William and Punch shows progress, others still struggling

ST. CROIX - One effect of HOVENSA's looming closure has been to renew the community's focus on three resort and development projects that have been discussed for nearly a decade: William and Punch; Robin Bay and Golden Resorts.

Residents see the completion of the three developments - William and Punch, Robin Bay and Golden Resorts - as a source of much-needed jobs and revenue and a boost to St. Croix's tourism industry, but so far, permitting hurdles and financing in the current economic crisis have presented hurdles.

Now, word that William and Punch has entered into negotiations with two potential lenders that are "very interested" in backing the project has re-energized the hopes of residents across the island.

One of the partners in the development, Chris Elliot, said the developers began to negotiate with the two financial institutions recently - "the first time that we have actually entertained any of these discussions," he said.

The hope is that, with a massive influx of highly skilled workers soon to be laid off, there could be an average of 600 construction jobs created during the three-year life of the first phase of construction, Elliot and others said.

Once the hotel, golf course, marina, spa, casino and restaurants are up and running, they are expected to employ some 800 people permanently, Elliot said.

"The permanent jobs from phase one will have approximately a $500,000-a-week payroll," Elliot said, of which the V.I. government would collect its share in income taxes.

V.I. Labor Commissioner Albert Bryan Jr. has said that with all the skilled workers who will be released from HOVENSA, it may be the first time that major construction in the territory would not require bringing large numbers of construction workers into the territory.

While the status of William and Punch offers some positive news, the status of Robin Bay and Golden Resorts is less encouraging.

Robin Bay has been fighting foreclosure proceedings from its private lender, and Golden Resorts has been fighting a series of legal battles in local and federal courts related to the project, officials said.

Paul Golden, the developer of Golden Resorts, also said two lenders are "seriously considering the project," and that Wyndham Hotels and Resorts was still signed on to manage the resort.

"What we need is our final funding to push forward," Golden said.

Many interested investors have emerged over the years, but none of them have stepped up and backed any of the projects yet.

The William and Punch project also currently is tied up in the permitting process as it awaits word on its Army Corps of Engineers permit, officials said.

The permitting is being held up by two divisions within the National Oceanic and Atmospheric Administration's National Marine Fisheries Division: the Special Habitat and Protected Species programs, Elliot said.

"Both of those two agencies in the last six months have been unresponsive," Elliot said. The entities - just like the U.S. Environmental Protection Agency and the U.S. Fish and Wildlife Service - are required to comment on the proposed development, though the Army Corps ultimately weighs all comments and makes an independent decision.

"By being unresponsive, they have basically handcuffed the Army Corps," Elliot said. "That's our last speed bump."

A group of concerned residents who call themselves "We the People" have taken an active role in backing the William and Punch development, which would place a 378-room hotel, a marina, a casino, restaurants and golf course on the western coast just north of Frederiksted.

The group has asked the governor to intervene and apply some pressure on the federal agency, said George Flores, one of the We the People's founders.

"We have to do something to get jobs here, and they dragging their feet," he said.

Flores said he spoke with the governor already, and the group plans to have a meeting with V.I. Delegate to Congress Donna Christensen on Saturday to discuss the matter further. The group also plans to ask for help from the U.S. Interior Department.

Gov. John deJongh Jr. told The Daily News he was well aware of the project and was working with the developers to push it through the permitting process.

"They seem to be one of the furthest along," the governor said.

Hotel development on St. Croix remains a major priority, particularly in light of the closure of HOVENSA, and the V.I. government is doing as much as possible to help jump start the long-awaited projects, he said.

Elliot said, however, it was the passage of the Hotel Development Act that really shifted the tide to make the island attractive to wary investors. The act, which was signed into law in October, allows hotel developers to use a portion of their hotel occupancy and casino taxes to repay their long-term loans.

"That was key," Elliot said. "I mean, this is a historic financial crisis."

William and Punch is interested in borrowing $293 million to fund the first phase of construction. That amount would be the lion's share of the project and would include the hotel, marina, casino and golf course, Elliot said.

While there are multiple parties interested, Elliot said it likely would come down to one lender backing the project.

"We all going to work together to put St. Croix back together somehow," Flores said.

- Contact Daniel Shea at 714-9127 or email dshea@dailynews.vi.

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