Westin St. John executives asked the Economic Development Commission during its public hearing Tuesday to reduce the facility’s required number of full-time employees from 250 to 150, a move meant to keep the hotel EDC-compliant as it transitions to a fully timeshare operation.
Commissioners took no action on the Westin St. John request on Tuesday.
According to Adrienne Dudley, counsel for Westin St. John, the hotel is scheduled to reopen in January 2019, but instead of reverting back to its part-resort, part-timeshare model, Westin St. John will operate solely as a timeshare property, reducing the need for full-time employees. Transitioning to timeshare is a boon to the economy, according to Dudley, due to the spending consequences of extended stays.
“They’re spending, as a result, way more money, probably double or triple the amount that an ordinary cruise ship passenger, or maybe even hotel guest will spend,” said Dudley.
Companies that receive EDC certificates enjoy corporate and income tax cuts – as much as 90 percent – and a full exemption on gross receipts, business property and excise taxes. In return, they must comply with specific requirements, from maintaining a certain number of employees and making charitable cash and in-kind contributions to the community.
In addition to the 150 full-time employees, Dudley said Westin also expects to hire an additional 15 to 20 employees for its sales and marketing division, which could bring the total to 170. Food and beverage services at the hotel will also now become a concession, a substantial operation that could draw some 50 to 70 additional workers that will not count toward the EDC requirements.
“We want to be certain we have a minimum number of employees of 150 because don’t want to overpromise and underdeliver,” said Dudley.
Westin St. John saw the exodus of roughly half of its employees after the 2017 hurricanes. Of some 250 employees, many opted for a severance package and separated from the company for various reasons. Others took advantage of the option to transfer to other Westin properties. Some 140 stayed for the cleanup, said Jackson, but that number was eventually further reduced.
Westin St. John currently has 80 employees but officials expect to ramp up hiring the next several weeks. Raheema Jackson, director for the division of rooms at Westin, said they are working with the Department of Labor to reach former employees who separated from the company, were displaced by the storm or transferred to other properties. They are also recruiting locally, targeting former employees of properties like Caneel Bay who already have the needed experience and skill sets to work at Westin.
On top of the reduced employment quota, Westin St. John also asked for eliminated or prorated charitable contributions for a period of one year. According to Dudley, they could see charitable contributions go up to normal levels by 2020.
Since the hurricanes, Westin St. John was acquired by Marriott Vacations Worldwide.
Yacht Haven Grande Settlement
The commission also settled a non-compliance issue that would have cost Yacht Haven USVI more than $222,000 for failure to comply with their charitable contributions requirements.
Yacht Haven was granted approval by the commission in 2013 to count in-kind contributions toward their requirements between 2003 and 2012. There was, however, a lack of proper documentation to support some $300,000 that Yacht Haven claimed in in-kind contributions, resulting in the Economic Development Authority’s compliance division to quantify them.
The EDA initially came up with $288,000 in charitable contributions shortfall, which was later adjusted to $222,223. After working with Yacht Haven in determining the value of each in-kind contribution, that amount was further adjusted to $105,000.
At the insistence of Commissioner Eugene Farrell, Yacht Haven USVI Vice President Charles Irons agreed to an upfront payment of $10,000, payable within the next 30 days. The remaining amount would be split into two payments – half to be paid in January and the last half in February.
EDA Director of Compliance Claude Gerard and attorney Henry Smock recommended that the commission approve the settlement. Chairman Jose Penn and members Farrell, Haldane Davies and Juan Figueroa, Sr. all voted in the affirmative.
Commissioners also heard from Tropico Management, LLP, a St. Croix-based advisory and consulting firm serving some 50 clients in the U.S. mainland and one foreign client. Commissioners will decide on Tropico’s application to become an EDC beneficiary in a later hearing.
The commission also:
– Granted a request by 183 Media to reduce its employment quota from eight full-time employees to five.
– Granted a request by Grapetree Shores, Inc., to reduce its employment quota from 75 full-time employees to 25.
– Fined Concordia Campgrounds, Inc., $19,600, which represents the discrepancy between its required and actual charitable contributions.
– Fined Diam Management $1,572, which represents the discrepancy between its required and actual charitable contributions.
– Fined Spartan Products $20,000 for failure to employ the requisite number of interns.
– Granted a request by Impact Technologies VI to have until January to comply with its employment quota of six employees.
– Granted a request by JH Capital VI, Inc. to suspend its EDC benefits for a period of two years.