Now that it is law, many have asked for my opinion on the Malone Amendment. Things done in the dark are usually questionable at best and often not good. Bills that are drafted and slipped through late night Carnival Sessions without public hearings and committee discussion that, even after veto, are not sent back to committee for hearings or to correct procedural oversights – smell of bad law. As a trained lawyer, as a practitioner of law for over 20 years and as someone with an expertise in economic development; I recognized that the Malone Amendment was bad policy and felt it necessary as someone holding myself to be a leader in this community to speak up.
The Malone Amendment gives successful profitable tax paying businesses an enormous reduction in gross receipts and corporate taxes with no real evidence of substantial economic benefit to the people of the territory during a time of economic crisis with looming budget deficit, job losses, and compromised social services; – This action cannot be right. Senator Malone and the special interest business proponents of this bill believe that because the Malone Amendment is now law, they have won and that they were right. Unfortunately, it is the people of the territory who have lost and this law is wrong. While the government struggles to make up a deficit in the amount of $30 Million for this year and $55 Million projected for next year, we have just given away (by calculation on the Senate Floor) at least $2.6 Million per year in gross receipts taxes which is $39 Million for the first 15 years or $78 Million over the potential 30 year benefit period. This amount doesn’t include corporate, property, and other taxes, which the Senate by its Act has agreed to reduce or nullify for these same companies. And we have done this because those companies have threatened us? Aren’t we stronger than that? Don’t our elderly, sick and children deserve leaders who will not be hijacked in this manner?
There are facts in the new law which are not disputed:
Questionable benefits granted to the ISPs and the potential taxes which might have come into the Virgin Islands treasury of potentially up to $78 Million, are now legislatively gone.
The proponents have still not been able to substantiate the jobs that are here in the territory. Are those jobs merely due to the growth of services, where are the jobs located and are those companies contractually required to keep those jobs in place with the tax benefits?
The law is now liberal as to the types of businesses that can apply for the benefits. According to the new law, even consultants who service online companies can apply. And technically, companies not in the Virgin Islands can receive benefits.
There is no longer a requirement to be in the newly built Research and Technology Park building on the UVI St. Croix campus, as was the original intent of the law or even for the tenants to be on the island of St. Croix.
Contrary to the melodrama on the floor by Senator Shawn Michael Malone, opposition on this bill was not about him. This was about legislation that will negatively impact the future of the territory. This was about the greed of a few over the best interest of the many. This new law is about those few who would eat their pound of flesh off the back of our retirees, government workers, students and children who will have to pay for these companies’ subsidies in the form of increased health cost and gross receipts, continued retirement instability, neglected schools and dare I say, furloughed government workers. Those few, through Senator Malone, have gutted legislation created by a prior Senate to grow our economy, develop intellectual capacity on our college campus and help new businesses. Large already profitable businesses will now pocket much needed and judicially questionable taxes. At the least there should have been true public hearings on the matter and at best our Senate President should have known the separation of powers from civic class and allowed the judiciary to decide the contractual issues that were the basis of those companies’ claims.
And as for Senator Malone’s vainglorious sentiment that I had malicious reasons for pressing this issue; Senator Malone and I are in a campaign to represent the people of these islands in Washington, DC and these are serious times and we should take equally serious who represents us in all positions. Senator Malone has specifically pointed out his experience as a legislator as a reason why he should be elected to the position; therefore he has invited scrutiny of his legislative record and actions. Well, the people of the Virgin Islands and myself should use the passage of the Malone Amendment as an example of how Senator Malone legislates. The leader of a legislature which one day pushes through (without public committee hearings) tax breaks which could well be over $100 Million over the life of the benefits and removes an economic stimulant for St. Croix and the next day approves borrowing in the amount of $50 Million cannot be what the people of the Virgin Islands would want as their representative in Washington. Senator Malone and others believe that the people have no right to vocalize discontent with their actions. It is our right as citizens and our duty as responsible residents of the territory to speak out on matters that affect us all. I have spoken out before this devastating Act and I will continue to vigorously fight for the people of these territories and bring light to questionable actions with facts. Stacey Plaskett Esq.
