July 13, 2002 – Thousands of tourists coming to the Virgin Islands for a vacation at the Westin Resort are catching the Breeze, the latest in luxury transportation between Crown Bay on St. Thomas and the resort's private dock at Great Cruz Bay on St. John.
For some in the transportation industry, however, the Breeze is riding on an ill wind bringing unfair competition to regulated taxi and ferry services.
Medallion taxi operators and public ferries with exclusive franchises issued by the Public Services Commission have long viewed tour boats, barges, water taxis, chartered shuttles and courtesy cars in this light. Critics say ambiguities in the law and failures in enforcement have aggravated the situation.
The Breeze, the territory's latest high-profile entry into the private tourist transportation business, has generate mixed reaction within the industry and beyond. The V.I. Taxi Association says it's ready to fight. Sen. Celestino A. White says he is reviewing the vessel's licenses and permits allowing it to bypass public ports.
The attorney in charge of the Public Services Commission's legally mandated rate investigation of the two franchise ferry companies says the Breeze is indicative of a trend toward incursions into the transportation market by non-regulated vessels. And, he says, that may justify a revision of the public ferry franchise.
Stylish Willis, the PSC hearing examiner, is of the opinion that the Westin ferry "appears to have some kind of effect" on the revenues of the public ferry companies. But, he adds, "I can't tell what kind of effect until I have a hearing."
While the PSC does not regulate the private Westin service, Willis says such a hearing could take place within the context of the current rate investigation of Transportation Services of St. John and Varlack Ventures, the public service franchisees He says he would be willing to take testimony from all parties who have an interest in the matter.
Since the Breeze went into service about a month ago, it has transported some 5,000 passengers back and forth between Crown Bay Marina in Sub Base, St. Thomas and the Westin's private dock in Great Cruz Bay, St. John. "It's been tremendous. It's a tremendous improvement to our service here," Graeme Davis, Westin general manager, says.
The Westin has been providing private ferry service between the two islands for its guests for the last two years, Davis said, and tried a number of private companies before settling on the St. John-based Inter Island Boat Service. The Breeze, a brand-new $1.3 million, four-level luxury transport with two cocktail bars and a stereo system, is owned and operated by Inter Island.
Arriving Westin guests utilize regular taxi service for the short ride from Cyril E. King Airport to Crown Bay Marina. From the time they board the Breeze, ship's crew and hotel staff see to their luggage, allowing the guests a hassle-free experience, Davis says.
Having "to go through public transportation with inadequate luggage service has proven over the years to not be the quality of service a guest would want to experience when coming here to the Westin," he says. "You try to increase the quality of service for the guests."
White, a staunch taxi industry advocate, says he realizes that the Westin has been running its own ferry service from its private dock for a while, but when the Breeze came onto the scene, some new dynamics came into play.
"I'm taking issue with the Westin hotel," he says. "The situation has knocked out not only the taxi industry but those who have the franchise to move passengers by sea … It is clear to me that what is happening now with Westin from Sub Base is affecting a lot of people badly."
White says he is especially looking into the permits for the resort's private dock. "We're not talking about someone coming to the island and wanting to take a day sail," he says. "We're talking about moving groups of people from one point to another, and that's taxiing."
The V.I. Taxi Association has been fighting the Westin over jurisdiction for transporting guests since 1997. Eustace Grant, association president, says some of the arrangements made for hotel guests violate the association's franchise for providing taxi service from the St. Thomas airport.
"These are not pre-paid tours," Grant says. "It's not free. What these people are doing is giving [tourists] transportation and charging it to them on their bills, $75 and up."
A Westin executive offices employee said the resort bills guests $65 round-trip for transportation aboard the Breeze. The current taxi rate from the airport to Crown Bay adds $3.50 per person each way, assuming two travelers.
Round-trip taxi and public ferry rates, again assuming two travelers, would come to $29 per person — $17 from the airport to Red Hook and back, $3 each way on the Red Hook-Cruz Bay ferry and $6 from the ferry dock to the resort and back. Alternatively, taking a ferry from the Charlotte Amalie waterfront and back, the costs would be $28 — $8 from the airport to the waterfront and back, $14 for the round-trip boat transportation and $6 from the ferry dock to the resort and back. These charges do not include baggage transportration fees, transfers and gratuities.
The V.I. Taxi Association pays the Port Authority more than $3,000 a month for the airport concession, Grant says. In 1997, the association sued the Westin and other businesses in Territorial Court, charging illegal solicitation of passengers, he says, and the court issued an injunction.
"We won that case. They appealed to a higher court and they lost," Grant says. But, he charges, "They're still violating." He indicates that the association may go back to court on the matter.
In contrast, taxi drivers on St. John who meet tourists at the Loredon Boynes Ferry Dock in Cruz Bay appear less disturbed by the Breeze. For one thing, Benedict C.E. Regis and Randolph Thomas say, they are wrestling with other headaches.
A month into the new service, Thomas says, the drivers who wait by the dock for business have not felt much impact. "I don't think it's affecting us right now," he says. "The Westin has its own taxi association, so I don't know how it's affecting them."
According to Regis, "The passengers that go to the Westin would go straight now, because they have the service. But what is affecting us is the house people."
The "house people" are drivers hired privately by vacation property mangers working with the St. John Accommodations Council. "They come and go, and that's big money," Regis says.
For Delrise Varlack at Varlack Ventures, St. John's growth as a tourist attraction means big money, money that's out there for anybody enterprising enough to rake it in. New transportation enterprises are "just a side effect of growth" in the hospitality industry, she says, "and somebody's going to get left behind."
Her interest, she says, is in making sure her company is one that stays ahead.
In addition to providing publicly regulated commuter service between St. John and St. Thomas, Varlack Ventures charters its boats for private use, as does its rival franchisee, Transportation Services of St. John. But Varlack says informal alliances between regulated and unregulated companies are putting her at a disadvantage.
Her company already is seeking relief from the PSC against the barges that transport motor vehicles between the two islands. Varlack contends that the barges also are carrying passengers in violation of the franchise agreement.
With the expanded Westin ferry service, Varlack says, the disadvantage her company faces has grown. "I have a problem with the franchise," she says, while noting that the Breeze is "not operating from a designated port." But, she adds, &
quot;Until the [Public Services] commission does something about it, there's not a lot I can do."
Davis notes that the Westin's transportation partner, Inter Island Ferry Service, is a regulated, long-established business and says he doesn't understand why the operation of the Breeze is a problem. "It's being run by a local company, it's properly regulated, long established. We're not taking away anything from anyone," he says.
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