May 15, 2009 — The V.I. Water and Power Authority’s governing board voted Friday to have WAPA Executive Director Hugo Hodge, Jr. petition the Public Services Commission to let WAPA use up to $5 million from the Self Insurance Fund to fill up its fuel storage tanks during the 2009 hurricane season.
If the tanks are full when a big storm hits, the weight of the fuel stabilizes and strengthens the tanks, reducing risk to the tanks and the environment, Hodge said. And once a storm is over, WAPA has a large supply of fuel on hand in case there is any disruption of supply.
Most years, Hovensa has loaned WAPA the cost of the fuel, allowing the utility to pay it off over the year. But last year, when WAPA was strapped for cash due to long delays between fast rising fuel costs and Public Services Commission approval to raise customer's fuel surcharge, Hovensa put WAPA on a pay-as-you-go regimen.
"Hovensa has told us they are under financial stress right now and cannot afford to advance us the fuel this year," Hodge said. "This option of using the Insurance Fund has been done in the past, though not in the past few years."
The Self Insurance Fund has a bit over $8 million in it. It used to be replenished by a surcharge on customers' bills but the surcharge was eliminated several years ago because the fund was declared full, WAPA officials said.
Chief Financial Officer Nellon Bowry proposed using the Self Insurance Fund to fill the tanks. As filling the tanks safeguards them from wind damage, "this use is consistent with the intent of the Insurance Fund," Bowry said.
Voting in favor of the measure were board members Noel Loftus, Brenda Benjamin, Donald Francois and Juanita Young. No one voted no. Ex-officio board member Kenneth Hermon was present as well.
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