.ST. THOMAS, VI — The 36^th Legislature of the Virgin Islands, led by Senate President Milton E. Potter convened into Committee of the Whole at the Earle B. Ottley Legislative Hall. Lawmakers received testimony on measures that would ratify a perpetual access easement over a portion of a public road,  rezone properties in the territory, as well as a measure ratifying a proposed Water Island hotel and marina development. Lawmakers cannot vote on items in the Committee of the Whole, and action will be taken at the next scheduled Legislative Session.

Policy makers considered Bill No. 36-0307, An act amending Official Zoning Map No. SJZ-1, St. John, Virgin Islands by rezoning Parcel No.17-D-5 Estate Adrian, No. 18, Cruz Bay Quarter, St. John, consisting of 0.83 acres as described on PWD No. D9-9095-T016 from R-1 (Residential-Low Density) to B- 3 (Business Scattered). The measure was proposed by Senator Milton E. Potter, by Request of the Governor.

Jennifer Jones, Esq., the property owner’s representative delivered testimony. Property owners Maxentius Griffith and John D. Griffith operate a business that provides heavy equipment services, transportation services, and water delivery services. The rezoning would allow the establishment of a permanent location for the business.  Jones stated that there is limited available property on the island of St. John, and businesses providing essential services have few realistic opportunities to secure facilities. The proposed development would consist of a single enclosed building containing a three-bay garage, administrative office space, storage areas, and related support facilities. The site is not proposed as retail operation, commercial store front, or public facing business. No industrial activity is proposed. Jones said that there is a need for this rezoning, as the applicants currently lack adequate enclosed storage and secure facilities to protect equipment from weather, theft, and deterioration.

Keshoy Samuel, Planning Technician at the Department of Planning and Natural Resources, delivered testimony on the proposed measure. The petition seeks to amend the zoning designation of the parcel from R-1 (Residential Low Density) to B3 (Business-Scattered). The applicants seek to establish a commercial trucking operation, including equipment storage facilities for a water delivery and construction support business.  The surrounding area reflects a predominantly residential character, though prior rezonings and use variances have introduced mixed uses over time. This has led to a pattern of incremental encroachments rather than a coordinated land use strategy.  The site would rely on cistern water, and an independent sewage disposal system, and includes proposed buffering, fencing, and storm water measures to mitigate impacts. Operations would involve six to eight trucks, four employees and would operate typically between 8AM and 6PM.

At the DPNR-CCZP public hearing held on April 20, 2026, there were 22 written submissions with strong and unified opposition to the rezoning. Concerns included incompatibility of the heavy equipment and trucking operations within a residential neighborhood, noise, traffic, negative effects on quality of life, concerns with spot zoning, as well as inconsistency with the Comprehensive Land and Water Use plan. The Department recommended denial of the rezonings.

Lawmakers then received testimony on Bill No. 36-0252, An act to ratify a perpetual access easement for ingress and egress over a portion of Public Road R.O.W. Store Tvaer Gade, Queen’s Quarter, St. Thomas. The measure was proposed by Senator Milton E. Potter, by Request of the Governor.

Vincent Richards, Assistant Commissioner of the Department of Property and Procurement delivered testimony on the proposed measure.  The Government of the Virgin Islands owns Public Road R.O.W. Store Tvaer Gade, Queens Quarter, St. Thomas, US Virgin Islands, and 18 Dronnigens Gade LLC owns adjacent Parcel No. 18 Dronnigens Gade, Queens Quarter, St. Thomas, US Virgin Islands. The GVI’s property and the Grantee’s property share a border, and the grantee’s improvements encroaches upon the GVI’s property by approximately 156 US Square feet and is comprised of a stairway grantee’s uses for access to grantee’s property and a storage area housing propane gas tanks and a small generator.  The grantee has been accessing their property over a portion of the GVI’s property for years without a formal agreement. This measure would formalize the prior usage and cure the encroachment onto Public Road R.O.W. Store Tvaer Gade.

Rosa Thomas, President of Operations for Crystal Blue Operations, LLC urged the body to approve the measure. Crystal Blue Operations is the developer of the Historic Area Revitalization Project, a multiphase $17 Million investment to renovate various properties in Downtown Charlotte Amalie. CBO has been working closely with HARP to modernize structures in the area while also preserving the architectural character of the historic district. CBO’s development team submitted a request to the Historic Preservation Commission to update the stairway, awning, trash receptacle area, propane gas storage and small generator serving its tenant at #18 Dronnigens Gade, which houses Virgilio’s Restaurant.  The HPC advised the CBO that before any construction could be done, legal rights to the designated area must be established. The stairway at #18 Dronnigens Gade has served as the point of entry to several well-known restaurants at that area since the 1970s. A formal survey of the property confirmed that the stairway encroaches on the public sidewalk, and an easement would be needed.

Senators then considered Bill No. 36-0290, An act granting a zoning use variance for Plot No. 104 Estate Concordia, West End Quarter, St. Croix from the R-2 (Residential Low Density-One and Two Family) to allow for the construction and operation of a beauty salon. The measure was proposed by Senator Milton E. Potter, by Request of the Governor.

Gail Pagan, Planning Technician at the Department of Planning and Natural Resources delivered the report on the proposed measure.  Daphne Jean-Marie, property owner requests a use variance to the R-2 (Residential-Low Density-One and Two Family) zoning designation for Plot No. 104 Estate Concordia, Westend Quarter, St. Croix, consisting of 0.265 acres. The purpose of the request is to allow for the addition of a beauty salon, which would be operated only by the applicant. Jean-Marie proposes to construct a 10 ft. by 12ft. addition to one of the existing dwellings and utilize an existing bathroom to support salon operations. The salon would operate Monday through Saturday from 9AM to 4PM, by appointment only.  Off street parking for 6-7 vehicles is available on the property and access would be on the West side of the property via Concordia West Public Road No. 17. Infrastructure needs would be met via the public water line, cistern, and a 1,500-gallon septic tank. No additional DPNR reviews are needed except permits for new construction.

At the DPNR-CCZP public hearing held on January 27, 2026, no opposition or concerns were expressed. No post hearing comments were received.  Because of the small scale and low impact, the operation is deemed compatible with existing and permitted R-2 uses. If the use variance is granted, the salon would still require a business license with the DLCA Board of Barbers, Beauticians, and Manicurists, and the Department of Health. DPNR recommended that the variance be granted.

Senators then considered a proposed Water Island hotel and marina development.

Vincent Richards, Assistant Commissioner of the Department of Property and Procurement delivered testimony. A request for proposal was issued in 2014. The Government of the Virgin Islands entered into Lease No. BCT-383 with Water Island Development Company LLC for the development of a resort project on an assemblage of government owned properties on Water Island. The lease was originally executed on December 23, 2014 and became effective on January 1, 2015. The projected experienced significant delays and reduced performances due to various events, such as the impacts of Hurricanes Irma and Maria, and the COVID-19 pandemic. The Department of Property and Procurement began proceedings to terminate the lease agreement on April 11, 2025, which was later rescinded.  

DPNR was then approached by Bluewater Global Advisors, LLC and Innovative Architecture regarding the revitalization of the project.  This amended lease now adjusts the acreage, removing some tracts of land from the project, such as the catchment area and Tract C, returning those areas to the possession and control of the government of the Virgin Islands.  The reinstated and amended lease agreement provides for a term of 99 years, beginning on May 1, 2026, with an option to renew for one additional two-year term. The annual rent for the leased premises would be $120,000, payable in equal monthly installments of $10,000 during the initial term. The rent will increase to $240,000 in the 20^th year of the lease, payable in monthly installments of $20,000.  Beginning in the twenty fifth year, and every five years afterwards, annual rent will increase by five percent.  The amendment provides for a construction period of up to 60 months following the receipt of all required permits and approvals. During this time, rent will be reduced to $1,000.  The proposed development consists of a five-star resort, featuring an 88 key branded hotel, marina, spa, and restaurant. It also includes 90 branded residential units consisting of condominiums, townhomes, and villas.  The development plan also includes workforce and employee housing, a retail village, and facilities to support, police, fire, medical, and security services.

Alex Moskowitz, Partner at Dudley, Newman, Feurerzeig, states that the amended lease is a carefully renegotiated, modernized and economically beneficial redevelopment plan for Water Island. According to developers, the minimum $300 Million investment, with an anticipated $440 Million final budget, and outlines projected public revenues including annual hotel occupancy taxes of $5 Million, $16 Million in residential sales commissions and $2 Million in annual property taxes.  Bluewater Global Advisors began working with WIDC to restructure the project, reduce the hotel size down from 157 to 88 keys, remove development from Honeymoon beach, and shift towards inland parcels to address community concerns. BWG proposes employee housing, upgraded public infrastructure, a rebuilt public marina and new municipal service facilities, designed to support residents and visitors.

Chuck Nestrud, President of the Water Island Civic Association states that the amended Water Island lease is suffering from a complete lack of transparency, has major unanswered questions, and fails to protect the public interest. Nestrud states that the proposed developer has no project development experience of any kid, and that the only two major projects associated with its project managers, both collapsed into bankruptcy and litigation. Nestrud objects to the lease’s authorization for transferring public land into private ownership for luxury, stating that Water Island’s deed restrictions require use for “public purposes” and that the lease would allow these sales without any further act of the Legislature. Nestrud disputes that the amended plan is smaller than the original 2014 proposal and says that the current concept “extends from one end of the island to another.” Nestrud argues that the project’s feasibility and financing have not been demonstrated and points out that the lease allows the developer to delay construction indefinitely, unless it alone determines financing, permits and federal waivers are satisfactory. He further raises concerns about EB-5 immigration-based financing, the absence of a confirmed hotel brand partner, and the lack of standard public-land protections.

Rachael Ackley, a Water Island homeowner voiced opposition to the development, stating that it would dramatically and unsustainably reshape Water Island. The proposal would increase the island’s population almost tenfold. Ackley states that Water Island’s fragile infrastructure cannot handle such expansive growth, stating that the island depends on a deteriorating undersea WAPA cable from the 1950’s and integrating new electrical, water and sewage services could leave residents without essential services for a long time.  Ackley stated that the project also privatizes public parcels that are integral to daily live on Water Island, such as the deep-water dock used for trash removal and supply deliveries, the Fire/EMS station used by Water Island Search and Rescue, and Fort Segarra, a historic site and hurricane shelter restored with grant funding.  Ackley states that Water Island’s roads are in bad condition and would be damaged further with large scale construction. She states that while residents support a moderate, appropriately, scaled boutique hotel, the current proposal is not appropriate.  

Isaac Northup, Jr., President of the Sprat Bay Homeowners Association urged the Legislature to slow and scrutinize the proposed development because key elements of the submission are inaccurate, incomplete or potentially harmful. Northup states that the development map has errors and omissions, including the exclusion of Area J and Lot 112, where developers previously proposed a floating dock.  Northup warns that Lot 112 on Water Island, where significant archeological artifacts were found, could be irreparably damaged. Northup also voices concern about Sprat Point, citing a 1998 federal deed that requires that the land be preserved strictly for conservation. He states that the developer’s intention to build hiking or biking trials violates that mandate and conflicts with Sprat Point’s status within the territorial park system.

Dr. Stephan Bitterwolf voiced concern with the proposed Water Island development.  Bitterwolf states that the lease before the Legislature is flawed, stating that the original developers had more than eight years to begin construction, but did not begin.  The proposed amended lease triples the land area stated for development compared to the 2016 agreement.  Bitterwolf states that it essentially operates as a new lease.  Additionally, Bitterwolf states that the current lease caters heavily to wealthy outsiders and luxury tourism, sending a message to children that their future in the territory depends on serving the wealthy who arrive by helicopter and mega yacht.

Futhermore, Bitterwolf voices additional apprehensions with the proposal. Bitterwolf states that there is a lack of protection of project abandonment, stating that the proposed $3 Million performance bond is barely 1% of the $300 Million investment and will not begin to cover necessary ecological repairs of demolition if the entity goes bankrupt.  Bitterwolf also states that the project could risk permanent alienation of public land and insider dealing. An “acquisition option” allows the developer to carve out approximately 55 acres of public land to build and sell 92 luxury villas and condos. This could then allow the developer to sell those properties for less than they are worth.  Bitterwolf also stated that the developer rushed planning of the proposal without due diligence and that the community should not be forced to review it. Bitterwolf also cautions against the immediate ecological and erosion risk of the project, displacement of vessel space in Flamingo Bay, and a failure to build local capacity, as the lease lacks binding guarantees that the developer would invest in the people of the territory.

Senators present at today’s Legislative Session included Milton E. Potter, Kenneth L. Gittens, Marvin A. Blyden, Angel L. Bolques, Jr., Dwayne M. DeGraff, Ray Fonseca, Novelle E. Francis, Jr., Alma Francis Heyliger, Hubert L. Frederick, Marise C. James, Franklin D. Johnson, Carla J. Joseph, Avery L. Lewis, and Kurt A. Vialet.

The Division of Public Affairs is committed to providing the community with accurate information on legislative proceedings and other events at the Legislature of the Virgin Islands. Visit legvi.org.

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