PFA HIKES FEE BY $2.5M: Authority raises annual administrative charge to $7.5 million

The V.I. Public Finance Authority raised its annual administrative fee from $5 million to $7.5 million on Thursday, a decision that adds $2.5 million to the territory's operating costs for fiscal year 2027.

The board voted unanimously to approve the increase, which is funded through gross receipts tax revenue. Officials said the authority's legal expenses and the scope of its disaster recovery operations had grown substantially, justifying the larger budget.

Board Secretary Keith O'Neale Jr. told fellow directors that the authority's responsibilities had expanded significantly since he joined during the de Jongh administration. He said staffing had grown and expenses had quadrupled, particularly due to projects managed by the Office of Disaster Recovery.

"It's more than reasonable to think that if our scope and if our mandate and if our goal to do the public good has expanded to such a degree that our budget should expand commensurately," O'Neale said.

The authority's finance director had previously flagged rising costs during a budget hearing in June. Nathan Simmonds attributed a $1.77 million increase in the authority's overall budget request to legal fees from tax refund litigation. The administration category alone was projected to rise 10 percent, driven by higher insurance expenses and rent for a new St. Thomas office.

The Office of Disaster Recovery is managing more than $734 million in planned recovery expenditures for the coming fiscal year, according to its director, Adrienne Williams-Octalien.