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Economy

Decline in Timeshare Revenues Poses Challenge for Virgin Islands’ Environmental Fund

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A proposal from Senator Dwayne DeGraff, aiming to employ the Timeshare Environmental Infrastructure Impact Fee for enhancing beautification projects through the Waste Management Authority, inadvertently revealed an emerging issue for the territory.

Officials from both the Office of Management and Budget (OMB) and the Bureau of Inland Revenue (BIR) noted a decreasing trend in the revenues flowing into this fund over the years.

On Monday, OMB Director Jenifer O’Neal shared with legislators that post all pertinent deductions, the residual amount designated for the general fund stood at $5.5 million and $4.5 million for fiscal years 2022 and 2023, respectively.

The payment towards the Timeshare Environmental Infrastructure Impact Fee, as per Ms. O’Neal, is essentially voluntary, being contingent on self-reporting. She urged the respective authorities to amplify tax collection efforts, stating that enhanced enforcement is the viable pathway to augmenting revenues.

With a notable influx of visitors to the territory, many of whom opt for timeshare facilities, Ms. O’Neal highlighted the potential for increased fee collection. However, BIR Director Joel Lee identified a structural dilemma.

He apprised the legislators of a waning timeshare market, particularly mentioning a loss of a timeshare base on St. Croix, which he foresees as contributing to a revenue deficit in this segment moving forward.

On a positive note, Mr. Lee informed committee chair Sen. Donna Frett-Gregory of ongoing diligent audits concerning timeshare collections. “We examine trends, and respond proactively if we observe a decline,” he assured. Yet, he acknowledged the limitation of resources, which currently impedes the BIR from performing annual compliance checks on timeshare establishments. Ironically, Mr. Lee sees a silver lining in this constraint, suggesting that the unpredictability of audits has historically played to their advantage, maintaining an element of surprise that could potentially spur compliance.

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Economy

Survey Unveils Strategies to Bolster USVI’s Diminishing Labor Force

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A recent labor force survey in the U.S. Virgin Islands highlights several strategies to strengthen and expand the territory’s shrinking workforce.

Economic disruptions from the 2017 hurricanes, the closure of the Limetree Bay refinery, and the Covid-19 pandemic have led to a declining population, reducing the available labor pool. Currently, the unemployment rate stands at approximately 3.2 percent.

The survey results, presented to the Committee of Education and Workforce Development by Collin Perciballi, a consultant with labor market analytics firm Lightcast, identified key approaches to address these challenges. Perciballi emphasized the importance of aligning career and technical education with cross-cutting skills, advocating for a workforce trained to be flexible and capable of filling various roles. Additionally, foundational skills, including computer literacy, should be integrated into K-12 and adult education programs.

Addressing the “enrollment decline” in schools, a byproduct of population decrease, is also crucial. Lightcast recommended offering scholarships to Virgin Islander families who have moved away.

High living costs, particularly energy expenses, deter people from returning to the territory. Perciballi noted that reducing these costs could encourage repatriation and expand the workforce pipeline. Energy, healthcare, and education gaps have long been barriers for Virgin Islanders in the diaspora.

Labor Commissioner Gary Molloy described the current job market, where available positions outnumber available workers, as a “job seekers market.” With over 6,000 workers in the public sector, Lightcast’s report suggested transitioning talent to the private sector without layoffs, proposing that for every new government hire, two positions should transition to the private sector.

Lightcast also urged the territory’s leaders to facilitate entrepreneurship by removing processing delays and high fees associated with starting businesses. They recommended a comprehensive regulatory review and overhaul.

The consultants advocated for establishing a remote work culture, suggesting policies to make the Virgin Islands a remote-friendly destination. This could attract talent to the territory.

Additionally, workforce development should target forward-looking sectors such as the blue and green economy and tourism. Training in solar energy maintenance and agro-processing can support these industries. Financial services, particularly on St. John, also hold promise.

With an aging population, there will be an increased demand for retirement and healthcare services. Lightcast suggested long-term care initiatives and training nurses to support the University of the Virgin Islands’ nursing faculty shortage.

Contracted by the Virgin Islands Workforce Development Board, Lightcast’s study aims to meet U.S. Department of Labor requirements to evaluate the territory’s labor market. Board Chair Michael Carty emphasized that the territory is at a pivotal moment and that comprehensive workforce development strategies are essential for sustainable growth.

Actionable solutions, he noted, will bridge gaps, attract talent, and bolster sector resilience.

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Economy

Lt. Governor Tregenza A. Roach Participates in NAIC Southeastern Zone Meeting

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Lieutenant Governor Tregenza A. Roach embarked on a journey from the U.S. Virgin Islands to Jackson, Mississippi, earlier this week. He attended the National Association of Insurance Commissioners (NAIC) Southeastern Zone Business Meeting in his capacity as the commissioner of insurance for the U.S. Virgin Islands.

As a dedicated member of the NAIC, Roach is actively engaged in a series of conferences, training sessions, and meetings that the association funds. This involvement underscores his commitment to effectively regulating the insurance industry and safeguarding consumer interests.

The NAIC plays a crucial role by equipping insurance commissioners from the 50 states, the District of Columbia, and five U.S. territories, including the Virgin Islands, with necessary expertise, data, and analytical tools. These resources help in setting standards and ensuring effective governance within the industry.

The focus of the Southeastern Zone meeting is to address issues relevant to the regions represented within the zone. Commissioners, grouped by geographic zones, convene periodically to deliberate on challenges and opportunities unique to their respective areas, promoting a collaborative approach to problem-solving.

Lieutenant Governor Roach is scheduled to return to the territory on Thursday, May 9, 2024. During his absence, Senate President Novelle E. Francis, Jr. will perform the duties of the Lieutenant Governor as stipulated by the Revised Organic Act of the Virgin Islands.

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Economy

St. Thomas Humane Society Adjusts to Economic Challenges with Strategic Staff Changes

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The Humane Society of St. Thomas (HSST) is navigating through tough economic waters by making difficult, yet necessary adjustments to its workforce. This strategic move comes after a detailed financial analysis revealed that the shelter must reduce its workforce to continue its mission.

Randolph Knight, the President of HSST, shared that this decision was not made lightly. A comprehensive review of the shelter’s finances made it clear that to sustain the care for the increasing number of animals and offset a downturn in donations, staffing changes were inevitable.

The society, a cornerstone in the St. Thomas community for animal welfare, has faced challenges like many non-profits, balancing the care of more animals with fewer resources. The decision to reduce staff is aimed at maintaining the shelter’s operations and ensuring the animals receive the care they need.

Knight expressed deep regret for the impact of these layoffs on the dedicated employees and their families, acknowledging their commitment and contributions. He reassured that those affected would be supported through this transition, including receiving information about COBRA for health insurance continuation.

Despite these changes, Knight remains optimistic about the future of HSST. The organization is actively seeking new funding sources and is committed to its mission of caring for animals in need. He highlighted the resilience of the remaining team members and volunteers, whose dedication ensures the shelter’s activities will go on.

Knight also encouraged open dialogue, offering contact details for those with questions or concerns about the staffing adjustments.

As a 501(c)(3) non-profit, the Humane Society of St. Thomas continues to be a vital part of the community, demonstrating unwavering dedication to animal welfare even in the face of economic adversity.

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