Aug. 4, 2003 – The Senate Finance Committee took Fiscal Year 2004 budget testimony as scheduled Monday from the Port Authority and the Planning and Natural Resources Department, but not from the also-scheduled Government Employees Retirement System.
Sen. Adlah "Foncie" Donastorg, Finance chair, said a series of things led to the GERS hearing being postponed. And he said the committee would take the steps necessary to insure the participation of GERS officials in the budget process.
The Port Authority as a quasi-independent agency sets its own budget based on its own projected revenues and federal funding. But it and other such agencies are invited to appear before the Finance Committee to present an overview of their budgets for the coming fiscal year.
Darlan Brin, VIPA executive director, said that for FY 2004, the authority's budget is $79.3 million, up by $3.9 from the current fiscal year.
The Port Authority has spent $40 million on capital projects this fiscal year and is planning to expend $46.8 million for that purpose in FY 2004, Brin said.
He told the senators on Monday morning that the authority's capital projects provide both direct and indirect benefits. "Some of the projects are revenue creating, and they create jobs," he said.
Here are the six Port Authority capital projects under way, along with their funding sources:
– The Enighed Pond Marine Freight Facility on St. John — $16 million in federal Grant Anticipated Revenue Vehicle (GARVEE) bonds.
– The Crown Bay cruise ship pier expansion and commercial center on St. Thomas — $34 million bond issue.
– The Red Hook Marine Terminal on St. Thomas — $2.5 million in GARVEE funds.
– A new air traffic control tower at Henry E. Rohlsen Airport on St. Croix — $4.6 million.
– The Gallows Bay pier in Christiansted — a $1 million grant from the U.S. Economic Development Administration.
– The Ann E. Abramson Cruise Ship Facility in Frederiksted.
Brin said groundbreaking for the Crown Bay facility was held July 19 and that construction should be completed by next June, "before the start of the 2004 cruise season."
Responding to a query from Sen. Louis Hill, Brin said the first phase of the Charlotte Amalie waterfront apron revitalization will begin next year, and construction on the Red Hook marine facility will "probably begin sometime next year."
The Rohlsen Airport control tower should be completed within a year, Brin said, and the Enighed Pond cargo dock facility should be completed by September 2004.
VIPA's budget also includes $28.2 million for operating costs in FY 2004 — down by $3.1 million from FY 2003.
Last March, Brin said, VIPA cut costs by freezing vacancies, reducing overtime by 60 percent, suspending capital spending, cutting professional services by 25 percent, reducing other costs by 25 percent and reducing management salaries by 8 percent.
He told the lawmakers VIPA's financial difficulties were a side effect of the Sept. 11, 2001, mainland terrorist attacks. An "increase in security, operating expenses and insurance costs is the most significant factor in VIPA's aviation operating cost," he said. "This agency has been faced with declining traffic and higher costs for security and insurance, including terrorism coverage."
On a more optimistic note, Brin told the senators the coming year is expected to bring growth of about 2 percent in both aviation and marine traffic.
"Barring new unexpected events, a degree of normality may return to the market in late 2004," he said. "If this is true, the air and sea transportation sectors will continue the almost uninterrupted pattern of steady stability that has characterized both industries in the past."
Planning and Natural Resources
Monday afternoon, Planning and Natural Resources Commissioner Dean Plaskett presented his agency's budget.
"I am pleased to report to you today that the Department remains fiscally sound and is considerably prepared to carry out its statutory responsibilities," Plaskett said told the committee.
The many divisions under the DPNR umbrella include architecture and historic preservation, libraries and museums, environmental protection, the V.I. Energy Office and Coastal Zone Management program.
Plaskett presented a total FY 2004 budget of $29.8 million, including $6.2 million from the General Fund, an increase of 17.62 percent from this fiscal year. He also budgeted $18.6 million in federal funds, down by 10.2 percent from FY 2003.
The major funding sources for the budget:
– $6.2 million – General Fund
– $2.8 million – miscellaneous funds
– $929,782 – Natural Resources Reclamation Fund
– $759,897 – Air Protection Fund
– $401,720 – Fish and Game Fund
– $18.6 million — various federal funds
Plaskett said he also has submitted a request to the Office of Management and Budget for a supplemental budget of $1.5 million to cover shortfalls, especially for the operation and maintenance of the new fish market on St. Croix.
Hill asked whether the staffing of the Permits Division was sufficient.
"These employees are responsible for revenue generation," Plaskett said. "The problem is the level of salary when you ask a licensed contractor of electrician to work for $30,000." The department needs to pay such people what they deserve, he said.
However, he said, the Permits Division did get two new vehicles and hand-held radios for both districts this fiscal year, he added.
And to address what he called a significant problem regarding salaries, Plaskett said, DPNR is continuing to "transfer numerous employees from the General Fund to federal funds, resulting in significant savings to the General Fund."
He also said the department has installed videoconferencing equipment to facilitate inter-island meetings without travel costs. "We have seen some significant savings from the that," he said.
The Capital Development Division is working on a plan to provide permanent housing for the homeless, Plaskett told the senators. "Based on this plan, two non-profit organizations have submitted three applications to Housing and Urban Development for $1.2 million to develop Section 8 housing, an information management system and transitional housing for the homeless," he said.
For FY 2004, Plaskett said, "we do not profess perfection; we intend to address our shortfalls and improve."
Committee members present at the day's hearings were Sens. Roosevelt David, Donastorg, Hill and Renee. Absent were Sens. Norman Jn. Baptiste, Shawn-Michael Malone and Ronald Russell.
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