to the Senate, and was heard and approved by the Economic Development, Agriculture and Planning Committee earlier this month. It was on the agenda of the session originally scheduled for Monday, but that session was pushed back to the following Monday.
Dowe said the whole process has been hampered by the Senate's lack of action on the permit, and the Port Authority is on a very tight deadline to have the project completed. If the dredging does not happen by the start of the tourist season in November, Dowe said the port will lose 13 ship calls, representing a potential $18 million economic loss for the territory.
He said the Senate's approval means the Army Corps of Engineers can move forward to approve the federal permit. Once the permits are in place, the project will go out to bid, and once a contractor is selected, work can begin.
Dowe said he hopes the dredging can start by September to meet the November deadline.
The dredging is expected to cost the Port Authority about $3.5 million; however, Dowe is negotiating with cruise lines to cover some of the expense.
Dowe told senators Wednesday that his initial request was that the cruise lines fund 75 percent of the project cost, but he did not have a final agreement yet with any entity.
The second measure approved by the Senate Wednesday will help the Port Authority fund its capital projects plan by refinancing existing 2003 bonds in the amount of about $25 million and issuing about $29 million in new bonds. The refinancing is expected to save the Port Authority about $1.7 million, according to Chief Financial Officer Valdamier Collens.
Typically, the Port Authority as an autonomous agency can float bonds without Legislative approval. However, Act 5089 requires the Port Authority to obtain Senate approval for the refinancing of those particular bonds.
Several St. Croix senators were upset that the majority of the funding for the capital projects was planned for St. Thomas and St. John.
Dowe said the Port Authority is working hard to improve St. Croix's infrastructure and develop it as a prime tourist destination; however, the majority of the territory's port facilities are in the St. Thomas-St. John District.
The bonds will be backed by the Port Authority's marine revenues and will fund projects scheduled for Fiscal Years 2015 and 2016.
Dowe told senators that the territory's Caribbean competitors are working hard to improve their facilities and are investing millions to do so. He said the British Virgin Islands has just secured a $35 million loan to expand its cruise ship pier; Barbados has partnered with cruise lines to invest $150 million developing its cruise port; and St. Kitts plans to invest $31 million to build a second cruise ship pier large enough to accommodate the Oasis class ships that currently call on Crown Bay.
"The USVI cannot afford to be stagnant in the development of our infrastructure while our competition continues to upgrade," Dowe said.
The new bonds will support the following projects:
- $11 million - U.S. Customs building and parking lot for the Urman Fredericks Marine Facility in Red Hook.
- $8 million - Crown Bay cargo and cruise port dredging and upgrades to the facility.
- $2 million - Improvements to the Cruz Bay ferry and Enighed Pond barge facilities.
- $3 million - Development of Gallows Bay port, St. Croix.
- $4 million - Wilfred Allick Port and transshipment center.
- $1 million - Abramson Marine Facility, Frederiksted, St. Croix.
Gov. John deJongh Jr. issued a statement Wednesday saying he will sign the bills as soon as they arrive at Government House.
- Contact reporter Aldeth Lewin at 714-9111 or email email@example.com.