Despite signs of recovery from the recent economic downturn, West Indian Co. Ltd. will probably not be able to repay millions owed to the V.I. government—at least not any time soon. That’s according to WICO CEO and President Edward Thomas, who testified Wednesday before the Senate Committee on Appropriations and Budget.
For the last several years, Thomas said, the company—which manages the Havensight dock—has been unable to meet a legislative mandate requiring WICO to contribute $1 million of net revenues to the General Fund in lieu of taxes per fiscal year.
He said the company was not able to do so in 2006, 2008 or 2009; and he didn’t think it would be possible in 2010 or 2011—unless the economy made a drastic turnaround.
During questioning, Thomas told Sen. Wayne James that between 2009 and 2010 WICO lost $1 million. (A quasi-governmental entity, WICO does not receive an appropriation from the government’s General Fund.)
He said the relocation of some cruise ships from the Havensight port to facilities in Crown Bay has affected the company’s bottom line. After a controversial plan to dredge Charlotte Amalie’s main harbor was scrapped, the company lost docking rights for the Oasis of the Seas (one of the world’s largest cruise ships) to the V.I. Port Authority, which owns the Crown Bay dock.
Additionally, both the Princess and Holland America cruise lines entered into 10-year berthing agreements with Crown Bay.
Despite the economic loss for his company, Thomas acknowledged the greater economic gain for St. Thomas as a whole. He called the move a shift in economic action, meaning that businesses that previously didn’t see many dollars from cruise ship passengers, now get some attention.
“The territory didn’t lose, because the ships still come,” he said.
And, Thomas said, after several bad years when the economy was at its worst, those ships are once again bringing increasing numbers of tourists. He said that on March 30, more than 20,000 passengers arrived in St. Thomas – the first time in history that many people were here.
Through June, passenger arrivals into St. Thomas totaled approximately 965,000 compared to roughly 864,000 this time last year.
And those people are spending more money. Per-passenger spending in St. Thomas was $193 in 2009 compared to $176 back in 2006. He said people are spending more here than in St. Thomas’ number one competitor, St. Maarten, which is also good news.
During his testimony, senators took time to extend well wishes to Thomas, who’s retiring after 16 years at the company’s helm.
During Wednesday’s hearings, senators also met with representatives from the Department of Agriculture.
Commissioner Louis Peterson said his department has been hard at work on their “No Pound Left Behind” campaign to track local agricultural production data. He said their plan to collect data from July 2009 through June 2010 generated a low response – just 13 percent of registered producers in the St. Thomas–St. John district responded, compared to 20 percent of St. Croix producers.
Despite the low response rate, the survey revealed that the territory’s top three livestock commodities are goats, cattle and sheep; while the top three crops were mangos, coconuts and cucumber.
Peterson said the department is also working to market locally grown produce with its Virgin Fresh brand logo.
Sen. Craig Barshinger told Peterson that many local farmers work very hard only to make about $2 an hour. He said that Peterson’s department needs to work with farmers to teach them how to get a good return on their investment.
The governor has recommended a general fund appropriation of $3.1 million for the department for fiscal year 2011. That number represents a 7 percent decrease from 2010. The department also expects to receive $250,000 in additional funds from the Agricultural Revolving Fund and $295,000 in federal funds.
