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VIPA to Begin Negotiations on Gallows Bay Development

Sept. 21, 2005— The V.I. Port Authority got the go-ahead Wednesday from its board to begin negotiations with Gallows Bay Development Partners for the development of Gallows Bay Dock on St. Croix.
The Gallows Bay Partners' proposal, presented to the authority's property committee twice, promises to turn the VIPA-owned dock into a world class mega yacht marina and commercial center.
"This is a good proposal, especially for St. Croix," Leslie Milliner, board member, said. "Anyone who's ever been to the dock has seen that something needs to be done — it's a blight, and I'm happy to see the project going forward."
If a lease is negotiated between the two entities, Gallow's Bay Partners proposes to extend the Christiansted Boardwalk to Gallows Bay, a project that the company envisions will be a major factor in rejuvenating the island's appeal to both cruise ship passengers and overnight visitors.
According to the plan, the project will consist of a landside structure that will adjoin the boardwalk and a marina.
Gallows Bay Partners says the island will have a "premier retail and office mall," while simultaneously enveloping already existing businesses and producing the state-of-the-art marina. The mall's landside development includes building a series of three-story structures to house shops, restaurants, gourmet food stores, and nightclubs.
To accommodate the marine industry, particularly the mini cruise ships and yachts expected to dock at Gallows Bay once the marina is available, the proposal includes piers and docking areas with one-stop facilities for refueling, potable water, and electrical connectivity for bigger ships. Fueling areas will also be available for small yachts.
As for the Gallows Bay community, the proposal calls for continued public use of the fisherman's dock, the building of new recreational facilities, and the provision of first-class landscaping and security for the surrounding area.
The entire construction cost of the project, estimated at $47 million, will be covered by Gallows Bay Partners. According to the proposal, private funding sources will be used to fund the development, with no financial burden placed on VIPA or the local government. However, VIPA does have to relocate its cargo facilities at the dock and dredge Gallows Bay before construction begins.
Once negotiations for the project are complete, the proposal will be presented to VIPA's full board for a final review.
Other economic development proposals approved by the board Wednesday came from Tourism Department Commissioner Pamela Richards, and Kenn Hobson, VIPA property management director.
In order to encourage new air service to the Virgin Islands, Richards presented a plan which provides airlines currently serving the V.I., or a new airline wishing to serve the V.I., a 90-day waiver on all landing fees if those airlines provide new or additional routes to and from the territory .
As an example, Richards said if American Airlines presently only provided a route to John F. Kennedy International Airport in New York from St. Thomas, they would be eligible for the incentive plan if they were to offer a flight from the island to La Guardia Airport in New York.
Likewise, if certain airlines offer flights between St. Thomas and a specific location , they would also be eligible for the plan if they were to offer an additional route between that location and St. Croix. "While most incentive plans offer a period of six months instead of three, we are one of the only areas that do not have something like this in place," Richards said.
Although Richards added that the plan's development came at the request of airline carriers who have been discussing the plan with Tourism for at least three years, board members were still concerned that their input should once again be solicited before anything is put into effect. Consequently, instead of implementation on Oct. 1, the incentive plan is scheduled to be put in place on Nov.1, pending consultation with the various carriers.
Richards reassured board members that once the plan expires on Oct. 31, 2006, airlines will still want to stay in the territory. "It takes at least a year to establish a new route," Richards said. "Once those things are up, I'm sure they'll stay up."
Tourism has recently been involved in other initiatives to bring new airlines into the territory. Richards said Florida-based Spirit Airlines has announced plans to add daily nonstop service from Fort Lauderdale to St. Thomas beginning Dec. 15. Once in Florida, the airline also offers connecting flights to Chicago, Atlanta, Detroit, New York, and Washington D.C.
In addition, a pamphlet circulated during the board meeting said in March, Delta Airlines resumed flights on Wednesdays and Saturdays from Atlanta, Ga to St. Croix, after pulling out of the island in 1999 due to economic difficulties.
For the upcoming tourist season, the pamphlet also claimed United Airlines has announced it will expand service to St. Thomas by adding three direct flights beginning Dec. 17: one nonstop flight from Chicago O'Hare International Airport on Tuesdays, and two nonstop flights from Washington Dulles International on Tuesdays and Thursdays.
Finally, the VIPA board considered a proposal presented by Hobson and legal counsel Henry V. Carr III on behalf of the V.I. Horseracing Commission. According to Hobson and Carr, the commission, in conjunction with Divi Carina Bay Resort on St. Croix and Traxco Inc., wants to install a gaming facility at the Randall "Doc" James Racetrack on St. Croix.
While the commission has consulted with the Coastal Zone Management to obtain the required permits needed for the establishment of such a facility, CZM required that the three entities obtain a variance from VIPA to install closed loop operating devices at the track.
These devices, Carr explained, are similar to slot machines, but the "brain or heart of the machine" stays at the Divi Carina Bay Casino. Since VIPA owns the racetrack land, CZM required that the variance be obtained from them. However, George Phillips, acting commissioner of Public Works, pointed out that since the land is leased by VIPA to the Housing, Parks, and Recreation Department, they should be consulted before a anything be approved.
A fax was sent to the board toward the end of the meeting from Housing Commissioner Ira M. Hobson in support of the installation of such devices. Subsequently, the board voted to allow Traxco Inc. and the Horseracing Commission to seek a variance from CZM.
In other action Wednesday, the board voted to approve a number of leases for space owned by VIPA to Ferrol Trucking Services Inc., the Transportation Security Administration, and V.I. Fire Services.
A lease was also approved between the V.I. Waste Management Authority and VIPA for office space at the Crown Bay Marina Facility. While some debate did ensue as to the fixed lease rate, members agreed to charge the VIWMA $18.50 per square foot for the facility as opposed to $15 per square foot per month.
Additionally, the board approved leases for businesses seeking space at the new Crown Bay Commercial Center, scheduled to open later this year. Space was approved for Tourism, JBH Communications, Financial Services/MoneyGram, the Westin Resort, Diamonds International, and Beverly's Amit Khemani (a local jewelry store).
Wrapping up the meeting, the board approved the extension of contracts for businesses involved in the building of the Red Hook Terminal. This includes contracts with J.U.B. King and Associates for the additional building of fences for the project, and Alcatraz Technology for the installation of new light pole conduits.
New rates for airlines renting office spaces at the Henry E. Rohlsen Airport on St. Croix were also established. Instead of paying $20 per square foot per month for air conditioned office space, airlines will now pay $30. Also, rent for tenants living in
VIPA's Bournefield Housing development, located across from the Cyril E. King Airport on St. Thomas, has increased based on the size of the apartment:
– One-bedroom units, to $350 from $300
– Two-bedroom units, to $350 from $250
– Three-bedroom units, to $525 from $425
Board members said the rate increases will offset VIPA's increasing utility costs. Landing fees, departure fees, and arrival fees will remain the same.

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