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Proposed Port Authority Budget Tightens Belt

The Virgin Islands Port Authority board and chief staff spent a long day Wednesday putting the finishing touches on its fiscal year 2010 budget, which will be presented for final approval at its next meeting Sept. 23 on St. Croix.
Meantime, the Legislature will get a look at the proposed budget Friday on St. Thomas when Ken Hobson, VIPA executive director, testifies before the Appropriation and Budget Committee.
To reduce operation and personnel costs, VIPA will institute three new policies, suggested by staff and Selsia & Co., the authority’s financial consultant:
• The Crown Bay Center staff will be cut, sending some employees to general staff. The move is expected to save $183,000 annually.
• VIPA will pay 80 percent of the employee medical insurance, while the employees pick up the other 20 percent.
• A voluntary severance plan will be offered to employees with 29 or more years of government employment, with a two-year payout period. Currently, 14 employees are eligible for the plan. These positions cannot be filled, after the employees retire. A savings of about $488,000 is anticipated if all employees accept the plan.
• Implementation of non-invoice billings to VIPA’s larger clients, such as airlines and cruise lines, incorporating a 5-percent late fee after five days.
The plan also envisions a measure for the employees: The new minimum salary will increase from $15,600 to $20,000.
Seaborne Airlines will continue to provide airport to airport service between St. Thomas and St. Croix from its hanger facility at St. Croix’s Henry E. Rohlsen Airport. ‘The board also voted to temporarily extend Seaborne’s one-year permit, which expires Sept. 3, for six months, after which the airline will be required to move its operations into the terminal.
In a related measure, the board direct the staff to explore the feasibility of developing non-sterile gates at HERA for airlines providing St. Thomas-St. Croix service.
In other action, the board:
• Denied a proposed payment plan by Four Star Aviation. Board members voted instead to approve a two-year payment plan for past due amounts owed by FSA at a four-percent interest rate.
• Approved a request by Bohlke International Airways to reduce their rent by 50 percent from June 1 through Aug. 31, since the tenant was unable to fully utilize its leased hangar space at HERA due to ongoing construction work being performed by VIPA.
• Approved a request from Bohlke International Airways to reduce their rental rate for hangar space leased at HERA based on the Consumer Price Index increase effective July 2008. The rate was reduced from 12 percent to 9.74 percent.
• Approved the assignment of the lease between VIPA and Deliver It Inc. for cargo warehouse space at HERA to Caribtrans Agency LLC d.b.a. Caribtrans, VI. The tenant will lease the space to provide import shipping, delivery, customs clearance and brokerage of cargo, and commercial warehousing for three years with a three-year option at $1,666.67 per month.
• Approved a lease agreement between VIPA and Jorge Rodriguez-Brown d.b.a. B. L. Bolivars to operate an automotive repair business at Building No. 10 Subbase for three years with a three-year option at $1,153.33 per month.
• Approved a settlement plan between VIPA and DCB Investments. DCBI will be reimbursed $97,338.31 because it was unable to occupy its leased premises at Building D (the sugar mill) at the Crown Bay Center for a period of 14 months, pending VIPA’s repair of recurring leaks in the building.
• Approved a $2,372,367 contract between VIPA and Oshkosh Corporation to purchase three 1,500-gallon fire trucks for use at the airports to meet the Federal Aviation Administration’s Part 139 requirements. The FAA has provided 95 percent of the funds, and VIPA will pay the remaining five percent for the purchase of the trucks.
• Approved a $59,801.50 contract between VIPA and Julien Welding to install fencing at the Victor L. Sewer Marine Facility (the Creek) in Cruz Bay, St. John, to meet U.S. Coast Guard safety requirements. The project is funded by a grant from the Transportation Security Administration.
The meeting was conducted by Board Chairman Cassan Pancham. Members present included Beverly Nicholson-Doty, Gordon Finch, Robert O’Connor Jr., Attorney Vincent Frazer, Darryl Smalls, Yvonne Thraen, Albert Bryan Jr., and Hector Peguero.

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The Virgin Islands Port Authority board and chief staff spent a long day Wednesday putting the finishing touches on its fiscal year 2010 budget, which will be presented for final approval at its next meeting Sept. 23 on St. Croix.
Meantime, the Legislature will get a look at the proposed budget Friday on St. Thomas when Ken Hobson, VIPA executive director, testifies before the Appropriation and Budget Committee.
To reduce operation and personnel costs, VIPA will institute three new policies, suggested by staff and Selsia & Co., the authority’s financial consultant:
• The Crown Bay Center staff will be cut, sending some employees to general staff. The move is expected to save $183,000 annually.
• VIPA will pay 80 percent of the employee medical insurance, while the employees pick up the other 20 percent.
• A voluntary severance plan will be offered to employees with 29 or more years of government employment, with a two-year payout period. Currently, 14 employees are eligible for the plan. These positions cannot be filled, after the employees retire. A savings of about $488,000 is anticipated if all employees accept the plan.
• Implementation of non-invoice billings to VIPA’s larger clients, such as airlines and cruise lines, incorporating a 5-percent late fee after five days.
The plan also envisions a measure for the employees: The new minimum salary will increase from $15,600 to $20,000.
Seaborne Airlines will continue to provide airport to airport service between St. Thomas and St. Croix from its hanger facility at St. Croix’s Henry E. Rohlsen Airport. ‘The board also voted to temporarily extend Seaborne’s one-year permit, which expires Sept. 3, for six months, after which the airline will be required to move its operations into the terminal.
In a related measure, the board direct the staff to explore the feasibility of developing non-sterile gates at HERA for airlines providing St. Thomas-St. Croix service.
In other action, the board:
• Denied a proposed payment plan by Four Star Aviation. Board members voted instead to approve a two-year payment plan for past due amounts owed by FSA at a four-percent interest rate.
• Approved a request by Bohlke International Airways to reduce their rent by 50 percent from June 1 through Aug. 31, since the tenant was unable to fully utilize its leased hangar space at HERA due to ongoing construction work being performed by VIPA.
• Approved a request from Bohlke International Airways to reduce their rental rate for hangar space leased at HERA based on the Consumer Price Index increase effective July 2008. The rate was reduced from 12 percent to 9.74 percent.
• Approved the assignment of the lease between VIPA and Deliver It Inc. for cargo warehouse space at HERA to Caribtrans Agency LLC d.b.a. Caribtrans, VI. The tenant will lease the space to provide import shipping, delivery, customs clearance and brokerage of cargo, and commercial warehousing for three years with a three-year option at $1,666.67 per month.
• Approved a lease agreement between VIPA and Jorge Rodriguez-Brown d.b.a. B. L. Bolivars to operate an automotive repair business at Building No. 10 Subbase for three years with a three-year option at $1,153.33 per month.
• Approved a settlement plan between VIPA and DCB Investments. DCBI will be reimbursed $97,338.31 because it was unable to occupy its leased premises at Building D (the sugar mill) at the Crown Bay Center for a period of 14 months, pending VIPA’s repair of recurring leaks in the building.
• Approved a $2,372,367 contract between VIPA and Oshkosh Corporation to purchase three 1,500-gallon fire trucks for use at the airports to meet the Federal Aviation Administration’s Part 139 requirements. The FAA has provided 95 percent of the funds, and VIPA will pay the remaining five percent for the purchase of the trucks.
• Approved a $59,801.50 contract between VIPA and Julien Welding to install fencing at the Victor L. Sewer Marine Facility (the Creek) in Cruz Bay, St. John, to meet U.S. Coast Guard safety requirements. The project is funded by a grant from the Transportation Security Administration.
The meeting was conducted by Board Chairman Cassan Pancham. Members present included Beverly Nicholson-Doty, Gordon Finch, Robert O’Connor Jr., Attorney Vincent Frazer, Darryl Smalls, Yvonne Thraen, Albert Bryan Jr., and Hector Peguero.

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