May 24, 2007 — The Economic Development Commission heard from several companies hoping to qualify for generous tax benefits during a public hearing Thursday at its Frederiksted offices.
EDC members probed representatives of the long-awaited major casino resort project from Williams and Punch LLC for more details on the company's application for generous EDC tax benefits, but had no apparent opposition to the project.
Founding partner Kevin Rames represented Williams and Punch, joining five other companies at the hearing making their case for preferred status. The company anticipates having 449 permanent, full-time employees within the first year of breaking ground, Rames said. He suggested that the majority investors, the Mashantucket Pequot Tribal Nation, would be particularly good neighbors because of some common historical ties.
“The English and Dutch almost wiped out the Pequot, so they understand that common thread of history,” he said.
Rames said he was committed to the preservation of archaeological and cultural sites, including a graveyard of enslaved people. “Working with the archaeologist and talking to the Pequot, we plan to promote the cultural history as a main feature to draw people to the resort, and the main piece is that slave graveyard,” he said.
The project, slated for estates Williams and Punch north of Frederiksted on St. Croix, calls for a 302-room hotel, a 62-slip marina, golf course, 109 condominiums and 143 single-family homes. It requires moving Emancipation Drive away from shore and around the resort, a somewhat controversial plan. Williams and Punch has a letter from the commissioner of Public Works telling them they can move the road if they consult with the Federal Highway Administration and meet some conditions, Rames said.
The other first-time EDC benefit applicants Thursday were Spartan Concrete Products LLC, St. Croix One LLC and Portrait Financial LLLP. American Yacht Harbor and Investment Security Services applied to have existing EDC tax status transferred to new owners.
Spartan Concrete wants to open a concrete-mixing company based in Estate Cottage on St. Croix. The company would hire 19 people in the first year. The owners are Rodger Bressi Jr., who says his father started the first concrete company on St. Croix in 1964; V.I. construction heir and entrepreneur Jean Vivot; and financier Warren Mosler.
St. Croix One is the new owner of Chenay Bay. The company plans to refurbish most of the resort’s cottages and market them as timeshare units. It plans to hire 22 employees in the first year, with 80 percent or more hired locally. The owners — Deborah Linden, Cary Erfurth and Stephen Korshak — are resort developers based primarily out of Florida.
EDC benefits amount to nearly tax-free status for terms of 10 to 15 years. The roughly 75 businesses with EDC status don’t pay gross receipts tax or property tax. They also get a 90-percent reduction in their local income-tax payments, pay a customs tax rate of one percent, and get a 100-percent exemption in excise taxes on all building materials, machinery and supplies used to start the business.
In return, outside companies must hire at least 10 new full-time employees and provide various benefits and scholarships. Small local companies can receive benefits for up to five years, hiring two or more employees. The goal of the program is to bring in new investment and increase employment in the territory.
The EDC next meets on St. Thomas next Thursday. EDC officials will announce decisions on several benefit applications at that meeting, but not the ones discussed at the May 24 hearing. (See "Notice of Virgin Islands Economic Development Authority Governing Board Meeting.")
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