The V.I. Public Finance Authority on Wednesday chose not to act immediately on a request by the owners of the Island Crossing center on St. Croix to refinance the center’s loan so that it can expand.
At Wednesday’s PFA meeting, Attorney Kevin Rames kept saying the government had an obligation to help his client Caribbean Development Partners refinance a loan so the company could further develop the land around Home Depot on St. Croix.
Gov. Kenneth E. Mapp, chairman of the PFA, did not see it that way. He kept calling the more than $13 million CDP received back in 2011 when Home Depot opened a “gift.”
The refinancing effort by CDP would have added $5 million to the loan that the Virgin Government is paying off, according to Mapp. Rames disagreed saying it would only add $4 million. The government still owes $11 million on the first loan.
Mapp asked what would happen if the government just quit paying on that loan. He was told that the developers, as guarantors, would have liability concerning the loan and they would also lose a $1.5 million certificate of deposit they gave as collateral.
Mapp seemed to brush that idea away, saying the government defaulting on a loan that size would cause chaos for the government’s credit rating.
After an hour and a half executive session, the board came back into public session and offered little hope to the developers. Mapp said the PFA had “little appetite for expanding the loan.”
Along with Rames, Josh Tate, a principal in CDP, spoke to the board. In answer to a question about further development at Island Crossings if the refinancing did not take place, he answered, “I don’t want this taken anyway as a threat; but there won’t be any.”
For years, even before Home Depot opened in 2011, rumors about more development at Island Crossing, usually including a franchise restaurant, were floated; but they came to a halt after Hovensa closed.
Mapp said about further development, “It is not the taxpayer’s responsibility.” He added, “We have given no other shopping center that kind of grant.”
The decision for board was, according to Mapp. “Can we afford to do this or would the money be better spent on the hospitals, education, the roads or something else?”
Mapp presented the report out of executive session because the board secretary Keith O’Neal recused himself from the decision, saying Home Depot was a customer of his. In his report, Mapp said that the board could not even consider the request from CDP until issues were cleared up with regards to the original agreement. The board gave CDP 60 days to report back to the board that those issues have been resolved and then the board will consider CDP’s request.