Sept. 13, 2003 — The battle of wills between the Water and Power Authority and the Public Services Commission was resolved Friday night as the PSC voted unanimously to approve WAPA's request to purchase and install a new $17.5 million General Electric Frame 6 combustion turbine generator for St. Thomas.
The battle went public last month with the heads of the two entities publishing detailed statements of their positions in the Source and the Virgin Island Daily News. (See "PSC chair says WAPA must justify unit purchase" and "WAPA chief says PSC regulation not working" on the Source Op-ed page.)
Alberto Bruno-Vega, WAPA executive director, accused the PSC of attempting to run WAPA and being run, itself, by its consulting firm, Georgetown Consulting Group. He stressed that purchasing the unit right now was "critically important," after the blackouts last month on the mainland. He emphasized that the price of the unit would likely soar. He said WAPA needed to act immediately to ensure the present purchase price and not being "moved to the end of the production line" [for new units].
Valencio Jackson, PSC chairman, replied that based on WAPA's "past and continuing failures and actions which have cost and will continue to cost ratepayers dearly," the PSC had little choice but to order the utility to hold off on buying a $17.5 million generating unit until it justifies the purchase to the commission. (See "PSC, WAPA officials trade accusations".)
WAPA subsequently submitted the paperwork the PSC required to back up the purchase. According to an article in the Saturday Avis newspaper, the information was presented Friday at the St. Croix meeting, after which the commission went into executive session before taking the vote.
Though the authority won on one issue, it lost out on another. WAPA had submitted a request for a 15.2-percent increase in water rates, to be followed shortly by another of 9.3 percent. That would make a total, permanent raise in potable water rates of 24.5 percent.
According to Bruno-Vega, the increases are necessary to meet the utility's minimum debt service needs; that is, to meet principal and interest payments on borrowing. He said failure to get approval for the emergency rate increase could result in the water system being placed in receivership by WAPA's bond trustees. (See "WAPA wants to raise water bills by 24.5 percent".)
The commissioners were not going for it. With the exception of Verne David, who made a motion to consider the issue and received no second, the request was not even considered to be considered. Commissioner Alric Simmonds said, "I would not entertain any discussion on this item because I have not seen any information on it," according to the Avis article.
Sen. Emmett Hansen II has said that his Infrastructure Act will make the increase unnecessary. The Act was finally passed into law Sept 4. Hansen said his bill "will subsidize that charge, and bring immediate relief to the people of the V.I. I've said all along, if I could have gotten this moved last year, the public wouldn't have been paying the street light surcharge, either."
The bill calls for 6 percent of property tax revenues to be divided equally into separate funds for street lighting, potable water distribution and road maintenance, with such funds for St. Thomas, St. Croix, St. John and Water Island. In other words, for each island, 2 percent of its property taxes would go into each of the three infrastructure funds for that particular island. (See "Override OKs Infrastructure Maintenance Act".)
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