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HomeNewsArchivesWAPA: PULL THE SWITCH? SELL THE STORE?

WAPA: PULL THE SWITCH? SELL THE STORE?

If one thing became clear at the Senate Committee on Government Operations hearing on Tuesday, it was that when it comes to the V.I. Water and Power Authority there are no easy decisions.
In the very near future, WAPA board members will be faced with two controversial decisions.
The first is whether to start cutting power to nonessential public agencies because of the nearly $34 million — and growing — debt the government has run up.
The second is whether to support a partial or full sale of the utility.
"I think the time has come when the Authority, for its own survival, has to make some hard decisions" about the government’s mounting debt, WAPA board chairman Arthur Downing told the hearing in Frederiksted.
"It’s going to take a lot of guts. Can you imagine pulling the plug on the Department of Education?"
After former Gov. Roy Schneider’s administration failed to carry out promises of paying government water and electricity bills, Downing said, the WAPA board was left with no recourse but to shut off services. That option, however, hasn’t been seriously considered — until now.
Downing said the board was working on a resolution that will mandate the government pay its bill in full within 45 days of the end of each month. After that, he said, "We’ll have to pull the switch so these receivables don’t grow anymore."
The government agency with the largest outstanding debt, approximately $7.5 million, is the Department of Housing, Parks and Recreation. The department’s commissioner, Ira Hobson, is now a member of the WAPA board. DHPR and six other agencies represent 40 percent of WAPA’s accounts receivable. The others are the Department of Justice, V.I. Housing Authority, Fire Services, hospitals, Department of Education and the Police Department.
The reason for DHPR’s debt, said Hobson, is a law that mandates free water and electrical service to public housing residents. St. Croix's Castle Burke project alone has an outstanding water and power bill of $3.5 million.
Meanwhile, the WAPA board has entered into a 60-day agreement with a potential buyer, the multi-national corporation Southern Energy. During the 60 days, while the company is reviewing WAPA's books, WAPA cannot enter into any other agreements with potential buyers.
A sale, however, must be approved by the executive branch and the Legislature, Downing noted.
Dean Plaskett, WAPA board member and commissioner of the Department of Planning and Natural Resources, said Southern Energy’s appraisal did not necessarily mean the utility will be sold. Rather, he said it will give board members and other decision-makers some much-needed information.
He himself is undecided on a sale, he said. "How can I be for or against the sale of WAPA without the figures in front of me?" he asked. "We want to see the figures and see what it’s worth."

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