Gov. Albert Bryan Jr., who chairs the Public Finance Authority, raised concerns about how the West Indian Company would pay back a $55 million bond issuance it was asking the Authority to approve. He said if WICO came around later asking for money from the government it was not going to be forthcoming. He said, “The territory has so many other pressing needs for funding.”
Jenifer O’Neal, director of the Office of Management and Budget and member of the PFA board, also raised the concern, asking how WICO would be able to make a $3.9 million payment in a few years when it was now struggling to make $3.1 million payments.
Keith O’Neale, Authority secretary, said about the issuance, “This doesn’t sound like a plan to win but more like a plan to lose slower.”
Still, after Jerome Cox presented the problems that could arise if WICO was not able to issue the bonds, the Authority unanimously approved and consented to the use of WICO’s real property as security for the proposed bond issuance. WICO is a port facility with a cruise ship pier, shopping mall, and commercial rental complex. WICO is a wholly-owned subsidiary of the PFA, established as a public corporation rather than as a private corporation.
Cox told the Authority that the bond sale was all about getting WICO back in the position it was before the hurricanes of 2017 and the recent pandemic. He said of the $55 million, $4 million would go to critical maintenance projects to avoid interrupting the revenue stream.
WICO CEO Anthony Ottley answered how WICO would be able to make the higher payments in a few years, by saying WICO would be charging higher fees in the future. He said WICO expected cruise ship visits to be 80 percent of what used to be normal in the upcoming season and 90 percent in 2024. The territory used to average 2.1 million visiting cruise passengers each year. Headlines citing a tripling of cruise ship arrival in the upcoming year only referred to St. Croix which receives a small fraction of the cruise ships that come to the Territory.
Ottley said the average annual income for WICO before the disasters sent its books into the red was over $7 million.
Concerns were also raised about how the planned merger of the Port Authority and West Indian Company would affect the bond sale. Cox said, “We did carve out language that would allow for the merger.”
O’Neal also questioned how reliable the numbers were concerning upcoming cruise ship visits. Ottley said the cruise ships’ schedules were set 24 to 36 months out and those numbers would not change much. He added that because the harbor has not been dredged recently WICO cannot always let in all the ships requesting to come to St. Thomas. He said, “We don’t have an issue of getting ships, but we have an issue of where to put ships.”
The Authority had on its agenda for this meeting an item approving a loan to viNGN so it could buy a building. However, Stephan Adams, president of viNGN, reported that the sale was off now because a clear title to the property was not established.