April 18, 2007 — According to three St. Croix developers with major ongoing projects, the biggest obstacle to development on the island is a painfully slow permitting process. These views came out Tuesday evening at UVI’s St. Croix campus in a panel discussion sponsored by the business-friendly civic organization, Generation NOW!
The developers included Kevin Rames from William and Punch, and Paul Golden from Golden Gaming Resorts, both of whom have hotel/casino projects in the works. Also on hand was Stephanie Hodge and Duane Bobeck of Gallows Bay Development, which is working on a mega-yacht marina project at the bay. The three were invited to update the public on the state of their respective projects and answered questions from Generation NOW! and the audience.
“I’d like to say on behalf of the group of us here, the permitting is exceedingly difficult,” said local attorney Kevin Rames, a founding partner of William and Punch.
“We have the same laws here as on St. Thomas,” said Rames. “But the effect of those laws has always been substantially different on St. Croix.” Although the St. Croix Coastal Zone Management Committee formally opposed its project, Rames said he believes they have now come to an understanding.
“By working with the members of the CZM on an open and frank basis, we think we have turned the corner with respect to the permitting process,” said Rames. “But we need the community to come out to the CZM hearings and state their case for community development, for business and job development and for developing the west end of the island.”
Golden wholeheartedly agreed. “I can echo everything Mr. Rames said on the permitting process,” said Golden. “It has taken me three and a half years to get the permits in place.”
Of the half-dozen large St. Croix development projects currently in the works, Golden Gaming is the only one that has permits in hand. However, Golden is waiting for a federal appeals court ruling on the validity of his CZM permit.
Golden cited rising construction costs and finding enough labor as major challenges, too. “With every delay, prices keep going up, and our cost estimates become obsolete,” said Golden. “We have to work up new estimates and cost plans and change our credit agreements each time.”
Stephanie Hodge of Gallows Bay Development was optimistic about CZM permitting because her firm is leasing a Port Authority property that had previously gotten CZM permits and because the location is already industrial. They have not yet applied for permits.
Golden Gaming appears to be winning the race to break ground, though no one has gotten to that point yet. With all their permits in place, Golden said the secret major hotel brand that will be running the resort will likely announce its plans within the next 30 days, after which they are looking to break ground in mid- to late summer. William and Punch is further along the permitting process than Gallows Bay, but time will tell which of the two breaks ground first.
When asked about funding, Golden said he has a line of credit for $125 million that would be released once all legal obstacles to construction are overcome. Bobeck of the Gallows Bay marina project said they too had a line of credit in place for construction.
“What distinguishes us is we have no debt, we are entirely debt free,” said Rames. As evidence that his billionaire Pequot Nation partners are committed to the project, Rames said tribe members had purchased an additional 150 acres on St. Croix for tribal retreats and winter homes, demonstrating a long-term commitment to the island.
One audience member asked about the politically sensitive issue of moving North Side Road. Rames said the road would route inland just north of Rainbow Beach and rejoin its old path near Sprat Hall. Although they plan a town meeting to speak about the road, Rames said they had approval, and moving the road was unavoidable.
“To have a road between a major, world-class resort and the beach is simply untenable as a business plan,” said Rames.
After the audience questions were done, one or two individuals were unhappy that their questions were not read, and word was passed around that controversial questions were squelched. Asked about this, Generation NOW! President Adrienne Williams said controversy was not a factor in choosing questions, but time was.
“We told the moderator not to have any personal attacks and to keep the questions germane,” said Williams. “We also had time constraints. We try to start and end on time. I didn’t see the question, so I can’t say which it was. But our purpose was to provide an informational forum rather than a town hall meeting.”
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