The Senate Disaster Recovery, Infrastructure and Planning Committee convened an oversight hearing Friday on a $24 billion reconstruction effort, reviewing project progress and the territory’s labor and housing capacity.
Chaired by Sen. Marise C. James, the committee heard detailed testimony from the Office of Disaster Recovery, the Labor Department and private construction executives on how federal recovery funds are being translated into new schools, hospitals, utilities and housing.
Lawmakers focused on three themes: whether major projects are on schedule, whether the Virgin Islands has enough workers to complete them, and where thousands of additional off-island laborers would live.
Officials described a recovery now in full construction mode, with dozens of major projects under contract and more nearing rollout. At the same time, they warned that a tight labor market, permitting delays, inflation and limited housing stock could slow progress, even as FEMA has set 2035 as the deadline to complete fixed‑cost projects while maintaining the current cost share.
Office of Disaster Recovery officials said the scale of the effort has expanded sharply, with projected federal funding growing from about $8 billion to roughly $24 billion as additional projects were approved and funding rules changed.
“The Office of Disaster Recovery has been laser focused on executing contracts for our critical facilities and moving projects into construction,” Director Adrienne L. Williams‑Octalien testified. “The recovery is in full throttle.”
To manage the workload, ODR created a “Super Project Management Office” overseeing 38 large, complex projects, including hospitals, schools and major power and water system bundles. Officials said 34 are under contract or in procurement, and across the broader portfolio, ODR is tracking 87 projects in construction and 33 that are shovel‑ready.
Major work includes hospital rebuilds on St. Croix, including the Gov. Juan F. Luis Hospital and a new Donna M. Christian, M.D. Health Center at the former Charles Harwood site, as well as school projects such as Arthur Richards PreK – 8 and bundled education and mixed‑use projects on St. Thomas, St. Croix and St. John.
ODR is also overseeing territorywide infrastructure upgrades, including power plant replacements and underground utility, water and wastewater improvements. Officials said more than 10,000 composite utility poles have already been installed as part of grid modernization efforts.
With dozens of major projects moving or poised to start, senators turned to whether the territory has the people to build them. Labor Commissioner Gary A. Molloy told the committee the Virgin Islands is entering peak construction years with a tight labor market and limited interest in construction among job seekers.
As of Thursday, he said, the Virgin Islands Electronic Workforce System listed 40 construction vacancies from 12 employers, while “there are currently 712 active job seekers in the labor market, with 114 individuals expressing interest in or pursuing opportunities within the construction industry.”
To push more of the $24 billion rebuild toward local workers, Molloy said the department now requires contractors to post jobs in the VIEWS system, fund training programs, use registered apprentices and comply with labor standards written into recovery contracts. He said failure to follow those provisions “may constitute a material breach of contract.”
“We come in peace,” he said, “but if we have to come with enforcement, we are coming.”
Some contractors said they expect to rely primarily on existing local labor and subcontractors, at least in the early phases of construction. P.J Platt, project manager for Persons Services Corporation’s bundled fire station projects, said starting early and at a smaller scale allows firms like his to avoid the worst of the coming crunch. “We anticipate most of our needs through existing contractor relationships and local subcontractors,” he testified.
Even so, ODR officials said local labor alone will not meet projected demand. Drawing on prior workforce analysis, they estimate the territory will need roughly 5,500 additional workers at peak construction levels around 2028, even after all available local labor is employed. That projection raised a second issue at the hearing: where those workers will live.
Williams‑Octalien called workforce housing a “persistent and structural challenge,” citing limited land and already tight rental markets. She said the agency is exploring several options with contractors, including refurbishing existing worker camps, renovating vacant hotels and using marine‑based housing, with eligible costs billed to project budgets.
Several senators said existing options, including the St. Croix refinery man camp and shuttered public schools that could be converted to dormitory space, should be used before any new facilities are built. They warned that new worker housing must not strain neighborhoods or displace residents.
Lawmakers also raised concerns about how much the government is spending on outside consulting firms. James pointed to Public Finance Authority contracts worth up to $25.6 million a year for Ernst & Young and $21.2 million a year for Witt O’Brien, and said that money could instead be used to hire and train Virgin Islanders to do more of the work in‑house.
Williams‑Octalien said the firms are important to handling the surge of federal disaster funds. Witt O’Brien’s, she said, helps the territory secure money by preparing and defending complex FEMA funding requests, while Ernst & Young helps ensure the money is managed and spent in line with federal requirements. She added that she attributes a significant part of the increase from roughly $8 billion to about $24 billion in obligated funding to Witt O’Brien’s support.
As the hearing ended, officials and lawmakers acknowledged visible progress in the recovery but warned of continued pressure from inflation and housing costs as construction accelerates across the territory.
