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HomeNewsLocal newsUndercurrents: The Fiscal Conundrum Has Returned, Via the 3rd Circuit

Undercurrents: The Fiscal Conundrum Has Returned, Via the 3rd Circuit

A regular Source column, Undercurrents explores issues, ideas and events developing beneath the surface in the Virgin Islands community.

Where in the world is the government going to get the money to return the 8 percent that it cut from its employees’ salaries for two years?

And just how much money is it anyway?

Those may be the two most important questions facing Virgin Islands taxpayers right now. They are certainly much on the mind of Budget Director Nellon Bowry.

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“I’m trying to get my hands around that now,” Bowry said Monday, adding that Gov. Kenneth Mapp has already asked him for an estimate of the cost, in the wake of last week’s court ruling against the government.

“It’s obviously going to be a significant number,” Bowry said.

When the temporary 8 percent cut was proposed by the Legislature and signed into law by former Gov. John de Jongh in the summer of 2011, it was touted as an alternative to massive layoffs, as many as 1,400 over two fiscal years.

Under the law, all executive branch workers earning more than $26,000 annually were subject to the 8 percent cut from July 4, 2011, to July 3, 2013. Bowry said he does not yet know how much that savings totaled. But clearly it was in the tens of millions.

The government has some time as judicial proceedings are not quite over.

The Third Circuit has sent the case back to the District Court with a clear message that the lower court erred in its original ruling in favor of the government rather than the unions that brought the suit. Formally, the District Court must finalize the case. There’s even the possibility that the government could appeal the Third Circuit ruling.

But it’s pretty clear that the clock is ticking and the administration is preparing for the worst.

Right now, only members of the United Steelworkers and the American Federation of Teachers V.I. affiliates are affected, as those are the unions who brought suit.

There are about 1,200 AFT members on the three islands, Avery Lewis, president of the St. Thomas-St. John Federation of Teachers, said Monday. And that’s just a fraction of the total number of people he thinks will eventually need to be compensated.

“I would imagine that other unions will use our case as a precedent” and bring similar court challenges, Lewis said.

“That’s my anticipation, my expectation,” Bowry said.

There will be a lot of details to work out. Some employees have retired since the law was enacted. What about overtime? Was that subject to the 8 percent? And how do you calculate interest?

Bowry said the administrative logistics will be a “difficult challenge.”

But the biggest question, of course, is not what to pay, but how to pay.

As Bowry pointed out, the Budget Office doesn’t “find money.”

“That’s going to require legislation,” he said.

As for the Third Circuit Court decision, Bowry said, “It sort of put a disruptive element in fiscal ’17 planning.”

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