Analysis: Pathetic Taxi Service Is a Territorial Economic Emergency

Taxis wait to take tourists around St. John.
Taxis wait to take tourists around St. John.

This is the first in a series of stories looking at the severe failings of taxi service in the territory; how the wildly outsized influence of the taxi lobby has brought us here and what needs to happen.

Part 1: A knife in the heart

The lack of reliable taxi transportation after dark anywhere in the U.S. Virgin Islands is a knife in the heart to the territory’s tourism economy and senators urgently need to enable Uber and Lyft to help fill the gaping hole.

A locally-grown ridesharing app would be great. But everyone who visits has Uber and Lyft, giving those services a huge advantage. Improvements to the local taxi system would be great, but history suggests – Nay, shouts! – that will not happen.

Tourism contributes more than $200 million in tax revenue and accounts for 8,000 jobs in the territory, representing 30 percent of the U.S. VIrgin Island’s gross domestic product, according to the V.I. Tourism Department. And it is expected only to grow in importance.

Yet although tourism is the territory’s dominant industry and is projected only to grow in importance, there is no central number to call for a taxi, no way to order a taxi online and no reliable taxi service after dusk anywhere in the U.S. Virgin Islands. Very few, if any taxis take credit cards. Unlicensed, unregulated “gypsy” cabs are a large portion of all taxi service on St. Thomas, but are less active on St. Croix.

Neighboring Puerto Rico has late-night taxi service and Uber. So does the Dominican Republic. Many smaller competing destinations like Antigua and St. Maarten do not have Uber and may not be much better for taxi service. That makes it an opportunity for the USVI to move to the front of the pack, not an excuse for inaction.

For decades, elected officials, tourism officials, cruise industry leaders, local business leaders and economic experts repeatedly insisted the territory’s tourism product needs to improve.

Back in 1999, Gov. Charles Turnbull called tourism the “linchpin and epicenter” of the economy.

Beverly Nicholson-Doty, who served as tourism commissioner for 12 years, repeatedly emphasized the need to improve offerings.

“We are not only in competition with other Caribbean destinations, we are in competition with the world,” Nicholson-Doty said last October.

Not long ago V.I. businesses sounded the alarm that hordes of visitors would take their dollars elsewhere if liquor and cigarettes were taxed more, though still less than stateside.

Just the other day, Gov. Albert Bryan told cruise industry leaders the U.S. Virgin Islands is determined to position itself as the number one tourism destination in the Caribbean.

Yet despite the urgency the territory has fallen down on this most basic of services.

Every economist says overnight guests are, per visitor, vastly more valuable to the economy than cruise visitors. They spend much more on rooms, food, drink, shopping, transportation and souvenirs.

Many dozens, if not a few hundred people in the territory, make some income by renting rooms to overnight guests via AirBnB. One person who makes a significant portion of his income renting out a room in his Christiansted let the room over the Christmas holidays to two young men came on holiday for two weeks from Denmark. They had just graduated the equivalent of high school and were taking a break. They were on a budget; spending $80 per night for a room and buying groceries and some meals out but trying to conserve. They couldn’t afford to rent a car for another $70 per day. So they largely stayed in Christiansted. They learned, by word of mouth, how to use the dollar taxis to get to Frederiksted – with a stopover at Sunny Isles. But of course, you have to get back by dusk.

With Uber, Lyft or a homegrown phone-based app they could have taken one or two trips at much less than the cost of renting a car. They could have seen a band at Rainbow Beach or reggae at Eat @ Cane Bay. Or even gone to Carambola and walked to the tidal pools.

How much busier would all these places be if there were some sort of reliable transportation like Lyft or Uber? How much busier would downtown Charlotte Amalie be? Or businesses all over St. Thomas, if visitors did not have to rely on random, unlicensed gypsy cabs or taxis that don’t take credit cards and are unavailable after dark?

How much more money would taxi drivers be able to make if visitors could hail them too via the Uber or Lyft apps, like some jurisdictions allow?

This fundamental lack of convenient transportation is obviously a big problem so why hasn’t anyone fixed it? Many Virgin Islanders believe taxi drivers – and taxi medallion owners, who are not the same people – are too powerful a lobby and have the senators running scared.