Governor Bryan signs improved Hotel Development Act into law
US Virgin Islands Governor Albert Bryan Jr (D), signed into law on Monday a new version of the Hotel Development Act.
The Hotel Development Act (HDA), initially introduced and codified in 2011, was intended to herald new growth incentives for commercial and hotel development by incentivizing new construction in the territory.
Under the new Hotel Development Act signed into law, those incentives can now be applied to hotel reconstruction, renovation, restoration, and improvement—broadening the scope of who can participate in the program.
The bill expands the application of the HDA to not just new hotel and resort construction but also applies to reconstruction, renovation, and restoration of existing and damaged properties as a means of fostering our hurricane recovery.
“This legislation represents our efforts to not only attract new investments in the Virgin Islands but to ensure that the hotels that are here have an opportunity to refresh their product continually,” said Governor Bryan before touting the bill as a collaborative effort between the administration and the 33rd Legislature.
The legislation was sponsored by Senator Kurt Vialet (D), who worked closely with Governor Bryan and his legal staff on the bill’s development.
The newly-enacted Hotel Development Act also institutes the use of an Economic Recovery Fee (ERF), which allows hotels to add a fee up to 7.5% as a separate charge to the hotel guest’s bill in addition to the hotel occupancy tax to assist with the financing of qualified development.
The Economic Recovery Fee is recorded similar to the hotel occupancy tax on a guest’s bill as a separate line item but is collected and deposited into a separate ERF Trust Fund to be used as approved by the developer or existing hotel property to secure a hotel note or for self-financed construction.
The Hotel Development Act will apply across the territory, including water Island, where there are plans to construct a new hotel.
Joining Governor Bryan at Monday’s signing ceremony were Lieutenant Governor Tregenza Roach (D), Commissioner of Finance Kirk Callwood Sr., Commissioner of Tourism Joseph Boschulte, Chief Executive Officer of the Economic Development Authority Kamal Latham, Senator Kurt Vialet and President of Hotel and Tourism Association Lisa Hamilton.