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Virgin Islands Port Authority Testimon y re: BR25-0936 February 27, 2026 VIRGIN ISLANDS PORT AUT HORITY TESTIMONY CARLTON DOWE, EXECUTIVE DIRECTOR Good morning, Honorable Senator Kurt A. Vialet, Chairman of the 36th Legislature’s Committee on Budget, Appropriations, and Finance, as well as all present senators, legislative staff, and the listening and viewing audience. I am Carlton Dowe, the Executiv e Director of the Virgin Islands Port Authority (VIPA). Thank you for the opportunity to present testimony regarding Bill Request Number 2 5- 0936 , which seeks to reprogram administrative fees resulting from the bonds issued by the Fortress Investment Group for various projects and initiatives aimed at enhancing the economic development of St. Croix , United States Virgin Islands . These funds will be deposited into the Budget Stabilization Fund. Today, I will discuss the proposed one-million -dollar appropriation ($1,000,000.00) from this fund to provide a subsidy for airlift between St. Croix and the Eastern Caribbean . The Virgin Islands Port Authority supports this measure with the amendment to this Bill Request that will allocate the funds to the U.S. Virgin Islands Department of Tourism to assist in attracting and securing new airlift to the territory. Enhancing connectivity to the Eastern Caribbean has been a primary focus for both the Port Authority and the Department of Tourism. Our community and business operations are deeply linked to this region. There is a growing demand for additional travel options between the US Virgin Islands and our neighboring islands for leisure , Virgin Islands Port Authority Testimon y re: BR25-0936 February 27, 2026 celebrations, business, and commerce. Travel to these islands has become increasingly expensive due to limited airlift, often requiring an overnight trip to Miami or a stopover in the British Virgin Islands. This can be quite costly when traveling as a group or family , and burdensome when traveling to attend funerals or to visit ill family members. Costs can range upw ards of $2,000 per person , per trip. In St. Thomas, w e have successfully attracted new Caribbean routes through Cape Air, which offers service to Nevis and St. Barts ; Contour Airlines, which connects St. Thomas to Dominica; and SkyHigh, which provides flights to the Dominican Republic. We have not yet been as successful in establishing ongoing connections from St. Croix to the Eastern Caribbean . However, St. Croix could greatly benefit from a new airlift, as many residents on the island are connected to the Eastern Caribbean . A well-designed airline subsidy program can reduce the commercial risks that prevent carriers from launching services in new or uncertain markets. By subsidizing this route, we can make it financially viable for a smaller airline. This support will allow th e airline to offer affordable pricing without sacrificing profit margins or limiting service. Additionally, an airline introducing new service will promote this route, providing indirect marketing and publicity for St. Croix and enhancing the Department of Tourism’s efforts to promote the island . Lastly, but also as important, a new airline will provide new employment opportunities for resident s. Virgin Islands Port Authority Testimon y re: BR25-0936 February 27, 2026 I must highlight that our Caribbean neighbors account for a significant share of visitors to our islands. Connecting St. Croix to the Eastern Caribbean would be a two-way benefit , enabling individuals from the Eastern Caribbean to visit their families on St. Croix and participate in local festivals that celebrate the island’s rich culture and history. Our neighbors also serve as tourists, contributing to our economy. VIPA Airline Incentive P rogram Since 200 8, the Virgin Isl ands Port Autho rity has offered an inc entive program to any airline that provide s new service to the territory. The VIPA Board of Governors extended the Authority’s existing airline incentive program at its February 25, 2026, meeting. The renewed VIPA Air line I ncentive P rogram is available from March 1 through December 31, 2026 . To qualify to participate in the incentive program, an airline must: • Provide service on a route not served by that airline during the same period of the previous year , or • Provide additional flights on a route served by that airline during the previous year. Any scheduled commercial passenger airline or charter jet airline that currently serves or wishes to serve the USVI from outside the Territory may apply for the incentive. For a period of one year, during the term of the Incentive Perio d, VIPA’s Virgin Islands Port Authority Testimon y re: BR25-0936 February 27, 2026 Landing Fee is waived . Additionally, during the one -year period, Terminal Parking Fees, User Fees (Arrival), and User Fees (Departure) are reduced by 50%. This program has proved to be a successful tool for the Department of Tourism and the Port Authority in negotiations with airline officials over the years. The Virgin Islands Port Authority will continue to work together with the Department of Tourism to attract new air service and offer incentives. As you may know, the Honorable Jennifer Mattarangas -King, the Commissioner of the VI Department of Tourism, is a member of the Port Authority Board. She collaborates closely with all Board members and the executive staff to ensure that the Port Authority's activities and efforts complement and enhance the Tourism Department's overall goals . Conclu sion The Virgin Islands Port Authority supports this measure by the L egislature and commends the bill's sponsors for providing fu nding to support new air lift connecting St. C roix and the Eastern Caribbean . We will work collaboratively with Tourism and the Administration to spearhead the efforts to bring this new air service to the island of St. Croix. Honorable Chairman Vialet , t his co ncludes my testimony , and I remain available to provide any additional informat ion and answer any questions you may have.