The Matching Fund Special Purpose Securitization Corporation Board of Directors heard the good news at its quarterly meeting on Wednesday but did not touch on the bad news.
The corporation’s capitalized interest account, held by Causey Demgen and Moore PC, is earning more than anticipated.
Andy Mathes, representing the firm, said the investment this fiscal year earned $5.7 million instead of the $5.1 million expected. Gov. Albert Bryan Jr., who chairs the board, asked where that money would go. Joel Ephross, also with Causey Demgen, said he was not sure which account it would go to, but no matter which, it would benefit the Virgin Islands.
Bryan said, “So, we have a little change in the bank.”
Another piece of good news for the board is that its operation expenses are predicted to go down. A budget of $700,000 was approved, compared to last year’s budget of $750,000. The Public Finance Authority has assumed the corporation’s administrative duties. Nathan Simmonds, the director of finance administration at the PFA, presented the budget.
Although the budget decreased overall, it will increase in two areas in the upcoming year. Board fees and expenses will go from $55,000 to $90,000, and the PFA administrative fee will go from $154,00 to $159,000.
Simmonds also asked the board to approve payment of $239,000 in PFA invoices. The board did.
The board was formed as part of the plan to prevent the Government Employees’ Retirement System from going bankrupt.
The plan is based on the territory receiving $13.25 for each proof gallon of rum sold stateside from the United States government. The bad news is that because of a lack of action from the U.S. Congress, the territory has only been receiving $10.50 for the last two years.
Simmonds recently told the Senate that there is no indication it will be raised in the upcoming year. He said the government covered the shortfall to GERS in the first year but not in the second year. He said he expected the shortfall to be larger in the upcoming year. This year, it was $34 million.
In other action, the board plans to hold an annual meeting on St. Croix this December. The meeting will include tours of the Cruzan and Diageo rum distilleries.
