~ Says CEO reportedly making unilateral decisions ~
PHILIPSBURG, Sint Maarten – Leader of the United St. Maarten (US) party on Monday said that the current UD/SMCP government and its indecisiveness on Princess Juliana International Airport is a “riches of embarrassment” with one Minister contradicting the next while facilitating a developing rift at the airport that is stifling any kind of vital development at PJIA.
Additionally, Richardson said while the Prime Minister and CEO of PJIA Brian Mingo stated that they are not looking at any other financing options for the airport, apparently the same CEO, with the PM’s knowledge has reportedly signed an agreement to source alternative funding.
“There are too many contradictions and twisted stories surrounding funding for the airport,” Richardson said. “And our country is the ultimate loser. Making matters worse, we have reports of the CEO signing off and reversing decisions unilaterally without getting the support or approval of the Chief Operations Officer (COO) both of whom form part of the Managing Board along with the CFO. Many fear that the actions of the CEO is leaving the company at risk for court cases should these decisions be challenged or annulled,” Richardson said, adding that “there is no direction at the airport from Government or the CEO.”
Richardson said that while pre-clearance is one aspect that should come along with a financing option, he does not want the discussion to just focus on that. He said the World Bank/European Bank financing option falls way short of what is needed, has proven to be a political football and allows the Dutch too much control over St. Maarten’s most significant strategic asset.
MP Richardson said what PJIA needs is consolidated funding at favorable conditions to allow, among other things:
-Restructuring or buyout of the balance on existing Bond holders loan to allow more flexibility.
-Additional liquidity support for operations cash flow shortfalls during the reconstruction period.
-Funds to construct a new modern Fire and Rescue facility at airport
-Funds to construct a proper Fixed Based Operations (FBO) facility to maintain and attract more Private jet business and to avoid losing this business to other islands.
-Funds to construct a US Pre-Clearance terminal facility that would allow for significant growth of USA passenger traffic and increase in new airlines landing at PJIA with its associated increase in revenues for the airport and St. Maarten on the whole.
-Release and access to the insurance funds being held by the Bondholders.
-To execute the reconstruction of the airport using its own human resources to manage projects as it has done in the past. Without unnecessarily having the project costs increased due to being forced to the hiring of additional project management firms whilst it already has the capabilities locally and in house.
-Use of its already established in-house procurement processes (that were used in previous expansion projects) thereby avoiding implementation of a new lengthy third party procurement processes which will only increases costs and time for executing the project.
Richardson said the JPF Corporate Financing Option of US $240 million seems like an alternative option, once studied carefully and due diligence conducted, would allow all of the above including the possibility of establishing a dividend policy which benefits the country and by extension the people. The JPF option, Richardson said, offers complete financing package and released insurance proceeds can be placed in a Hurricane Reserve account or reserve.
“It offers a low interest rate despite the current Moody’s non-investment grade rating, a debt service coverage ratio flexibility, which will be initially low and with increases over time in alignment with the company’s recovery and the minimization of potential need for waivers, no prepayment penalties, pre-clearance, financial closure can be completed in two months, thereby allowing for construction to start already by January 2020 and completed by June 2021 and e would be committed to one loan with one institution namely Vidanova Pension Fund and consortium which will be easier to manage,” Richardson said.
MP Richardson stressed that this back and forth playing politics with the airport is making St. Maarten look amateurish to the rest of the world and to people who is thinking of doing business here. “It is obvious that this government is in a state of confusion, mired in distrust and in-fighting. This government is the biggest impediment to progress at the airport and something will have to be done soon to address this issue and finally get our airport on the path back to one of the best in the Caribbean. It will not happen with the current cast of characters in government,” Richardson said.
