Turtle farm still polluting sea
(CNS): Despite the requirements of its licence, the Cayman Islands Turtle Farm is still polluting the ocean, its 2011 annual report has revealed. Among the many other problems facing the beleaguered West Bay facility, the auditors confirmed that the farm is essentially bankrupt and kept afloat only by injections of capital from the public purse and from loans guaranteed by government -- by extension the Caymanian taxpayer. The report reveals that the farm, which is currently under pressure from international animal rights groups, earned even less revenue in 2011 than the year before, despite various efforts to stop the rot, creating a growing bill for an already financially strapped government.
According to the latest annual report, which was audited by KPMG, the farm remains at risk from potential legal action after its failure to acquire the correct environmental permits between 2007 and 2008. This has left the company exposed to possible litigation and the imposition of fines. However, when the audit was undertaken KMPG stated that so far there has been no legal action initiated against the company or any fines levied.
By July 2009 a two-year permit was eventually granted to the Turtle Farm for its effluent discharge but under the terms of the licence it was obligated to reduce this by some 50%, which the auditors say the farm has not done. Despite engaging external consultants to assist in complying with the terms of the permit and the relevant environmental laws, the farm has still failed to meet the required reduction in the waste and pollution it discharges into the ocean.
The report indicates that the farm has not been able to meet the effluent reduction goals of its permit “as a result of the cutbacks and cost constraints” on the facility. It concluded that the company needed to make a significant capital investment to install a system appropriate to meet the requirements. However, management has also decided that the system originally recommended would not necessarily meet its requirements and could have an adverse impact on air quality in the community, which it believes may be even worse than the pollution in the ocean.
In addition, during 2011 the farm hemorrhaged even more cash as profits plummeted, the report reveals. Gross profit at the farm was $3.6 million in 2011 compared with $4.6million in 2010. Although expenses at the farm decreased, there was still a significant loss of almost $8 million -- a bill picked up by the local taxpayer.
In their assessment of the farm the auditors made it clear that, without the continued support from the public purse, the facility could not continue as a going concern. In total government was forced to inject $9.8 million in 2011 to keep the tourist facility open.
KPMG said that the cost overruns of the development of the facility, lower than projected visitor numbers and operating costs in excess of the initial budget had all given rise to significant business risks that cast uncertainty over the company's ability to continue.
The farm has suffered significant operational losses since the 2006 financial year ended, shortly after the controversial redevelopment of the complex was completed. As a result, the company is unable to discharge its obligations as they become due in the ordinary course of business without recourse to lending, which was only secured via a guarantee from government -- essentially the wider public.
The results of the 2011 financial year, the auditors said, indicate that the company continues to generate significant losses from operations and is experiencing serious cash flow difficulties, despite efforts to address the problem, which have included increasing the price of turtle meat and considering the possibility of selling turtle shells. In 2010 the company laid off 20 workers and during the 2011 financial year it reduced the remaining staff’s salaries by as much as 15% for some people.
The farm is currently undergoing an independent review in the face of an international animal rights group's findings of inhumane treatment, overcrowding, poor water conditions and general husbandry, cannibalism, disease and injury among the turtle population, as well as other worrying charges.
The farm has denied the accusations and commissioned a report, which has now been completed, but it has not made it clear when or if the public will see the final results.
Copies of the annual report do not appear on the Cayman Turtle Farm's website. However, they are available in hard copy from the Legislative Assembly and should also be available on request at the Cayman Turtle Farm in West Bay. (If any CNS reader has a copy of the report and has the time and resources to scan the document, we'll be happy to publish.)
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