Nov. 3, 2003 Innovative Telephone Company, formerly Vitelco, is no longer a beneficiary under the Economic Development Commission. The firm's certificate expired on Sept. 30.
In May of 1996, Vitelco was granted beneficiary status by EDC, which allowed the company to receive several tax breaks and other privileges in exchange for certain obligations.
Nadine Marchena, assistant chief executive officer for the Economic Development Authority, the umbrella agency over EDC, said on Monday that Innovative has not expressed any desire to renew its status, but could apply for renewal later on. The EDC does not have a renewal deadline.
David Sharp, president of Innovative Telephone, refused to comment on the matter when contacted on Monday.
In April of this year, the Public Services Commission decided not to include Innovative's EDC tax benefits in calculating the phone company's rate of return, despite hearing examiner Frederick Watts' recommendation that they be figured in. The PSC said the company's benefits were due to expire in September and dismissed the recommendation. A rate increase was later approved for Innovative in August.
"They gave us their word that they were not going to renew [the benefits]," Keithley Joseph, PSC executive director, said on Monday.
However, Sen. Adlah "Foncie" Donastorg said in August that he would "not be surprised" if Innovative asked for a renewal of the benefits originally granted in the Schneider administration.
Under the certificate of agreement, Innovative was responsible for:
– Investing locally not less than $1 million.
– Employing no fewer than 421 full-time employees, of which at least 80 percent must be residents of the Virgin Islands.
– Providing its employees with health, dental, life and accident insurance and 401(k) retirement-savings plans and an Employee Stock Ownership Plan.
– Providing 10 $1,000 scholarships a year for the duration of the benefit period.
– Assisting schools in the territory to gain access to the Internet.
– Contributing $40,000 yearly to the Boys and Girls Club.
– Continuing its sponsorship of the St. Thomas Vitelco Youth Strikers Program and establishing a similar program on St. Croix.
– Contributing $5,000 yearly to both St. Thomas and St. Croix Little League Baseball.
In exchange, Innovative was entitled to 90 percent exemption on its income taxes, 100 percent exemption on gross receipts, excise and real property taxes and certain customs duties breaks.
Some have charged that the telephone company had been violating its contractual agreement yet was still receiving benefits. Donastorg said the EDC has yet to investigate these alleged violations.
Share your reaction to this news with other Source readers. Please include headline, your name, and the city and state/country or island where you reside.
Publisher's note : Like the St. Croix Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.