Governor de Jongh Commends Government Employees Retirement System
on Recent Actions to Assist Two Local Businesses

Governor John P. de Jongh, Jr. has commended the trustees and staff of the Government Employees Retirement System for the recently closed loans made by the retirement system to Carambola Beach Resort and Spa and Seaborne Airlines. “Each of these companies is essential to our local economy, each had specific financing needs that had to be met to assure their future success, and the GERS was able to meet these needs while maintaining the high investment return the system seeks,” de Jongh said, adding, “This is how government can help the private sector.”

GERS Administrator Austin Nibbs outlined the two transactions as follows:

A loan of $15 million was closed on December 8, 2009, the proceeds of which will be used by the Carambola to assure that the resort stays open and operating during this economic downturn, and meets the requirements to be part of the Marriott reservation system. The hotel’s previous lender was in the process of selling the hotel’s loan which would have put its future in jeopardy and possibly even impacted its continued operations as a hotel on St. Croix. Only $8.2 million of the total loan has been disbursed by the GERS to date. 

The loan to Seaborne Airlines was in the amount of $3.3 million and closed on December 4, 2009. Its proceeds will be used for expansion of the vital inter-island service Seaborne provides. The governor noted that the GERS’ loan to Seaborne is consistent with the financial assistance government has provided to others in the transportation industry, most especially, the ferryboat companies and the operating subsidies that they received. The government, through funding provided in the American Recovery and Reinvestment Act, is working with the ferryboat companies to purchase new vessels for inter-island transportation. 

Commissioner of Tourism Beverly Nicholson-Doty also reiterated the importance of maintaining hotel room inventory on St. Croix as her department and its industry partners work to increase tourism on St. Croix. “Our efforts to brand St. Croix, to increase airline service, and to build our tourism infrastructure all rests on keeping our hotels open and welcoming our visitors with top level hospitality. 

This loan helps Carambola to do just that as it keeps the facility open but in the near term will finally enable the hotel to add the Marriott name to its marketing efforts which will only benefit St. Croix,” Nicholson-Doty said. Carambola was originally built in 1986 and has had two previous owners; the current owner is Carambola Northwest, LLC.“ 

Well-structured loans will reward the GERS with a healthy return and provide an alternate source of financing for our local businesses, the backbone of our economy. said the governor. “These are difficult times for all as the recession has not yet ended and this year will be another challenging year. These two transactions have enabled us to preserve over 200 jobs in our economy and ensure the viability of the companies,” de Jongh added. 

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