June 13, 2001 — The Senate Finance Committee on Tuesday tabled indefinitely a bill seeking to remove the property tax exemption benefit from the Economic Development Commission’s bag of investment incentives.
Had the bill, proposed by Sen. Adelbert Bryan, been ultimately approved by the Senate in 2001, the V.I. coffers would have seen an infusion of more than $650,000 in property taxes from EDC – formerly the Industrial Development Commission – beneficiaries whose benefits expire by Jan. 15, 2002, said Bernadette Williams, assistant tax assessor with the Internal Revenue Bureau.
In all, Williams said that there are currently 38 businesses in the EDC program that receive about $4.5 million in property tax exemptions. The bill, however, would only affect new businesses that seek EDC benefits or beneficiaries seeking renewal.
Support for removing the property tax exemption from the EDC’s incentives was thin at the Finance Committee hearing. Most senators said that the revenue that would be gained by the proposal is much smaller than what would be lost when investors either pull out or skip the territory altogether.
The EDC’s Nadine Marchena said that many beneficiaries can’t claim the property exemption because they don’t own the land on which they are based. The bill would also deter possible investors interested in buying land for their businesses and hotels. The latter is important because of the need for more hotel rooms on St. Croix, she said.
Sens. Alicia "Chucky" Hansen, Donald "Ducks" Cole, Douglas Canton Jr., Carlton Dowe and Norman Jn Baptiste voted to table the measure indefinitely. Bryan was off-island Tuesday.
Under the EDC program, beneficiaries can receive a 90 percent exemption on local income taxes and 100 percent exemptions on dividends, gross receipts taxes, property taxes and excise taxes.
In other action, the committee approved a federal grant applications for the HIV care program in the Department of Health for $249,330 and $416,724 for the Department of Planning and Natural Resources’ historic preservation office.
