Oct. 2, 2006 The V.I. Port Authority board approved a $59.5 million annual budget Tuesday, an increase of $6 million over last year.
While aviation revenues for the new fiscal year are expected to remain relatively flat, marine-division revenues are expected to increase significantly with the opening of the long-awaited Crown Bay Shopping Mall, planned for late November or early December.
The newly extended Crown Bay dock, however, will see the first arrival of a Princess Cruise Line ship Tuesday. The 3100-passenger Caribbean Princess will arrive with much fanfare starting at 10 a.m., with steel pan music, dancers and a water-jet display. The visit heralds year-round scheduled port calls, the result of a 10-year agreement signed in July between VIPA and Princess Cruise Lines.
Aviation budget projections are cautious because of what Judith V. James, VIPA administration and finance director, terms "the level of uncertainty" in the industry's traffic flow. Aviation revenues are anticipated to show about a 2 to 3 percent increase, from the estimated $19.2 million for the 2006 fiscal year to $19.6 million in 2007.
The marine-division projections, on the other hand, call for a healthy $3.6 million increase for the new year. The 2006 fiscal year estimate is $17.2 million, with $20.8 million projected for the new year.
The division issued revenue bonds for $35.4 million in January 2003, and converted an additional $10.7 million at the start of the 2006 fiscal year. The current revenue projection is sufficient to meet the bond-debt coverage requirements for both issues.
Revenue streams continue to rise in the marine division. The occupancy rate for the Crown Bay Mall and surrounding areas is anticipated at 90 to 95 percent. In addition, the new marine rates are anticipated to become effective this month. Many of the rates adjusted in the new tariff had been effective for the past 10 years. See the VIPA Marine Division website for the new rate sheet.
The authority is a semi-autonomous agency and receives no money from the government's General Fund. It is charged with being self sufficient and must operate on revenues from its multiple marine, airline and property fees.
The 2007 fiscal year budget breakdown:
— Operating expenses — $34,668,891
— Debt service — $3,615,746
— Capital projects — $20,683,040
— Equipment — $507,998
Rental and concession revenue is projected at $6.9 million from the aviation division for the 2007 fiscal year, and $5.8 million from the marine division.
Federal grants of $43,037,699 and $16,437,976 will provide primary funding of VIPA's projected revenues for 2007. VIPA projects that expenditures will increase $7 million over last year. Estimated expenditures for the 2007 fiscal year are $29.3 million. The largest increase is in salary and benefits, a leap of $1.2 million over last year.
The escalating cost of Medicare expenses explains the increase. Perhaps the only government or semi-autonomous agency to do so, the authority has previously paid 100 percent of employee and family-member health insurance coverage. As of this month, the report says, it can no longer afford those costs.
No solution to the problem of rising health-care costs seems apparent, even on a national scale, the report says.
Starting Monday, Oct. 1, VIPA will require all union and non-union employees to pay a share of medical and health benefits at the rate of 65-percent employer share and 35-percent employee share. The authority will continue to cover 100 percent basic life and accidental death and dismemberment insurance at one and one half times the employee's salary, to a maximum of $100,000.
Health care and prescription costs have increased an estimated 12 to 16 percent each year for the past three years, the report noted.
Attending the meeting were Board chairman Robert O'Connor, Attorney General Kerry Drue, Hector Peguero, Tourism Commissioner Pamela Richards and James Rodgers. Absent were Leslie Milliner, Public Works Commissioner George Phillips and Planning and Natural Resources Commissioner Dean Plaskett.
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