Last week in the House of Assembly, opposition member Andrew Fahie (R-D1) continued to push for answers about government’s decision last year to divert an $8 million loan earmarked for sewerage work in East End/Long Look into the $85 million-plus Tortola Pier Park project.
Premier Dr. Orlando Smith maintained at the time that the transfer was authorised by the Public Finance Management Act, which states that “money in the development fund received by way of a grant or loan shall be used by the government for the purpose for which it was received unless the donor or lender of the money agrees that it may be used for some other purpose.”
However, the BVI Ports Authority Act states that notice must be given in HOA for such a transfer to be approved, and legislators debated that issue at another HOA sitting later in April.
At that sitting, government tabled a notice showing exactly when the funds were transferred: $5 million in April 2015, $2 million in May 2015, and $1 million in July 2015.
TPP lease income still falling shortA 2015 prospectus for potential investors in the Tortola Pier Park forecasted that the landside development would receive $837,000 in lease revenue in 2015 and more than $2 million in 2016. However, total revenue as of Sept. 15 fell far short of those projections, according to information provided by Communications and Works Minister Mark Vanterpool last Thursday in the House of Assembly. In response to questions from the opposition, Mr. Vanterpool said that TPP has billed its tenants $1,031,490 and has collected $939,244 as of Sept. 15. The gap between what TPP is billing and what it’s receiving is increasing, too. In April, Mr. Vanterpool provided documents in HOA showing that the pier park had billed retailers for nearly $333,000 as of March 31 and received $308,293. Therefore, TPP received almost 93 cents on the dollar for its billings through March 31, but only about 91 cents on the dollar through Sept. 15. Also last Thursday, Mr. Vanterpool passed documents to opposition members that detail the rents collected from each TPP tenant. However, HOA officials had not provided those documents to the Beacon as of this issue’s press deadline. |
The notice also stated that the loan was to be paid off by Dec. 31, 2015 — something Communications and Works Minister Mark Vanterpool admitted had not been done.
“The Ports Authority has put the case forward that they will pay it back as soon as they’re able to totally complete the project and have the revenue coming in,” Mr. Vanterpool said of the BVIPA’s loan delinquency.
Timeline
Last Thursday, Mr. Fahie pressed for more details about when the loan will be repaid to CIBC.
Dr. Smith responded that the loan is being repaid over four years, in quarterly installments of $500,000 each year. The BVIPA has already paid the first two installments, he said.
As a follow-up question, Mr. Fahie asked why the terms of the CIBC loan had changed, enabling government to repay the funds in quarterly installments through 2019 instead of paying in full by the end of 2015.
“The BVI Ports Authority received funds to help complete the pier park,” Dr. Smith replied. “They’re not in the position to repay the monies as quickly as they originally thought. Therefore, this arrangement allows them to repay in an extended period of time.”
Mr. Fahie then argued that the BVIPA defaulted on its loan, according to general accounting practices.
“You would say that, but I would say there’s a new arrangement,” the premier responded.
Audit
Also discussed last Thursday was the audit the international firm KPMG is conducting on the project.
In response to a question from Mr. Fahie, Dr. Smith said that Cabinet determined and approved the terms of reference for the audit, which is expected to cost about $195,000.
The premier added that the audit will be released before the end of the year.
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After Dr. Smith answered his question, Mr. Fahie reiterated the criticism he’s levied in the past: that the KPMG audit is tantamount to government investigating itself.