Aug. 17, 2001 – Jeffrey Prosser, the local tycoon whose newspaper announced in 1999 that he was going to bail out the cash-strapped V.I. government, recently used a boat to pay off a debt. The move fuels speculation that Prosser’s Innovative Communication Corp. is experiencing cash-flow problems.
According to Territorial Court documents, Prosser’s ICC is suing Tip Top Construction, the company that renovated the former Victor Borge mansion in Christiansted that is now ICC’s corporate headquarters, for what ICC is essentially calling a breach of contract.
An agreement was signed by ICC and Tip Top executives in March that settled Tip Top’s $808,766 construction lien filed in February for work done on the Borge mansion, also called the Bjerget House. After what court documents characterized as "intense negotiations" mediated by project architect Robert deJongh to settle the $808,766 claim, ICC agreed to sign over title of a 1999 Contender sportfishing boat over 30 feet in length and valued at approximately $120,000 to Percy Hollins, father of Tip Top owner Joey Hollins, for $1. ICC also agreed to make two payments of $190,000 by March 16 and April 13 to Tip Top.
But in June, Tip Top filed another construction lien against ICC, this one for $47,980. Tip Top claims it is for work done on Bjerget House East. ICC disputes the claim and is suing Tip Top.
"The filing of the second lien is for a sum of monies that was fully settled and resolved between the parties," the ICC lawsuit said, adding that Tip Top’s action is "unlawful and constitutes slander" on ICC’s title to the Bjerget House property. ICC wants the lien invalidated and an award of punitive damages of $47,980. The case is being scheduled for trial.
Prosser's use of an asset to partially satisfy a debt and the existence of other liens filed by subcontractors who have worked on ICC projects have raised questions about the financial health of Prosser’s empire, something the Source reported on last April in the story "Does Prosser have money problems?"
The questions about ICC’s financial standing are a far cry from April 1, 1999, when Prosser’s newspaper, the V.I. Daily News, trumpeted in a banner headline that he was going to bail out the V.I. government in a land-for-tax breaks deal.
In the proposed deal, Prosser’s ICC, which is privately held, and its subsidiaries would have received tax breaks in exchange for giving land to the cash-strapped government. The plan was for ICC to turn over to the government 1,000 acres of improved, subdivided land on St. Croix’s northwest shore, which would then have been given to government workers in lieu of retroactive wages owed.
In addition, ICC would have given nearly $10 million for public projects to be built on St. Croix, St. Thomas and St. John.
In return, Prosser would have received full tax breaks for 10 of his companies for 30 years, a deal that was valued at anywhere from $180 million to $3.5 billion.
The controversial proposal was considered by Gov. Charles W. Turnbull, then pulled by Prosser after intense criticism in the community. It was revived in late May of 1999 and approved 8-7 in the Senate. Turnbull vetoed the deal.

Aug. 16, 2001 – The University of the Virgin Islands Little Theatre will hold auditions for the play "Marty" from 7 to 8 p.m. on Monday and Tuesday, Aug. 27 and 28, in the theater, located on the second floor of the Classroom Administration Building.
The production will need approximately 15 characters — seven males and eight females — ranging in age from 17 to 30. Dancers are also needed.
"Marty," set in the 1950s, is the story of a butcher -– and a nice guy — who finds love, despite thinking he never would.
The play, by Paddy Chayefsky, was originally produced for television but later was made into a feature film. It won Oscars in 1955 for Best Actor (Ernest Borgnine as Marty), Best Picture, and Best Screenplay (Chayefsky).
For information call 693-1354.

The Social Sciences Division at the University of the Virgin Islands will offer a history course on the island of St. John for the fall semester.
Dr. Malik Sekou will teach History 342, "History of the Virgin Islands," beginning at 9 a.m. on Saturday, Aug. 25, at the Julius Sprauve School.
Registration is in progress at UVI this week and continues through Monday, Aug. 20.
For further information call 693-1169.

The Government Employees retiree meeting which was scheduled for 6 p.m. on Friday, Aug. 24, has been postponed until Friday, Aug. 31, at the same time and at the Curriculum Center.
The meeting is to hear retiree grievances and suggestions.

Aug. 16, 2001 – The body of 17-year-old Elton King Jr. was found submerged in the waters of John Brewer's Bay by a St. Thomas visitor who said he came upon it while snorkeling.
The Police Department Major Crime Unit was investigating the matter Thursday, and an autopsy was to be performed to determine the youth's cause of death.
In a release, Deputy Police Chief Theodore Carty said officers responded to a 911 call and recovered the teen's body about 100 feet from the shore with the help of the Police Marine Unit, members of the federal HIDTA (High Intensity Drug Trafficking Areas) task force and the snorkeler, who was not identified by police.
The youth was a resident of Kirwan Terrace.
Police asked that anyone with information bearing on the case call the Major Crime Unit at 715-5546 or the emergency number 911.

Aug. 16, 2001 – The third tropical storm of the Atlantic hurricane season could bring showers and gusty winds to the local region on Friday afternoon. Tropical Depression 4 was upgraded to Tropical Storm Chantal on Thursday morning.
"Early visible satellite photos indicate that the depression has strengthened and has become Tropical Storm Chantal," hurricane forecaster Lixion Avila said.
The center of the storm was located near 12.9 degrees north latitude and 54 degrees west longitude. Avila said the storm's movement is to the west at 28 miles per hour and that it is packing top sustained winds of 40 mph. "Conditions are favorable for additional strengthening and Chantal could be upgraded to a hurricane in the next day or two," he said.
Chantal is a relatively fast-moving storm and it is unusual for such a system to build rapidly in strength, but warm sea temperatures are having that impact, weather analysts said.
An air force reconnaissance aircraft is scheduled to investigate the storm later in the day, Avila said.
Knight Quality Stations chief meteorologist Alan Archer projected gusty winds on the order of 50 to 70 miles per hour being felt across the Virgin Islands Friday afternoon. "These winds will be in gusts associated with Chantal," he said. "Small-craft advisories are already in effect well in advance of the arrival of any inclement weather." On its current movement and projected track, Archer said, the storm would pass about 150 miles south of St. Croix.
Tropical storm warnings were posted for Barbados, St. Vincent and St. Lucia. Tropical storm watches were up in the Grenadines and Dominica.

Aug. 15, 2001 – Cruise ships could be berthing at a new, extended Crown Bay dock as early as next March, the Port Authority Board was told Wednesday by representatives of the two cruise lines that will be building a new shopping center and expanding the present docking facilities.
At its July 18 meeting, the board approved a contract between the Port Authority and the Royal Caribbean and Carnival lines for the dock and shopping center development.
The $31 million project will now officially get under way, Gordon Finch, VIPA executive director, said as the board approved a letter of agreement at its Wednesday meeting. Although the letter spelling out the contract details still needed a final review by the cruise lines, Finch said, "This will allow them to begin spending dollars."
John F. Tercek, vice president for new business development for Royal Caribbean Cruises Ltd., said he would have the letter back to Finch with any revisions by Wednesday evening. The press was not allowed to see a copy of the multi-page letter in advance of any revisions to come.
The agreement calls for the two cruise lines to cover all costs and for the Port Authority to manage the property. The cost will be split evenly – $15.5 million each — for the dock expansion and the shopping center development. The cruise lines would retain 75 percent of tariffs from the development for the first 20 years of the agreement, which calls for a 50-year lease by the cruise lines, after which the property will revert to VIPA.
The shopping development is to be a 5,000-square-foot area for local businesses, with an emphasis on arts and crafts. Kent Bernier, Gov. W. Charles Turnbull's economic adviser, said the Economic Development Authority will coordinate the shopping center.
A Government House release distributed Aug. 1 announced that the Port Authority, the West Indian Co. and the Tourism Department had executed a long-term operating agreement with the Florida-Caribbean Cruise Association and its member lines. A task force of V.I. public- and private-sector members and representatives of the FCCA and its member lines worked for more than two years on the agreement as an alternative to the Virgin Islands increasing per-passenger docking fees.
One of the agreement's 13 points was that the cruise line or lines "to undertake seaside and land-based projects" in Crown Bay would "commit to the incremental passenger flow" needed to enable VIPA to finance the development.
At Wednesday's meeting, board member and Public Works Commissioner Wayne Callwood expressed grave concerns about how his department would be involved. "I see serious problems with the infrastructure — traffic lights, sewage, sidewalks," he said. "We don't have the funds to do all that." But Finch replied, "Let's not hamstring the cruise lines with all of that right now."
Bernier promised Callwood to bring the matter up with Property and Procurement Commissioner Marc Biggs at a Thursday cabinet meeting.
Tercek and Gioira Israel, Carnival Cruise Lines executive officer, were enthusiastic as they explained mutual goals for the area. Although there are always fewer cruise ships calls in the summer, Israel said, the expanded dock facilities will allow mega-ships to dock in Crown Bay, so ships that do call will carry greater numbers of passenger than now — about 3,000. Tercek said the agreement is unique; the cruise lines have no other like it anywhere.
The Crown Bay development has come under criticism from Edward Thomas, chief executive officer of the West Indian Co., and from downtown Charlotte Amalie retailers fearful that the development will deter passengers from shopping in town. Some critics have argued that the Port Authority should focus its energy on getting a cruise line to home port on St. Croix.
Israel said that before St. Croix could be a homeport, it needs more infrastructure and "it needs an anchor attraction — rain forests and beaches won't do it."
The board also heard from Triad Associates, an economic and community development consulting firm hired by VIPA to make an economic development study for St. Croix. John E. Corrigan, Triad senior associate, said he foresaw making St. Croix "the best business port in the Caribbean."
Board member and Attorney General Iver Stridiron expressed reservations about VIPA's involvement in the proposed development program laid out by Triad, which embraces 80 projects, 28 of them directly connected to the authority. "We have had so many grandiose schemes over the years," Stridiron said. "We overwhelm the public, and we don't do anything. Maybe we should just take one or two things and do them well."
He also suggested that a fundamental change in St. Croix's attitude toward outside investment would be an improvement. "Perhaps this isn't politically correct," he said, "but St. Croix doesn't embrace new projects; they reject them."
The Triad proposal envisions the development of an industrial business park on 100 acres adjacent to the Henry R. Rohlsen Airport, a theme park, convention centers, golf courses and casinos. The board debated how the study report should be implemented and how the public should be involved. The proposal would involve many government agencies, and require input from them all.
The board decided to accept the draft of the study report so that Triad can proceed with public hearings on its proposals. The draft is to be submitted to all public and private agencies involved, with a request that they respond by a given time.
Again, Bernier said he would bring the matter up at Thursday's cabinet meeting.
The press also was not allowed to obtain a copy of the Triad report. VIPA charges media representatives $15 for a copy of the agenda of each board meeting. Wednesday's agenda did not provide any information about either the Crown Bay development or the Triad study, except to list both as presentations under "Matters Requiring Board Action."
In other action, Hortense Rowe, Sen. Adelbert Bryan's chief of staff, asked the board to help sponsor Bryan's Economic Development Summit held on St. Thomas and St. Croix in July. Rowe placed the cost at $100,000 and said Bryan's Committee on Economic Development, Agriculture and Consumer Affairs contributed $20,000. The board referred the request to its finance committee.
Attending the meeting were the board chair, Tourism Commissioner Pamela Richards; Stridiron, Callwood, Kent Bernier and Leslie Milliner. Planning and Natural Resources Commissioner Dean Plaskett was absent.

Aug. 16, 2001 – St. Croix would become the hub for air operations between the mainland and points south if Sun Airways, which stated its case before the Port Authority governing board on Wednesday, is approved to operate in the territory.
Bruce M. Casner, Sun Airways chairman, was introduced to the board by Sen. David Jones, a longtime supporter of bringing off-island investment to the territory.
Casner told the board, meeting on St. Thomas, of plans to make St. Croix the airline's hub for an ambitious schedule. He said Sun Airways expects to transport some 215,000 passengers in its first "mature" year of operation.
A former Washington, D.C., transportation lobbyist, Casner said he foresees the expanded Henry E. Rohlsen Airport as the transit center for air traffic between certain U.S. mainland gateway cities and down island and Latin America. The airline plans to have another hub in Puerto Rico, he said.
Casner noted that American Airlines now dominates the U.S. mainland-Virgin Islands and Puerto Rico traffic, with about 70 percent of the total market. However, he added, American has reduced its number of flights, and this has caused major concern for hotels in the territory.
"We've studied everything about this market that exists," he said. New business investment in the territory is deterred by inadequate air transport capacity, he said.
"Look at the empty ticket counters at the airport now, the empty gates," he said. "We could fill those up with passengers connecting to other flights and those staying in the V.I." He stressed that there is a market for competition with American Airlines, which he charged has "damaged much of its customer base in the Caribbean from poor customer service."
With seven round-trip flights weekly, Casner said, Sun Airways would provide about 34 percent of the available seats from Washington's Dulles Airport to the territory, and the only non-stop service from Orlando. The airline plans to serve European passengers who come to Orlando to visit Disney World and the other theme parks there, he said.
The airline plans to establish maintenance centers, air cargo distribution centers, fueling facilities and an aviation training school, he said.
Asked by board member and Attorney General Iver Stirdiron if the Puerto Rico hub wouldn't compete with the one on St. Croix, Casner said the airline would need Puerto Rico to support its operations. Stridiron commented that airlines have come to the territory before, only to default to the Puerto Rico market. Casner insisted his plans wouldn't allow that, saying the St. Croix hub would provide an "escape valve" for the overcrowded airports of San Juan and Miami.
Because of time constraints in his appearance before the board, Casner said, he didn't get into the airline's financial picture. He said he would submit a financial statement to the board. He also said Golden Gaming LLC, which has a casino application before the Casino Control Commission, "is willing to put some dollars into Sun Airways."
Jones said the airline wasn't asking for anything more from the Port Authority at present than an acceptance of its plan. The board agreed to take it under consideration.

The following shelters have been inspected and approved for the year 2001 hurricane season.
St. Thomas
– Seventh Day Adventist School, Anna's Retreat
– Charlotte Amalie High School, Sugar Estate
– Nisky Moravian Church, Nisky
– Blue Water Bible College, Fortuna
St. John
– Clarice Thomas Annex, Cruz Bay
– Emmanus Moravian Church, Coral Bay
– Bethany Moravian Church, Cruz Bay
– St. John Methodist Church, Contant
St. Croix
– Claude O. Markoe School, Mars Hill, Frederiksted
– Educational Complex, Kings Hill

Aug. 16, 2001 – "Good news" tourism statistics released by Government House Wednesday paint only part of the picture, the presidents of the territory's hotel associations agreed Thursday.
Citing government Economic Research Bureau statistics, Gov. Charles Turnbull said the number of visitors arriving in the territory during the first half of this year was up by 14 percent from the same period last year, to a total of 1.46 million. The figure includes arrivals by both air and sea.
"Concentrating on head counts is how to lie with statistics," countered Richard Doumeng, president of the St. Thomas-St. John Hotel and Tourism Association.
Wendall Snider, president of the St. Croix Hotel and Tourism Association, called Turnbull's claim that the territory's tourism picture is steadily improving "a trip to fairyland."
Snider and Doumeng both pointed out that two of the territory's small hotels recently closed — the 12-room Admiral's Inn on St. Thomas and the 8-room Sea View Farm Inn and its restaurant, Bandanas, on St. Croix.
Saying he fears that such closings may become a trend on St. Croix, Snider noted that smaller properties are the first to feel the pinch in economic downturns. They typically are independently owned by people without the financial resources of hotel chains. "The question is, how deep are their pockets?" he said.
Doumeng said the Economic Research Bureau uses inadequate methods to count people. The numbers don't take into account travelers' ultimate destinations — St. Thomas "arrivals" include a high percentage of people who stay with family or friends as well as people headed to the British Virgin Islands. And the St. Thomas/St. John district statistics do not separate St. John from St. Thomas. This means St. John tourism professionals have no count of how many people have the island as their destination.
In the case of St. Croix, the statistics include the large numbers of arrivals who are heading to work at the Hovensa coker construction project. While some of these workers stay at hotels and condominiums, many are housed in accommodations on the Hovensa property.
Snider, who runs the 38-room Hibiscus Beach Hotel, said that his hotel is running at 50 percent occupancy, but that 40 percent of those guests are on St. Croix in connection with the Hovensa project. While these guests help his occupancy rate, Snider said, they do not for the most part spend money on hospitality-oriented items as tourists do. "Taxi drivers don't get the revenue. Restaurants don't get the revenue," he said.
He said the Hovensa construction workers typically cook for themselves or eat at low-budget restaurants because they get a set food allowance.
Stays are shorter, rates are down, costs are up
Other factors also are hurting hoteliers' bottom line. For one thing, the average visitor stay has gotten shorter. Doumeng said many people now come for only a few days. "Instead of six nights, they might stay three nights," he said.
Doumeng, who manages Bolongo Bay Beach Club and Villas, said that his guests are spending more at the resort's restaurants because they don't venture off the property the way visitors used to. "They don't get rental cars. They don't eat at Craig and Sally's," he said, referring to an upscale Frenchtown restaurant.
To stay in business, Doumeng said, he has slashed rates. When he started working at Bolongo in 1989, the summer rate was $175 a night. Twelve years — and many cost-of-living increases — later, it's $165 a night. Operational expenses have escalated in those dozen years. Property insurance now runs him $190,000 a year. In 1989, it was $36,000. And Water and Power Authority costs are "through the roof," he said.
Doumeng pointed out that the drop in room rates means that the government is getting less money in gross receipts taxes and hotel occupancy taxes.
Actually, the Economic Research Bureau statistics show little change in the numbers of visitors arriving in the territory by air. For St. Thomas, the total from January to June of this year was up 4.1 percent, to 282,161, over the same period last year. In St. Croix, the total number of air arrivals rose by 1.7 percent, to 79,705.
Cruise ship arrivals for the same six-month period showed bigger gains. For St. Thomas/St. John, the number arrivals increased by 12.7 percent, to 1.05 million. On St. Croix, the increased 17.2 percent, to 148,164.
Mike Daswani, who owns the Royal Caribbean camera and electronics shops on St. Thomas, said his revenues were up slightly the first half of this year, but not significantly. "The increase in ships did help," he said.
Cruise ships account for most of the increase
For the first six months of this year, the territory's hotel occupancy rate stood at 67.8 percent, just a tick above last year's 66.3 percent. For St. Thomas/St. John the rate was 71.4 percent, up from 69.4 percent last year. For St. Croix, the rate barely changed, at 56.5 percent from January to June this year, compared to 56.4 percent for the same period last year.
The Government House release also noted that the percentage of tourists from Canada, Europe, Central America and South America registering at V.I. hotels in the first half of this year was down from the corresponding period last year. The numbers dropped by about one-third in the case of Europe and Central America, and 25 percent in the case of South America, it said.
"We are pleased that the economic indicators reflect that we are presently exceeding tourism-related activity achieved during 2000 when we experienced a banner year," the release quoted Turnbull as saying.
Tourism Commissioner Pamela Richards did not return a telephone call requesting comment.