FOOLED AND BEGUILED: Senator Janette Millen-Young says Gov. Kenneth Mapp pulled a fast one on the Legislature. Senators voted 9-5 to approve the Limetree Bay refinery deal.
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CHARLOTTE AMALIE — Shortly after midnight last Thursday morning, nine members of the 32nd Legislature approved the governor’s multi-million-dollar plan to give Limetree Bay Terminals LLC the rights to the former Hovensa oil refinery facility on St. Croix’s South Shore. But far too many questions remain unanswered about the future of that facility and what the deal will mean to Virgin Islands taxpayers and employees who may be employed by Limetree.
The governor, as usual, rushed this legislation with his typical “take it or leave it” push. Five senators, including two St. Croix senators and myself, voted against the proposal for various reasons. It is my belief that all of us favor economic development and private-sector job creation for the entire territory. But because of the governor’s virtually secret negotiations and vague promises, it appears the Virgin Islands has again given away too much too soon with no guarantees that the territory will receive any significant benefit from this deal.
Anyone who takes time to read the agreement should be shocked at the giveaway. For example, in Section 11.2 of the agreement, Limetree will pay no income taxes, will not pay any excise taxes, will not pay U.S. Customs duties, will not pay fuel taxes, will not pay gross receipts taxes, will not pay production taxes, will not pay property taxes, will not pay franchise taxes, will not pay annual report fees and will not pay any licensing fees, among other things. Let us remember, residents, including our senior citizens and veterans, received a hike that many could ill-afford in property taxes just last year.
The tax exemptions given to Limetree seems to be a giant tax giveaway and in return the territory may create 100 new jobs. Or, maybe 80 new jobs, or maybe more or less. Where is the guarantee of creating and maintaining a certain employment level? Are there any penalties if Limetree doesn’t meet those obligations?
And, it remains completely unclear what guarantees, if any, are in place for Virgin Islands employees who may work at the oil facility. Will they have a guaranteed minimum wage above the standard minimum wage in the territory? Will they have a reasonable health-insurance plan? Will they have a pension and or 401(k) plan? Will Limetree be exempt from Workman’s comp claims? Will Limetree be exempt from the territory’s Early Plant Closing law? Will employees be forced into arbitration instead having the option to seek legal counsel if there is an employment disagreement?
According to the agreement, Limetree will apparently have complete authority to back out of the deal and sell its position – including the laundry list of tax-free and other benefits – to anyone it wants, including companies that are foreign owned. Additionally, the Virgin Islands government will have no participation in such action, and seemingly, will not benefit financially from such a transaction.
Certainly, one of the looming issues is the environmental concern. The Limetree agreement fails to explicitly state how it will implement the Consent Decree that the U.S. Environmental Protection Agency ordered in 2011. This was a result of HOVENSA failing to uphold federal mandates and evidence of illegal emissions and oil spills. A $700-million fine was assessed and Limetree inherited the responsibility to correct those deficiencies. How will that be addressed?
Environmental damage is especially serious here. A number of dangerous chemicals remain somewhere underground in our beloved St. Croix. There must be a cleanup. If not, we will leave to our children and our children’s children the worst environmental heritage in the Caribbean.
Some may agree that the Limetree agreement is seductive. Yes, we would all like to again see the hay days when Hess and Hovensa served as the territory’s largest private-sector employer and brought in $250 million annually to the territory. But with the agreement now in place, a virtual unlimited tax holiday and no serious penalties for non-compliance, it’s doubtful any glory days are ahead.
I have long advocated for economic development and job creation for the ENTIRE territory. But with so many vague promises and unanswered questions in the Limetree deal, I was not about to risk the future of the people of the Virgin Islands. That’s why I voted no.
–SENATOR JANETTE MILLEN-YOUNG IS A GUBERNATORIAL CANDIDATE OPPOSING GOV. KENNETH MAPP