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HomeNewsArchivesGOVERNMENT'S TRAVEL AGENCY FILES CHAPTER 11

GOVERNMENT'S TRAVEL AGENCY FILES CHAPTER 11

Oct. 19, 2002 – In spite of an effort by the V.I. government to help a vendor going through hard times, a local travel agency is filing for financial reorganization.
The financial affairs of World Wide Travel became the subject of media attention back in February after Gov. Charles W. Turnbull wrote a memo to nine agency heads, asking them to "provide advance quarterly payments" for their travel arrangements. The combined travel budget for the nine agencies – Tourism, Human Services, Education, Planning and Natural Resources, Labor, Police, the Law Enforcement Planning Commissioner and the V.I. Board of Education – amounted to more than a quarter million dollars for Fiscal Year 2002.
Government House officials said it was the first time to their knowledge that such an arrangement had been made between the V.I. Government and a private company, and was done in part because World Wide was the last remaining travel agency willing to do business with the government. Previous vendors in the travel business said they stopped because late payments for plane fares were costing them too much money.
When an agency books a ticket with an airline, it has seven days to pay for it; after that they have to pay a penalty. Under the advanced payment system, the agency could take the funds from another account, eliminating the wait for payment and the need to pay a penalty.
But the move came too late for World Wide Travel. Six months later, the agency filed for Chapter 11 bankruptcy, listing outstanding debts of $675,741.30. In early October Angela Balfon, company president, met with creditors to discuss plans for a financial reorganization. A bankruptcy hearing is scheduled for Oct. 28.
A successful Chapter 11 filing allows companies to continue operations, as long as they pay creditors according to an approved agreement reached through arbitration.
Balfon declined comment on the future of the travel agency, given its current financial plight, but a top official at Government House said the current financial arrangement would remain in place for now. "That doesn't mean they are prohibited from doing business with the government," said Alric Simmonds, deputy chief of staff.

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