USVI Public Records

Document text

VI ECONOMIC DEVELOPMENT AUTHORITY BUDGET ANNUAL 2016 “BUILDING AN ECONOMY THAT DRIVES ECONOMIC GROWTH AND PROSPERITY” V.I. ECONOMIC DEVELOPMENT AUTHORITY FISCAL YEAR 2016 BUDGET October 1, 2015 – September 30, 2016 St. Thomas: 8000 Nisky Shopping Center, Suite 620 St. Thomas, U.S. Virgin Islands 00803 Phone: (340) 714-1700 www.usvieda.org St. Croix: 116 King Street, Frederiksted St. Croix, U.S. Virgin Islands 00840 Phone: (340) 773-6499 www.usvieda.org i V.I. ECONOMIC DEVELOPMENT AUTHORITY FISCAL YEAR 2016 BUDGET October 1, 2015 – September 30, 2016 TABLE OF CONTENTS I. INTRODUCTORY SECTION Chief Executive Officer’s Budget Message ................................................................................................ 1 Principal Officials………………………………………………………………………………………………………………….……………3 Mission Statement .................................................................................................................................... 4 Scope and Overview ................................................................................................................................. 5 Organizational Chart ................................................................................................................................. 6 Accounting System and Financial Reporting Roles and Responsibilities .................................................. 7 VIEDA Cost Accounting Structure ............................................................................................................. 8 Goals, Objectives, Performance Measurement, and Performance Evaluation ...................................... 10 Annual Budget Process ........................................................................................................................... 11 II. DEPARTMENTAL GOALS AND OBJECTIVES 1.0 VIEDA ADMINISTRATIVE DEPARTMENTS ........................................................................................ 14 1.1 Board of Directors ............................................................................................................................. 14 1.2 Executive Office ................................................................................................................................ 17 1.3 Accounting and Finance .................................................................................................................... 19 1.4 Human Resources ............................................................................................................................. 23 1.5 Legal .................................................................................................................................................. 26 1.6 Marketing/Public Relations ............................................................................................................... 30 2.0 VIEDA OPERATIONAL DIVISIONS ..................................................................................................... 32 2.1 V.I. ECONOMIC DEVELOPMENT COMMISSION ............................................................................... 32 2.1.1 Applications Unit ............................................................................................................................ 32 2.1.2 Compliance Unit ............................................................................................................................. 36 ii II. DEPARTMENTAL GOALS AND OBJECTIVES CONTINUED 2.2 Economic Development Bank (EDB) ................................................................................................. 40 2.3 Enterprise & Commerical Zone Commission .................................................................................... 45 2.4 Economic Development Park Corporation ....................................................................................... 50 III. FINANCIAL SECTION 3.1 Revenue ............................................................................................................................................ 51 3.2 Expenditure Comparison for FY 14, FY 15 Projected and FY 16 Budgeted ...................................... 53 3.3 Professional Services ......................................................................................................................... 54 3.4 Personnel Service Cost Breakdown by Department and Classification ............................................ 55 3.5 Budget Summary ............................................................................................................................... 56 III. OTHER INFORMATION A. Vehicle Listing for VIEDA ..................................................................................................................... 57 B. Listing of Real Property being rented or leased by the VIEDA ........................................................... 57 III. APPENDIX Glossary of Terms.................................................................................................................................... 58 May 30, 2015 The Honorable Clifford F. Graham Chairman, Committee on Finance Legislature of the Virgin Islands Capital Building, P.O. Box 1690 St. Thomas, U.S. Virgin Islands 00804 Dear Senator Graham: It is my privilege to present the Virgin Islands Economic Development Authority’s (“VIEDA” or “Authority”) Fiscal Year 2016 Budget for your consideration and that of your honorable colleagues. The budget request of $4,800,000 is $56,000 or 1% less than the amount appropriated in Fiscal Year 2015. Despite a reduced budget, we are committed to delivering a high level of performance to build an economy that supports an expansion of the tax base. We intend to accomplish this objective by building partnerships with both public and private entities that, over time, can improve the standard of living for our residents. The EDC program remains a viable means of attracting new investments to the Territory. For example, within the last 6 months, thirteen (13) new companies have filed applications for EDC benefits. These applications, if approved, are expected to create 81 full time jobs and generate approximately $14.4 million in direct investments. We intend to sustain the momentum. To do so, adequate funding must be in place to compete with other jurisdictions in attracting new companies regionally, nationally and globally. This budget is designed to use a targeted market approach to attract new investments and to help local entrepreneurs start and grow their businesses. At the same time, we continue the push towards establishing an EB-5 center for the Territory, proceeding with Tax Increment Financing development, drafting the appropriate rules and regulations relative to the Hotel Development Act and the STARS Act, and remaining steadfast in efforts to resuscitate the marine industry. All these initiatives will help strengthen and diversify the economy. Honorable Clifford F. Graham May 30, 2014 Page 2 – We are aware of the financial challenges the Territory faces, and the EDA is fully committed to building an economy that drives economic growth and prosperity now and into the future. My staff and I are available to answer questions or provide additional information that you or the Post- Audit Division may have with respect to this submission. Respectfully, Wayne Biggs Jr. Wayne Biggs, Jr. Acting Chief Executive Officer V.I. Economic Development Authority – Fiscal Year 2016 V.I. ECONOMIC DEVELOPMENT AUTHORITY FISCAL YEAR BEGINNING OCTOBER 1, 2016 Principal Officials Governing Board Board Member Position José A. Penn Interim Chairman Philip Payne Interim Vice Chairman Avery Lewis Interim Secretary Haldane Davies, PhD. Member Juan Figueroa, Sr. Member Catherine Hendry, Esq. Member Simon B. Jones-Hendrickson, PhD. Member Senior Management Team Wayne Biggs, Jr., Acting Chief Executive Officer Assistant Chief Executive Officer/Chief Operating Officer Tracy Lynch Bhola, Esq., Legal Counsel Ernest Halliday, Director, Administration & Finance Margarita Benjamin, Director, EDC, Applications Unit Claude Gerard, Director, EDC, Compliance Unit Nadine Marchena Kean, Director, Enterprise & Commercial Zone Commission Sharmane Brookes, Director, Economic Development Bank V.I. Economic Development Authority – Fiscal Year 2016 Mission Statement The Virgin Islands Economic Development Authority is a semi- autonomous governmental agency responsible for the promotion and enhancement of economic development in the United States Virgin Islands. The VIEDA strives to foster positive public/private sector partnerships for the enhancement of economic growth and development. V.I. Economic Development Authority – Fiscal Year 2016 Scope and Overview The Virgin Islands Economic Development Authority (“VIEDA” or “Authority”) is a semi-autonomous governmental instrumentality responsible for the development, promotion and enhancement of the economy of the U.S. Virgin Islands. The VIEDA is the umbrella organization which assumes, integrates, and unifies the functions of the following subsidiary entities: the Economic Development Bank (“EDB”), the Economic Development Commission (“EDC”), the Economic Development Park Corporation (“EDPC”), and the Enterprise and Commercial Zone Commission (“ECZC”). The VIEDA operates under one Governing Board (“Board”) in order to achieve maximum efficiency of operation by avoiding duplication of services, positions, and responsibilities; to reduce expenses of personnel, physical plant and operations; and to develop comprehensive programs for the economic development of the U.S. Virgin Islands. The VIEDA is a vehicle by which the Virgin Islands Government develops and nurtures the economic growth of the Territory. According to the legislation which governs the VIEDA, the Authority shall be governed by a seven (7) member board. Of the seven (7) members, three (3) shall not be employees of the Government of the Virgin Islands or the Government of the United States and shall be appointed by the Governor, with the advice and consent of the Legislature, for a term of three (3) years. Of the three (3) non-governmental employees, one must be a resident of St. Thomas, one must be a resident of St. John, and one must be a resident of St. Croix. Three (3) members shall be cabinet-level appointees. One (1) member shall be appointed from either the Board or executive staff of the Employees Retirement System of the Government of the Virgin Islands, Virgin Islands Port Authority, or the University of the Virgin Islands. V.I. Economic Development Authority – Fiscal Year 2016 VIEDA Organizational Chart V.I. Economic Development Authority – Fiscal Year 2016 Accounting System and Financial Reporting Roles and Responsibilities The VIEDA is a component unit of the U.S. Virgin Islands Government and follows enterprise fund accounting and reporting. The financial statements are presented in a manner similar to that of a private business, using the economic resources measurement focus and the accrual basis of accounting. Management prepares a plethora of financial and statistical reports, including the Financial Statements with Supplementary Information (annual audit), and is responsible for the integrity and objectivity of management and financial reporting. Management prepares Reports in accordance with Generally Accepted Accounting Principles (“GAAP”) in the United States of America, applying certain estimates and judgments as required. The VIEDA employs internal controls designed to provide reasonable assurance of integrity and reliability of financial reporting and to safeguard, verify, and maintain accountability of assets. Such controls derive from established written policies and procedures and are implemented by trained, skilled personnel. The VIEDA’s employment policy prescribes that all employees maintain the highest ethical standards and conduct business practices in a manner above reproach. The VIEDA engages the services of outside auditors to perform an annual independent audit of its financial statements. The objective of an audit is to express an opinion on the financial statements in accordance with Generally Accepted Accounting Principles (GAAP). The VIEDA Board of Directors formulates the vision and fulfills its responsibility for oversight and administration of the Authority’s practices and governance through actions of the full Board as well as through its committees. The Board’s Finance Committee is responsible for reviewing the annual budgets, making recommendations, and advising the full Board on major financial issues and decisions. V.I. Economic Development Authority – Fiscal Year 2016 VIEDA Direct and Indirect Cost Allocations The VIEDA activities are classified into two categories – operational and administrative – and all expenses of the Authority are attributed to both Operational and Administrative Units, either as direct or indirect costs. An Operational Unit is a division within the VIEDA with the responsibility of carrying out organizational mandates. These Operational Units include the Economic Development Bank (EDB); the Applications and Compliance Units, which make up the Economic Development Commission (EDC) Division; the Enterprise and Commercial Zone Commission (ECZC) Division; and the Economic Development Park Corporation (EDPC). An Administrative Unit is a department within the VIEDA that provides support to the Operational Units in fulfilling their mandates. The administrative departments are the VIEDA Board of Directors, Executive Office, Accounting and Finance, Human Resources (HR), Legal, and Marketing. A direct cost is a cost that can be identified specifically with a Unit and can be directly traced with relative ease and a high degree of accuracy. An indirect cost, on the other hand, is a cost that is incurred in common with other Units and cannot be traced to any specific Unit. Those costs, therefore, are distributed to both the Operational and Administrative Units through an internal allocation process or indirect cost rate. All operating indirect costs are budgeted and expensed in a temporary department within the administrative grouping referred to as Economic Development Management (“EDM”). At the end of a period, the indirect costs accumulated in the EDM department are allocated to all operational and administrative units based on a pre-determined rate. At the end of a fiscal period when all direct costs are posted and all indirect costs are allocated from the EDM department, each operational and administrative unit will be able to determine its total operating cost. The total direct and indirect costs for each administrative unit are considered indirect costs to the operational units and are allocated to the operational units using a pre-determined allocation method. V.I. Economic Development Authority – Fiscal Year 2016 V.I. Economic Development Authority – Fiscal Year 2016 Goals, Objectives, Performance Measurement, and Performance Evaluation Goals, objectives, performance measurements, and performance evaluations establish the strategic framework for the Authority’s economic development operations. A goal is the end result to be accomplished and answers this question: “What is the purpose in the big picture?” For the VIEDA, the purpose is the creation of good jobs to improve the standard of living for residents and the expansion of the tax base of the government. Objectives are the action steps taken to fill out the big picture and serve as benchmarks to measure performance. Each objective has these fundamental characteristics.  Be measurable.  Identify a target of program activity.  Set a timeframe for completion.  Provide an expected direction of change. Performance measurement is the ongoing monitoring and reporting on program accomplishments compared to the pre-established goals and objectives as outlined by each Unit. We recognize that the development of performance measurements requires careful thought and planning and includes the following basic ingredients: objectivity, relevance, reliability, validity, and indicators of degrees of success. Performance Evaluations are critical, especially in periods of scarce resources, and provide a means of assessing how well a Unit is performing. Evaluations answer key goal-related questions. 1) Are stakeholders getting what they deserve? 2) Are taxpayers getting their money’s worth? 3) Are those we serve better off? 4) Can the service we provide be improved? The achievability of the VIEDA goals and the fulfillment of objectives rest with supervisors and their subordinates, and the budget provides the financial resources to do so. Most importantly, however, is the execution of the measurement and evaluation functions in ensuring that scarce resources are used in the most efficient manner for the benefit of residents. V.I. Economic Development Authority – Fiscal Year 2016 Annual Budget Process The Virgin Islands Economic Development Authority’s budget formulation process is designed to allow the Authority to fulfill its mission; align goals, priorities, and objectives with financial resources; and evaluate actual achievements relative to anticipated outcomes. December – January The budget formulation process begins with the development of revenue and expenditure projections for the upcoming fiscal year. These projections are presented to the VIEDA Governing Board’s Finance Committee with a comparison and analysis of past trends (i.e. appropriations, allotments and expenditure levels) in addition to other financial data to justify and support the budget recommendation. During this period, the VIEDA Governing Board outlines the priorities, goals and objectives of the Authority for the upcoming fiscal year. This forms the basis for the development of the budget and determines the final budget amount to be submitted to the Office of Management & Budget for inclusion in the Government’s annual operating budget. February The VIEDA budget staff establishes budget ceilings for each division and department within the VIEDA consistent with the priorities, goals, and objectives as outlined by the EDA Governing Board. This information is communicated to each division or department head through a budget call that provides instructions and guidance for preparing the budget. The budget staff conducts budget orientation sessions with lead members of each division and department in order to provide an overview of the budgeting process and to address budgetary concerns. March – April The budget staff holds individual budget review discussions with all division and department heads to discuss areas of concerns, goals, and new initiatives, or programs the departments desire to implement for the upcoming year. At this meeting, each division or department has the opportunity to justify its needs before the Chief Executive Officer and Assistant Chief Executive Officer. After discussions, revisions may be made and budget schedules updated accordingly. The proposed budget is presented to the VIEDA Governing Board for consideration and final approval before submission to the Legislature’s Post-Audit Division. April – June Communication is maintained with the Post-Audit Division in its analysis of the budget while the VIEDA budget staff researches and gathers data and conducts round-table sessions with the internal department and division heads before drafting the final version of the CEO’s budget presentation to the Finance Committee of the Legislature. V.I. Economic Development Authority – Fiscal Year 2016 Annual Budget Process, continued July – August The Chief Executive Officer, accompanied by the Assistant Chief Executive Officer, and the Director of Administration and Finance, defends the VIEDA budget recommendation before the Finance Committee of the Legislature. October Once the Legislature approves the budget, the VIEDA is legally authorized to request quarterly allotments from the Department of Finance through the Office of Management and Budget. 12-Month Monitoring (October – September) At the end of each quarter, actual expenditures are compared and analyzed against the budget to ensure that resources are managed in accordance with the budget plan and are consistent with the goals and objectives of the organization. On a quarterly basis, financial reports and analyses are presented to the Finance Committee of the EDA Governing Board detailing the sources and uses of funds compared to the budget and to the same period in the previous fiscal year. When necessary, the budget staff offers recommendations for policy review to senior staff and management to improve overall financial integrity and efficiency. V.I. Economic Development Authority – Fiscal Year 2016 Jan/Feb EDA Governing Board outlines performance goals and objectives for upcoming fiscal year Budet team develops budget recommendation for upcoming fiscal year March Budget call issued to department heads Budget request submitted to the Office of Management and Budget Communication is maintained with the Office of Management and Budget to confirm final budget recommendation for VIEDA April Internal budget reviews and discussions with executive team, department heads, and budget staff Presentation of detailed proposed Budget to EDA Finance Committee EDA Governing Board approves Budget May/June Budget submitted to the Post Audit Division July/August Legislative Budget hearing Annual Budget Process, continued Budget Calendar Overview V.I. Economic Development Authority – Fiscal Year 2016 1.0 VIEDA ADMINISTRATIVE DEPARTMENTS The administrative departments within the VIEDA provide support to the operational divisions in ensuring that the VIEDA adheres to and meets statutory and legal requirements. 1.1 BOARD OF DIRECTORS Functional Statement The powers of the VIEDA rest in the hands of a Governing Board, which sets the vision and acts on behalf of the organization. The Board is responsible for establishing all operating policies; hiring a Chief Executive Officer (CEO), who assumes operational responsibilities; approving all major contracts; overseeing overall policy decisions; and providing oversight. Most importantly, the Board ensures that the organization complies with all applicable laws. Operational Goal(s) Collaborate with management in exploring opportunities for the VIEDA and assist management in grasping the complexities of adapting to the changing global environment. Fiscal Year 2015 Objectives  Participate in Marketing Events and Activities  Participate in Professional Development Training (Best Practices in Board Governance)  Develop policies towards the implementation of various strategic financing tools (i.e. U.S. Government’s Employment Based (EB-5) program, New Market Tax Credit program, Tax Increment Financing Expansion, Hotel Development Act)  Review and approve annual operating budget  Review and evaluate 3-, 6-, 9-, and 12- month financial performances  Conduct performance review of Chief Executive Officer and Board Assessment Fiscal Year 2015 Accomplishment as of March 31, 2015  Participated in the Territory’s first Investor Advisor Forum  Conducted performance review of the CEO  Attended Internal Economic Development Council Seminars Fiscal Year 2016 Objectives  Participate in Marketing Events and Activities  Develop policies towards the implementation of various strategic financing tools (i.e. U.S. Government’s Employment Based (EB-5) program, New Market Tax Credit program, Tax Increment Financing Expansion, Hotel Development Act)  Review and approve annual operating budget  Review and evaluate 3-, 6-, 9-, and 12- month financial performances  Conduct performance review of Chief Executive Officer and Board Assessment V.I. Economic Development Authority – Fiscal Year 2016 Key Performance Indicators (KPI) Actual FY 14 Target FY15 Actual FY 15 (as of 3/31/15) Planned FY 2016 Number of Board Meetings 30 28 12 28 Number of Policies Reviewed and/or Developed 6 5 4 10 Review/Approve Annual Budget 4/2014 3/2014 6/2015 4/2016 CEO Performance Evaluation 6/2014 6/2015 12/2014 3/2016 V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 55,460 64,733 57,000 57,000 Fringe Benefits 18,302 15,895 21,575 21,575 Supplies 5,441 2,126 850 1,000 Other Services & Charges 45,304 29,096 33,695 26,572 Professional Services 4,595 1,168 - - Inter-Island Travel 7,756 2,242 2,500 5,000 Utilities 3,233 3,584 4,000 5,000 Total Expenditures (Direct Cost Only) 140,091 118,844 119,620 116,147 FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category VIEDA Board of Directors Year End Financial Summary $140,091 $118,844 $119,620 $116,147 FY 13 Actual FY 14 Actual FY 15 Projection FY 16 Budget VIEDA Board of Directors Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 1.2 EXECUTIVE OFFICE Functional Statement The Chief Executive Officer (“CEO”) and the Assistant Chief Executive Officer (“ACEO”)/Chief Operating Officer (“COO”) provide overall leadership and direction in the planning, development, and administration of policies governing the operation of the VIEDA. This office ensures that responsibilities established by statute and policy directives are executed at the highest level. Operational Goal(s) Direct and monitor the activities of the VIEDA in a manner that ensures assets of the organization are safeguarded and optimized, and maintain a positive work climate that is conducive to attracting, retaining, and motivating a diverse group of top quality performers. Fiscal Year 2015 Objectives  Concentrate recruitment efforts on designated services businesses, high value manufacturers, healthcare suppliers and EB5 candidates to catalyze business development opportunities  Support economic diversification initiatives in the Broadband, Maritime and Marine industries  Establish VIEDA as the premier driver of economic development and policy in the Territory Fiscal Year 2015 Accomplishment as of March 31, 2015  Hosted the Virgin Islands’ first Caribbean Clean Energy Technology (CCET) Symposium  Hosted the Virgin Islands’ first Investor Advisor Forum  Reviewed and developed legislative proposals in support of economic development  Conduct executive sessions to discuss and shape policies and procedures for organizational effectiveness Fiscal Year 2016 Objectives  Initiate and strengthen existing partnership collaborations  Update the rules and regulations for the Sustainable Tourism Through Arts-Based Revenue Streams Act (“STARS Act”), Economic Development Bank (“EDB”), Economic Development Commission (“EDC”), Enterprise and Commercial Zone Commission (“ECZC”), Hotel Development Act, and Youth Recreational Incentive Act  Develop legislative proposals in support of economic development  Continue to support economic diversification initiatives in the Broadband, Maritime, Marine, and Arts-Based industry V.I. Economic Development Authority – Fiscal Year 2016 Key Performance Indicators (KPI) Actual FY 14 Target FY 15 Actual FY 15 Planned FY16 New industry partnerships Formed 3 6 2 4 Existing partnership collaborations 2 8 1 3 New initiatives 2 8 2 4 Legislative proposals in support of economic development 3 4 5 3 V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 418,564 609,147 472,000 457,000 Fringe Benefits 116,732 175,534 153,027 154,525 Supplies 2,243 2,717 2,000 1,000 Other Services & Charges 29,843 20,266 35,527 7,905 Professional Services - 1,168 2,300 - Inter-Island Travel 16,704 26,659 25,000 12,500 Utilities 3,500 16,549 5,000 2,500 Total Expenditures (Direct Cost Only) 587,586 852,040 694,854 635,430 Executive Office Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category $587,586 $852,040 $694,854 $635,430 FY 13 Actual FY 14 Actual FY 15 Projection FY 16 Budget Executive Office Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 1.3 ACCOUNTING AND FINANCE DEPARTMENT Functional Statement The Accounting and Finance Department provides financial planning, accounting, and reporting for the VIEDA. It is primarily responsible for relationships with auditors, financial institutions, the Post-Audit Division of the Legislature, rating agencies, and others within the financial community. It provides leadership in developing proposals and policies on strategic issues that affect the VIEDA’s long-term financial integrity and competitiveness. The responsibility for the establishment of financial policies and procedures for organization-wide guidance and internal control falls within this unit. Operational Goal(s) Provide quality customer service to the VIEDA departments and divisions while practicing responsible stewardship of VIEDA resources and aspire to excellence in financial and administrative practices, including taking measures to reduce costs and improve overall efficiency. Fiscal Year 2015 Objectives  Conduct at least six (6) site visits to EDA units and program locations  Draft for Board approval an accounting policy manual for the VIEDA by December 2014  Finalize the Fiscal Year 2014 Financial Audit by March 2015  Computerize the acquisition and disposal of all VIEDA assets  Provide staff training in accounting, budgeting, finance and procurement practices  Continue to work with the banks in facilitating payments to/from vendors, EDC Beneficiaries and IP Tenants Fiscal Year 2015 Accomplishments as of March 31, 2015  Submitted corrective action plans/written procedures as part of STEP 1 audit and close-out  Provided Incubator financial and reporting support to meet grantor agency requirements  Provided SSBCI financial and reporting support to meet grantor agency requirements  FY 2014 financial audit fieldwork completed. Final report due by April 30, 2015 Fiscal year 2016 Objectives  Update accounting software to improve operational efficiencies  Complete the Fiscal Year 2015 Financial Audit by March 2016  Work collaboratively with Unit Heads and the Executive Team in the computerization of operational processes  Evaluate existing EDA programs and offer recommendations to improve program delivery  Reduce operating cost by 5 – 10% by developing strategies to improve operational efficiencies  Work closely with Units that receive Federal funds to ensure adherence to operational and reporting requirements V.I. Economic Development Authority – Fiscal Year 2016 Key Performance Indicators (KPI) Actual FY14 Target FY15 Actual FY 15 (as of 3/31/15) Planned FY16 Financial Audit Completed 6/2014 3/2015 6/2015 6/2016 Annual Budget submission to OMB 3/28/2015 5/2015 2/18/15 2/2016 Board Finance Committee Meetings 3 4 0 4 V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 275,978 293,979 298,370 298,370 Fringe Benefits 98,484 109,747 107,009 107,009 Supplies 1,663 890 500 500 Other Services & Charges 19,749 1,970 15,000 8,327 Professional Services 6,913 6,218 5,000 - Inter-Island Travel 2,750 880 905 700 Utilities 654 3,755 4,500 500 Total Expenditures (Direct Cost Only) 406,191 417,439 431,284 415,406 by Expense Category Accounting and Finance Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget $406,191 $417,439 $431,284 $415,406 FY 13 Actual FY 14 Actual FY 15 Projection FY 16 Budget Accounting and Finance Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 1.4 HUMAN RESOURCES DEPARTMENT Functional Statement The Human Resources (HR) Department is responsible for talent management and workforce development, which includes staffing/recruitment, position classification, benefits counseling, and employee and labor relations. It is also responsible for providing a cost-effective and coordinated strategy for the delivery of professional development training. It identifies talent and provides training to manage, improve and retain a high functioning workforce. Operational Goal(s) Provide an organizational framework to strategically develop and retain the VIEDA’s workforce for the promotion of economic development initiatives in the U.S. Virgin Islands. Fiscal Year 2015 Objectives  Analyze the results of the desk audit and comprehensive compensation study and pursue appropriate recommendations  Review and amend employee appraisal procedure form to reflect proper job descriptions and provide greater efficiency  Conduct mandatory Sexual Harassment Awareness training for all staff  Conduct Conflict Resolution training for all staff and Contract Administration training for managers  Update and incorporate all HR policies into one comprehensive document  Offer employee professional development training to improve leadership and team building skills, productivity, and workplace etiquette Fiscal Year 2015 Accomplishments as of March 31, 2015  Provided general and specialized trainings and workshops for the entire staff on topics covering employee rights and responsibilities, time management, sexual harassment and fire safety  Encouraged staff participation in the CIGNA Employee Assistance Wellness Seminars, which resulted in eighty-five percent (85%) staff participation  Attended the American with Disabilities Act (ADA) seminar presented by the Northeast ADA Center in collaboration with Cornell University Employment and Disability Institute  Coordinated routine biometric screenings by CIGNA Health Care Coaches  Completed Phase I, Position Description Questionnaires, of the Comprehensive Compensation Study  Organized employee appreciation activities and service awards ceremony V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2016 Objectives  Cultivate a high performance organizational culture that enhances productivity and efficiency, supports team building and promotes employee retention, development and advancement  Provide professional develop trainings in team building, progressive discipline, and leadership development  Implement a wellness program that encourages employees to focus on key health behaviors such as increasing physical activity, improving eating habits and reducing stress Key Performance Indicators (KPI) Actual FY 14 Target FY15 Actual FY 15 (as of 3/31/15) Planned FY 16 Employee evaluations completed 53% 100% 0% 100% HR Trainings provided 3 6 5 6 Employee relations initiatives undertaken 6 6 3 6 Professional development training completed 5 - 12 13 V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 141,395 61,518 132,920 132,920 Fringe Benefits 49,488 25,421 48,773 48,773 Supplies 2,531 1,300 1,500 - Other Services & Charges 22,242 22,446 59,866 54,500 Professional Services - 845 - - Inter-Island Travel 2,030 1,428 1,500 2,500 Utilities 2,874 - 500 500 Total Expenditures (Direct Cost Only) 220,560 112,958 245,059 239,193 Human Resources Department Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category $220,560 $112,958 $245,059 $239,193 FY13 Actual FY14 Actual FY 15 Projection FY 16 Budget Human Resources Department Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 1.5 LEGAL DEPARTMENT Functional Statement The Legal Department provides a broad range of legal services to the four (4) component entities of the Virgin Islands Economic Development Authority (VIEDA). This Department provides legal analysis, preparation and review of legal documents and legislative policy, reviews proposal of amendments to rules and regulations, guides special projects, and oversees litigation, offering general legal guidance to executive staff and the Board of Governors. Operational Goal(s) A primary focus of the Legal Department is to understand the intricacies of each entity within the VIEDA and how those entities link together with a shared goal of promoting economic development in the U.S. Virgin Islands. In providing legal advice, this Department must be knowledgeable of changes in federal and territorial laws and must integrate legal with economic development objectives. Fiscal Year 2015 Objectives  Enhance the quality of investigative reports by exploring collaborative agreements with government agencies that can provide criminal justice information using databases such as, the National Crime Information Center (“NCIC”), which operates under a shared management concept between the FBI and federal, state, and local users  Manage the litigation of delinquent loan portfolios carried by the Economic Development Bank  Coordinate staff training opportunities provided by the Public Employees Relations Board and other government agencies regarding common issues within the workplace, industry or profession and their legal ramifications  Identify and analyze issues in the workplace to prevent or mitigate liability, and develop best practices, policies and procedures for legal compliance  Improve the efficiency of legal research by cross training the Legal Department’s staff to perform background investigative analyses and paralegal duties  Conduct ongoing assessments and implement measures to improve the security of information in the Legal Department  Update computer software to enhance the processing of legal documents Fiscal Year 2015 Accomplishments as of March 31, 2015  Improved the quality of investigative reports including, but not limited to exploring collaborative agreements with government agencies  Monitored, advised and collaborated, as needed, with retained counsel and the VIEDA team regarding the litigation of delinquent loan portfolios carried by the EDB  Identified and reviewed with Human Resources common issues within the workplace and their legal ramifications and explored prevention or mitigation strategies to work on best practices, policies and procedures for legal compliance  Improved the efficiency of the Legal Department by cross training staff to perform background investigative analyses and paralegal duties V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2015 Accomplishments as of March 31, 2015, continued  Conducted ongoing assessments and improved procedures to ensure the security of sensitive information within the VIEDA  Explored case management systems to assess the benefit to the Legal Department and VIEDA as a whole Fiscal Year 2016 Objectives  Continue to enhance the quality of investigative reports by way of legislation and collaborative agreements providing for such government-to-government sharing of criminal justice information using the NCIC database, which operates under a shared management concept between the FBI and federal, state, and local users  Explore expanded access to the Department of Licensing and Consumer Affairs’ database  Update computer software to enhance the processing of legal documents  Conduct ongoing assessments and implementation of measures to improve the security of sensitive information within the VIEDA  Implement or amend internal VIEDA policies and procedures  Review, draft or amend Board policies, motions and resolutions  Prepare contracts, as needed, to accomplish the mandates of the VIEDA Key Performance Indicators (KPI) Actual FY 14 Target FY15 Actual FY 15 (3/31/15) Planned FY 16 Standard Operating Procedures drafted 2 7 24 20 Contracts and leases drafted 23 30 26 25 Completed background investigations 60 n/a 52 70 V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 177,596 177,893 217,000 217,000 Fringe Benefits 58,607 56,390 72,910 72,910 Supplies 100 1,036 700 500 Other Services & Charges 610 2,240 18,650 20,400 Professional Services 6,262 - - - Inter-Island Travel 5,025 4,937 4,600 2,500 Utilities 1,018 1,216 650 500 Total Expenditures (Direct Cost Only) 249,218 243,713 314,510 313,810 Legal Department Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category $249,218 $243,713 $314,510 $313,810 FY13 Actual FY14 Actual FY 15 Projection FY 16 Budget Legal Department Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 1.6 MARKETING / PUBLIC RELATIONS DEPARTMENT Functional Statement Our key responsibility is to help attract new investment opportunities to the Territory; retain existing companies, especially small and medium sized enterprises; create opportunities to expand businesses; and improve the Virgin Islands Economic Development Authority’s image as it relates to the Authority’s strengths, products, and services. The VIEDA’s Four Pillars promote sound economic development policies and programs. Those pillars are the Enterprise & Commercial Zone Commission, Economic Development Commission, Economic Development Bank, and the Economic Development Park, along with our various programs including the Incubator, State Small Business Credit Initiative (SSBCI), Employment Based Immigration Fifth Preference (EB-5), and State Trade Export Promotion (STEP) Program. Our job is to get the message to the community, to our customers, and to prospective clients. Operational Goal(s) Our goal is to promote and position the U.S. Virgin Islands as the best place for businesses to invest, whether local, national or international. The Marketing Team will use promotional initiatives, including various marketing missions, targeted events, targeted advertising, messaging via social media, web presence, and other media outlets. Fiscal Year 2015 Objectives  Update the VIEDA’s 5-year Marketing and Strategic Plan  Implement a data-mining module to profile the Territory’s assets and investment prospects  Develop a Guide called “Doing Business in the U.S. Virgin Islands” for mass distribution  Identify targeted firms and/or prospective investment leads in High-Value Manufacturing, IT Services, Captive Insurance, Back Office Support Services, and Hotel Development Industries  Execute final phases of the VIEDA’s website and other collateral material Fiscal Year 2015 Accomplishments as of March 31, 2015  Hosted the Territory’s 1st Annual Investor Advisor Forum, which introduced industry leaders that play a pivotal role in aiding corporate owners in their decision to relocate or expand their operations to the attributes of “doing business” in the USVI  Promoted the U.S. Virgin Islands as a business location full of “Promise, Opportunity and Prosperity” by engaging in three marketing missions: the Shared Services Week (Orlando, Florida), the Caribbean Hotel and Resort Investment Summit (Miami, Florida), and the Caribbean Clean Energy Technology Symposium (St. Thomas, Virgin Islands)  Implemented a customer relationship management software program to track and record EDA’s interactions with current and prospective EDC beneficiaries  Continued the VIEDA’s local public relations campaign through the radio show, “VIEDA Focus on the Marketplace” V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2016 Objectives  Increase media coverage for the Economic Development Commission program through a national public relations campaign  Recruit EDC Ambassadors to help spread the word about the Virgin Islands and its tax-incentive program through their personal networks and peers  Build partnerships with other government and semi-autonomous agencies to form marketing alliances that broaden EDA’s outreach and build awareness of the Virgin Islands competitive tax- incentive program Key Performance Indicators (KPI) Actual FY 14 Target FY 15 Actual FY 15 - 3/31/15 Planned FY 16 Site visits made by potential EDC beneficiaries 12 20 8 20 Companies activated EDC Benefits 1 5 1 5 Targeted marketing events held and/or attended 7 13 3 10 V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services - 4,175 181,350 126,350 Fringe Benefits - 1,386 65,566 44,749 Supplies 926 2,509 6,000 2,000 Other Services & Charges 131,199 194,466 127,717 152,700 Professional Services 232,798 296,015 292,050 262,050 Inter-Island Travel 3,284 4,675 5,000 5,000 Utilities - - - 500 Total Expenditures (Direct Cost Only) 368,207 503,224 677,683 593,349 Marketing / Public Relations Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category $368,207 $503,224 $677,683 $593,349 FY13 Actual FY14 Actual FY 15 Projection FY 16 Budget Marketing / Public Relations Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 2.0 VIEDA OPERATIONAL DIVISIONS 2.1 V.I. ECONOMIC DEVELOPMENT COMMISSION Functional Statement The Economic Development Commission (EDC) is charged with promoting the growth, development, and diversification of the economy of the United States Virgin Islands, developing the human and economic resources of the Territory, preserving job opportunities for residents of the U.S. Virgin Islands, and promoting capital formation to support industrial development in the Territory. The EDC is comprised of the Applications Unit, which is the first point of contact by a business seeking to apply for economic development benefits, and the Compliance Unit, which monitors beneficiaries to ensure that they comply with the terms and conditions of their certificates and other requirements of law. 2.1.1 Applications Unit Operational Goal(s) Promote capital investment opportunities to support economic development. Fiscal Year 2015 Objectives  Re-implement Online Application within the first six (6) months of the fiscal year  Host Eligible Supplier Seminar, open house and/or educational forum by May 2015  Host EDC Job Fair to address employment gap by Summer 2015  Host EDC Consultants Seminar within the first eight (8) months of the fiscal year  Update Multiplier used for Cost Benefits Analysis Model Fiscal Year 2015 Accomplishments as of March 31, 2015  Responded to inquires from fourteen (14) potential EDC applicants  Received seventeen (17) applications, which included thirteen (13) new, two (2) modifications, and two (2) extensions  Reviewed twenty (20) new applicants for Eligible Supplier Certification and eight (8) pending for the prior fiscal year of which eighteen (18) were approved, four (4) were denied, and four (4) are pending Fiscal Year 2016 Objectives  Create an EDC online public access portal on the VIEDA’s website to provide information on job/internship opportunities, EDC Beneficiary Certificates, Eligible Supplier Beneficiary products and services  Establish an EDC e-Hotline that provides an interactive link between the EDC, its stakeholders and the general public  Process a minimum of 25 new applications for EDC benefits with anticipated job opportunities for 250 full-time employees V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2016 Objectives continued  Host semi-annual town hall meetings to educate the public on the benefits of the EDC program to the Virgin Islands  Conduct semi-annual educational outreach seminars to inform high school students on career opportunities with the EDC Program  Develop and implement an electronic compliance case management system which includes an online compliance reporting component to work in conjunction with other units within the organization Key Performance Indicators (KPI) Actual FY 14 Target FY 15 Actual FY 2015 (as of 3/31/15) Planned FY 2016 New Applications Received 21 25 13 25 Potential New Job Opportunities 172 300 81 2501 Approx. Wages of New Applications $11,203,420 $6,000,000 $5,510,888 $12,500,0002 Min. Investment of New Applications $14,884,315 $15,000,000 $5,200,000 $2,500,0003 1 Minimum employment of 10 full-time employees 2 Average salary of $50,0000 3 Minimum Investment of $100,0000 V.I. Economic Development Authority – Fiscal Year 2016 256 329 172 81 FY12 FY13 FY14 FY15 Number of Job Opportunities (based on EDC Applications) $47M $89.9M 12.6M 5.2M FY12 FY13 FY14 FY15 Minimum Potential Investment of EDC Companies (based on Applications) Economic Development Commission Applications Unit Statistical Data as of March 31, 2015 $16M $23M $11M $5.5M FY12 FY13 FY14 FY15 Total Approximate Potential Wages of EDC Employees (based on Applications) 23 10 0 13 20 8 2 10 21 10 2 9 13 5 5 3 Applications Received Applications Approved Applications Tabled/Denied Applications Pending EDC Applications Statistics FY12 FY13 FY14 FY15 V.I. Economic Development Authority – Fiscal Year 2016 $279,855 $310,711 $276,758 $359,033 FY13 Actual FY14 Actual FY 15 Projection FY 16 Budget Applications Unit Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 170,670 184,263 183,557 243,557 Fringe Benefits 56,321 75,473 66,401 89,111 Supplies 1,101 - 300 850 Other Services & Charges 27,817 25,845 8,500 20,215 Professional Services 10,044 18,387 15,000 - Inter-Island Travel 13,513 6,170 2,500 4,800 Utilities 389 575 500 500 Total Expenditures (Direct Cost Only) 279,855 310,711 276,758 359,033 by Expense Category Applications Unit Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget V.I. Economic Development Authority – Fiscal Year 2016 2.1.2 COMPLIANCE UNIT Functional Statement The Compliance Unit ensures the integrity of the Economic Development Program and assists the beneficiaries in meeting the requirements outlined in their Certificates. The Compliance Unit reports its findings to the EDC Commission, which has the legal authority to assess fines and penalties for non- compliance. The funds derived from such penalties are used for workforce development and training programs within the Territory. Operational Goal(s) Ensure that beneficiaries adhere to the requirements of the EDC Program. Fiscal Year 2015 Objectives  Conduct annual beneficiary summits in August 2015 and Economic Development program’s consultant forum in May 2015  Increase beneficiary care initiatives to ensure retention and expansion while maintaining the integrity of the EDC Program  Complete twenty (20) compliance reviews and eighty (80) outreach/beneficiary care visits by the end of the fiscal year  Implement concise standard operating procedures to include quality assurance standards and code of ethics  Analyze, design, develop and implement an electronic compliance case management system which includes an online compliance reporting component to work in conjunction with other units within the organization  Evaluate and enhance the electronic Cost Benefit Analysis model and internal reporting on impact analysis FY 2015 Accomplishments as of March 31, 2015  Completed eleven (11) compliance reviews and seventeen (17) outreach/beneficiary care visits  Reviewed and submitted thirty-four (34) petitions from beneficiaries to EDC Board  Drafted standard operating procedures for the compliance unit, including code of conduct and ethics Fiscal Year 2016 Objectives  Conduct annual beneficiary summits in August 2016 and Economic Development program’s consultant forum in May 2016  Complete twenty (20) compliance reviews and eighty (80) outreach/beneficiary care visits by the end of the fiscal year  Implement a beneficiary care program to ensure retention and expansion while maintaining the integrity of the EDC Program (Compliance Officers/Ombudsman) V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2016 Objectives continued  Implement standard operating procedures for compliance to include quality assurance standards and code of ethics  Develop and implement an electronic compliance case management system which includes an online compliance reporting component to work in conjunction with other units within the organization  Evaluate and enhance, if necessary, the electronic Cost Benefit Analysis model and internal reporting on impact analysis KEY PERFORMANCE INDICATORS (KPI) Actual FY 14 Target FY15 Actual FY 2015 (as of 3/31/15) Planned FY 16 No. of Petitions to the EDC Board 77 25 34 25 No. of Certificate Modifications completed 0 15 0 15 No. of Non-Compliance matters resolved 40 15 6 15 No. of Outreach/Beneficiary Care Visits 57 75 17 75 5 13 10 3 13 26 77 34 15 31 33 11 20 41 57 17 FY12 FY13 FY14 FY15 EDC Compliance Department Activity as of March 31, 2015 Orientations Petitions Compliance Reviews Beneficiary Care Visits V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 325,494 362,671 353,922 353,922 Fringe Benefits 107,413 123,300 130,884 130,884 Supplies 1,101 232 700 500 Other Services & Charges 59,377 61,506 18,900 45,350 Professional Services 10,119 39,593 32,000 - Inter-Island Travel 9,861 7,808 5,000 3,000 Utilities 446 426 350 500 Total Expenditures (Direct Cost Only) 513,811 595,536 541,756 534,156 Compliance Unit Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category $513,811 $595,536 $541,756 $534,156 FY 13 Actual FY 14 Actual FY 15 Projection FY 16 Budget Compliance Unit Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 2.2 ECONOMIC DEVELOPMENT BANK (EDB) Functional Statement With the passage of Act 7632 in 2014, the Legislature of the Virgin Islands merged the Government Development Bank and the Small Business Development Agency and renamed the Government Development Bank as the Economic Development Bank (EDB). The Economic Development Bank (EDB) provides financial resources, including but not limited to, loan guarantees, medium and long-term credit, and equity infusions to minority, small, medium, and large businesses located in the United States Virgin Islands. The EDB provides the assistance necessary to allow businesses to maintain economic stability and helps them to grow into mainstream commercial banking customers. It also offers technical and managerial assistance to ensure the continued viability of these businesses and encourages large corporate investment. EDB also facilitates employment growth opportunities and promotes the location of financial services within the Virgin Islands. The EDB promotes and encourages local commercial banks and other financial institutions to make loans by providing the required guarantees, thereby reducing lender-risk. Operational Goal(s) Assist small and medium-sized businesses to access capital by providing financial resources and technical and managerial assistance to ensure continued viability, thereby facilitating employment growth and opportunities. Fiscal Year 2015 Objectives  Reduce the delinquency rate by 20% through aggressive collection efforts  Increase the loan portfolio by 20% or $1.8M with credit quality loans  Recruit experienced staff to support the lending initiatives  Hire outside counsel to handle loan closings and lending delinquencies Fiscal Year 2015 Accomplishments as of March 31, 2015  Reduced the loan delinquency rate from its high peak of 81% to 66% a 15% reduction that was achieved through aggressive collection efforts, loan modifications, and the write-off of non- collectible accounts  Increased the loan portfolio by $910K with credit quality loans that supported business and enterprise activity across a broad range of sectors  Actively promoted EDB’s loan products and services through the local banks, one-on-one meetings, media and print advertisements, webinars and community development forums  Installed Portfol, a multi-user loan software that streamlines lending processes from a client’s initial point of contact through the servicing of an approved loan  Provided professional development training in topics covering corporations and trademarks, customer service, real estate credit administration, and Porfol V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2016 Objectives  Reduce the delinquency rate by 20% through aggressive collection efforts  Increase the loan portfolio by 20 or $1.8M with credit quality loans  Provide professional development training for staff in the areas of credit administration and collections  Partner with local banks to promote the State Small Business Credit Initiative Loan Program  Collaborate with other related government agencies to promote loan programs and services  Implement Phase II of the Sun Power Energy Program grant Key Performance Indicators (KPI) Actual FY 14 Target FY 15 Actual FY 2015 (as of 3/31/15) Planned FY 16 Loan Delinquency Rate (%) 55% 45% 65% 56% No. of Site/Calls/Customer Care Visits 680 175 101 1100 No. of Clients assisted with Development Business Plans 8 20 8 24 No. of Educational/Outreach programs 14 12 31 50 V.I. Economic Development Authority – Fiscal Year 2016 $89,351 $81,186 $538,671 $528,516 $78,886 $69,736 $538,671 $528,516 $168,237 $150,922 FY12 FY13 FY14 FY15 Intermediary Relending Program (IRP) Current versus Delinquent Loans ($ Value of Loans) FY 2012 - FY 2015 $ Value of Loans that are current $ Value of Loans that are delinquent $ Value of total Loan Portfolio $598,831 $574,800 $457,685 $492,615 $5,436,104 $2,934,483 $604,448 $703,999 $6,034,935 $3,509,283 $1,062,133 $1,196,614 FY12 FY13 FY14 FY15 Small Business Development Agency (SBDA) Current versus Delinquent ($ Value of Loans) $ Value of Loans that are current $ Value of Loans that are delinquent $ Value of total Loan Portfolio Virgin Island Economic Development Authority Economic Development Bank (EDB) Statistical Data V.I. Economic Development Authority – Fiscal Year 2016 244 91 20 17 100 150 72 75 22 19 17 17 83 23 20 20 266 110 37 34 183 173 92 95 FY 12 FY 13 FY 14 FY 15 FY 12 FY 13 FY 14 FY 15 SBDA GDB GDB and SBDA Loan Portfolio Current versus Delinquent Loans (#) No. of Delinquent Loans No. of Current Loans Virgin Island Economic Development Authority Economic Development Bank (EDB) Statistical Data $2,288,016 35% $1,896,048 30% $1,580,278 43% $1,192,329 31% $4,285,028 65% $4,571,339 70% $3,535,806 57% $2,636,185 69% $6,573,044 $6,467,387 $3,660,247 $3,828,514 FY12 FY13 FY14 FY15 Government Development Bank (GDB) Current versus Delinquent ($ Value of Loans) FY 2012 - FY 2015 $ Value of Current Loan Portfolio $ Value of Delinquent Loans V.I. Economic Development Authority – Fiscal Year 2016 Virgin Island Economic Development Authority Economic Development Bank (EDB) Statistical Data 81% 77% 77% 76% 55% 66% FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 Total EDB Portfolio Delinquency Rate (%) V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 392,521 307,213 370,662 354,462 Fringe Benefits 129,532 78,384 137,221 107,924 Supplies 1,562 1,311 800 1,000 Other Services & Charges 31,831 75,710 126,641 25,775 Professional Services 68,453 101,677 97,000 96,682 Inter-Island Travel 8,190 4,395 8,500 4,500 Utilities 389 426 500 500 Total Expenditures (Direct Cost Only) 632,478 569,116 741,324 590,843 Economic Development Bank Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget by Expense Category $632,478 $569,116 $741,324 $590,843 FY 13 Actual FY 14 Actual FY 15 Projection FY 16 Budget Economic Development Bank Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 2.3 ENTERPRISE & COMMERCIAL ZONE COMMISSION Functional Statement The Enterprise & Commercial Zone Commission (ECZC) was created by the Legislature of the United States Virgin Islands with the passage of Act No. 6294 and amended by Act 7589. The Act mandates the revitalization of designated blighted and severely distressed areas in the U.S. Virgin Islands that were once socially and economically vibrant communities. The legislation provides for tax incentives and economic development program benefits that relax or eliminate fiscal and regulatory constraints that hinder economic growth. The legislation encourages collaboration between public, private and non- profit entities and provides a number of tax incentives and other benefits to support economic growth. Operational Goal(s) Promote growth through revitalization activities and public/private partnerships to revitalize and sustain community self-sufficiency and involvement. Fiscal Year 2015 Objectives  Implement the Enterprise Zone 5-year Strategic Plan  Implement components of Enterprise Zone’s Town and Neighborhood plans  Market and administer the community development tax programs (EZ Tax Credit, EZ Plan Program & Commercial Zone Benefits)  Offer an estate planning conference by May 2015 in each district to provide information to individuals with joint ownership of properties within the zones  Educate stakeholders on activities and programs through radio and print media  Increase staff efficiency through selected trainings and programs Fiscal Year 2015 Accomplishments as of March 31, 2015  Held the 2nd Annual EZ stakeholders Seminars, which provided information on maintaining a non- profit status and keys to grant readiness  Concluded Garden Street Neighborhood Town Plan  Received five (5) applications for Enterprise Zone tax credits  Changed the compliance process and trained a new compliance officer  Completed ten (10) years of compliance for the beneficiaries of the tax credit program  Held 6th Annual Estate Planning Conference in both districts  Increased staff efficiency with trainings from Bureau of Internal Revenue, Lt. Gov Office of Corporation and Trademarks and Tax Assessor’s office  Increased understanding of the E&CZC through multiple appearances on the EDA radio show and others outlets  Held 2nd Annual Beneficiary Conference providing information on how to work with Internal Revenue Bureau, Town Plan status and reporting requirements V.I. Economic Development Authority – Fiscal Year 2016 Fiscal Year 2016 Objectives  Continue to utilize all existing funds and seek additional funds to implement programs of the ECZC Strategic plan and Zone Community Plans  Increase efficiency in services offered to our clients through streamlining documents and processes and increasing training of staff  Evaluate and, if needed, increase effectiveness of existing programming Key Performance Indicators (KPI) Actual FY 14 Target FY15 Actual FY 15 (as of 3/31/15) Planned FY 2016 Financing institution contacted for funding 3 3 5 3 Plan programs implemented 10 6 9 12 No. of clients affected 65 n/a 25 70 V.I. Economic Development Authority – Fiscal Year 2016 Virgin Island Economic Development Authority Enterprise & Commercial Zone Commission (E&CZC) Statistical Data as of March 31, 2015 6 4 4 3 FY 2012 FY 2013 FY 2014 FY 2015 (as of 3/31/15) Number of New Beneficiaries $541,000 $717,300 $1,985,000 $210,000 FY 2012 FY 2013 FY 2014 FY 2015 (as of 3/31/15) Dollar Value of Beneficiaries Committed Investments V.I. Economic Development Authority – Fiscal Year 2016 FY 13 FY 14 FY 15 FY 16 Expenditures Actual Actual Projection Budget Personnel Services 187,682 206,034 216,649 216,649 Fringe Benefits 54,824 60,089 76,877 76,877 Supplies 782 817 800 500 Other Services & Charges 11,975 8,819 46,077 35,800 Professional Services 17,288 16,544 15,000 15,000 Inter-Island Travel 4,943 4,353 4,000 2,800 Utilities 424 509 500 500 Total Expenditures (Direct Cost Only) 277,918 297,166 359,903 348,126 by Expense Category Enterprise & Commercial Zone Commission Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projected, and FY 16 Budget $277,918 $297,166 $359,903 $348,126 FY 13 Actual FY 14 Actual FY 15 Projection FY 16 Budget Enterprise & Commercial Zone Commission Year End Financial Summary FY 13 Actual, FY 14 Actual, FY 15 Projection, FY 16 Budget Operating Personnel Total V.I. Economic Development Authority – Fiscal Year 2016 2.4 ECONOMIC DEVELOPMENT PARK CORPORATION Functional Statement The Economic Development Park Corporation (“EDPC”) is chartered as a public corporation to acquire and operate industrial parks in the United States Virgin Islands and to complement activities of the Economic Development Commission (EDC). The EDPC does not receive any funding from Government appropriations and is self-supported by revenues generated from its tenants. Two Industrial Parks fall under the auspices of the Economic Development Park Corporation. They are the William D. Roebuck Industrial Park in Frederiksted, St. Croix and the St. Thomas Industrial Park located in Contant, St. Thomas. Presently, the EDPC facilities management team has the responsibility of maintaining all of VIEDA’s property, plant, and equipment. Operational Goal(s) Meet the present and future needs of business and industry by making space available for commercial use and maintaining property value through a systematic and long-term maintenance program. Fiscal Year 2015 Objectives  Seek federal funding to improve the Park’s infrastructure  Increase tenant occupancy by thirty percent (30%)  Develop long and short term preventative maintenance programs  Improve tenant relationships to encourage retention and expansion of services  Reduce outstanding receivables by at least sixty percent (60%) Fiscal Year 2015 Accomplishment as of March 31, 2015  Continued to research grants to assist in the maintenance and upkeep of the Park’s infrastructure  Began an aggressive marketing campaign to attract new tenants  Improved customer care services to enhance relationship with tenants Fiscal Year 2016 Objectives  Seek federal funding to improve the Park’s infrastructure by creating a micro-grid within the Park  Increase tenant occupancy by thirty percent (30%)  Develop long and short term preventative maintenance programs  Improve tenant relationships to encourage retention and expansion of services  Reduce outstanding receivables by at least sixty percent (60%) V.I. Economic Development Authority – Fiscal Year 2016 Key Performance Indicators (KPI) Actual FY 14 Target FY 15 Actual FY 15 (as of 3/31/15) Planned FY 16 Percentage reduction in accounts receivables 15% 60% 0% 0% Number of new tenants 2 6 0 4 Dollar value of capital improvements 0 $500,000 0 $500,000 Scheduled maintenance work to be completed 1 3 2 6 89,400 54% 84,926 51% 99,333 59% 89,926 54% 78,760 46% 83,234 49% 68,827 41% 78,234 46% 168,160 168,160 168,160 168,160 FY 2012 FY 2013 FY 2014 FY 2015 Economic Development Park Corporation Occupany / Vacancy Rate (Square Footage) St. Thomas & St. Croix Square Footage Vacant Square Footage Occupied V.I. Economic Development Authority – Fiscal Year 2016 3.0 Financial Information 3.1 Revenue The VIEDA’s revenue is derived from three primary sources: government allotments, interest earned on unrestricted loans and interest bearing accounts, and fees collected from operating activities. Fees received from operating activities include activation, application and compliance fees from EDC Beneficiaries. These amounts are deposited into the EDC Industrial Promotion Fund. An annual amount is transferred from this fund, as authorized by the Board of Directors, to help fund the VIEDA operation. Actual Actual Projected Total Projected Budgeted FY 2014 10/1/14-3/31/15 4/1-9/30/15 FY 2015 FY 2016 Loan and Interest Bearing Accounts 46,949 $ 13,699 $ 13,699 $ 27,397 $ 25,000 $ Loan Origination / Application Fees 22,410 1,850 3,500 5,350 $ 8,500 Miscellaneous Fees (i.e. copy, registration, etc.) 71,335 10,487 1,000 11,487 $ 2,500 Transfer: EDC Industrial Promotion Fund 505,000 505,000 - 505,000 $ 505,000 TOTAL REVENUES FROM OPERATING ACTIVITIES 645,694 $ 531,036 $ 18,199 $ 549,234 $ 541,000 $ PLUS: Government Allotment 4,652,133 2,428,000 2,039,600 4,467,600 4,800,000 TOTAL BUDGETED REVENUE 5,297,826 $ 2,959,036 $ 2,057,799 $ 5,016,834 $ 5,341,000 $ REVENUES Loan & Interest Bearing Accounts 5% Applications Fees (Lending Division) 1% EDC Industrial Promotion Fund 94% Fiscal Year 2015 Budgeted Revenues from Operating Activities V.I. Economic Development Authority – Fiscal Year 2016 FY 2013 FY 2014 FY 2015 FY 2016 Request $4.72 $4.93 $4.86 $4.80 $4.48 95% $4.84 98% $4.47 92% Millions Appropriation and Allotment Comparisons Historical Data (FY 2010 - FY 2016) Appropriation Allotment V.I. Economic Development Authority – Fiscal Year 2016 3.2 EXPENDITURE COMPARISON FOR FISCAL YEAR 2014, 2015 PROJECTED AND 2016 BUDGETED DEPARTMENT/AGENCY/OFFICE NAME: Actual Actual Expenditures Proj. Expenditures Total Proj. Expenditures PROJECTED Fiscal Period 2014 10/1/14-5/31/15 4/1/15-9/30/15 FY 2015 Budget 2016 PERSONNEL SERVICES CLASSIFIED EMPLOYEE SALARIES 1,243,566 534,390 620,896 1,155,286 1,419,411 UNCLASSIFIED EMPL. SALARIES 1,060,507 563,733 593,750 1,157,483 1,167,500 TEMP/PART TIME SALARIES - OVERTIME SALARIES - LUMP SUM PAYMENTS - NIGHT DIFFERENTIAL COMP - OTHER DIFFERENTIAL COMP - FEES & COMPENSATION NOC - HOLIDAY PAY - ALL OTHER - SUB-TOTAL 2,304,073 1,098,123 1,214,646 2,312,769 2,586,911 - CAPITAL OUTLAYS - MACHINIERY & EQUIPMENT 23,670 - 23,670 25,000 VEHICLES - ALL OTHER 46,200 - SUB-TOTAL 46,200 23,670 - 23,670 25,000 - FRINGE BENEFITS - EMPLOYER CONTR. RETIREMENT 367,723 177,593 192,473 370,066 454,591 F.I.C.A. 137,727 67,861 75,308 143,169 160,388 MEDICARE 33,328 15,925 17,612 33,537 37,511 HEALTH INSURANCE PREMIUM 229,848 107,312 117,821 225,133 250,930 WORKERS COMP. PREMIUMS - UNIFORM ALLOWANCE - ALL OTHER 2,325 9,172 12,500 21,672 - SUB-TOTAL 770,951 377,863 415,714 793,577 903,420 - SUPPLIES - OFFICE SUPPLIES 56,255 37,536 30,000 67,536 50,000 OPERATING SUPPLIES SMALL TOOLS/MINOR EQUIPMENT ALL OTHER - SUB-TOTAL 56,255 37,536 30,000 67,536 50,000 - OTHER SERVICES & CHARGES - PROFESSIONAL SERVICES 742,919 211,746 385,464 640,435 620,732 COMMUNICATION 90,204 42,404 42,000 84,404 85,000 TRAVEL 105,520 48,610 40,000 88,610 85,000 TRANSPORTATION - NOT TRAVEL - ADVERTISING AND PROMOTION 261,428 130,460 125,000 255,460 235,610 PRINTING AND BINDING 1,806 2,586 2,000 4,586 6,750 INSURANCE 55,554 2,310 53,000 55,310 55,000 REPAIRS AND MAINTENANCE 69,141 32,469 30,000 62,469 62,000 RENTAL- LAND/BUILDING 232,065 117,282 117,282 234,564 237,063 RENTAL - MACHINES/EQUIPMENT - - TRAINING 132,374 26,720 12,500 39,220 45,000 SECURITY - ALL OTHER 296,365 150,225 150,000 257,000 245,914 SUB-TOTAL 1,987,376 764,812 957,246 1,722,058 1,678,069 - UTILITY SERVICES - ELECTRICITY 130,344 47,844 47,000 94,844 95,000 WATER 2,628 981 1,400 2,381 2,600 SUB-TOTAL 132,972 48,825 48,400 97,225 97,600 - TOTAL EXPENSES 5,297,827 2,350,829 2,666,006 5,016,835 5,341,000 Appropriation/Allotment 4,652,133 2,428,000 2,039,600 4,467,600 4,800,000 EDA Revenue 645,694 531,036 18,199 549,235 541,000 Total Projected (Actual) Revenues 5,297,827 2,959,036 2,057,799 5,016,835 5,341,000 LEGISLATURE OF THE VIRGIN ISLANDS POST AUDIT DIVISION EXPENDITURES BY PRIME ACCOUNTS V.I. Economic Development Authority – Fiscal Year 2016 3.3 Professional Services Professional Services FY 2013 Actual FY 2014 Actual FY 2015 Projected FY 2016 Budgeted Audit Fees 43,400 $ 42,000 $ 43,500 $ 45,000 $ Collection Agencies (Lending) 54,794 61,531 60,000 60,000 Consulting 35,631 51,929 65,000 65,000 Credit Reports (Lending) 1,683 1,682 1,682 1,682 IT Services 49,992 58,382 50,000 50,000 Legal Fees 120,723 119,633 82,000 85,000 Marketing 227,893 296,015 258,782 242,000 Stenographer 47,826 52,078 50,000 52,000 Website Maintenance - 25,635 20,050 20,050 Other - 34,033 9,621 Total 581,942 $ 742,919 $ 640,635 $ 620,732 $ Audit Fees 7% Collection Agencies (Lending) 9% Marketing 58% IT Services 9% Consulting 2% Credit Reports (Lending) 0% Legal Fees 8% Stenographer 7% Professional Services 2015 Budgeted Expenses V.I. Economic Development Authority – Fiscal Year 2016 3.4 Personnel Service Cost Breakdown by Department and Classification Personnel cost is the single largest component of the Authority’s operating budget, representing approximately sixty-five percent (65%) of total operating expenses in the FY2016 budget. Positions Unclassified Positions Classified Total Total (#) Amount (#) Amount Positions(#) Salary Amt. EDA 10 $ 789,500 15 $ 628,821 25 $1,418,321 EDC 2 160,000 8 437479 10 597,479 E&CZC 1 90,000 3 126649 4 216,649 EDB 2 128,000 5 226462 7 354,462 Total 15 $ 1,167,500 31 $ 1,419,411 46 $2,586,911 FY 2016 Personnel Cost by Department Department Budget Comparison of Personnel Service Cost (FY 2012 – FY 2016) $1.2M $1.2M $1.1M $1.4M $1.4M $539K $485K $524K $524K $597K $223K $210K $199K $218K $216K $463K $405K $475K $426K $370K $2,485,901 $2,370,691 $2,397,212 $2,591,504 $2,586,911 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 EDB E&CZ EDC EDA V.I. Economic Development Authority – Fiscal Year 2016 Economic Development Bank 11% Applications 7% Compliance 10% Enterprise Zone 7% Legal 6% Human Resources 4% Accounting 8% Executive Office 12% Board 2% Marketing 11% EDM Cost 22% 2016 EDA Budgeted Expenses by Units 3.5 Budget Summary  The V.I. Economic Development Authority’s Fiscal Year 2016 Budget is $5,341,000.  Internally generated revenue used to balance the budget is $541,000.  The requested level of appropriation for FY 16 is $4,800,000. Division / Department Personnel Fringe Operating Total Economic Development Bank 354,462 $ 107,924 $ 128,457 $ 590,843 $ EDC Applications Department 243,557 89,111 26,365 359,033 $ EDC Compliance Department 353,922 130,884 49,350 534,156 $ Enterpise & Commerical Zone Commission 216,649 76,877 54,600 348,126 $ Legal Department 217,000 72,910 23,900 313,810 $ Human Resources 132,920 48,773 57,500 239,193 $ Accounting & Finance 298,370 107,009 10,027 415,406 $ Executive Office 457,000 154,525 23,905 635,430 $ Board of Directors 57,000 21,575 37,572 116,147 $ Marketing Department 126,350 44,749 422,250 593,349 $ EDM - Indirect Cost 129,681 49,083 1,016,743 1,195,507 $ Total Fiscal Year 2016 Budgeted Expense 2,586,911 $ 903,420 $ 1,850,669 $ 5,341,000 $ V.I. Economic Development Authority – Fiscal Year 2016 4. OTHER SUPPLEMENTAL INFORMATION A. Vehicle Listing for VIEDA Presently, EDA has ten (10) vehicles. Seven (7) were purchased with local funds and three (3) with Economic Development Park Corporation funds. YEAR MAKE MODEL ASSIGNED USE SOURCE OF FUNDING ISLAND 2007 TOYOTA RAV4 ADMIN –VIEDA GENERAL FUND ST. CROIX 2007 TOYOTA RAV4 EXECUTIVE – VIEDA GENERAL FUND ST. CROIX 2002 HONDA CRV-LX ADMIN – VIEDA GENERAL FUND ST. CROIX 2005 CHEVROLET PICK UP ADMIN – VIEDA INDUSTRIAL PARK FUND ST. CROIX 2005 CHEVROLET TRAIL BLAZER EXECUTIVE – VIEDA INDUSTRIAL PARK FUND ST. CROIX 2007 TOYOTA RAV4 EXECUTIVE – VIEDA GENERAL FUND ST. THOMAS 2007 TOYOTA RAV4 EXECUTIVE – VIEDA GENERAL FUND ST. THOMAS 2013 CHEVY TRANVERSE EXECUTIVE– VIEDA GENERAL FUND ST. THOMAS 2005 HONDA CRV-LX EXECUTIVE – VIEDA GENERAL FUND ST. THOMAS B. Listing of Real Property being rented or leased by the VIEDA Physical Address Landlord Sq. Ft. Annual Rent Lease Terms Use of Lease Premises Nisky Shopping Center Second Floor, Suite 620 St. Thomas B & W Realty Investments, Ltd. 6,800 $166,600 5 Years Office Space 116 King Street F’sted, St. Croix VI Industrial Park Development Corp. 4,088 $49,464 Month to Month Office Space 18B-2 Lindberg Bay St. Thomas Crown Holding 2,000 $16,000 5 Years Storage Space V.I. Economic Development Authority – Fiscal Year 2016 Glossary of Selected Terms BUDGET: A budget is an estimate of income and expenditure used to plan, monitor, and evaluate financial activities. CAPITAL OUTLAY: Capital outlay refers to expenditures for the acquisition, maintenance or upgrade of assets exceeding $500 and benefiting more than one period. TEMPORARY EMPLOYEE: A temporary employee is one hired for a particular project or period of time. DIRECT COST: A direct cost is a cost that can be identified specifically with a Unit and can be directly traced with relative ease and a high degree of accuracy. FRINGE BENEFITS: Fringe benefits refer to various types of non-wage compensation provided to employees that include retirement contributions, F.I.C.A., health insurance and uniform allowance. INSURANCE: Insurance is a cost to cover risks of a contingent or uncertain loss, and these include personal injury, directors’ and officers’ liability and auto insurance. INDIRECT COSTS: An indirect cost is a cost that is incurred in common with other Units and cannot be traced to any one Unit. KEY PERFORMANCE INDICATOR (KPI): A key performance indicator is a quantitative or qualitative factor that measures program results against an objective. A KPI suggests or approximates an outcome which need not be based on an official standard. PERSONNEL SERVICE: The phrase, Personnel Service, refers to the gross salary amounts paid to full- time, part-time and temporary employees. PROFESSIONAL DEVELOPMENT: Professional Development refers to employer-sponsored training to improve and enhance employees’ job-related skills. RENT: Rent is compensation paid for the use of offices or storage space. REPAIRS AND MAINTENANCE: The category, “repairs and maintenance,” refers to the amount for repairs, maintenance, and upkeep of buildings and equipment. OFFICE SUPPLIES: Office supplies are the materials needed by staff to perform their daily tasks. Examples of office supplies include pens, paper and other stationery items. INTER-ISLAND TRAVEL: Inter-island travel refers to travel by staff between Islands and includes airfare, per diem and hotel costs. UTILITIES: This expense category includes electricity, water, telephone, cell phone and internet services.