Firstbank Approves $30 Million UVI Loan For Medical School

ST. CROIX — In a press release issued on Friday, Firstbank revealed that it has provided a $30 million loan to the University of the Virgin Islands as part of the institution’s efforts to open its own medical school in the territory.

UVI’s board of trustees had approved the request in an August 29 meeting, giving Dr. David Hall, UVI’s president, the authority to execute the loan with the banking institution.

Of the $30 million, $20 million will be used to establish the endowment and $10 million is for the school’s operations.

“FirstBank applauds and commends Dr. Hall and his team of educators and administrators for making UVI a leader in higher education,” said Firstbank Senior Vice President Victor Santiago. “We are honored to support this effort that encourages economic development and raises the quality of healthcare education in the territory.”

The Firstbank loan, however, is one of a few funding sources that UVI has sought for full completion of the medical school. On Wednsday, August 19, members of the Committee on Finance gathered at the Earl B. Ottley Legislative Hall in St. Thomas to receive testimony from Dr. Hall, along with Management and Budget Director Nellon Bowry, both men testifying in support of a bill to increase the territory’s debt service payment for UVI’s soon-to-be-built medical school from $700,000 to $1 million annually.

The Legislature approved $700,000 for debt service for UVI in September of last year, funded by rum cover-over revenues.

The extra $300,000, Dr. Hall said, would “permit us to construct a facility that would train existing physicians, nurses, emergency medical technicians, other first responders and military personnel” at the simulation center on St. Croix. As it now stands, the $700,000 would only allow UVI to build phase one of the facility on St. Croix, while the complete structure in St. Thomas would be erected. And he was sure to point out that the funding remains time-sensitive because UVI needs to “be able to convey to the Dept. of Education that this resolution passed by the PFA has now been translated into law, so it’s clearly something we’d like to get done so we’re not in a vulnerable position in regards to the loan that we have taken out,” Dr. Hall said.

In a special meeting of UVI’s Board of Trustees held on Feb. 13, a resolution was approved authorizing the university to enter into a loan, not to exceed $21 million, with the U.S. Department of Education Historically Black College and University Capital Financing Program for the construction of buildings for the UVI School of Medicine.

The institution’s president began making plans in earnest for a medical school when a $30 million gift was granted to the university last April from Chicago businessman, Dr. Chirinjeev Kathuria. That gift, UVI officials say, will be used for the operation of the medical school, allowing the university to create an endowment with start-up funds.

But the 31st Legislature’s Post Auditor Jose George came in opposition of the measure, stating that there was no money in the bill’s funding source for the added $300,000 UVI is calling for, and that it remains uncertain whether it would become available in FY2016. He also mentioned the debt’s yearly reoccurring nature, hinting that it would be difficult for the government to find funds, for the next 30 years, to pay the debt.

Even so, Dr. Hall said long-term investments must be considered to move the territory’s economy forward, and made known that a feasibility study the university conducted revealed that the territory, particularly St. Croix, would see $30 million annually in economic activity because of the simulation center.

“If we only look at the short term and not the long term, we would never be able to grow an economy,” Dr. Hall said. “When you combine what the medical school classrooms would bring, then we are coming close to doubling that [$30 million] number.”

And such investments are not unique to the territory.

“This is what medical schools do wherever they are located. They have a stimulus impact on the economy of the place where they are located and we feel very confident that this one would have the same impact.”

Senator Kurt Vialet later offered an amendment striking all language that related to a funding source and instead left the measure open to any available funding avenue. The amendment was adopted by the committee and favorably forwarded without opposition by Senators Vialet, Clifford Graham,  Myron Jackson, Marvin Blyden and Tregenza Roach. Senators Sammuel Sanes and Terrence “Positive” Nelson were absent.