Most Challenging BI Road Project to Date

This task came at a price. “The risk of employees working in such big cuts and in confined areas, and with cars transiting [practically] on top of them throughout the day were some of the biggest challenges,” said Devin McNab, General Manager of Elite, a company that is constructing the project. The French Harbour-based construction company, founded in 2007 and employing 350 workers, has become the island’s most experienced concrete road building firm.

The Coxen Hole project broke ground in June 2024, and McNab expects the work to conclude in June 2025. “The project seems that is going slow, but there are more than $2 million of underground [black water] infrastructure,” said McNab of the Coxen Hole black water system.

“ZOLITUR has been visionary and it’s the only institution that has looked after the [black water] problem.”

The paving of the PO-35 across Roatan’s biggest city is estimated at 59.9 million [$2.4 million] and is the most expensive per kilometer road Roatan has seen. “These 1.5 kilometers cost more than the 11 kilometers that were paved from the garbage dump to West End,” says McNab. “We are working nights. We are pouring [concrete] late nights instead of the day to alleviate the traffic.”

The project was originally designed to have bridges, but the Municipality of Roatan noticed there was an opportunity to save money by eliminating the bridges and expanding the culvert boxes in several different locations of the urban road project. There are three sections with culvert boxes, one by Serrano Hardware, another by the triángulo section, and a third by the ESBIR school street entrance. “You need to make it [Coxen Hole] more of a city than a town,” said Ing. Castillo, infrastructure chief of the Roatan Municipality.

The road crossing in Coxen Hole will consist of two 3.5 meter lanes, two bicycle lanes, and two sidewalks. “We are not cutting corners,” says McNab. The idea is for this portion – the busiest and most urban of the PO-35 road – to last 30-40 years. The PO-35 originates in West Bay and goes for 54 kilometers to Camp Bay Village.

The most expensive per kilometer road

The entire island of Roatan has been getting a vehicular road heart surgery since 2018. In 2024, the construction company Celaque has paved a concrete road from the Punta Gorda entrance east to Diamond Rock, but has not finished the portion that was supposed to reach Camp Bay village. Palmetto to Crawfish road is waiting for construction to begin this year.

The José Santos Guardiola portion of the PO-35 road is being rebuilt as well. The entire length in the contract is 7.2 kilometers. The municipality of Jose Santos Guardiola has awarded Elite a contract to construct 3 km of the road. ZOLITUR has funds for another 1.2 kilometers of the concrete road, and the central government has finally awarded Elite the three-kilometer contract from their budget.

The idea is to create two new tax regimes while eliminating the possibility of joining any of the current 10 regimes. This change doesn’t affect us currently as issuing of new ZOLITUR permits stopped years ago. The Secretary of the Presidency is correct in the video published: they aren’t eliminating the existing benefits, just any future possibility to affiliate.

In the justification for the proposal of this new law, the legislator also cited corrupt practices by all the regimes. Among other abuses stated, were that under ZOLITUR benefits. There are five companies that import twice the amount of fuel the island can consume.

I would like to know where they got the numbers for this statement. We haven’t had a proper census in years on the island, just an electoral one. I want to see the compiled data for what 1 person consumes in fuel according to this study for the Tax Law proposal.

Here is data I want them to show in this tax proposal. Honduras is projected to generate $600 million in tourism revenue in 2023. With two million visitors expected, vast majority of the income is coming from the Bay Islands.

One third of revenue generated by Roatan cruise ships ends on the mainland and stays there. On the other hand cruise ships that dock here, deplete our resources: our water, roads and beaches.

This could open the door to a spike in kidnappings.

As islanders and resident ex-pats we pay plenty in local and federal taxes. On the other hand, what central government invests back here is very little to sustain the natural resources and protect the tourism industry that produces this income for them.

Personally I think that when it comes to tourism in Honduras, Bay Islands leads the way. When it comes to remembering the island for projects from central government well let’s just say we are far from their top priority.

The new law also proposes to eliminate the bank confidentiality to allow the tax offices to freely have access to our bank records without a court order. Every employee that works at the tax office will have the ability to access your bank information. As information about individual cash assets will become accessible this could open the door to a spike in kidnappings like 20 years ago.

Here is where it gets fun for the islands and the field of real estate. The Honduran lawmakers are pushing to eliminate bearer share corporations. This is a problem, as we islanders pay more capital gains tax here than anywhere else in Honduras. We pay on actual sale value and they pay on cadastral value or an assessed value.

We are allegedly charged only 4% instead of the 10% that is paid on the mainland. We pay that tax regardless of affiliation to ZOLITUR for the benefits. I believe that ZOLITUR is doing a fine job spending our money on its projects in sanitation and infrastructure.

The new law makes it sound like we don’t pay any taxes to the government at all. The companies under the ZOLITUR regime still must collect the taxes and pay them to the government. An audit to weed out those abusing the ZOLITUR system is needed, I’m all for that.

The Bay Islands Organization Is Focusing on Brick and Mortar Projects

“They have the money, they have the technology, they have the plans,” said Romeo Silvestri, ex Bay Islands congressman, speaking about ZOLITUR. “They would be perfect to supervise the development of Roatan. They need to make a strategic alliance with the Municipality and the patronatos.” Since its inception ZOLITUR has focused its funds on brick-and-mortar infrastructure development projects.

However, the past decade brought mostly confusion, anxiety, and a handful of mostly symbolic projects. Evans McNab, who took over direction of ZOLITUR in March of 2015 following Cynthia Solomon and Ricky Marin, overlooks 26 technical and administrative employees at their offices in French Harbour. “I’ve had employees who have been harassing businesses saying: ‘I will report you to the fiscalia.’,” says Evans McNab about the ZOLITUR administration he took over.“ZOLITUR was portraying an image of a white elephant and not doing what it was meant to do,” said McNab. All that is changing.

Last year ZOLITUR paid Lps.6 million for the construction of the Roatan new police headquarters in Los Fuertes built on the property confiscated after the 2014 arrest of Lobo “El Negro” Aleman, a cocaine trafficker for Colombia’s Los Mellos de Kasandra. In 2019, ZOLOTUR’s largest funding initiatives are the paving of the road to the Roatan hospital under construction in Dixon Cove, construction of a public dock in Saint Helena island, and connecting homes in the Coxen Hole neighborhood of Palos Altos to municipal sewer line.

ZOLITUR will complete 11 years of existence in December 2018 and on December 31, the 366 companies that enjoy the ZOLITUR tax exempt status have to renew their licenses. According to McNab, by the end of October barely half had done so. Why? “That is a good question. Maybe they no longer are active, or physically here,” says McNab. If you don’t have a ZOLITUR license you can purchase an already existing one. The going price is $40,000-$100,000. “Most people just see ZOLITUR for their tax exempt status, but it’s much more than that,” says Silvestri. “Doing business on Roatan is already difficult and costly so having ZOLITUR gives us an opportunity to remain competitive,” said Annie Jones, an islander who’s furniture business recently began using ZOLITUR. “It [ZOLITUR] works, but it is a flawed system because it is not handled with the time frame necessary for good business practices.”

The ZOLITUR budget is Lps. 50 million [$2 million] a year, and according to McNab, 65%-70% of it goes towards projects. This number pales in comparison to what Bay Islands bring in taxes to the central government in Tegucigalpa, “Bay Islands bring the central government a yearly income of Lps. 600 Million [$25 million] in sale tax revenue alone,” says Silvestri. ZOLITUR’s budget is gathered a dollar at a time, from tourists. Eighty percent of it comes from the $2 per passenger fee collected from tourists arriving at Mahogany Bay Cruise Terminal and from the capital gains fees from property sales. The airport fees of $6 per international passenger and $1 per national passenger and the $1 fee for passengers arriving by ferry provide the remaining revenue. The proposal of charging visitors arriving at the Port of Roatan $2 per passenger to help fund ZOLITUR has never been resolved.

Things are much better than they were eight-ten years ago. Back then all funds from the fees were transferred to Tegucigalpa and a portion was disbursed back to the Bay Islands under pressure from the local government representatives. “The [central] government kept 50% of the money [in the first few years],” says McNab. “There was a perception in Tegucigalpa that businesses were using their tax exempt status to import to the island and sell on the mainland,” says McNab. Nothing was ever proven, but an unsuccessful presidential executive order demanding that ZOLITUR be shut down was issued by Pepe Lobo. Since ZOLITUR was established by an act of congress, it would need an act of congress to be dissolved and that, according to McNab, is unlikely.

Dale Jackson of Roatan Municipality drives a piece of heavy machinery near Mud Hole, on the north side of the Roatan Municipality.

Roatan is Getting a Badly Needed Facelift

A brand new paved road will open the north side of Roatan to traffic and investment opportunities linking the communities of Mud Hole, Corozal with Brick Bay. The Municipality awarded the 49 million Lps. 8.8 kilometer paving contract to Ing. Luis Alvarado. Roatan Municipality is doing all the preparatory work and grading and is also handling negotiations with local owners about donating land to the right of way. The first 800 meters of the north side road, from the easternmost end of Sandy Bay to just beyond the municipal dump, were paved in 2012 under Mayor Julio Galindo’s administration, but paving stripped abruptly. The new construction is scheduled to be completed by October 2018, but is likely to be delayed into the early 2019. “This will be a completely different island when the projects are finished,” says Ing. Luis Alvarado.

There are other substantial projects taking place including the 5.6 Kilometers white topping contract running from McNab Plaza and the Santos Guardiola Municipal border has been won by Island Concrete and is funded by the Roatan Municipality. There is even talk of closing the excising dump and opening another dump by 2019.

Much of the damage to Roatan’s paved roads was done by heavy traffic and water running over the roads. Central Government’s Fondo Vial is, at least in theory, responsible for maintenance and repair of culverts under national roads. “Most of the drainage system isn’t even damaged, but it just wasn’t maintained. It accumulated a lot of dirt,” says Ing. Isnardi. Even the road section by RECO, the Catholic Church and the mall will get new paving. “We have a lot of equipment here and we are ready to go to work,” says Ing. Isnardi.

Ing. Gustavo Isnardi Jr. With machinery ready to begin road patching and construction.

Island Roads are Stressed to their Limits

Roatan never had a master plan for its road system. The island’s roads were never zoned and the current road system is the result of organic growth: occasional availability of funds; local and national politics; and access to construction equipment, spare parts and fuel. 

The 2017-18 rain season has brought a record rainfall to the island the road system has been put under tremendous stress. In the end however, the current situation is the result of tough, hilly terrain, proximity to the sea, poor original construction, and lack of regular road and culvert maintenance.

The very fact that Roatan is able to operate and in some areas thrive this massive challenge to its basic infrastructure points to the resilience of its people and businesses.

Across the Caribbean numerous islands including: Puerto Rico, Anguila, Barbuda, the US Virgin Islands, British Virgin Islands, Dominica,, the Bahamas, and the Dominican Republic remain in recovery mode after the devastating effects of the 2017 storm  season. Hurricanes Maria & Irma alone cut a swath of destruction across roughly 30% of the region.

The Caribbean economy relies heavily on the 25 million tourists that visit the region each year. For those islands whose economies depend on tourism, this recovery will be long and expensive. Allen Chastanat, Prime Minister of Saint Lucia wrote: “Your visit to our islands is more important now than ever. By coming to the Caribbean you will be contributing to our assistance to our fellow islands who are still recovering.” Roughly 7 million tourists looking for an alternative Caribbean destination in 2018. The crisis in eastern Caribbean is Roatan’s opportunity. Once the road conditions are stabilized, Roatan could experience a boom as efficiency of doing business, and just going on about one’s life will improve.

While islanders and tourists are going about their business, everything has its limits. Jerry Hynds, sworn in as Roatan Mayor on January 25, declared a state of emergency on the island because of the road and garbage situation.

For Roatan the road to recovery will likely be long and not without pitfalls. It’s not easy doing business without basic infrastructure: roads or garbage collection. “How do you attract foreign investment if the place is not attractive enough?,” asks Julio Galindo, ex Roatan Mayor and ex Bay Islands Congressman.

Roatan is an island living a split existence. On one hand there are examples of XXI century technologies and operations like the gas and wind powered Roatan Electric Company [RECO] and some of the largest, safest dive shops in the world. On the other hand, the basic infrastructure of the island like roads and garbage disposal system are in shambles.

But why is that and what caused this splitting of island’s personality?

The Very First Roads

Before any roads existed on Roatan, the majority of transport on the island was done by boat, on foot, on horseback, or on a motorcycle. Until the late 1960s the most efficient way to travel up and down island was by boat named ‘Norma Don’ captained by Wilkie Edwards leaving Oak Ridge to Coxen Hole. ‘Norma Down’ would leave Oak Ridge every day at 6am, stop in Jonesville, French Harbour and arrive in Coxen Hole around noon, then head back.

Vehicular road transport on the island began with one short stretch of road wide enough for a truck to pass. In 1965-6, Sam Grant used what was the first vehicle on the island, a jeep truck, to traverse that first drivable road on the island between the landing strip in Coxen Hole and the town itself. In 1969 Walter McNab began transporting passengers on a windy, dirt road between French Harbour and Coxen Hole.

In 1974, a six kilometer dirt road between Port Royal, Diamond Rock, Camp Bay and Camp Bay village was built. Marvin Grant, an American with a USAID contract did much of the work. “We built the road around Wilks Point ahead so the government wouldn’t mess it up,” says Eric Anderson.

In the 1970s the east of the island began developing and in 1973 Eric Anderson flew Jacobo Goldstein, Honduras’ first minister of tourism, in a small Cessna to show him a potential site for a future international airport in Diamond Rock. “It was flat, it could be 8000 feet long, the land had few owners and it was much less expensive than to extend the landing strip in Coxen Hole,” said Eric Anderson. Anderson came to the island in 1962 with his father Roy Anderson and became a Cessna dealer for Central America. Obviously, this plan never came to fruition.

On the east end of the island sacks of flower were dropped from a helicopter to mark the way for the bulldozer to work its way through the bush. “We used to do stuff like that,” says Erick Anderson. Flower was cheap and exploded on impact in the canopy marking the work for the bulldozer.”Between 1970 and 1975 a dirt road between Coxen Hole and West End was constructed. It opened access to the West End and Sandy Bay, which was just a tiny fishing community with no tourist facilities. Some of the original work was done by one person: Domingo Andino, a D6 tractor operator paid by the central government .

Sam Grant used what was the first vehicle on the island

In 1986-90, during the presidency of Jose Azcona the Brick Bay to West End road was paved with 10 cm asphalt. President Callejas continued the paving from Brick Bay to Oak Ridge but using a much thinner 2.5 cm asphalt paving. Thus the majority of today’s large potholes are in that portion of the main road.

In 1992-93 a road between West End and West Bay was built using a tractor from Anthony’s Key Resort. Thus a meandering 48 kilometer back bone of the island: from West Bay to Camp Bay Village was created.

Roads Today

While the roads on Roatan are the worst they have ever been in their entire history, that history isn’t that long. “I am surprised the roads lasted this much,” says Bill Etches, a West End resident. According to Ing. Gustavo Isnardi Jr. there are 7,000 cars moving about on Roatan, placing constant stress on the roads. The island roads are constantly trafficked by heavy machinery, subject to frequent landslides, and are further weakened by water runoff. “The worse enemy of asphalt is water,” says Ing. Isnardi.

The 2017-2018 rain season exacerbated what was already a stressed road system. The Roatan Weather Facebook page reported 70.55 inches of rain during the last three months of 2017 which is roughly twice the average rainfall for the same period recorded in any of the past 23 years. Some of the most damaged roads are in Los Fuertes and Harbor. These areas have only 2.5 cm of asphalt, their drainage and maintenance have been neglected for years, and they handle very high levels of traffic. On most days a gigantic pothole by the RECO plant slows traffic to a crawl. “We are on the edge of what this island can take. There are problems where there really shouldn’t be,” said Samir Galingo, General Manager of Anthony’s Key Resort.

Drivers swerve to avoid potholes crossing into oncoming traffic

Some communities ended up cut off almost entirely. The only road linking French Harbour and Crawfish Rock is reminiscent of something from magic garden: mud road, canopy of trees spanning all across the road. For 500 meters around Tres Flores the road is one of the most beautiful vistas on Roatan looking down a ridge towards north shore beaches of Pristine Bay. Beyond that point, for about two kilometers, the road has been practically destroyed.

Residents of of Crawfish Rock have to pay exorbitant amounts of money just to be able to go to the supermarkets across the island. “We have to pay 500 Lps. to a guy to take us to Eldon’s every time we need to buy something,” said Celso Connor, a Crawfish Rock resident.

The lack of alternatives to main roads puts pressure on already exhausted infrastructure. “We need to have a paved north side road. That is the only way forward,” said Julio Galindo.

Another tricky part in creating a system of roads on the island is appropriating private land for the roads and their right of way. It’s often not easy. “As mayor you have to convince and incentivize people to give up a portion of their land for a municipal road,” says Julio Galindo. “But some people want an arm and a leg for their right of way. (..) I always tried not to expropriate people – buy them out at a value of their land.” Some roads ended up much longer, and indirect: a good example of this is the paved road around the Coxen Hole stadium.

The constant water and runoff from construction sites and swollen creeks damages the existing roads daily. Since the early 2000s Roatan Municipality would not allow for heavy construction or any road work to be done during the rainy season from October through January. “There is a moratorium on construction, but in this [Mayor Dorn Ebanks] administration, no one is enforcing it,” said Galindo, who sits on the Roatan Municipal council.

The roads took a heavy toll on the bodies and suspension of vehicles all over the island. Roatan potholes are a cash cow for mechanics and vendors of auto shocks. The potholes and poor condition of the roads increase traffic accidents as drivers swerve to avoid potholes crossing into oncoming traffic. In other words Roatan potholes cost lives.

Fixing the Roads

Much of the road construction over the last 20 years on Roatan was done by one company- Bay Islands Development Company [BIDCC] established on the island by Ing. Gustavo Isnardi Jr., a Paraguayan born engineer, in 1994. More recently, in 2007, BIDCC founded a consortium with the larger San Pedro Sula based PRODECON in order to bid for road construction in all three Bay Islands.

“The problem has been for the government to find funds,” said Ing. Gustavo Isnardi Jr. The most recent construction contract of 30 mln Lps. was allocated as an emergency contract by the central government from funds of ZOLITUR, INSEP and IHT. “I get a feeling the government wants us to put up some money to construct these roads, but they don’t expect it in other departments,” said Julio Galindo.

The contract for rebuilding a first portion of Roatan roads was awarded in December 2017 and involved cutting and filling all the potholes between Flowers Bay and West Bay, concrete paving the 200 meters paving at West Bay Mall, and “White topping, ” or placing a 15 cm concrete layer of pavement, on top of the two kilometer section of road in Flowers Bay. That however would be just the beginning.

The road construction equipment necessary for the construction was shipped in mid-December 2017 and BICD was waiting for better weather. With the contract specifying January 30 as the last work day the funds could leave the island. “We are working on extension of the dates of the contract,” said Ing. Isnardi.

On Roatan, like in the rest of Honduras, road construction and maintenance fall under several jurisdictions. There are national roads, there are municipal roads and then there are private roads.

The longest national road runs from West Bay all the way to Camp Bay Village, a distance of 48 kilometers with 38 kilometers of it paved, but with pavement in varying conditions. At times national roads were paved with both asphalt and in the last 6 years concrete. In 2010-14, during President Pepe Lobo the national Coxen Hole to Flowers Bay road was paved with a 2.5 cm concrete coating- white top, with central government approval, but using Roatan Municipal funds.

With several jurisdictions the maintenance and repair work has become a constant challenge. Legally, the national roads patching should be done only by national contractors.

During Julio Galindo mayorship, between 2010 and 2014, in just three years Roatan Municipality managed to pave 23 km of concrete roads, a distance from West End to French Harbour, just with municipal monies. “I had to pay the debt of previous administration for the first year, so we ended up working only three years,” says Galindo.

Roatan should be able to pave every last road on the island just with municipal funds

What becomes evident is quite surprising. If one Roatan mayor is able to pave 23 kilometers of concrete roads in just three years, Roatan should be able to pave every last road on the island just with municipal funds. In theory at least, no need for the largesse and straightjacket of the central government.

When Galindo was mayor, he paved roads and pressured central government to pave roads on the island from 2010-2014. Road paving begun in Gravel Bay, Mud Hole and large stretches of road were paved in Coxen Hole and West End. “By law the municipality can spend up to 40% of its budget on operating expenses, a minimum of 60% has to be used for improvements,” says Galindo. He did it all with 194 municipal employees.

Mayor Dorn Ebanks administration (2014-18) has done almost no road paving at all while the municipality employees went from 198 people to 300. Now with a new mayor Jerry Hynds hopes are high.

The highest quality paved roads on the island, likely of 20 kilometers in total, are private. Developers of Lighthouse Estates, Pristine Bay, Parrot Tree, Lawson Rock and many others have spent millions building and maintaining these roads. Private developers connected remote parts of the island: the Jackson to Marbella was one such private road that was municipalized during Julio Galindo mayorship.

The Conundrum

There are two types of asphalt paving on Roatan: a 10 cm and 2.5 cm thick. “During [president] Callejas time they were even using pavement of 30 cm,” said Isnardi. But subsequent Honduran governments began skimping on asphalt allocation. The West End to Brick Bay road was a “carpeta” road built with 10 cm thick asphalt. The Gravels Bay to West Bay and Brick Bay to Oak Ridge roads was built with thinner “doble traccion” road with 2.5 cm thick asphalt. These thinly paved roads are in biggest trouble.

According to Isnardi while concrete roads are around 20% more expensive to construct than asphalt roads, they are much more resistant. According to road builder Luis Alvarado, building a kilometer of asphalt road on the island costs around 7 million Lempiras, and a concrete road construction should come out around 9.8 million Lps.

In the next four years many of Roatan roads are likely to end up with 15 cm concrete white top, but how soon, that remains to be seen. There is a proposal to budget 85 million Lps. a year for improving and paving Bay Islands roads for the next 10 years, but Ing. Isnardi doesn’t know when the bid would be.