Government has terminated its previous $5.4 million greenhouse development contract with International Business and Trade LLC, and it is in talks with the company to reach a new agreement to get the greenhouses up and running, officials said this week.
Last November, Deputy Premier Dr. Kedrick Pickering announced that IBT would devise a plan to get the greenhouses operational once the government pays an outstanding bill of $1.26 million to the company.
Officials said this week that government paid the outstanding funds on Dec. 30, and IBT sent inspectors to the sites earlier this year to assess the project.
“We are waiting on a report from [IBT regarding] their findings, at which time we will sort through the details of the new arrangement,” said Ronald Smith-Berkeley, the permanent secretary in the Ministry of Natural Resources and Labour.
In addition to the $2.8 million that had been paid as of March 2014, the $1.26 million transfer to IBT makes the total sum paid to the company at least $4 million, which has so far produced three vacant greenhouses at Paraquita Bay and a large plot of excavated land at South Sound on Virgin Gorda.
Mr. Smith-Berkeley declined to discuss details about what the new agreement might entail, but he said that the ministry plans to proceed as outlined in Dr. Pickering’s November statements.
Dr. Pickering said at the time that IBT would assess the sites and then sign a new contract under which it would receive a yet-to-be-determined annual payment to help run the greenhouses.
IBT Legal Coordinator Lizeth Prado sent a written statement to the Beacon yesterday stating that government asked the company to submit a proposal to complete the project.
“We expect to be able to provide one in early May,” the statement explains, adding, “The final decision as to the scope of the project … and other technicalities will be in the government’s sole discretion.”
Dr. Pickering also said last November that the Paraquita Bay greenhouses could be growing food by the end of 2015, but that works on the VG site would be put on hold indefinitely.
No planning approval
Before work can restart, developers presumably must receive permission from Town and Country Planning to complete the project: A lack of permission from planning authorities stalled construction in November 2010.
Former TCPD Chief Planner Rob Beard said in January 2013 that his agency still hadn’t received required environmental impact assessments from greenhouse developers, and he added that the Planning Authority had not yet approved development for either site.
Gregory Adams, who replaced Mr. Beard in April 2013, said yesterday that no EIAs have been submitted and that he hasn’t had any discussions with greenhouse developers.
Delays and other problems have plagued the project from the start.
The structures were originally supposed to be completed by the end of 2010, but missteps including multiple violations of the government’s planning and procurement rules delayed construction, according to a March 2014 report by the Office of the Auditor General.
The previous Virgin Islands Party-led government inked a contract with IBT in February 2009 before the project sites had been identified or prepared, according to the report, which was sharply critical of government’s handling of the project.
Work began that year, but it stalled in November 2010 because government had broken its own laws by failing to submit applications for planning permission to build the facilities.
In 2011, IBT representatives wanted the government to issue them a “taking over certificate” for the Paraquita Bay site so that Deutsche Bank, which had lent government $5.4 million for the project, would release a $1 million payment to IBT.
Government refused, and work ceased in June 2011 with both sites incomplete, according to the audit report.
After the National Democratic Party administration took over the reins of government in November 2011, leaders said they would continue with the project, but for several months they provided few details.
In 2013, Dr. Pickering announced that instead of proceeding with IBT, government would find other qualified parties to operate the greenhouses.
Though there was reportedly interest expressed by Virgin Islands entrepreneurs, no contractors responded to requests for proposals to complete the work, and the minister later reversed his position and said that government would reengage with IBT.
To date, it remains unclear whether all the issues laid out in the audit have been rectified.
Problems included a lack of adequate water supply for the sites, according to the audit report.
In 2011, the MNRL requested $511,000 from the Ministry of Finance to install a 346,000-gallon reservoir at Paraquita Bay, but the request was not granted, and IBT’s recommendation to install a $1.3 million desalination plant in South Sound was never addressed, according to the report.
Ms. Penn said Tuesday that with the Biwater desalination plant coming on stream in Paraquita Bay, there will be adequate water supply for that site.
Other irregularities alleged in the audit are wide-ranging:
• Some of the land pledged for the project had previously been leased or promised to farmers.
• During the delays, some of the greenhouse structures were improperly stored, causing some $13,000 in damages to materials.
• An extra cost of $127,856 was incurred to move structures stored at Fish Bay to the Paraquita Bay site.
• The company Mirsand Town Planning and Architects Ltd. was paid $757,301.57 in no-bid contracts to supervise site preparation. The firm is owned by Jose and Sandra Camilo, the brother- and sister-in-law of former NRL Minister Omar Hodge, who conceived and oversaw the project.
The report also stated that Mr. Hodge did not accommodate requests by the Office of the Auditor General to be interviewed for the audit.
Mr. Hodge told the Beacon in 2013 that he never benefitted financially from the greenhouse project and disputed the suggestion that the selection of his in-laws’ firm was a conflict of interest. Mirsand, he said, was subcontracted by IBT and not selected by government.