The V.I. Casino Control Commission Monday restructured its licensing fees in hopes of attracting more hotel-casino investors to the territory.
At its monthly meeting, commission chairwoman Eileen Petersen said one of the major complaints she has fielded recently is the "non-competitiveness" of the territory’s casino licensing structure. She said high fees and the territory’s low population base, meager tourism traffic, low air traffic and lack of hotel rooms make prospective investors jittery.
"This makes investors think twice or three times," she said. "Couple that with high licensing fees and we scare away potential investors."
"If we are to remain competitive, we need to be prepared to make the necessary overtures."
With that, Petersen and commissioners Imelda Dizon and Lloyd McAlpin approved lower fees for two of the four hotel-casino options.
The first change will see fees for a Tier 1, 1,500-plus room hotel with a 20,000-square-foot casino reduced in half from $800,000 to $400,000 for the first two years. The renewal fee for the second two years will drop to $300,000 from $640,000.
Where originally there was no extra charge for adding additional casino floor space with a Tier 1 hotel, the commission will charge $50,000 for each additional 5,000 square feet of casino floor space added.
Licensing fees for a Tier 2 hotel with 300 to 1,400 rooms and a 10,000-square-foot casino will be cut to $200,000 from $350,000 for the first two years. A second two-year license will now cost $175,000 instead of $280,000.
Petersen said the goal of the Casino Control Act was to spawn more hotel rooms rather than a proliferation of casinos. But she said she’s been told that the former licensing fee schedule was "punishing" investors because more rooms meant higher fees.
"This will balance out," Petersen said. "It will not appear we are legally penalizing people who want to build hotel rooms."
