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Governor Seeking to Replace PSC Chairman Jackson

July 15, 2005 — If Gov. Charles W. Turnbull has his way, the current chairman of the Public Services Commission will be replaced.
Valencio Jackson, who has chaired the commission charged with oversight of the territory's public services for the last two and a half years, would be replaced as soon as a new commissioner is approved by the Senate.
However, that will take some further doing. In a letter to Senate President Lorraine L. Berry dated June 21, which not made public as is customary with nominations, Turnbull nominated Violet Anne Golden to replace Jackson, whose term has expired. But Golden has declined the nomination, citing a potential conflict of interest with her position as policy advisor to Berry.
Jackson's removal from the commission at this point, would leave a number of issues hanging.
Jackson was one of three commissioners who recently voted to hire a forensic accountant to scrutinize the finances of the local phone company, whose owner is currently embroiled in several costly lawsuits. (See Prosser Busy in at Least Five Courthouses".) The status of the audit is not known.
Jackson was also appointed to be the hearing examiner on a dispute between Vitelco and Choice Communications over access to DS-3 lines. He followed up by appointing Greg Mann, a telecommunications consultant who has done other audits on Vitelco, to further investigate the details of a potential agreement, including what the cost to Choice should reasonably be and the parameters of how the connectivity would work. That matter is also pending.
Jackson has also been adamant that if Vitelco were to receive the renewal on the tax breaks the company is currently seeking through the Economic Development Program, he would call for a another rate investigation. When the phone company received its last rate increase, the decision by the PSC to allow the increase was predicated in part on Vitelco's statement that it didn't intend to pursue renewal of the EDC certificate. Jackson was not pleased when he was informed that the phone company had reapplied for benefits. "We got our information from the media. We weren't informed personally. If I were in the street, I would say how I really feel," Jackson said at the time. (See "PSC Irked by Innovative Bid to Renew Tax Breaks".)
The tax benefits, which amounted to a 90 percent break on most of the phone company's tax obligations, break down over the first five-year period to an estimated $35 million to $40 million on the local portion of the company's revenues. However, this is not the full amount of tax savings to Vitelco. The company also receives breaks on revenues collected on its portion of long-distance calls routed through its phone lines. The PSC does not regulate long-distance matters, and therefore the tax breaks received on that portion of the company's revenues is anybody's guess.
As for the governor's initial choice to replace Jackson, who has served only one three-year term with the PSC, Golden, during her tenure as a senator, supported legislation financially favorable to phone company owner Jeffrey Prosser.
Golden was a sponsor on a bill dubbed "the Prosser bail-out bill," in which the communications mogul offered to exchange property on St. Croix — which he did not own at the time — for 30 years worth of tax breaks from the V.I. government. (See St. Thomas Source story "Daily News Says Prosser 'Bailing Out' V.I.")
The Senate passed the bill, but it was subsequently vetoed by the governor, who though he reportedly authored the agreement along with Jeffrey Prosser, later said the bill eventually passed by the Legislature was outside the purview of the Senate and that it was "not in the best interest of the people and the territory."
Golden also favored legislation that added telecommunications companies to the list of eligible Economic Development Commission tax beneficiaries. She told the Source Friday afternoon that when she was championing that amendment to the EDC laws, Vitelco was already receiving tax breaks, and she was "just leveling the playing field for everyone."
Before her senatorial stint with the 23rd Legislature, Golden also worked as a consultant for then Sen. Holland Redfield — who has worked for Innovative Communications Corp., Vitelco's parent company, since he decided not to run for reëlection in 1998.
In what was a somewhat premature gesture, Jackson — who apparently was blindsided this week by the governor's action — gave a bit of a farewell address at Friday's Public Services Commission meeting.
In the message he specifically mentioned Vitelco. He said the company issued bonds without telling the PSC and that is against V.I. law. He added, "This matter remains pending and may test the patience and persistence of this commission."
The commission has focused recently on $28 million earned from that bond sale that was loaned to another Prosser-owned company and then used as a down payment on the purchase of a Belize phone company – a deal that went sour and is currently being battled in the courts of Belize and the United States.
An attorney for Vitelco last year promised that the $28 million would be returned to the V.I. utility with interest. However, it has not been returned.
In his short speech, Jackson said the governor had the right to make appointments as he saw fit, and Jackson thanked him for letting him serve three years on the board.
Jackson said about the last three years, "The rigor in which the commission has looked at the telephone company and WAPA has resulted in loud complaining from the utilities. They asked that we leave them alone. They have complained in nearly every forum – on the radio, on TV, in the print media, and in court. This is healthy. This must mean the PSC was doing its job."
He said, "The staff and the commissioners have worked together to make this commission more responsive to both the public and the utilities."
Meanwhile, the governor renominated Alric Simmonds, his deputy chief of staff, to another three-year term.
Turnbull also nominated University of the Virgin Islands Vice President Joseph Boshulte to replace Desmond Maynard, who served as chairman of the PSC prior to Jackson.
All of the current commissioners will continue to serve until their replacements are approved by the full Senate.
The first official notice to the public about the PSC nominations came Friday from Government House. It mentioned both Simmonds and Boschulte, but made no mention of a replacement for Jackson.
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