The COVID economy continues to haunt the Virgin Islands Port Authority and the tourism support services that drive its revenue, Executive Director Carlton Dowe reported to the agency's board members Wednesday.
While operating at a $6.9 million loss in the first quarter compared with a year ago, overall revenues decreased by 44 percent, according to the most recent financial report.
Many of the rents the Port Authority's depends on to fill its coffers are delinquent; some but not all due to COVID's depression of the tourist sector. Nesbitt Trucking, for example, a tenant at Crown Bay in Sub Base, St. Thomas, owes more than $119,000. American Airlines is current on its rent, but owes more than $387,000 in aviation and operational late fees. And, the Virgin Islands Supreme Court has been holding back over $144,000 due to water leaks that were supposed to be fixed at the facility it rents from the authority on St. Thomas, according to the February accounts receivable and collection report.
The agency is chasing many of its lost revenues in collection and eviction actions that cost its operations further.
"We have been very aggressive in dealing with folks while understanding their situation," Dowe said. "We are pushing and pulling at the same time."
Meanwhile, while it has issued a handful of lease assignments that will help stem the financial ebb tide, out of 21 potential tenants ranging from DHL Express to the British Virgin Islands Tourist Board & Film Commission, the majority leases are waiting to be drafted, reviewed or approved.
The director acknowledged the need for more tenants that are not reliant on the cruise industry.
"We have initiatives for how we can gain some of that back that we are not yet prepared to talk about," Dowe said.
Barge bunkering deal
The board narrowly approved an exclusive 20- to 30-year agreement with Virgin Islands Oil And Transportation Company for the bunkering of fuel in St. Thomas Harbor to service cruise and cargo ships.
The agreement calls for fueling to take place from a barge rather than on land, with an annual $5,000 fee and tariff of 10 cents per barrel payable to the Port Authority in exchange for the exclusive license.
Some board members questioned the decision to enter into a long-term agreement with a company that, Dowe admitted, had not provided full financial disclosure of its long-term viability.
The company alluded to interested investors, but did not share who they are, board members were told.
Virgin Islands Oil And Transportation Company "has been in discussion with the Governor's Office, and apparently the project is encouraged by the Governor's Office," Dowe said.
In partnership with St. Croix Oil and Transportation Company, Virgin Islands Oil And Transportation Company will purchase fuel from the the Limetree Bay refinery on St. Croix and deliver it to St. Thomas.
In a separate agreement with the V.I. Water and Power Authority, the partners agreed to buy two storage tanks with a 100,000 barrel capacity and lease WAPA land for storage and launching. WAPA has been switching its fuel source from oil to propane for several years, and a major part of the changeover has been the construction of a new fuel-storage facilities as oil and propane cannot be stored in the same type of tanks.
Bright spots on the horizon
Not all is doom and gloom, the director noted. While acknowledging "some challenges," he reported good news as well:
—Dates have been confirmed for the 2021 Spring Yacht Show from May 16 to 1 an opportunity for charter captains and brokers to show off their product and for the Virgin Islands to promote itself as a marine destination.
—Revenues from private and chartered yachts have helped to defray lost cruise ship income.
—A redesign of King Airport, originally designed to accommodate 300,000 people each year, is pushing ahead with a goal to accommodate 900,000; closer to the actual numbers of people getting on and off flights today.
—"We expect about four Delta jets this Sunday," Dowe said, "and we are seeing American Airlines jets waiting for a gate to open. We haven't seen that in a long time."
—A roster of Port Authority infrastructure projects has weathered COVID to keep marching forward, including the $1.6 million to $1.7 million Customs site on St. John; now finished and ready to go.
If it looks like a duck and walks like a duck ...
On a lighter note, Dowe reported that the Port Authority has done such a good job cleaning the runway gut at King Airport — a biannual chore — that it has created the perfect habitat for visiting fowl.
The Division of Fish and Wildlife is reportedly seeing the biggest infestation of ducks in the territory, ever — 100 ducks a day.
"Now it's so clean ducks are starting to live there," Dowe said.
Fish and Wildlife is developing a mitigation plan.
— Contact Patricia Borns at 340-714-9104 or email [email protected].
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