The Virgin Islands Water and Power Authority Governing Board on Thursday via Microsoft Teams and in person on St. Croix advanced several infrastructure projects while confronting growing concerns about delayed funding from the Virgin Islands Housing Finance Authority (VIHFA) that officials say is impacting operations, vendor payments, and ultimately service reliability in the territory.
During the meeting, board members approved amendments to the agenda to include time extensions for multiple projects, including the Queen Mary Highway undergrounding work and a line of credit extension with Banco Popular.
A key discussion centered on a request to extend a contract with West Peak Energy for project management support tied to the Wartsila generation project. The proposed amendment included a $300,000 increase and a time extension through August to assist with closing out the project and addressing outstanding items. The authority originally hired West Peak in 2022 to help with putting the generators online.
However, the board ultimately voted to table the measure after concerns were raised about payment terms and outstanding balances owed to the contractor. Project Management Director Maxwell George told the board that West Peak has not been paid since August 2025, despite invoices being submitted, and warned that the contractor is now considering a stop work notice due to the delayed payments.
“They are right now at the cost of giving WAPA a stop work notice because of payment,” George said.
Executive Director and CEO Karl Knight acknowledged the seriousness of the situation, pointing to broader systemic delays.
“The HUD funds via VIHFA have not been forthcoming,” Knight said. “There’s $38 million caught up for projects that could make a meaningful difference in reliability of our system.”
Knight added that while federal funding through FEMA has been more consistent, Community Development Block Grant disaster recovery funds administered by VIHFA have been slower to reach projects, creating bottlenecks that affect infrastructure work and vendor payments.
“That has been much more vexing. It all comes down to bureaucracy, and that is having real world implications on our ability to provide services to our customers,” he said.
Board members expressed frustration, noting that delayed funding not only affects project timelines but also risks long-standing partnerships with contractors.
“We shouldn’t have a partner of 30 years threatened to walk off because a local partner cannot uphold their part of the agreement,” one board member said during the discussion.
The board requested a status update on funding from VIHFA by the end of next week and emphasized the need for improved coordination to ensure vendors are paid in a timely manner so projects tied to system reliability can move forward.
Later in the meeting the discussion shifted to ongoing service interruptions in the St. Thomas and St. John district, where residents have experienced recent outages caused by both infrastructure failures and generation issues.
As previously reported Knight told the board a major outage affecting St. John began the night of March 14, when a transmission line supplying the island was compromised around 10 p.m. Crews mobilized immediately and attempted to restore service by switching to a secondary cable connecting St. Thomas and St. John.
Power was temporarily restored late Sunday morning, but the system failed again just hours later after a fire broke out in a junction box, causing further damage. Crews were then forced to return to the original damaged line, resulting in an extended outage that lasted approximately 48 hours and affected residents over three nights.
“Needless to say, that was quite a setback for us, with our customers, especially on the island of St. John,” Knight said.
The situation was further complicated by the nature of the initial damage. According to Knight, early findings suggest the transmission line did not fail naturally.
“All evidence points to the fact that the cable did not fail naturally, that the cable was actually intentionally cut,” he said.
The outages were discussed during the meeting just after a St. John town hall on Wednesday evening where residents voiced frustration with the utility following repeated service interruptions and prolonged outages.
Separate from the St. John incident, St. Thomas has been experiencing rotating outages due to generation shortfalls at the Randolph Harley Power Plant, where multiple units have been offline, including Unit 15, a 46-year-old generator described as a workhorse of the system.
Knight said the loss of Unit 15, combined with other units already down for maintenance or repairs, left the system short by about five megawatts during peak periods, forcing the utility to implement rotational outages.
“That has forced us to put out preemptive rotational schedules during the day when we are short those five megawatts,” he said.
Crews have been working around the clock to restore the unit, with additional personnel brought in from St. Croix to assist. Officials said once the unit returns to service, the rotational outages are expected to stop.
Knight emphasized that the outages are not related to fuel shortages.
“We have not had a fuel shortage issue — this is a generator showing its age,” he said.
In other action, the board approved a $35,251 cost increase and a 10-day extension for the Hannah’s Rest Phase I underground project on St. Croix. The delay was attributed to a temporary suspension of work during the Crucian Christmas Festival to accommodate traffic and public safety concerns. The project is now expected to be completed by April 14.
The board also approved a 30-day, no-cost extension for the Queen Mary Highway undergrounding project, which is approximately 99 percent complete. The extension will allow time to install a current transformer cabinet and transition customers to the new underground system, as well as complete remaining punch list items. Officials said the undergrounding work is part of a broader effort to improve system resilience and reliability, particularly for critical facilities along the corridor.
Members present included Board Chair Maurice K. Muia, Hubert Turnbull, Xavier Acevedo, Joan Foy, Kyle Fleming, and Cheryl Boynes-Jackson.
