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1 WAYNE BIGGS, JR. CHIEF EXECUTIVE OFFICER TESTIMONY BEFORE THE COMMITTEE ON HOUSING, TRANSPORTATION, AND TELECOMMUNICATIONS VI Slice Moderate Income Homeownership Program (A Gap Financing Program) SEPTEMBER 10, 2025 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 2 Good day – Senator Marvin A. Blyden, Chairman, Committee members, 1 senators and staff of the 36th Legislature, Virgin Islands Economic Development 2 Authority (“VIEDA”) team members, the legislative staff, and the listening and 3 viewing public. I am Wayne Biggs, Jr., Chief Executive Officer of the VIEDA; here 4 with me today is Mr. Dwayne A. Benjamin, Sr., Assistant Chief Executive Officer, 5 Mrs. Kelly Thompson Webbe, Chief Financial Officer, and Ms. K’Nisha Gumbs, 6 Loan/Collection Officer. Unfortunately, Ms. Monique Samuel, Managing Director, 7 Economic Development Bank for the United States Virgin Islands is out of the 8 Territory and cannot be here with us today. I would like to thank the Committee 9 Chair and members of the Committee on Housing, Transportation, and 10 Telecommunications for inviting us to provide a status update on the VI Slice 11 Moderate Income Homeownership Program (“VI Slice”). 12 13 Virgin Islands Economic Development Authority (VIEDA) 14 The VIEDA is the umbrella organization that assumes, integrates, and unifies 15 the functions of the following subsidiary entities: the Economic Development Bank 16 (“EDB”), the Economic Development Commission (“EDC”), the Enterprise Zone 17 Commission (“EZC”), and the Economic Development Park Corporation (“EDPC”). 18 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 3 It is a semi-autonomous governmental instrumentality responsible for the 19 development, promotion, and enhancement of the economy of the United States 20 Virgin Islands. 21 The basic objectives of the VIEDA are to promote the growth, development, and 22 diversification of the economy of the United States Virgin Islands; to create 23 opportunities for the gainful employment of residents; to promote access to 24 capital; to contribute to the development of the educational system; and to 25 preserve the environment, beauty, and natural resources of the Territory. 26 Through its four main pillars: the Economic Development Bank, the Economic 27 Development Commission, the Enterprise Zone Commission, and the Economic 28 Development Park Corporation, the VIEDA has facilitated investment 29 opportunities, thereby leading to job creation and retention, as well as assisted our 30 clients with bringing their dreams of entrepreneurship and business growth to 31 fruition. 32 33 VI Slice Moderate Income Homeownership Program (VI Slice) 34 The VIEDA was charged by the Honorable Governor Albert Bryan, Jr., with 35 administering the VI Slice Moderate Income Homeownership Program known as VI 36 Slice. The primary goal of VI Slice is to establish opportunities that may increase 37 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 4 homeownership rates amongst moderate-income households in the US Virgin 38 Islands by offering “Gap Financing”. The program supports long-term sustainability, 39 resiliency, and economic viability across the Territory by providing financial 40 assistance to expand affordable homeownership opportunities to first-time home 41 owners. VI Slice is a “Gap Financing” Program funded through an $8M American 42 Rescue Plan Act (“ARPA”) grant. It is administered by the Virgin Islands Economic 43 Development Authority (USVIEDA) in partnership with the Office of Disaster 44 Recovery ("ODR”) and the Office of the Governor, with participation from the 45 Territory's mortgage lending institutions. 46 47 What is Gap Financing? 48 Gap Financing is supplemental funding to help applicants bridge the “gap" or 49 shortfall between the overall project cost and the amount secured through a 50 primary lender. 51 52 VI Slice supports the following activities: 53 • Home Purchase without or with rehabilitation, if necessary, to make 54 the house livable and bring up to current building codes, (Limit: 55 $200K), 56 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 5 • New Construction (Limit: $200K), and 57 • Down Payment & Closing Costs Assistance (Limit: $100K). 58 However, the VI Slice maximum aggregate gap financing amount is $200K. 59 60 To be eligible for VI Slice an Applicant must: 61 • Meet established household income requirements. 62 • Be a first-time homeowner. A first-time homeowner is defined as an 63 individual who has had no ownership in a principal residence during 64 the 3-year period ending on the date of purchase/construction of the 65 property. 66 • Be a resident of the territory for the last three (3) years prior to the 67 signing of a sales contract, except for those applicants who were prior 68 residents of the territory for at least 10 years and have now opted to 69 return, or whose birthplace is the U.S. Virgin Islands. 70 • Attend the Virgin Islands Housing Finance Authority’s Homebuyer 71 Education Program and earn a Homebuyer Education Certificate of 72 Completion. 73 • Attain a Commitment Letter for a mortgage loan based on the 74 underwriting standards of the primary mortgage financing lender. 75 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 6 • Have the ability to make a minimum earnest money deposit of $5K at 76 the time of signing the purchase contract. (For Veterans holding a 77 certificate of eligibility or an honorable discharge via the DD214, are 78 exempt from the earnest money deposit requirement). 79 • Have the ability to make an additional investment, if required, into the 80 mortgage transaction in an amount to be determined by the primary 81 lender. 82 • Have a minimum credit score of 620 or conform with the required 83 credit score of the primary lender. 84 85 To be eligible for VI Slice Program financing: 86 • An Applicant must have a Commitment Letter from a primary lender. 87 • An Applicant must have a Sales Contract or Purchase Agreement, if 88 applicable, for home purchase or a valid Contractor’s Estimate for 89 home construction. 90 • An Applicant must obtain the maximum funding available from a 91 primary financing lender. 92 • The Applicant is required to submit the Commitment Letter from a 93 qualifying lender for at least 60% of the overall project cost. 94 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 7 • The Applicant’s combined mortgage payments cannot exceed 36% of 95 the Applicant’s gross monthly household income, providing that this is 96 in accordance with the primary lender’s policy. 97 • The Applicant’s debt repayment cannot exceed 43% of gross monthly 98 household income, providing that this is in accordance with the 99 primary lender’s policy. 100 • The maximum Combined Loan-to-Value (“CLTV”) cannot exceed 105%. 101 • The Applicant must obtain a 30-year, but not more than a 40-year (if 102 available), fixed-rate loan from a primary lender. 103 • The property must be utilized and remain as the client’s primary 104 residence for a minimum period of 10 years. 105 106 It is important to note that if the Primary Participating Lender’s mortgage 107 requirements are more liberal than VI Slice Program financing requirements, the 108 Primary Participating Lender’s mortgage requirements are utilized when evaluating 109 the Primary Participating Lender’s VI Slice gap financing request. 110 111 112 113 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 8 How does the VI Slice Program work? 114 1. Applicant applies for a mortgage or construction loan from a 115 primary lender. 116 2. Primary lender evaluates and determines the loan amount, and the 117 financing “gap”, if any. 118 3. Primary lender refers its client’s application to VIEDA for the VI Slice 119 Program if it is determined that there is a need for gap financing. 120 4. If the referral package is approved, the borrower will execute a first 121 mortgage in favor of the primary lender and a second 10-year VI 122 Slice mortgage for the gap financing amount. 123 5. The client utilizes the home as their primary residence and submits 124 an annual certification statement as proof of residency. 125 6. The client pays nothing on the second mortgage providing the 126 property remains as their primary residence for a 10-year period 127 and they do not sell, lease, or move out. 128 7. The VI Slice mortgage converts to a grant at the end of 10 years if 129 the client remained in the house for the 10-year period. 130 131 132 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 9 VI Slice Status Update 133 As of August 31st, 2025, 88 VI Slice applications have been received 134 requesting VI Slice gap financing of $9,317,028.30 for primary lender financing of 135 $27,822,473.00. Sixty-five applications have been approved totaling $6,811,190.41 136 in VI Slice gap financing with overall primary lender financing of $20,186,223.00. 137 Nine (9) applications were withdrawn by the primary financing lender totaling 138 $835,569.91 in VI Slice gap financing with primary lender financing of 139 $3,126,450.00. Three (3) applications were declined by the primary financing 140 lender totaling $398,927.04 in VI Slice gap financing with primary lender financing 141 of $762,000.00, and three (3) applications were declined by the VIEDA/EDB totaling 142 $462,963.94in VI Slice gap financing with primary lender financing of 143 $1,145,800.00. Four (4) applications requesting VI Slice gap financing of 144 $556,150.25 with primary lender financing of $1,086,469.00 are currently awaiting 145 submission of supplemental documents from the primary financing lender to be 146 decisioned by VIEDA/EDB. Four (4) draft applications requesting VI Slice gap 147 financing of $369,250.00 with primary lender financing of $1,373,600.00 have been 148 submitted in the online application portal by primary financing lenders to be 149 decisioned by VIEDA/EDB when the application is complete. 150 151 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 10 Of the 65 approved applications, 46 have been approved for St. Croix totaling 152 VI Slice gap financing of $4,009,207.96 with primary lender financing of 153 $13,212,723.00, and 18 for St. Thomas totaling VI Slice gap financing of 154 $2,633,412.30 with primary lender financing of $6,473,500.00, and one (1) for St. 155 John totaling VI Slice gap financing of $168,570.15 with primary lender financing of 156 $500,000.00. Sixty-one approved VI Slice transactions have closed and are fully 157 disbursed totaling $6,255.040.16 in VI Slice gap financing with primary lender 158 financing of $19,099,754.00, and four (4) approved VI Slice transactions are 159 pending closing totaling $556,150.25 in VI Slice gap financing with primary lender 160 financing of $1,086,469.00. 161 162 Banco Popular has originated 22 approved VI Slice transactions, Capital 163 Mortgage Services of Texas has originated 17 approved VI Slice transactions, the 164 United States Department of Agriculture/Rural Development has originated 10 165 approved VI Slice transactions, Oriental Bank has originated nine (9) approved VI 166 Slice transactions, Merchant’s Commercial Bank has originated three (4) approved 167 VI Slice transactions, and First Bank Virgin Islands has originated three (3) approved 168 VI Slice transactions. 169 170 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 11 171 172 VI Slice Challenges 173 The three (3) main challenges the program has faced are: 174 1. Inventory of affordable homes available on the market; 175 2. High cost of home construction; and 176 3. Limited number of mortgage lenders offering construction 177 financing/construction loans for residential homes. 178 179 We will continue our aggressive marketing initiatives to include town hall 180 meetings, radio and newspaper advertisements, social media campaigns, webinars, 181 and community outreach to involve participation by the local schools. 182 183 Individuals seeking more information can visit the VI Slice website at 184 www.vislice.com or send an email request to vislice@usvieda.org. 185 186 I thank you for the opportunity to provide this status update on behalf of the 187 VIEDA on the VI Slice Moderate Income Homeownership Program to the 188 Virgin Islands Economic Development Authority Wednesday, September 10, 2025 12 Committee on Housing, Transportation, and Telecommunications. My team is 189 available to answer any questions you may have related to my testimony. 190