Gov. Albert Bryan Jr. declared a state of emergency Monday after the latest round of rolling blackouts on St. Croix, and confirmed that the V.I. Water and Power Authority’s failure to make lease payments to Aggreko caused the company to shut down generators at the Richmond power plant.
More outages are possible if Aggreko does not receive $2.3 million by today, Bryan said at a press conference held at Government House on St. Thomas. He pledged to make that payment with “rainy day funds” to avert another round of blackouts, and spoke at length about plans to create a task force and hire a management turnaround company to stabilize the territory’s power grid.
“I’m just stepping in, in a big way, much to my dismay,” Bryan said.
The government has already given WAPA nearly $100 million in taxpayer money between March 2022 and June 2023, “effectively subsidizing $2,000 per household to maintain stable electricity costs,” Bryan said.
But WAPA customers are still paying 43 cents per kilowatt hour for unreliable power, and the utility is still falling behind on bills. About two cents of the electric rate goes directly to Aggreko to lease generators on St. Croix, and a WAPA official said in 2021 that the lease was estimated to cost in excess of $23 million over the next two years.
Bryan said Monday that WAPA did not make a $100 million payment to fuel supplier Vitol by April 15, and said a new deadline is in negotiation.
He delivered mixed messages throughout the press conference, expressing deep concern over the territory’s energy crisis, but also dismissing WAPA’s problems as easily solved if the government pays its debts.
“This is the administration that led you through a global pandemic, WAPA is a cakewalk,” Bryan said. “We just need to pay the light bill.”
He blamed the Legislature for not making an appropriation to pay WAPA earlier this year, and said, “I can’t wait any longer.”
He highlighted three semi-autonomous agencies, Schneider Hospital on St. Thomas, Luis Hospital on St. Croix, and the V.I. Waste Management Authority, and said they collectively owe over $11 million to WAPA.
“They are once again racking up a considerable outstanding obligation to WAPA, without any meaningful conversation about how they will address these bills,” Bryan said.
The territorial hospital board did have that conversation at a meeting Thursday, where Schneider Hospital CEO Tina Comissiong explained that the Health Department and Bureau of Corrections are among agencies that owe money to the hospital, and payments from those departments would help enable the hospital to pay WAPA.
Those departments are supposed to pay for care for behavioral health patients court-ordered to stay at the hospital, but Comissiong said Schneider has not received reimbursement, and the hospital is not the most appropriate place for patients to live long-term.
Comissiong also said the hospital has expended at least $6 million to care for “boarders,” patients who no longer need acute medical care but cannot be safely discharged because they are unable to care for themselves, such as the elderly or those in need of long-term rehabilitation after an illness.
The hospital has been forced to care for some patients indefinitely, because the Virgin Islands government has not created a rehabilitation facility or inpatient mental health treatment center.
Bryan said Monday that having those facilities would not help the situation, because the government is still paying regardless of where patients are being housed.
“So, if the government builds a rehab center and moves everybody to the rehab center, who pays for that? The same government. I mean, it’s like a joke. These same entities act like they’re really autonomous? All of them living off the central government money,” Bryan said. “If the hospital wants us to take our $26 million and then they run it themselves and when we have our bills due, we’ll just pay them. They can do that too, but that can’t work right?”
Bryan says the government pays “over $16 million a year for all kinds of maladies,” including behavioral health, hospice, homecare, and long-term disability, and “whether we paying to the hospital, whether Human Services paying, Bureau of Corrections, Department of Health, it’s the same money. It’s the same government.”
A Daily News reporter asked the governor: “So, it is just a shell game? It’s all just one pot of money and it’s just being moved around to cover crises?”
“Yeah. I mean, like, I don’t know why that’s a mystery to you. There’s only one Virgin Islands government,” Bryan responded.
Bryan said the government has been subsidizing the hospitals’ operations, and “over the last three years, between the two hospitals we’ve probably given them over $50 million and now you’re going to tell me I’ve got a bill for this?”
Both Schneider and Luis hospitals have had their allotments redirected by the Office of Management and Budget to pay outstanding WAPA bills, and Comissiong said $1 million in American Rescue Plan Act funding was also sent to WAPA, instead of hospital needs.
“The hospitals still have ARPA money in reserve, they could always switch what they want to do with the money and buy supplies. I really don’t understand it,” Bryan said Monday.
Bryan said the government intends to give WAPA around $15 million to satisfy the agencies’ $11 million debt, help with liquidity to make fuel purchases, pay vendors, and make a $4 million bond payment.
When the government pays the hospitals’ bills to WAPA, “we’re actually going to strike off all of the bills that they say the government owes them. Each of the hospitals got $10 million to use as they please. Out of that $10 million, I’m sure they have at least $6 million left. They’re not activating any of those funds to pay their light bills,” Bryan said. “Instead they’re choosing to do other things with the money. I’m not saying any of those things are meaningless, but I’m saying when tough times come you have to make tough decisions.”
In terms of WAPA’s management, “I think we have effectively terminated or forced to resign WAPA’s entire C-suite. There is nobody in their executive management that was there before. Right now, they don’t have a CFO, they don’t have an official COO, the CEO is new,” Bryan said.
WAPA CEO Andy Smith was hired in January 2022.
COO Michael Sharp resigned in January 2023 after only seven months on the job. And CFO Jacob Lewis, who joined WAPA in April 2022, resigned at the end of 2023.
“We have effectively changed the entire management of WAPA and it’s no better. The simple solution is raise the rates to 55 cents a kilowatt hour, which is what WAPA produces it at. But then that would ruin the economy, so. The least we could do is pay our bill,” Bryan said.
V.I. Delegate to Congress Stacey Plaskett said in a statement that she has worked to help funnel hundreds of millions of federal dollars to the territory to rebuild the water and power infrastructure, and more than $55 million for repairs, and other needs.
“Nonetheless, we know these additional sources of funding are for long term projects and do not solve the immediate cash flow problems facing WAPA if its largest users, our government agencies, are unable to pay their bills,” according to Plaskett.
Senators have scheduled a press conference for 1:30 p.m. today, an emergency committee hearing Wednesday, and a Legislative session is set for Thursday, all to address the latest WAPA crisis.
– Contact Suzanne Carlson at 340-714-9122 or email scarlson@dailynews.vi.