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Charlotte Amalie
Monday, July 4, 2022
HomeNewsArchivesCLASH OVER TOURISM AUTHORITY LIKELY

CLASH OVER TOURISM AUTHORITY LIKELY

Some version of a Virgin Islands tourism authority is likely to come about in the next year, but issues of control between the public and private sectors could make the long-awaited body’s creation occur later rather than sooner.
A proposal is sitting on Gov. Charles W. Turnbull’s desk awaiting his signature as part of the Omnibus Authorization Act of 2000, passed in the waning days of the 23rd Legislature. But the new Senate majority has vowed to work on its own version, regardless of what Turnbull does.
The current tourism authority proposal is supported by the territory’s business community and, among other things, would create a semi-autonomous agency similar to the V.I. Port Authority and the West Indian Co. Ltd. It would be responsible for developing long-range plans, coordinating and implementing policy and marketing plans and conducting market research.
The authority would be headed by a nine-person board made up of two hoteliers, one from St. Croix and one from the St. Thomas-St. John district; one person each from the St. Croix and St. Thomas Chamber of Commerces; two individuals from each district’s taxi industry and three representatives from the government.
The board would have the authority to issue bonds and would have an executive director responsible for managing day-to-day affairs.
But most importantly, the body would be funded by a variety of sources, including the $11-million-a-year hotel occupancy tax.
"We believe the bill is a great starting point," said Beverly Nicholson, executive director of the St. Thomas-St. John Hotel Association. "We believe the bill should be signed by the governor."
Nicholson noted that the proposal has "changed form" over the last year but is still workable considering the makeup of the board and the funding stream.
Unlike the St. Croix Chamber of Commerce and St. Croix Hotel and Tourism Association, Nicholson said the St. Thomas-St. John Hotel Association doesn’t have a problem with how much of the hotel occupancy tax has been used by the V.I. Department of Tourism in the recent past.
However, by having occupancy tax revenue administered by a private-public tourism authority, Nicholson said it is likely more money will be ponied up for tourism marketing by businesses leery of a government-only scenario.
"We need more dollars so we can spend more. Together we will be able to plan the marketing" of the territory, she said.
"As a whole, we believe the majority of the (occupancy tax) is being used on marketing and advertising," she said.
Carmelo Rivera, president of the St. Croix Chamber of Commerce, said his organization is adamant that the private sector have a strong role in any proposed tourism authority. Another critical factor needed for success is that the authority have a funding stream, he said.
But the funding stumbling block could be the $11 million a year generated by the occupancy tax. The private sector has long advocated that the 8 percent tax be separated from the government's General Fund. Revenue from the tax is, by law, supposed to go toward marketing the territory's tourism product. But for several years the money has been used to meet the government's financial obligations.
Some observers, though, believe that Turnbull cannot divert such a large sum of money from the General Fund because it would upset the government’s precarious payroll balancing act.
"If he puts the tourism authority together without money and clout, it will be a futile effort," Rivera said.
Who carries that clout, however, appears to be an area of concern for the new 24th Legislature. According to the Senate majority’s policy agenda, the tourism authority proposal awaiting the governor’s signature would "remove the government from any significant role in shaping tourism policy" and place "power" in the "hands of the hotel associations and chambers of commerce."
"Regardless of whether the current bill is signed or vetoed by the governor, this Legislature intends to revisit the concept" of a tourism authority, according to the policy agenda.
The Senate majority wants to see an "equitable balance between the public and private sectors in setting tourism policy" and a body that "widens the representation of private sector groups on the authority’s board as opposed to merely the hotel associations, the chambers of commerce and the taxi associations."
Normally, the governor has 10 working days to sign or veto a bill. But because the Legislature submitted it after adjourning, he has 30 working days to act on it. That gives him until Feb. 13.

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Some version of a Virgin Islands tourism authority is likely to come about in the next year, but issues of control between the public and private sectors could make the long-awaited body’s creation occur later rather than sooner.
A proposal is sitting on Gov. Charles W. Turnbull’s desk awaiting his signature as part of the Omnibus Authorization Act of 2000, passed in the waning days of the 23rd Legislature. But the new Senate majority has vowed to work on its own version, regardless of what Turnbull does.
The current tourism authority proposal is supported by the territory’s business community and, among other things, would create a semi-autonomous agency similar to the V.I. Port Authority and the West Indian Co. Ltd. It would be responsible for developing long-range plans, coordinating and implementing policy and marketing plans and conducting market research.
The authority would be headed by a nine-person board made up of two hoteliers, one from St. Croix and one from the St. Thomas-St. John district; one person each from the St. Croix and St. Thomas Chamber of Commerces; two individuals from each district’s taxi industry and three representatives from the government.
The board would have the authority to issue bonds and would have an executive director responsible for managing day-to-day affairs.
But most importantly, the body would be funded by a variety of sources, including the $11-million-a-year hotel occupancy tax.
"We believe the bill is a great starting point," said Beverly Nicholson, executive director of the St. Thomas-St. John Hotel Association. "We believe the bill should be signed by the governor."
Nicholson noted that the proposal has "changed form" over the last year but is still workable considering the makeup of the board and the funding stream.
Unlike the St. Croix Chamber of Commerce and St. Croix Hotel and Tourism Association, Nicholson said the St. Thomas-St. John Hotel Association doesn’t have a problem with how much of the hotel occupancy tax has been used by the V.I. Department of Tourism in the recent past.
However, by having occupancy tax revenue administered by a private-public tourism authority, Nicholson said it is likely more money will be ponied up for tourism marketing by businesses leery of a government-only scenario.
"We need more dollars so we can spend more. Together we will be able to plan the marketing" of the territory, she said.
"As a whole, we believe the majority of the (occupancy tax) is being used on marketing and advertising," she said.
Carmelo Rivera, president of the St. Croix Chamber of Commerce, said his organization is adamant that the private sector have a strong role in any proposed tourism authority. Another critical factor needed for success is that the authority have a funding stream, he said.
But the funding stumbling block could be the $11 million a year generated by the occupancy tax. The private sector has long advocated that the 8 percent tax be separated from the government's General Fund. Revenue from the tax is, by law, supposed to go toward marketing the territory's tourism product. But for several years the money has been used to meet the government's financial obligations.
Some observers, though, believe that Turnbull cannot divert such a large sum of money from the General Fund because it would upset the government’s precarious payroll balancing act.
"If he puts the tourism authority together without money and clout, it will be a futile effort," Rivera said.
Who carries that clout, however, appears to be an area of concern for the new 24th Legislature. According to the Senate majority’s policy agenda, the tourism authority proposal awaiting the governor’s signature would "remove the government from any significant role in shaping tourism policy" and place "power" in the "hands of the hotel associations and chambers of commerce."
"Regardless of whether the current bill is signed or vetoed by the governor, this Legislature intends to revisit the concept" of a tourism authority, according to the policy agenda.
The Senate majority wants to see an "equitable balance between the public and private sectors in setting tourism policy" and a body that "widens the representation of private sector groups on the authority’s board as opposed to merely the hotel associations, the chambers of commerce and the taxi associations."
Normally, the governor has 10 working days to sign or veto a bill. But because the Legislature submitted it after adjourning, he has 30 working days to act on it. That gives him until Feb. 13.