The federal government shutdown slowed down the V.I. Port Authority’s efforts to get permits to dredge the East Gregorie Channel in Crown Bay, VIPA Executive Director Carlton "Ital" Dowe told the Senate during budget hearings Friday.
The delay is not expected to have a substantial impact on the project, which Dowe told the Finance Committee is the "most critical and complex marine project for the Port Authority," but it serves to show that events here "do not happen in a vacuum," Dowe said.
Larger cruise lines have requested the channel be dredged to 11 meters for safe navigation and getting the work done is critical to avoid losing visits from them, he said. VIPA projects the work to cost several million dollars and be completed by November 2015.
When Sen. Clifford Graham, the committee chairman, asked for an update on the Crown Bay dredging, Dowe said VIPA expects to get the permit in December but that the shutdown has made it harder to work out the details.
Dowe said VIPA Director of Engineering Dale Gregory "was calling people in the Army Corps of Engineers to try to work that out and nobody was available for 16 days.”
Dowe told the senators the Federal Aviation Administration had issued more than $10.6 million to VIPA for airport improvements. This is the first time since 2002 the FAA has given VIPA funds for St. Croix, Dowe said. The FAA withheld funds pending progress on closing the Anguilla landfill, which attracted birds, posing a risk to planes. But the FAA is pleased with progress toward its closure and issued more than $3 million in discretionary funds for the Henry E. Rohlsen Airport on St. Croix, Dowe said.
Sen. Nereida "Nellie" Rivera-O’Reilly asked Gregory how much of the $10.6 million total is dedicated for the St. Croix airport. Gregory said $1.7 million for specific work and $3.1 million in discretionary money, for a total of $4.8 million.
"So when that is disbursed, we can expect some spending and job creation?" O’Reilly asked.
"That is correct," Gregory said.
The $3.1 million in discretionary funding will be used to help pay to rehabilitate the Rohlsen Airport runway apron, he said. VIPA is also paying for several studies aimed at making the airport more efficient and an expansion of the parking lot.
While happy to hear that some money was flowing to St. Croix, O’Reilly said years of neglect and lesser funding have left the St. Croix airport a dark, unfriendly place.
"When you get off a commuter flight from St. Thomas, what do you see? A dungeon with equipment all over the place," O’Reilly said.
Among the larger projects happening right now at Rohlsen Airport, VIPA is in the midst of installing hurricane shutters and has signed a $431,000 contract to V.I. Paving Inc. to expand parking.
On St. Thomas, the FAA issued a $5 million grant to install a new fence around the entire Cyril E. King Airport and upgrade the private jet apron. Work rehabilitating Taxiway A began in February, funded with an $8.9 million FAA grant and matching funds, Dowe said.
VIPA, which oversees public seaports and both V.I. airports, does not receive annual allotments and is self-sustaining through user fees, leases to its facilities and properties, and federal grants. But as a government agency, VIPA’s budget is under the oversight of the Legislature.
The authority’s revenues are directly related to the number of air and cruise ship passengers visiting the territory. Cruise and air passenger traffic is predicted to remain the same or grow very slightly in Fiscal Year 2014, Dowe said. It is projected to be around 1.9 million cruise passengers – the same as 2012 and 2013. About 868,000 air passengers are projected to visit – unchanged from 2013 and down about 5 percent from 2012.
VIPA’s proposed budget for 2014 is $96.6 million. Payroll accounts for $13.2 million of that, with employer contributions for Social Security and Medicare taxes, Worker’s Compensation, pension and medical benefits taking up another $6.7 million. Those plus all other operating expenses, from utilities to professional services, bring VIPA’s FY14 operating budget to $41.7 million. Debt service is budgeted at $4.9 million and capital spending accounts for the remaining $50.1 million for a total outlay of $96.6 million. Depreciation is budgeted as a $20.3 million expense.
Revenues to pay for those expenses include $51.5 million from operating fees and charges. Of that, VIPA’s aviation division is projected to generate $20.96 million and the marine division $30.5 million. Revenues for the FY 2014 also include:
– $18.4 million in cash on hand;
– $13.8 million in federal capital grants;
– $10.5 million in loan proceeds;
– and $2.5 million from passenger facility charges.
No votes were taken at the information gathering budget hearing, which was the final one for this budget year. The Legislature passed all the major budget bills in session earlier this month, but several agencies that are not funded directly by the government had budget hearings after the Legislature approved them because they were not affected by the budget bills.
Present were O’Reilly, Graham, Sens. Donald Cole and Myron Jackson. Sens. Judi Buckley, Terrence "Positive" Nelson and Clarence Payne were absent.
