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VIPA Board Faced With Declining Revenues

Dec. 22, 2005 – Some members of V.I. Port Authority Governing Board had questions about the financial report for fiscal year 2005. The words "decrease" and "revenues" appeared to be combined too often for their comfort.
Judith James, director of administration and finance, presented the figures Dec. 13 for the fiscal year that ended Sept. 30. She said that VIPA's net assets increased by $2.2 million last year; however, that figure was $3.4 million less than the previous year's increase.
She attributed the decrease to several factors, including:
– a 1.9 percent increase in operating revenues;
– a 7.2 percent increase in operating expenses; and
– a 39 percent decrease in federal capital contributions.
A 4.1 percent increase in aviation revenue was gained from landing fees, concession rentals and terminal use fees. However, parking and ramp fees dropped by 6 percent. Overall, the aviation picture did not look good. Total operating expenditures were pegged at $27.2 million, which meant an aviation operating loss of $7.7 million.
Member Leslie Milliner asked what the Authority was doing to stop the bleeding. "It is obvious we can't go on forever sustaining those losses," Milliner said.
VIPA Executive Director Darlan Brin said efforts were being made, but that the Authority could do little when airplanes were not using the airport. "I don't have a magic wand," he added.
The board also learned that marine revenues had decreased by 9 percent. The losses were broken down in the following manner: 3 percent in rentals and concessions, 12 percent in piloting fees, 5 percent in ships' dues and 5 percent in other losses. Wharfage revenue increased 18 percent, while docking fees increased 16 percent.
Marine operating expenses increased 15 percent for a total operating expense of $16.9 million. The operating profit was $454,000 — only a fifth of last year's profit.
James concluded her report, saying, "Total V.I. Port Authority assets at the end of fiscal year 2005 are $313 million. Current liabilities are $9.4 million, long term liabilities are $43 million, and total capital equity is $260 million."
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