An animated Gov. Albert Bryan Jr. told the Virgin Islands Legislature Monday night the state of the territory was “resolute.”
Citing better-than-national-average unemployment rates, strong tax revenue collections, obligation of vast federal funds, and a booming tourism market post-2017 hurricanes, Bryan said in his State of the Territory Address the U.S. Virgin Islands was receiving and spending more money than ever before. New schools, utility upgrades, and other infrastructure improvements are on the way.
“We are purposeful, determined, and steadfast. The social and economic impacts of the COVID-19 pandemic are increasingly further in the rearview mirror, and we remain firmly focused on the opportunity to permanently transform the Virgin Islands into a home that provides us all the standard of living and quality of life we deserve. Hand in hand with you, we withstood the challenges and uncertainties of that time, but we have not been deterred from continuing to deliver on our promise of progress for the people of the Virgin Islands,” Bryan said.
Bryan plans to soon launch the Bureau of School Construction and Maintenance, led by an experienced and qualified facilities maintenance professional, he said.
“This professional will take responsibility for school construction and major maintenance from the Department of Education. We need our trained educators focusing on student instruction, not building construction,” he said.
This plan focuses on ensuring quality schools, fostering an effective education system that produces self-sufficient adults, engaging families, and building a supportive community. Each school has developed improvement plans detailing strategies to enhance student performance, with $250,000 allocated to each school’s principal to facilitate implementation, Bryan said.
Educators had walked off the job as the school year began in September, expressing outrage over decrepit conditions.
Bryan didn’t mention the job action but did say, “You have to invest to get returns,” when it came to education.
When stumbling over his words discussing library reopenings, he had to excuse himself.
“I’m getting so excited,” the governor said.
Well-educated Virgin Islanders will have a place to work, he said, with 1,000 new jobs created in 2023, most of which were in the hospitality industry as it recovered from the pandemic and the 2017 storms. The territory’s cruise and arrivals were strong when compared to pre-pandemic levels.
“Hotel occupancy rates in the territory remained stable at 58 percent in fiscal year 2023, a slight decrease from 63 percent in fiscal year 2022. This decline is attributed to the popularity of Airbnb accommodations due to the limited availability of traditional hotels, not a decrease in the number of overnight stays,” Bryan said. “Despite the shortage of hotel rooms, the number of visitors from the U.S. mainland staying for an average of 3.5 nights significantly increased. In fiscal year 2023, there were over 452,000 overnight visitors, an 85 percent increase when compared to fiscal year 2022.”
New hotels were online in late 2023 and 2024, he said, including the Westin Beach Resort and Spa at Frenchman’s Reef.
“Other sectors in the economy remained relatively unchanged, demonstrating consistent economic performance,” Bryan said.
In 2023, the Virgin Islands realized a record low unemployment rate — 3.2 percent in the month of November and averaged 3.5 percent throughout the year, he said.
“There is even more potential job growth if the restart of the refinery and other hospitality projects come online. So, while recent indicators suggest some normalization is underway, the labor market is forecast to perform well even as the post-COVID momentum eases,” Bryan said.
Overall revenues dipped slightly, reflecting the end of Covid-related fiscal stimulus and relief, he said.
“Our collections were in line with our revenue projections for the fiscal year 2023 revenues. Our Office of Management and Budget’s gross revenue was projected at approximately $934 million for fiscal year 2023 and collections were off by less than one percent,” he said. “This direct infusion of cash to the population included the Economic Impact Stimulus Payments, the increased Child Tax Credits, Pandemic Electronic Benefit Transfers, Premium Pay, Water and Power Authority credits, stipends for Social Security recipients, Rental Assistance, and subsidies to taxi drivers, to name some of our larger programs. These programs had a greater-than-anticipated impact on the economic activity in the territory and helped generate substantial tax revenues for the government. Those stimuli have worked their way through the local economy and now revenue collections are normalizing. Although the streak is broken, the revenues collected by this government remain far above where they were in the years before the pandemic.”
Gesticulating with his hands for emphasis throughout the speech, Bryan said 2024 was looking strong.
“The numbers simply don’t lie. The fact is revenues for the first quarter of the fiscal year 2024 are already above revenues for the same period in fiscal year 2023,” the governor said.
Cash-on-hand problems, including those caused by inflation, have caused delays in pay to vendors. Some of these debts are 40 years old, he said.
“I want to assure our vendors this evening that we are working hard to catch up on outstanding payments –and we will! That is currently the administration’s highest priority,” Bryan said.
A revolving line of credit could help bring money in today to be repaid later, like a family’s credit card, he said.
Bryan spoke optimistically about the burgeoning legal cannabis industry and the V.I. Slice home ownership grants. He said the key to redeveloping strong downtown areas was to get people back to living in town.
Getting derelict properties up and running again was paramount.
“This proposal is rooted in a property conservatorship model designed to remedy blight while protecting communities from the ill effects of gentrification,” he said. “Before this proposal was even publicly distributed, there were attempts to politicize the matter with misinformation and fearmongering. Some attempted to put a cloud of suspicion over the proposal and build opposition for the sake of opposition.”
Pushing back on the idea that the proposal was a government land grab, Bryan pointed out that the properties were in tax arrears. But the government was less interested in taking land than in getting local families back onto the crumbling properties, redeveloping them with government assistance.
Bryan called for acknowledging the disenfranchisement of the past with taking advantage of a prosperous future.
“There was a time in these islands when education opportunities for people of color were limited. That is why I am worried that our residents are not capitalizing on the opportunity for a free college education being provided at the University of the Virgin Islands. There was a time when people of color did not own property. Each successive generation of the residents of these islands strived to make property ownership much more attainable. That is why it is heartbreaking to see some property owners demonstrate an absence of pride by allowing their properties to become overgrown or filled with trash. There was a time when the lives of our ancestors were not valued. That is why I am concerned that we associate with and enable violent criminals who similarly place little value on life. There was a time when we did not have the right to elect our leaders; they were selected for us. So, I have grown uneasy that too many of us enjoy the spectacle of politics but never personally get involved in making this community better for ourselves and our neighbors.”
Property was increasingly valuable in the territory, he said.
In fiscal year 2023, the value of building permits issued was $305 million, which indicates a five percent increase as compared to $290 million in 2022 for the same period. During 2023, the private residential construction permits were worth $166 million, which is only slightly higher than the $165 million worth of permits issued in 2022. However, the non-residential construction permits showed significant growth of 200 percent, increasing from $27.7 million in 2022 to $83.5 million in 2023, the governor said.
Inflation hit hard, however, making $100 in groceries last year cost $120 in the territory. The near term may look rough for a while, but the long term looks good, he said. The territory is better positioned from 2023 forward than it was pre-pandemic.
While the USVI’s economic growth of the last two years has been more modest than the years prior, the rebound from the COVID-19 pandemic has been remarkable, he said. “Consumer spending, tourism, and significant investments from businesses and the public sector have driven this incredible growth.”
The government of the Virgin Islands has expended more than $3 billion in disaster recovery funds since hurricanes Irma and Maria struck in 2017, Bryan said, averaging $500 million in federal recovery dollars spent annually over the last six years.
“Prior to the hurricanes, we had never expended that much in contracts in a single year — not even half that much,” he said.
But even that was too slow a pace, Bryan said.
“At the present pace, it will take us another 20 years to complete the recovery and that is simply not good enough. Our goal is to at least double this amount and expend a billion dollars a year solely in disaster recovery funds. But to get there, we cannot continue doing things the traditional way. Frankly, we don’t have enough contractors, enough workers, or enough housing. We need a significant paradigm shift,” he said. “As a result, we are embarking on a new initiative called Rebuild USVI. We are estimating the total cost of reconstruction from the hurricanes to ultimately approach $15 billion or more. That is a monumental task to be managed by a workforce of just 41,493 people. Rebuild USVI is being developed to expedite the timeline for this massive reconstruction effort.”
The Rebuild USVI strategy will have three major goals: Attract large general contractors to help secure the performance bonds on projects worth hundreds of millions of dollars; systemically resolve logistical challenges and supply chain issues that drive up project costs, discourage contractor interests, and slow recovery efforts; and solidify manpower and capacity issues, he said.
“Rebuild USVI supercharges the territory’s disaster recovery to think outside the box and dispense with the bureaucracy that is simply inadequate for our progress. The success of this initiative will allow us to launch several of our largest recovery projects simultaneously and create an ecosystem of economic activity from the resulting construction boom. This is the way we facilitate the transformation of a resilient Virgin Islands,” Bryan said.
After the hurricanes and COVID pandemic, 2023’s biggest health story was essentially a goof, the governor said.
Extraordinary lead and copper levels in many St. Croix municipal water pipes discovered in September 2023 were attributable to testing errors, not widespread heavy-metal poisoning, he said. While subsidies and alternative water supplies were offered to people in affected areas, the likely culprit was tests performed at the meter, not at the sink.
Subsequent testing found dramatically lower lead and copper levels more in line with EPA standards.
“It is our firm belief that the original round of testing conducted used incorrect methodology. The apparatus used to collect the samples at the meter box caused tiny shards of metal to become free and contaminate the samples that were sent off for testing. Plainly stated, the way the water samples were collected created misleading results and led to the high levels of lead and copper reported. The proper testing methodology, which took samples from the faucets inside the building, without tampering with the plumbing components, yielded more accurate results,” Bryan said.
The local State of Emergency expired in December and the national emergency declaration expires Tuesday, he said. The “No Drink Advisory” will be dropped at that time.
“Now, while we do not believe we have a water crisis caused by the presence of lead and copper in the water distribution system — now, I want to make sure you all hear what I just say — we do not believe we have a water crisis caused by the presence of lead and copper in the water distribution system we do acknowledge that water in some parts of the distribution system on both islands is discolored and, therefore, unfit for consumption. It’s been this way for the last 20 years. We have clearly heard the frustration of residents who have had to cope with brown water from their taps. It is simple: We are getting rusty water in areas where we have rusty pipes. The solution is equally simple: WAPA must replace those rusty pipes.”
Returning several times to the issue of the territory’s embattled roadways, Bryan said the cost of getting rust out of the pipes was roads being dug up yet again. The Water and Power Authority would replace aging pipes and add corrosion controls that include FDA-approved, food-grade additives to the water system that form a coating within the pipes that prevents further leaching of rust into the water.
“This is the EPA’s strongest recommendation for water systems like ours that are showing signs of aging. For many years, WAPA had perfected such a corrosion treatment but did not make the required adjustments for the new water chemistry when the switch was made from desalination to reverse osmosis as its means of water production. They are now working with subject matter experts to make the necessary corrections and treat the rusting pipes within the system,” he said.
The governor also addressed calls to reduce electrical bills and improving quality service. New generators currently running on diesel were far more efficient than previous models and would generate even more cost saving once switched to lower-priced propane, he said. Battery-energy storage systems that help buffer disruptions on the energy grid were on the way too. These battery systems could provide nine megawatts of energy storage gathered during periods of low demand and released during peak demand. Improved operating costs on St. Thomas will accrue to the benefit of all WAPA customers territory-wide.
“My friends, I am fully committed to fixing WAPA and restoring its viability as a government agency. Most importantly, changing our perspective and approach to the energy challenges of this territory is essential,” Bryan said. “Residents and businesses must have affordable and resilient energy options. We are moving to a future where our power generation will be decentralized, with greater reliance on small private power producers. We are also creating opportunities for individuals to produce their own power and purchase their own battery storage.”
Two new solar farms should be able to provide 58 megawatts throughout the territory by April. A series of new wind turbines at Bovoni should add another 15 megawatts on St. Thomas within six months, the governor estimated.
President Biden’s Inflation Reduction Act allows the EPA to fund Solar for All programs nationwide, he said.
“These programs aim to give subsidies and financial help to residential rooftop and residential-serving community solar projects benefiting low-income and disadvantaged communities. We anticipate $100 million to be awarded to the U.S. Virgin Islands as part of the funding allocation. This funding will allow the Energy Office to install solar photovoltaic systems directly on low-income single-family homes at no cost to the homeowner. It will also allow solar developers to install large community renewable energy facilities or community solar that can provide electricity bill credits to low-income residents who are renters or whose roofs are not suitable for installing solar. The Virgin Islands Energy Office is currently awaiting approval of the grant award.”
This funding will also support the continuation of the Sun Power Solar Loan Program, he said. This program provides low-interest financing for homeowners who wish to install photovoltaic systems and battery storage devices in their homes, in which, through paying their utility bill, they can simultaneously repay their loan.
Close to $78 million in federal funding to advance various energy initiatives was on the table, he said.
“We want the next generation of Virgin Islanders to view energy independence as an achievable and normal way of life. WAPA will continue to play a critical role in that energy future. Its commercial, industrial, and government clientele will continue to require affordable and reliable power from the utility. WAPA will also play an important role as the supplementary source of energy that backstops the distributed energy connected to the grid. We have already begun the mission of ushering in an energy revolution with WAPA. We will lay a solid foundation this year to get us there.”
A construction boom was on the way as well.
The Office of Disaster Recovery had successfully increased the anticipated allocations for federal disaster recovery funding from $8 billion to $12 billion, with the potential to meet or exceed $15 billion over the next few years, Bryan said. Of the approximately 1,500 FEMA Public Assistance projects, only 54 remain to be obligated for education, healthcare, and infrastructure projects.
“In 2023 alone, more than $2.6 billion had been obligated, marking a 138 percent increase compared to the funds secured in 2022. This brings the total amount of obligated funds to a little over $8.6 billion, with $3.1 billion of that already expended. Over the next year, the territory expects about 300 projects to enter various phases of construction, generating over $500 million in spending,” he said.
The governor also called out violent criminals, warning against the cancer of gun violence and praising programs that help convicted criminals rehabilitate. He also warned against ignoring neighbors in trouble, saying four Virgin Islanders took their own lives in 2023.
He called out the ravages of opioid abuse, especially deadly, high-power fentanyl, as particularly dangerous. There were three confirmed opioid deaths in the USVI in 2023, he said.
“Settlements secured by the Department of Justice brought in more than one million dollars in opioid settlements and judgments to combat this growing epidemic, which will be administered through the Department of Health,” Bryan said. “Three deaths are three too many. This month, the Division of Behavioral Health hosted a planning meeting for a territory-wide Opioid Overdose Prevention Task Force to center community engagement and address this growing crisis. I urge this community to get educated on the dangers and actively discourage our family and friends from abusing fentanyl and other opioids.”
Bryan also hinted at the Jeffrey Epstein saga, acknowledging the settlement of one suit while not mentioning another.
“We must not shy away from the ugliest parts of our community but instead, be resolute in our efforts to address them head-on. Human trafficking and sexual abuse are real and present threats to our community. The territory has now received settlement funds resulting from the human trafficking litigation, including proceeds from the sale of Great Saint James and Little Saint James and other direct funds. These settlement funds include $20 million dollars to support services to vulnerable, disenfranchised individuals and community organizations to address social ills, including sex trafficking, human trafficking, mental health initiatives, domestic violence, and poverty. An additional $25 million will supplement prosecution and enforcement measures within the territory, and $15 million will be allocated to mental health services.”
He said he was advocating for legislation that would allocate an additional $11 million to combat human trafficking in the territory.
