Editor’s Note: A separate correction was issued for this story on Dec. 15.
Using the buzz words “special interest,” Gov. Albert Bryan vetoed Bill No. 34-0168 earlier this week which would have removed a casino licensing stipulation that casinos construct a banquet facility able to accommodate a minimum of 400 people.
Sen. Kurt Vialet, one of the six senators to sponsor the bill, refuted the notion the legislation could be deemed special interest, making it clear that casinos are prohibited from making campaign donations. He said the legislation was prompted after the V.I. Casino Control Commission issued steep fines to Hotel Caravelle for not having the mandatory 400-person banquet facility.
“The fines amount to $30,000 per month and a mandatory performance bond of $300,000 within fourteen days for the construction of a facility,” Vialet said.
The 42-room hotel is nestled in the historic district of Christiansted, and co-sponsor Sen. Janelle Sarauw said she believes “the historic districts are impacted by such a legislation as they do not have the footprint to build or construct areas that accommodate 400 people.”
The hotel and casino did try to comply with the existing law, but as Sarauw said, they were limited by the available land around the current vicinity to erect the structure.
“The original purpose was to increase hotel rooms, and that was accomplished, but the adjoining banquet facility was never built. Instead, an attempt was made to purchase the vacant lot between Holger Danske and the hotel, but that transaction failed,” Vialet said. “After reading the requirements, I felt that the original bill banquet requirement was a bit steep, and accessing the success of what has been accomplished by the downtown casino, I decided to remove the requirement.”
In Bryan’s transmittal letter where he announced the veto of the bill, he said casino licensee applicants are aware of the requirements for obtaining a license, so “a complete removal after the fact by the Legislature, without any substitute condition or allowing the Casino Control Commission the opportunity to ‘add other conditions it deems appropriate to the applicant or license holder’- is counterproductive to the act and prejudicial to all the other license holders who have complied with the act.”
While the governor asserts it would be unfair to other licensee holders, Vialet said the casino is the only casino located in the Christiansted enterprise zone. “Because there is only one casino in that category, then naturally, it only affects that one entity. It is not like having five casinos and changing the regulations for only one. Hence there is no special interest.”
He added that the legislation only spoke to hotels in the enterprise zone, which are the smallest in the casino act, and no other class is affected.
Bryan said part of the reason the legislation was vetoed was that it defeated the original purpose and intent of the existing law, which is “to spur hotel development and convention activity, thereby creating jobs, investment and economic activity in St. Croix.”
But Vialet argued the intent of the act was in full effect as the casino employs 96 people with healthcare coverage, and “the development sparked renewed interest in downtown Christiansted, millions of dollars have been paid to the Government of the Virgin Islands in taxes.”
He added the hotel throws free concerts, makes numerous donations to charitable events, has repaired lights on the boardwalk, and entered into an agreement to build a racetrack on St. Croix with an estimated project cost of over $20 million.
“We have attracted two hotels in twenty-five years. No hotels are awaiting approval for a casino license. So, it makes sense to protect the two that we have,” Vialet said.