76.7 F
Charlotte Amalie
Friday, March 29, 2024
HomeNewsArchivesWAPA SALE PROPOSAL TO TURNBULL IN 5 TO 10 DAYS

WAPA SALE PROPOSAL TO TURNBULL IN 5 TO 10 DAYS

Southern Energy’s offer for 80 percent of the V.I. Water and Power Authority could be on Gov. Charles Turnbull's desk in five to 10 days, a company official said Wednesday.
George Gray told members of Harborside Rotary that the company will offer $100 million in cash up front for WAPA and refinance its $150 million bond debt. Gray also said customers wouldn’t see a rate increase for two years after the proposed purchase, and indicated they might even decline at the end of that time.
"We’re at a point that for the first two years the rates will remain the same as today," Gray said. Company projections indicate a decrease in rates after that period, he said.
Discussions between the company and the governor's negotiating team will end soon, he said, and Turnbull will have a proposal in the next five to 10 days. If he agrees with the offer he will submit a bill to the Legislature.
Despite the company’s promise that it will not layoff any unionized workers, the union representing the majority of WAPA’s 570 employees is against the sale. Gray said that if the sale goes through, the company will bring in an independent firm to analyze wages within the first 90 days.
"No layoffs of union employees, period," Gray said. "Case closed."
The company would keep current WAPA employees in the V.I. Government Retirement System, he added. New workers would be covered under a company 401K retirement plan.
To sweeten the deal further, the company plans to establish a $1 million line of credit so that new companies without the wherewithal can deal with the utility.
Gray also said Southern Energy would start a $1 million economic development fund to help attract new businesses to the territory.
"By putting this money in we’re investing in the future of this company," Gray said.
Although Turnbull is open to selling the utility, his second-in-command, Lt. Gov. Gerard Luz James II, opposes to the idea. Additionally, St. Croix community activist Gail Watson Chiang claims that the administration is violating the territory’s competitive bidding laws by dealing only with Southern Energy. Chiang’s lawyer, Lee Rohn,said she would file a lawsuit today, Friday, if the administration doesn’t reply to the allegations.
Southern Energy acquired 63 percent of Freeport Power Company on Grand Bahama in 1996. The company also owns the power company in Trinidad and Tobago.
At the end of 1998, Southern Energy’s assets were more than $11.6 billion, according to the company’s website. It reported a net income for 1998 of $239 million.

Print Friendly, PDF & Email
Keeping our community informed is our top priority.
If you have a news tip to share, please call or text us at 340-228-8784.

Support local + independent journalism in the U.S. Virgin Islands

Unlike many news organizations, we haven't put up a paywall – we want to keep our journalism as accessible as we can. Our independent journalism costs time, money and hard work to keep you informed, but we do it because we believe that it matters. We know that informed communities are empowered ones. If you appreciate our reporting and want to help make our future more secure, please consider donating.

UPCOMING EVENTS