A planned major overhaul of Cyril E. King Airport’s baggage area, generator room and expansion of the main building’s footprint may cost upwards of $20 million to complete, meaning the V.I. Port Authority will have to find a way to finance it before work can proceed.
At the Port Authority governing board’s regular monthly meeting Wednesday, Steven G. Henriquez and Fred Nielsen, project managers with engineering consulting firm URS Caribe, laid out initial plans for a complete rebuild of the baggage-handling system and other work for the authority, discussing the current layout of the airport, its problems and the proposed improvements.
Port Authority Chairman Cassan Pancham said he had expected something closer to half that amount and asked why the cost would be so high. Replacing the airport’s air conditioning system is very costly, moving structural support pillars and changing the building’s footprint is a major undertaking, the consultants said, adding that the cost of construction materials has skyrocketed in recent years.
"Just on the apron expansion, a few years ago we used to pay $40 a ton for asphalt and now it is $250 a ton," Nielsen said.
Airlines have been complaining the baggage-handling facilities for outgoing luggage are "highly problematic, to say the least," Pancham said, so that work must be a "high priority for resolution."
Board member Gordon Finch said the work would have to wait until a new source of funding is identified, as the authority’s regular revenue streams were already fully committed.
Meanwhile, the board unanimously approved spending $1.27 million for the detailed design work.
The board also approved use of $2.9 million in federal stimulus grant funds targeted at renewable energy for solar and wind power at the Henry E. Rohlsen Airport on St. Croix.
A new company; GCG Ground Services, got the go-ahead to continue as provider of ground services from passenger check-in to cargo handling at Cyril E. King Airport. GCG, a multinational corporation operating in 22 countries in the Caribbean and Latin America, has purchased the assets of Virgin Island Ground Handlers and Aircraft Services and took over operations in October.
Judith James, director of administration and finance at the authority, reported revenues are down, primarily due to a reduction in marine traffic to the territory.
Port Authority operating revenues for the year to date are $42.6 million, versus $46.3 million in 2008, James reported. Operating expenses were $55 million- down from $59.8 million in 2008. The reduction in expenses was due in part to reduced utility bills- $5.7 million in 2009 versus $7.3 million in 2008. Professional services were lower in 2009, too: $3.2 million, versus $4.4 million in 2008.
Overdue rent from government agencies and from airlines continue to plague the Port Authority. The Department of Planning and Natural Resources has $262,000 in payment overdue by more than 30 days. The V.I. Water and Power Authority owes $210,000. Several divisions of American Airlines owe a combined total of several hundred thousand dollars as well.
Economic conditions appear to be affecting some of the Port Authority’s lessees, too, reducing rental incomes. Wesk Marine owes $114,000 and has had its lease terminated, but has not turned over the property. Four Star Air Cargo has $133,000 overdue more than 30 days, according to the Port Authority. Both bills are now in the courts.
In other VIPA news, the board bid a fond adieu Wednesday to longtime executive assistant Barbara Donastorg, who is retiring after 17 years with the authority.
All VIPA board members were present.
