July 24, 2006–While officials from the University of the Virgin Islands Research and Technology Park say the project is "on the cusp" of moving forward, senators said they are hesitant about granting another $1.5 million budget request to fund the park's development. During the second half of Monday's budget hearings, senators said they were also concerned about the numbers presented by representatives from the Public Services Commission, who came in support of a $1 million request for Fiscal Year 2007.
Senators seemed more puzzled, however, that the tech park's budget request was not submitted to the executive branch prior to budget hearings. Instead, the $1.5 million request was submitted on Monday directly to the Legislature. Usually, government departments and agencies, along with various organizations, are given a budget ceiling by the Office of Management and Budget, and subsequently submit a request to the executive branch where it is then included in the overall executive budget.
Senators said they were also surprised that tech park officials have not submitted an expense report detailing how three appropriations previously made by the Legislature for the park's development have been spent. According to Malcolm Kirwan, former executive director of the tech park, the appropriations total $4.5 million–$3.75 million of which has already been allocated for the park's development.
Kirwan said that $1.2 million of the allocated funds have yet to be expended.
More questions arose about a $7 million grant awarded by the Legislature through the Public Finance Commission for the construction of the park. According to David Zumwalt, the park's current executive director, the money has not yet been allocated. However, he added that construction plans for the park have yet to be completed.
Park officials are also awaiting clarification from the U.S. Treasury Department on certain rules and regulations outlined in the American Jobs Creation Act–which cast doubt upon whether revenues generated by U.S. companies that have offices within the park can be counted as local revenues.
While Zumwalt said that park officials remain "optimistic," and continue to engage in an ongoing dialogue with Treasury about source income regulations for the territory, he also told senators that attracting businesses to the park is contingent upon being able to offer tax incentives to prospective tenants.
Senators said they would need park officials to submit a list of how the $3.75 million from previous appropriations has been spent before they are able to consider the $1.5 million request.
Senators were also skeptical about a $1 million request submitted by the PSC for FY 2007. The money used to fund the organization's operations throughout the year comes from the Public Services Commission Revolving Fund–a pool of money derived from fees the commission charges to the six entities it regulates.
The PSC was allotted the same amount of funding for FY 2006.
During Monday's meeting, however, PSC Chairwoman Alecia Wells said the commission would be submitting a supplemental budget to the Legislature within the next two months to subsidize costs needed to regulate the Waste Management Authority and its soon-to-be-implemented environmental user fee.
Wells claimed the new attorney position would cut down on legal fees and consulting costs, but according to Claudius Moore, the commission's accountant, utilities regulated by the PSC pay for both legal and consulting fees.
According to Claudius Moore, the commission's accountant, utilities regulated by the PSC pay for both legal and consulting fees. Therefore, those costs would not result in a savings to the consumer or the commission, but rather to the utilities.
Because of this reason, Sen. Louis P. Hill, chairman of the Finance Committee, asked Moore whether the same funding source could be used to pay for the salary of the PSC's new legal counsel.
"The board did not think of that," Moore said.
Hill repeatedly questioned PSC representatives about the proposed increase in personnel costs–which would fund a total of 11 employees once all vacancies are filled. While Wells said the additional personnel would improve the commission's efficiency by helping to cut down on an "increased workload," Hill disagreed, and said that the number of utilities regulated by the PSC has not changed–therefore, there should be no increase in personnel costs.
"I'm really concerned about the numbers the PSC is presenting to us," he added after the meeting. "They went from three employees to 11. The number of utilities hasn't changed, yet their personnel costs have tripled. And then there's the fact that legal fees are paid by the utilities. So, again, why is there a need for an increase? The math just doesn't add up."
During the meeting, Moore said that consulting fees paid by the utilities in FY 2005 totaled nearly $946,000. Consulting fees for this fiscal year, as of June 30, are nearly $724,000.
Moore also said that the PSC has yet to expend approximately $454,474 of the $1 million allocated in FY 2006 for the commission's operations.
Wells said the PSC would also be requesting funding for a public relations officer and two complaint officers for both districts. "We need the public relations officer to let the public know what we're doing," she explained. "And the complaint officers would be dealing with the number of complaints we're getting about the Water and Power Authority and the high cost of energy."
However, these positions are not included in the PSC's request for FY 2007.
Present during Monday's meeting were Sens. Roosevelt C. David, Liston Davis, Pedro "Pete" Encarnacion, Juan Figueroa-Serville, Hill, Neville James, Norman Jn Baptiste and Usie R. Richards.
Back Talk
Share your reaction to this news with other Source readers. Please include headline, your name and city and state/country or island where you reside.
