A measure approved by the 35th Legislature on Wednesday authorized the Virgin Islands Government to issue millions of dollars in bonds to finance needed infrastructure projects. The projects include a St. Croix-to-St. Thomas ferry, upgrades to Veterans Drive on St. Thomas and St. Croix road improvements.
V.I. Public Works Commissioner Derek Gabriel led testimony on behalf of the administration during a Committee of the Whole on Wednesday and echoed claims by Gov. Albert Bryan Jr. that the proposal “will probably be this decade’s most significant economic initiative undertaken by the U.S. Virgin Islands.”
The government’s plan relies on Grant Anticipation Revenue Vehicle bonds — or GARVEE bonds — through which states and territories can issue securities with the expectation of reimbursement from federal aid grants. Gabriel said GARVEE bonds expedite development of essential projects by leveraging future grants — eliminating delays caused by yearly funding allotments.
Bryan announced the bond initiative during a Government House press briefing last week, calling it a legislative proposal that would “drive our territories forward.”
“Now if you remember, back in 2015, the Legislature passed an appropriation for an allowance of the GARVEE bonds,” he said at the time. “With these bonds, we did the first part of Veterans Drive. Projects on St. Croix include the highway — which is almost complete now — the Lorraine bypass, as well as Frederiksted roads, other associated roads, and the Mahogany Road project — just to name a few of all the stuff we did under that. That money has been utilized over the last seven years, and now we’re seeking to go back to the bond market to get some money to do a couple of different things.”
According to testimony Gabriel delivered on Wednesday, the 2015 GARVEE issuance provided approximately $91 million. Those funds equated to:
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$40 million was allocated to Veterans Drive
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$8.5 million to Sion Valley Road
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$16 million to Melvin Evans Highway
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$12.5 million to Mahogany Road
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$3 million to Christiansted roads
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$6 million to Frederiksted roads
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$5 million to Spring Gut Road
The proposed $156 million GARVEE bond issuance Gabriel defended on Wednesday would allocate:
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$54 million to refinance existing GARVEE bonds
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$20 million toward the St. Croix-St. Thomas ferry
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$48 million for the next phase of the Veterans Drive project
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$28 million for St. Croix road improvement projects
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$6 million for deposit in a “Debt Service Reserve Fund” and to cover issuance costs
The Legislative session came one day after a Government House spokesperson responded to community outcry over the state of territory roads. Over several hours, lawmakers grilled the testifiers on specific roads and infrastructure projects.
“I need to get on my soapbox for this one,” Gabriel said after an exchange with Senate Majority Leader Kenneth Gittens. “We really need to realize that the territory has a crumbling infrastructure, and every time we go in and we do road work, in some instances it causes . . . damage to other conduits.”
Gabriel said that the Waste Management Authority and Water and Power Authority are also dealing with “crumbling” pipes and decried the fact that those utilities had to dig up newly paved areas.
The measure was approved unanimously, with the exception of Sen. Marise James, who was absent for the vote.
