Bermuda Jazz Festival organisers were allegedly threatened with "a sword or a very long knife" by a member of the local labour crew in the wake of announcements that this year's Festival has officially been cancelled.

A Police spokesperson confirmed that a man had been arrested in connection with the incident, and that as of 6 p.m. last night, Police maintained a "strong presence" at the Dockyard scene to squash the possibility of another flare-up between the two crews.

Festival promotor Lee Heiman of Track Entertainment said tensions have been high between his New York-based company, the Department of Immigration and Bermudian labourers working on the show.

Mr. Heiman claims that although he secured the necessary work permits for his core group of technicians, local workers wanted him to use more Bermudian labour - a dispute which he said culminated in verbal and physical threats.

"It's my call as a businessmen who I hire ... I can't train these people in a day, and it's not what I was hired for," he said.

And last night, Mr. Heiman alleged that his crew members were physically threatened with a "machete-like weapon" while attempting to pack up the remains of the equipment following yesterday's announcement that the show would not go on. "Last year was a nightmare, and this year is an even bigger nightmare," said Mr. Heiman. "We've been threatened by crew people trying to impede us trying to get out of here and go home.

"I went to the Bermuda Department of Tourism and said `help me, help me, protect us' and they told me to call the Police," he added.

"I've given more money to charity in this Country than I've walked home with in my pocket - I've lost hundreds of thousands of dollars."

Justifying the Festival cancellation, Mr. Heiman stated: "It is virtually impossible to get the performing artists and some additional necessary technical crew into Bermuda prior to the Friday, 14 September and Saturday, 15 September performance dates. We are still unsure about when flights will be able to take off from the US - and without performing artists there is no show. Some of the artists have also expressed their wishes not to fly during these uncertain times, and as this festival is a tourism initiative, many of the tourists and sponsors from the US have cancelled their trips," he added.

But promoter David Frost of Treble Clef Productions said Mr. Heiman was "b*llsh*tting Bermuda" and there were enough artists on Island now to do a mini-jazz show on Saturday.

"We have the best jazz musicians in Bermuda right now - the all-women Cuban band, the Female Jazz Ensemble who put on the concert last night, David Striker, the lead guitarist for Kevin Mahogany's band is here and there are all kinds of local musicians who are willing to perform," said Mr. Frost.

"This is the time that we should be showing that we are capable of performing. You have a stage up at Dockyard that has been built by Government for $400,000 so why can't you use the Maritime Museum on Saturday night? We could charge $25-30. Bermudians are asking why we don't have a mini-jazz festival and let's just jam."

Tourism Minister David Allen did not return calls yesterday, but the Department of Tourism announced that information regarding ticket refunds would be given shortly.