The Bermuda Jazz Festival has been growing from "strength to strength each year", said Tourism Minister David Allen.

And he dismissed as "sheer nonsense" promoter Lee Heiman's criticism of Tourism's contributions to the yearly festival.

Mr. Heiman, president of Track Entertainment which produces the festival, complained in an open letter to Bermuda that the department had reduced its support since Mr. Allen became minister.

But Mr. Allen said that advertising was cut because the festival was drawing more people than there were airline seats to bring them.

"There's been a 25 percent increase in attendance," he said. "We repositioned it to September firstly so we could take advantage of airline schedules and secondly more hotel rooms were available," he said.

And the decision to cut advertising was made in consultation with the hotels, he added.

He said $3 million has been cut from advertising and used for on-Island product development.

This year's festival was cancelled due to a travel shutdown in the wake of the September 11 attacks on the United States.

"This would have been a very successful jazz festival had it not been for the disaster," said Mr. Allen. "A team of people at the ministry has been working with Track for the past three years - this is the first time a problem of this magnitude has come up."

Mr. Allen said he intends to issue a "complete rebuttal" to the Heiman letter and the Ministry will conduct a post-mortem on the cancelled festival. But he reserved comment on whether Track will be asked to produce next year's festival. In any case, the contract has to go through the normal review process, he said.

Mr. Allen said many people came here from the US thinking they can conduct business by the same rules as they had back home. "But this is a different jurisdiction... If Mr. Heiman is saying we have been too zealous in protecting Bermudians, we can live with that."

Meanwhile ticket holders were issued assurances from Tourism, Track Entertainment and local ticket outlets that they will be refunded in full by the end of the week.

But both 27th Century Boutique and Music Box - the two retail outlets that sold tickets - had run out of money and were turning people looking for refunds away on Monday.

At 27th Century, manager Sharon Bartram, said the $10,000 the store received from Track ran out in 45 minutes while Music Box's Eddie DeMello said he had ceased giving refunds when the money he received ran out on Friday.

Both stores were waiting for additional transfers from Track to be received yesterday. But Mr. Heiman told The Royal Gazette the delay in refunds was not unusually long and that Ticketmaster in the US takes three to four weeks to issue refunds for cancelled performances. Track only owes the two retailers $67,000, he said, which will be sent out in three installments.