Financing Proposal Would Have DPW Buy and Lease Ferries to Franchised Operators

The V.I. Department of Public Works is exploring using federal funding to purchase ferries for franchised ferry company operators to run on the routes between St. John and St. Thomas, according to DPW Commisisoner George Phillips.

“We met with both ferry services in November,” Phillips said of DPW talks with Varlack Ventures Inc. and Transportation Services of St. John Inc. of the use of “federal funds to purchase vessels.”

“We are trying to assist our ferry companies,” said Phillips, who said the two locally-owned ferry services have had difficulty getting commercial financing for new vessels. Short-term commercial financing offered to the ferry operators by banks has left them with high repayments of interest and principal and “no money for daily operations and maintenance,” according to the commissioner.

Federal funds can be used for the purchase of ferries, Phillips told the senate committee on Government Operations and Consumer Protection hearing on Wednesday, May 17, in Cruz Bay.

“We would have to purchase the vessels,” said Phillips.

“We would do a lease agreement and they would be operating them on our behalf and they would be paid a fee to operate the boats on our behalf,” explained Phillips. “They have the expertise to operate.”

“They can put private boats in service to tourists, use private boats for private service,” added Phillips.

Ferry company representatives could not be reached for comment on the DPW proposal.