Caneel Bay owner spent $170K lobbying for lease extension

This article appeared in The Virgin Islands Daily News. By A.J. RAO Daily News Staff Sep 30, 2020

The leaseholder of Caneel Bay Resort on St. John has so far this year spent $170,000 lobbying the U.S. Interior Department to extend its management for another 60 years.

According to the Center for Responsive Politics, leaseholder CBI Acquisitions (CBIA) paid $160,000 to lobbyist Ballard Partners and and $10,000 to Van Ness Feldman, from January to June 30.

Ballard Partners, whose founder Brian Ballard was recently featured in Politico as the “most powerful lobbyist in Trump’s Washington,” boasts close ties to the Trump administration and was one of the president’s top campaign fundraisers, according to the report.

Van Ness Feldman, another D.C.-based firm, specializes in environmental and energy law, and accrued more than 45 clients in 2019 alone.

Both firms intend to convince the Interior Department that CBIA deserves a 60-year, no-bid lease extension to operate the resort, insisting the deal would hasten a rebuild and revive a critical employer to the Virgin Islands.

Many on St. John, however, are steadfastly opposed, arguing that CBIA and its principal owner Gary Engle have been poor stewards of the property and refused to rebuild despite millions of dollars in insurance money.

Ever since hurricanes Irma and Maria destroyed Caneel Bay Resort in 2017, the once-popular eco-resort has languished in an ongoing battle over its restoration and future management. To this day, the resort remains shuttered.

Much of the dilemma surrounds its so-called Retained Use Estate (RUE). In 1983, resort developer Laurance Rockefeller deeded the underlying resort land to the National Park Service, retaining the right to operate the resort until September 2023.

The agreement has allowed resort owners to pay zero rent to the federal government for using park land, under the assumption the resort will transfer to park ownership in 2023.

With the resort’s destruction, however, CBIA, which took over the property in 2004, has demanded a 60-year lease extension as an incentive to rebuild and recoup a purported $100 million reinvestment.

While Engle has ignored recent inquiries by The Daily News, CBIA spokesman Patrick Kidd said negotiations are ongoing.

“Mr. Engle has been continuing to work towards securing an arrangement with the NPS, so that construction can commence on rebuilding Caneel Bay Resort, but there is nothing specific to share at this moment,” Kidd said.

As negotiations remain at a standstill, more problems may lie ahead for CBIA.

Last week, St. John resident David DiGiacomo accused CBIA of generating hazardous waste at the resort, and is preparing to file suit against Engle — and the federal government — for failing to address the matter.

In a letter addressed to several parties linked to the property, DiGiacomo lays out his intent to file suit, responding to what he sees as the contamination of the land and water on the Caneel Bay property and potential violations of environmental laws, including the Resource Conservation and Recovery Act and the Clean Water Act.

“Your contributions to the past and present depositing, handling, storage and disposal of solid and hazardous waste on the property may present an imminent and substantial endangerment to health and the environment,” DiGiacomo writes. “The property soil as was identified in three environmental reports likely remains contaminated and is located next to beaches and waterways used by humans and wildlife.”

DiGiacomo, who addressed his letter to Engle, as well as representatives from the Department of the Interior, the Environmental Protection Agency, the V.I. National Park and even Gov. Albert Bryan Jr., further states federal oversight of the property was lax and failed to address the contamination.

DiGiacomo requested that CBIA cease all activity on the property until full compliance with environmental law is met and a comprehensive environmental review is conducted. He said he will “wait a reasonable time” and give the parties involved an opportunity to address his concerns before filing suit.