U.S. House OKs bill loosening strictures on charter boats
Published: April 3, 2014
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ST. THOMAS - A bill that could help save the territory's term-charter industry and boost the local economy has passed the House of Representatives and now a similar bill is heading to the U.S. Senate.
Since the Passenger Vehicle Safety Act was passed in 1993, the number of paying passengers that can be carried aboard uninspected vessels under 100 tons has been limited to six.
"Because of the existing rule, our once-thriving charter yacht industry has migrated to the British Virgin Islands, and estimates of revenue losses to the USVI economy range from 70 to 100 million dollars annually," Delegate Donna Christensen told the House in a statement on the floor Tuesday.
While Christensen has tried in the past to push through similar legislation, the language passed Tuesday actually came from Gov. John deJongh Jr.'s V.I. Marine Economic Development Council.
The council took a new approach that so far seems to be working.
Rather than trying to force an exemption for boats carrying more than 6 passengers, the new measure simply states that if the boat is certified and inspected in the BVI, that certification is enough for U.S.-flagged vessels to operate out of the U.S. Virgin Islands and carry more than six passengers.
According to the bill, HR 4005, sec. 312, an uninspected vessel less than 24 meters - about 79 feet - that carries passengers to and from a USVI port can carry up to 12 passengers instead of being limited to six.
The bill does include a number of safety regulations the vessels must comply with, including:
- The BVI's Code of Practice for the Safety of Small Commercial Motor Vessels, known as the "yellow code."
- The BVI's Code of Practice for the Safety of Small Commercial Sailing Vessels, known as the "blue code."
Both regulations are published and administered by the U.K. Maritime and Coastguard Agency, which is the BVI's version of the U.S. Coast Guard.
"We are not asking for an exemption, we are asking for an alternative compliance standard," Marine Economic Development Council member and policy advisor to the governor Colette Monroe said.
The existing law, implemented in 1993, was meant to make boating safer by regulating smaller commercial vessels, Monroe said.
However, it had the consequence of driving most of the territory's term-charter business to the British Virgin Islands, where regulations are less cumbersome and the system of inspection is more user-friendly.
The charter industry dried up in St. Thomas, taking a lot of revenue with it.
"Our marine industry has never really recovered since that time," Monroe said.
Who is affected?
The 1993 law does not affect the mega-yachts or the large day-sails that hold 50 people. Those boats are in different classes and are subject to different levels of Coast Guard inspection.
It affects mid-size vessels - less than about 79 feet long - that are used as floating hotels, with cabins and crew, for a vacation at sea, typically for a small group of people for a week or two.
The law forces boats such as Feel the Magic, a 50-foot catamaran, to pick up passengers in the BVI. However, the BVI government limits such pick ups to seven per year.
Feel the Magic's owner and captain, Hank Hampton, said his boat has five cabins and can comfortably take eight passengers for a one-week charter.
However, he cannot book eight passengers and have them get on the boat in St. Thomas, where he lives and the boat is registered. They must come through St. Thomas and take a ferry to Tortola to get on the boat.
"We can very easily take eight passengers, but unfortunately, because of this law, we have been handcuffed essentially, unable to take eight passengers out of the USVI," Hampton said.
He said the issue is not that his boat would not pass Coast Guard inspection or that he wants to skirt federal regulations.
"They won't even give us the opportunity to be an inspected vessel," he said.
However, he is fully inspected and certified by the British Virgin Islands government.
Having term-charter boats come back to the U.S. Virgin Islands will make U.S.-flagged vessels more competitive in the industry and will bring money into the local economy, said V.I. Marine Economic Development Council member Kelly Kiernan.
"The change is going to bring the term-charter, where people go out for a week at a time, back to home port," Kiernan said. "This is the most economical place to provision and get your boat ready."
When a boat can stay in St. Thomas to pick up passengers, it is more likely to provision food for the trip, get fuel, pay for laundry and housekeeping services and have boat repairs done on-island. The boats also will be paying rent for slips or paying dockage fees.
"It's going to trickle down to everyone," Kiernan said.
What would change?
Derek Hunsinger owns Charter House, a company that helps people buy charter yachts and start and market charter businesses.
"Every week I talk to investors who want to buy a big boat, and we have no options," he said.
He said a change to the law would bring a lot of charter yacht owners back to the USVI.
"I think we'll have boats coming over from the BVI who are just waiting for this announcement," he said. "It's tremendous news."
- Contact reporter Aldeth Lewin at 714-9111 or email email@example.com.