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HomeNewsArchivesExpansion of Facilities Key to Increasing VIPA Revenues, Officials Say

Expansion of Facilities Key to Increasing VIPA Revenues, Officials Say

Aug. 7, 2007 — Local marine and airport facilities need to be bigger and better for the V.I. Port Authority to expand its services and rake in more revenue, agency representatives told senators during the first round of budget hearings Tuesday.
This includes strengthening local container ports, creating facilities for berthing larger ships and modernizing the territory's airports to make both passengers and local employees more comfortable, said Darlan Brin, executive director of the V.I. Port Authority.
The accomplishment of these goals would help pull VIPA into a more secure financial position, added Judith James, the authority's finance director. Even with an increase in capital-improvement projects and investments, VIPA is still operating at a loss in both its marine and aviation sectors, James explained.
"Although we do have funds invested, we are operating at a loss in our various divisions overall," she explained. "And we've seen a reduction in assets, especially when we compare the revenues that are being generated to what our costs are."
The percentage of discretionary funds awarded by the Federal Aviation Administration have also been cut, Brin said, as the local government continues to be out of compliance with several government mandates, including guidelines related to the maintenance and closing of the Anguilla landfill on St. Croix.
Other challenges facing the authority include increased competition in the cruise industry from neighboring Caribbean and Latin American countries, a lack of resources needed for the maintenance and upkeep of local port facilities and the under-utilization of the Henry E. Rohlsen Airport on St. Croix, Brin said.
The need to develop St. Croix's cruise and airport industries was a major topic of discussion during Tuesday's hearing. While senators pushed VIPA officials to look at rejuvenating both sectors, Brin explained that plans are in the works to turn Rohlsen into a major cargo hub for the Caribbean.
"We're now going to meet with major international air carriers to see if they have interest in setting up a hub on St. Croix," he said. "We do have the facility — we have a 10,000-foot runway and a well-developed terminal, so it could definitely be a possibility."
Improved container ports for the transshipment of cargo through both districts would also provide a major revenue source, Brin said. However, he added that more money is needed to expand both facilities, including dredging the channel leading to the container port on St. Croix's south shore.
The channel is not currently navigable, as vessels heading to the container port need to make two sharp 45-degree turns to reach their destination, Brin explained. Without the assistance of at least two tugboats, this feat is difficult and presents an additional expense to the shipping company, he said.
Jump starting the island's ailing cruise industry presents another challenge, he added, saying that cruise-ship passengers are looking for various unique activities that will keep them occupied while on St. Croix.
"What we have heard from the cruise lines is that they want the tourists to go out and be able to do things," Brin said. "You must have venues there for them to explore — when ships go to a port, there's generally a lot of tours and activities, and many of the tourists sign up for those things before they get off the boat."
Even though plans are in the works for the expansion of both local airports, a lack of hotel rooms on St. Croix has also continued to put a damper on the influx of airplane visitors to the island, Brin added.
While VIPA does not receive any money from the General Fund, Brin also gave a rundown of the agency's projected budget for fiscal year 2008, putting operating expenses at about $54.6 million. Anticipated revenues are projected at the same amount, with about $48.4 million generated by the authority and another $6.2 million coming from the federal government.
A capital budget of approximately $12.2 million will also be funded through a combination of local and federal funds, Brin said.
Present during Tuesday's hearing were Sens. Liston Davis, Carlton "Ital" Dowe, Juan Figueroa-Serville, Terrence "Positive" Nelson and Carmen M. Wesselhoft.
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