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Waste Management Authority Feeling Weight of Funding Cuts

Feb. 15, 2006 – A shortfall in funding for Fiscal Year 2006, coupled with budget cuts in FY 2007, will seriously affect waste management operations in the territory, according to May Adams-Cornwall, executive director of the Waste Management Authority.
At a WMA Board meeting Wednesday, Adams-Cornwall said cuts made to the Authority's 2006 budget request have resulted in a $4.7 million shortfall, which will prevent the agency from funding "basic personnel and operating costs" as the fiscal year progresses.
She said that the lack of funding would affect WMA's ability to correct various health and safety violations cited in six different consent decrees issued by the U.S. Environmental Protection Agency.
To help with expenses, Adams-Cornwall said that a supplemental budget request of $3 million was recently submitted to Gov. Charles W. Turnbull's financial team to be considered as part of the $57.2 million supplemental budget bill that was debated in the Legislature on Wednesday. (See "Finance Committee Delays Vote on Supplemental Budget Bill".)
"While I was told by members of the financial team that our request would be part of the bill, I saw a few days ago that our request didn't make the cut," Adams-Cornwall said.
Keith Richards, WMA board member and special assistant to the governor for capital projects, explained that the financial team recently had to make cuts in the supplemental budget because projected revenue figures for FY 2006 were lower than anticipated. "As a result, the requests submitted by the government's departments and agencies had to be re-prioritized," he said. "The WMA's request was not considered a 'critical' need."
Richards suggested the board write a letter to the Legislature explaining the Authority's needs before the supplemental budget mark-up process begins.
"Just to be realistic, if we don't make the cut at the executive level, then it's even harder to make the cut at the legislative level," Richards said. "And if the senators decide to take money out of the supplemental budget at all, that money isn't going to fund the needs of the WMA – it's going toward other projects which they think are a priority."
Winston Adams, chair of the WMA board, said the letter should also include what would happen if more funding were not appropriated to the Authority. "People could go to jail," he said. "The conditions of the consent decrees have to be fulfilled; otherwise we're in violation of federal standards."
Adams-Cornwall told board members that the WMA's budget ceiling for FY 2007 is $18.6 million, which, she said, is $10 million less than what the Authority was planning to request in May, when government budget requests are due.
"We're just going to have to come up with a strategic plan to deal with this and cut corners where we can," she said. "We may have to tell our residents we're not going to be able to properly treat the sewage, or that they're going to have to throw their garbage out at the bin sites instead of getting house-to-house collection services."
Adams-Cornwall said the Authority may be able to offset some of their losses with the implementation of an environmental user fee – a per pound tax on most good shipped into or manufactured in the territory. However, Cornwall-Adams said the user fee might not impact the WMA's revenues until FY 2007.
Iver Stridiron, WMA legal counsel, said a final schedule of user fee rates will be reviewed by the Public Services Commission on April 10, after being reviewed by the Authority's board.
In other action, board members also decided to write a letter to officials from Public Works, Property and Procurement, and Finance detailing a plan for streamlining the payment process to VWNA Caribbean for the construction and operation of water treatment facilities on St Thomas and St. Croix.
Stridiron said that he recently received a letter from the U.S. Department of Justice stating that the V.I. Government is currently three months behind on its payments to VWNA, whose workers have threatened to stop construction on the new treatment plants.
While the contract with VWNA is presently under the Public Works Department, Stridiron said he was concerned that the WMA might by held liable for the government's failure to pay.
"The government may have the contract, but since the WMA has been doing the project management on the site, we could have exposure to liability," he said.
Stridiron added that while the WMA has tried to get the contract transferred from Public Works, the department's acting commissioner, George Phillips, has said he wants to keep the contract until work on the facilities is complete.
"That situation would be fine if the government could keep up on its payments," Stridiron said.
Adams said the letter should lay out a specific payment routing system for the government to follow so that timely payments could be ensured.
Board members approved a $25,000 addition to the WMA's contract with engineering and consulting firm HTA Caribbean for services relating to the completion of documents for the U.S. Department of the Interior. The documents are needed in order for the WMA to receive $4.1 million in federal grant money.
Adams-Cornwall also proposed that HTA be contracted to conduct a study on how much it would cost the WMA to extend sewer lines in the Bovoni area to reach houses with failing septic tanks. Board members voted to forgo the study and extend the lines.
Board members also authorized Waste Management officials to continue negotiations on a lease with Tropix Investments for new office space on St. Croix. According to Stridiron, the terms already negotiated include an annual rental fee of $197,000 for 1.25 acres of land.
However, board members said the final lease would not be approved until the WMA has created – and submitted to the board for review – a feasible relocation budget.
Adams-Cornwall said she is also looking for temporary office space on St. Thomas. "It is imperative for us to move from our location in Wheatley Center as soon as we can," she said. "There was a shoot out in the area yesterday, and I don't think it's safe for our employees to continue to work in the building during the evening hours. Also, we need to have everyone working under one roof so that we can be efficient and productive."
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