St. Croix Marine and Development Company, owners of the marina and marine store in Gallow's Bay and the Golden Rail Cafe St. Croix Marina, is seeking to enter into a new lease for its government-owned submerged lands that will increase its rent more than fifteen-fold, its owners told the Senate on Tuesday.
The land is owned by St. Croix Marine and Development Company and is leased to St. Croix Marine, headed by Larry Angus, who testified he has managed the business since 1981.
The current rent paid to the V.I. government is $1,200 per year, while the proposed new 20-year lease would shoot up to $20,000, Assistant Commissioner of Planning and Natural Resources Norman Williams told the Planning and Environmental Protection Committee.
All the committee members present – Sens. Louis Hill, Nereida "Nellie" Rivera-O'Reilly and Neville James – questioned CZM officials and the marina owners about the low initial rent and sharp increase.
The answer lies in the way the land was conveyed to the territory, CZM attorney Winston Brathwaite told the committee. When the federal government granted the land in 1978, the same year it enacted the federal CZM statute, it grandfathered in all existing federal leases on the property.
Anyone wanting to develop in the area after 1978 would need to apply for a CZM permit, and if the land were sold, the grandfathered lease would become void and CZM permits and leases would be needed, Brathwaite said. But so long as the land was not developed or sold, the lease was legally binding, potentially leaving the rent at $1,200 per year in perpetuity, he said.
Asked if many properties were quietly grandfathered in at extremely low rents, Williams said there were perhaps two others, but one was a private residence and the other a private dock, and no commercial ventures. Most of the grandfathered properties had either developed or changed owners in the intervening three decades, he said.
The marina owners decided to voluntarily enter the process and increase their rent now, so it can start planning on improvements and upgrades in the near future, according to Angus and landlord Torkel Knutson.
The senators present expressed support for the new lease and the marina's plans for development. No vote was taken due to the lack of a quorum.