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HomeNewsArchivesGENERAL FUND TO BE TAPPED FOR ROAD REPAIRS

GENERAL FUND TO BE TAPPED FOR ROAD REPAIRS

Nov. 5, 2001 – The territory will look to the General Fund and for different sources of federal money to pay for road work normally financed through $12.7 million a year that comes from the Federal Highway Administration, according to Kent Bernier, economic and financial adviser to Gov. Charles W. Turnbull.
Some of the FHA money will be used each year to repay the GARVEE bonds that will be floated to pay for the long-planned Enighed Pond commercial port and part of the Red Hook marine terminal. Both are Port Authority projects.
The government plans to float GARVEE bonds worth $19.5 million, with $17 million going for the Enighed Pond commercial port project and repair to adjacent roads, and $2.5 million to the Red Hook project.
GARVEE stands for Grant Anticipation Revenue Vehicles. States and territories can issue GARVEE bonds, which are backed by anticipated annual FHA funding.
Bernier said that debt service, meaning interest, on the GARVEE bonds will run $3.5 million a year. The bonds will have to be repaid in eight years from the time of issue. He said that once the FHA gives advance construction approval, the territory's Public Finance Authority will provide start-up money for both projects. The PFA will be reimbursed by money from the GARVEE bonds.
"The FHA is in the process of approving the construction," Bernier said.
He said the projects will generate jobs and, in a domino effect, increase revenues to the government. This means the government will still be able to pay for road repairs without using all of the FHA money, he said.
Additionally, Sen. Donald "Ducks" Cole is continuing his quest to get the federal government to send the territory the federal gasoline taxes paid by mainland motorists on fuel produced at the Hovensa refinery on St. Croix. "We're still lobbying on it," Cole said.
Bernier pointed out that the federal money doesn't come close to paying for all of the territory's road repairs. "We have set aside $4 million from the General Fund to fix the roads," he said, speaking of the Fiscal Year 2002 budget.
Port Authority officials announced last week that the authority and the V.I. government had reached formal agreement to apply for GARVEE bonds. The governor signed the agreement Oct. 30.
Finch said in a press release that, in light of the agreement, he was positive that the FHA would approve advance construction funding through the GARVEE bonds.
As soon as the FHA approved the deal, Finch said, the Port Authority would send out requests for design and construction proposals for the Enighed Pond project. He also said the Port Authority would request bids on the Red Hook marine terminal project.
In a complicated deal, Finch said the Port Authority will turn over to the General Fund the $4 million saved in a sinking fund toward the Enighed Pond project — because the GARVEE bonds will pay the tab. Additionally, the local government will advance to Port Authority $2.5 million to pay for part of the Red Hook marine terminal project, but the Port Authority must reimburse the government when money from GARVEE bonds come in. The Port Authority will pay for the rest of the $5 million project.
The Port Authority and the Public Works Department each will pay for half of the total cost to improve the roads at the Red Hook marine terminal, a project estimated at $1 million. The Port Authority and the local government had initially agreed to share funding of the Enighed Pond project, but when the GARVEE bonds became available, they developed an alternative funding method.
The agreement between the Port Authority and the government calls for paving the two 12-foot lanes to the Enighed Pond commercial port dock, constructing sidewalks on the dock side, adding curbs and gutters, building a concrete swale and installing streetlights.
At Red Hook, the Port Authority and the Public Works Department will equally split the $1 million cost of road improvements. The project includes signs at the intersection of the Red Hook dock, sidewalks, curbs, gutters, streetlights on Route 38 (Red Hook road), drainage improvements and asphalt paving on Route 38.

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Nov. 5, 2001 - The territory will look to the General Fund and for different sources of federal money to pay for road work normally financed through $12.7 million a year that comes from the Federal Highway Administration, according to Kent Bernier, economic and financial adviser to Gov. Charles W. Turnbull.
Some of the FHA money will be used each year to repay the GARVEE bonds that will be floated to pay for the long-planned Enighed Pond commercial port and part of the Red Hook marine terminal. Both are Port Authority projects.
The government plans to float GARVEE bonds worth $19.5 million, with $17 million going for the Enighed Pond commercial port project and repair to adjacent roads, and $2.5 million to the Red Hook project.
GARVEE stands for Grant Anticipation Revenue Vehicles. States and territories can issue GARVEE bonds, which are backed by anticipated annual FHA funding.
Bernier said that debt service, meaning interest, on the GARVEE bonds will run $3.5 million a year. The bonds will have to be repaid in eight years from the time of issue. He said that once the FHA gives advance construction approval, the territory's Public Finance Authority will provide start-up money for both projects. The PFA will be reimbursed by money from the GARVEE bonds.
"The FHA is in the process of approving the construction," Bernier said.
He said the projects will generate jobs and, in a domino effect, increase revenues to the government. This means the government will still be able to pay for road repairs without using all of the FHA money, he said.
Additionally, Sen. Donald "Ducks" Cole is continuing his quest to get the federal government to send the territory the federal gasoline taxes paid by mainland motorists on fuel produced at the Hovensa refinery on St. Croix. "We're still lobbying on it," Cole said.
Bernier pointed out that the federal money doesn't come close to paying for all of the territory's road repairs. "We have set aside $4 million from the General Fund to fix the roads," he said, speaking of the Fiscal Year 2002 budget.
Port Authority officials announced last week that the authority and the V.I. government had reached formal agreement to apply for GARVEE bonds. The governor signed the agreement Oct. 30.
Finch said in a press release that, in light of the agreement, he was positive that the FHA would approve advance construction funding through the GARVEE bonds.
As soon as the FHA approved the deal, Finch said, the Port Authority would send out requests for design and construction proposals for the Enighed Pond project. He also said the Port Authority would request bids on the Red Hook marine terminal project.
In a complicated deal, Finch said the Port Authority will turn over to the General Fund the $4 million saved in a sinking fund toward the Enighed Pond project -- because the GARVEE bonds will pay the tab. Additionally, the local government will advance to Port Authority $2.5 million to pay for part of the Red Hook marine terminal project, but the Port Authority must reimburse the government when money from GARVEE bonds come in. The Port Authority will pay for the rest of the $5 million project.
The Port Authority and the Public Works Department each will pay for half of the total cost to improve the roads at the Red Hook marine terminal, a project estimated at $1 million. The Port Authority and the local government had initially agreed to share funding of the Enighed Pond project, but when the GARVEE bonds became available, they developed an alternative funding method.
The agreement between the Port Authority and the government calls for paving the two 12-foot lanes to the Enighed Pond commercial port dock, constructing sidewalks on the dock side, adding curbs and gutters, building a concrete swale and installing streetlights.
At Red Hook, the Port Authority and the Public Works Department will equally split the $1 million cost of road improvements. The project includes signs at the intersection of the Red Hook dock, sidewalks, curbs, gutters, streetlights on Route 38 (Red Hook road), drainage improvements and asphalt paving on Route 38.