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Saturday, December 3, 2022
HomeNewsArchivesAT&T PAYING ONLY $2 MILLION IN 'PENALTIES'

AT&T PAYING ONLY $2 MILLION IN 'PENALTIES'

Of the $8 million that AT&T will pay as its settlement of a 1996 mud spill case, only $2 million is in actual "penalties" and $1.8 million of that will go to the federal government, AT&T and governmental officials said Thursday.
That leaves $200,000 in "penalties" that will go to the territorial government. By law, half of that must go toward paying government employees their long-overdue back wages, though government officials could allocate additional money toward back pay from the rest of the settlement.
The remaining $6 million is being paid to the V.I. government for permit fees for the Americas-II and subsequent cables, and to reimburse the government for related monitoring and legal costs, according to a release Thursday from AT&T.
A portion of the settlement will go to St. Croix attorney Jack Dema to satisfy his contract for handling the environmental pollution case, but no one has yet been willing to discuss how much.
Dema referred questions about the amount of his share to Attorney General Iver Stridiron who is off-island. Government House has not commented on the settlement.
The local and federal governments had cited AT&T for a bentonite drilling mud spill in Butler Bay, St. Croix, while it was laying undersea fiber-optic cables. Both governments cited the telecommunications giant for serious environmental damage; AT&T officials maintained the damage was not widespread.
AT&T paid for a cleanup of the area in 1997 and paid $1.5 million to the V.I. government in April 1998 as a partial settlement of the mud-spill dispute.
AT&T spokesperson Shelly de Chabert said the company feels the additional $2 million in penalties was excessive, but "we wanted to get our cable landed, so I think it was a win-win situation."
Planning and Natural Resources officials have said no more cleanup work will be required in view of the work that AT&T has already done, the company's release said.
Some union leaders and senators have expressed strong objections to the overall $8 million settlement, saying the government didn't get enough in the deal.
Under legislation passed in 1997, half of all fines levied for pollution and coastal zone violations are earmarked to pay retroactive wages. Under the terms of this settlement, that amount would be approximately $100,000.
However, there has been no word from Government House as to how the remaining $6 million will be split. Even though it is not being paid as a penalty, a portion of the $6 million still could be given to the Union Arbitration Award and Government Employee Increment fund to pay retroactive wages.
No one was available at Government House to discuss the distribution of the settlement.

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