OBA Leader: ‘A Bad Deal For Bermuda’
[Updated] Calling it a “bad deal for Bermuda,” Opposition Leader Cole Simons said that by ”conceding 15 years of tax concessions – Bermuda will forfeit revenue estimated at over $128 million dollars just for the hotel.”
Mr Simons was speaking about the ‘Fairmont Southampton Hotel Act 2022′, which grants a number of customs duty and tax concessions, an extract is below, and the Bill can be read in full here.
Mr. Simons said, “The OBA supports the redevelopment of Fairmont Southampton to revive Bermuda’s tourism economy. We are hopeful that it will support our business sector with conference facilities and provide more job opportunities for Bermudians.
“The question is – why has Premier Burt negotiated such a bad deal for Bermuda? Today, when Bermuda’s public finances are on its knees and the county needs every dollar of public revenue. So why during these desperate times is Premier Burt’s Government handing out mammoth concessions that Bermuda can ill afford?
“Let’s be very clear, as previously stated by the Shadow Minister of Tourism, the One Bermuda Alliance recognizes the need, and the support requirements, for a development of this scale. As a consequence, we would maximize the concession period to ten years, instead of fifteen- especially because of these challenging economic times.
“By conceding 15 years of tax concessions – Bermuda will forfeit revenue estimated at over $128 million dollars just for the hotel. That money could have been used to pave roads, care for the elderly, or pay down the island’s astronomical debt.
“Stuck with the new 15-year precedent, future Governments now will find it harder to negotiate a fair deal for Bermuda, and existing tourism operators will no longer have a level playing field.
“Alarmingly, the Burt Government has asked for virtually nothing in return and his details are sorely lacking. For example:
- Premier Burt says 70% of the hotel’s staff will be Bermudian – but which jobs and how many- and what about outsourcing?
- The Government has asked for a management training programme for Bermudians, but what about training and development programs for non-managers?
- Will the tax concessions extend to resort villas and resort suites? If developers of the villas get tax breaks, what about Bermudians? What about the smaller hotels, AirBNBs, developers and construction companies?
“The Burt Government tells us this is a good deal for Bermuda, but how can we tell? There was no public consultation, there are no numbers, no objective, and no independent view.
“The OBA has asked for details from the Government on multiple occasions this year, with no response:
- On February 8th, the OBA asked for details, and Premier Burt promised that his Government would ‘provide details when the Act is tabled’ – which he failed to do.
- On March 2nd, the OBA demanded to know why the public was kept in the dark on the taxpayer’s guarantee.
- And on March 20th, the OBA asked again and the Premier promised a deal was ‘imminent.’
“We all recall that the dramatic departure of the former Finance Minister, Curtis Dickinson, who thought this deal was so dangerous for Bermuda that he walked away from his position.”
Mr Simons added “we are all well-versed with this Government’s failed track record on making deals” noting that almost $1 million went to “the not-so-Savvy deal,” and $3.6 million was spent in “no-bid” contract for the Travel Authorization Form “which is killing tourism,’ with the OBA leader calling the contract ”friend & family”, noting it went a company the Premier’s advisor is involved with.
“The One Bermuda Alliance demands transparency, integrity, and fiscal responsibility from this Government. Instead, Premier Burt has wasted the people’s money on a bonanza for the developers – his inspiration resulted in his desperation,” Mr Simons said. “Bermudians demand a better deal for Bermuda.”
Update 9.49pm: In response, Minister of Tourism Vance Campbell said, “The only desperation on display is that of the Opposition, whose lack of due diligence has cost taxpayers over $200 million from the failed Morgan’s Point project. The Opposition Leader knows that a closed hotel provides zero dollars in tax revenue and that the reopening of this hotel will increase revenue to the Government and provide jobs for the country while supporting increased airlift and visitors to Bermuda.
“The Opposition also must have short memories as they passed a special act for St. Regis that extended tax relief to more than was allowed by law – because they understood what was necessary to get hotels built in Bermuda.
“The Opposition wants to have it both ways, but they can’t. They either support the reopening of the hotel or they don’t. If they support the reopening, they will support this bill tomorrow. If they do not support this bill tomorrow, the hundreds of Bermudians who will be employed by the hotel, the multiple businesses that support the hotel operations, and the taxi drivers who will transport the guests that will stay at the hotel will always remember that the OBA didn’t support the bill in Parliament necessary to re-open Bermuda’s largest hotel.
“The passage of this bill tomorrow will be another step towards the reopening of this hotel which will provide 650 jobs during construction and 800 jobs when the hotel reopens and I look forward to leading tomorrow’s debate on behalf of the Government.”
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All well and good the Southampton properties tax relief…what goes now for all who are currently operating and paying ….further concessions pending i see on the horizon
Blame blame blame when are we going to get some real Politicians, this 2 party crap is played out like damn children in a kinergarden play ground. Stop the lying the silly ass politics BOTH parties. Time for some real MEN/WOMEN BOTH OF YOU. Y’all represent US not your egos.
Here, here!
No deal in history has been as bad as the OBA airport deal.
@watching get real for cs. your dream world is collapsing around you!
@watching if the PLP airport was built we would have borrowed 500 million to build it that is interest of $30 million every year we would be paying, plus we’d have to find the $500 million to pay back.
The costs of running the airport through COVID would have had to be covered with little revenue. So add another 20 million to the 30 million and we are paying $50 million over the last two years.
Bermuda will get the airport at the end of the term
The airport deal was a very good deal. Take off your blinders
Well, you know, apart from the hospital.
“No deal in history has been as bad as the OBA airport deal”
Not giving away Stonington Beach Hotel to become a private money maker for John Jeffries and others, not building the Grand Atlantic to remain empty for over a decade, not giving away St. George Golf Course to St. Regis Hotel, nothing is worse than replacing our dreadful airport with its leaking roof and crumbling infrastructure. We should have kept that crumbling old airport to make a first impression on those few visitors now coming to Bermuda
@Joe B. Do you forget they have SELECTIVE memory, eyes n ears that DONT LOOK SELECTIVELY backwards, TOTAL MEMORY LOSS, Single Vision on OTGHER peoples mistakes and the INABILITY to admit they were wrong
Every deal the plp makes is worse than the airport deal.
You only say that because you’re a racist.
At the end of the day, the airport will belong to Bermuda… not so with the Gencom/Fairmont Southampton which will belong to Gencom and its shareholders/investors.
“We should have kept that crumbling old airport to make a first impression on those few visitors now coming to Bermuda”
What visitors?
The airport was replaced because it didn’t meet the US security standards, enacted after 9/11.
We had 20 years after 9/11 to comply…and the OBA was smart enough to comply.
Leaving this to the plp would have left us with no US, Canadian or UK flights.
But you all knew this. lol
“The airport was replaced because it didn’t meet the US security standards, enacted after 9/11.”
Really? The leaking roof had nothing to do with it? The fact that there were no empty conduits for expansion of communication systems had nothing to do with it?
And since when do American laws apply to Bermuda? If the American’s don’t like what we are doing they can remove Immigration and Customs pre-clearance. The American Government cannot stop Air Canada or British Airways from coming here. And I doubt it could stop any American airline from coming here either.
The airport was replaced to stimulate the economy and provide jobs for Bermudians.
Regards,
OBA voter/advisor
These concessions have now created a massive shortfall in Government revenue for years to come. Any new, or revamp, properties will want t least the same concessions. What if SP want to revamp again in 12 years, they will no doubt get another 15 years or close the hotel. Add in the lost revenue when the hotels (hopefully) run well and all the extra income goes to the investors, not the Bermuda taxpayer. Is there a revenue payback guarantee in the deal? The Premier must be a delight to negotiate with. All ego and no financial savvy (as previously shown).
this narrative makes no sense. the concessions do not create a shortfall as this revenue stream is currently non-existent. right now there are NO revenues from the Fairmont site. Once they invest in the redevelopment then we will see benefits of employment, and investment into our economy. Now, you can say perhaps without the concessions we ‘could’ get 200M, and with them we get less. but guess what, without the investment we get zero. I would rather award the concessions, but have the trade off be that hundreds of bermudians have gainful employment and able to sustain their families and their expenses. But unfortunately the narrative of the OBA and some others have never been to provide opportunities for everyday bermudians.
“hundreds of bermudians have gainful employment and able to sustain their families and their expenses.”
Able to do that as a hotel employee ? Those days ended back in the 70′s
Any payment on the guarantee should have included an equity ownership in the business so Bermuda is not giving away money,
If Burt had a clue, then we would have done this.
The sale of the property should have been conditional on a reopening date. If Burt had a clue we would have done this.
I’m so sick of this PLP. They just don’t have any clue as to what they are doing.
ah…Vance Campbell, the invisible MP. We all know what happened at Morgan’s Point, and the fact is the taxpayer is on the hook because the PLP didn’t think it through. Which should come as no surprise to anyone.