May 31, 2002 – The interest of two major cruise lines in developing Crown Bay isn't dead, the Port Authority's executive director, Gordon Finch, told the VIPA board Thursday. Given that cause for hope, board members spent much of the meeting discussing how VIPA funds now identified for the St. Thomas port expansion project could instead be diverted to help shore up the St. Croix economy.
Finch assured the board that the an agreement worked out last year with Carnival Corp. and Royal Caribbean Inc. still lives and that funding for the St. Thomas port project is still expected. "The cruise lines have not abandoned their position on financial backing for Crown Bay," he said.
Acting board chair Iver Stridiron said he would like to see revitalization of the commitments made earlier by the cruise lines to fund port development at Crown Bay. He said his concerns are based on "economic conditions in the Virgin Islands, particularly on St Croix."
Developing the Crown Bay dock in partnership with a cruise line or cruise lines was one of the provisions of the Long-term Operating Agreement worked out over more than two years by a public-private Cruise Ship Task Force created by the 23rd Legislature, and the Florida-Caribbean Cruise Association and its 13 member lines. Other provisions of that agreement include initiatives to increase cruise ship calls at St. Croix. (See "V.I. ignores task force in cruise line pact p.r.".)
Gov. Charles W. Turnbull became the final official to sign the agreement last fall. In recent weeks, two cruise lines have dropped St. Croix from their itineraries. No ships are scheduled to call at the island now until Oct. 30. Cruise officials noted that the commitment to increase calls at St. Croix was conditional upon marketing initiatives by the Tourism Department and the territory that had not materialized.
A related immediate desire expressed by VIPA board members Thursday was to speak to the governor and the Legislature about extending an agreement that for years has waived passenger fees at Frederiksted for ships visiting both St. Croix and St. Thomas. That agreement expires May 31, and Finch and board members said if it's allowed to lapse and if the $2.50 head tax were to be imposed on the last remaining ships now scheduled to begin calling at Frederiksted in the fall, it could spell disaster.
"If we move to charge anything, even 50 cents at this point, we will be back, big time, in the blame game," Finch said. Finch was a member of the Cruise Ship Task Force that negotiated the agreement with the cruise industry.
Since Turnbull nixed a development deal between VIPA and two cruise lines in March, the authority's governing board has been shepherding various phases of the Crown Bay project through the approval process. Carnival and Royal Caribbean had jointly committed $31 million to develop the dock and an adjacent shopping area, with part of the deal being that they would control berthing at the new dock. In the face of protests from the local business community and The West Indian Co., which owns the existing cruise ship dock, the governor told VIPA to call the deal off.
Board members said they want to make sure that the cruise lines are still willing to commit to the project. Stridiron said if the board can be assured of financial backing from the private sector, it can divert some of the public funding now identified for Crown Bay to St. Croix instead.
Stridiron, who as attorney general has a seat on the VIPA board, was sitting in for Pamela Richards, who as Tourism commissioner chairs the body. Richards was in New York attending a meeting of the Caribbean Tourism Organization, of which the Virgin Islands is a member.
Concerns for St. Croix's economic health have grown with the withdrawal of cruise ships from Frederiksted. A Carnival executive cited crime as the reason that line was leaving.
The governor is expected to pay a call on cruise line executives in an upcoming trip, although Government House spokesman James O'Bryan said dates for the meetings have not been set. Stridiron and other VIPA board members said when it happens, they want to go along.
If private commitment for funding Crown Bay can be assured, board members said, it's unclear how the VIPA resources currently identified for that project could be diverted to help St. Croix. Ultimately, they said, it would be up to the people of St. Croix to express their wishes.
One option would be bunkering — the refueling of ships as they make their way through their tours at sea. Most of the cruise ships sailing out of San Juan tank up at their homeport, but some sail out of south Florida. and some, to save money, like to bunker on St. Croix where prices are lower because of the Hovensa refinery.
"The cruise ships want to save money, and they have the potential of doing that if they bunker on St. Croix," VIPA board member Leslie Milliner said. Their doing so on a large scale could translate to "millions of dollars" in revenues for the territory, Stridiron said.
But board members said they also would have to consider the desires of the cruise lines that have expressed interest in bunkering at St. Thomas. Finch urged the board to put St. Croix first because St. Thomas is already a popular destination. If bunkering were added to the provisioning of food and other goods which already takes place on a large scale, St. Thomas would become a quasi-homeport, he said, further eroding economic opportunity for St. Croix.
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