June 24, 2003 – Sen. Lorraine Berry is working on a plan to help the territory get out of its fiscal quagmire that doesn't involve borrowing or tapping funds better left in place.
Berry has asked the federal government for technical and financial help in setting up a Financial Control Board similar to the federal board that temporarily took control of the Washington, D.C., local government in 1995, when that city was in fiscal chaos, and oversaw the reform of its financial operations.
One of the major players in that initiative, Herbert R. Tillery, currently a deputy mayor of D.C., was in the territory earlier this month and spoke about the experience at a forum on government leadership and management. (See "Man who helped rescue D.C. to keynote forum".)
Berry wrote to David Cohen, the deputy assistant Interior Department secretary who heads its Office of Insular Affairs, saying that the control board she advocates would be in existence for three years, would need to have at least seven members and could operate with a minimum budget of $2.5 million.
"As you are aware, the current Charles Turnbull-Vargrave Richards administration has submitted an unwise fiscal package that encourages more borrowing, spending and increased taxation," Berry wrote in the June 19 letter. "Presently, another bond issue is before the 25th Legislature, and our current debts are already overwhelming."
In the letter, Berry referred to "our informal discussion," apparently with Cohen, "relative to my proposal that would create a Financial Control Board."
Berry has been a harsh critic of Turnbull's borrowing proposals; she has stated repeatedly on the Senate floor that she will not approve any more borrowing. The governor's proposal to float a $235 million bond issue will be taken up Thursday by the Senate Finance Committee. The bill, submitted by the governor last month, was held for further study at the Finance Committee's June 5 meeting. (See "Finance axes gross receipts tax increase".)
In the interim, all 15 senators signed a letter to Turnbull saying they wouldn't consider the bond issue bill unless and until he rolled back the sizable salary increases he granted hundreds of unclassified government employees last year. The governor's comeback was an offer to reduce the salaries of those making more than $40,000 a year by 2 percent to 10 percent, depending on salary level, for the last half of this year. His proposed increases last year averaged 24 percent for upper-level personnel and 20 percent for mid-level employees. So far, the Senate has not responded publicly to that offer.
Berry told Cohen that the Virgin Islands "is experiencing a financial crisis" that predates the Sept. 11, 2001, terrorist attacks and their economic fallout. "Our economic difficulties have been the result of concomitant poor public policies and questionable fiscal strategies," she wrote.
Berry knows whereof she speaks. Currently vice president of the 25th Legislature, she was president of the 22nd Legislature and has chaired the Finance Committee three times. She has had a front-row-seat view of the territory's finances for the last 21 years.
She said she is aware that the Interior Department offers technical grants for institutional development and governance. The territory needs "immediate assistance," she said, asking that the federal department provide:
– Fiscal support or funding.
– Technical support through external collaboration with local experts.
– Political support through the enactment of relevant laws and rules to enable the autonomy of a non-political entity.
The 25th Legislature, Berry said, has mobilized a consensus body to "confront our fiscal challenges." She is working on organizing an effort to develop a board that would have the requisite institutional support from Congress, Interior and the Internal Revenue Service.
Berry, who will doubtless face opposition to the idea at home, is trying to organize support for the control board through the Senate. "I know that our local conditions will militate against any automatic adoption of mainland models," she said, "but we are willing to adapt political models onto local politics."
The senator also said she "welcomed the renewed interest of the Department of Interior concerning the small territories."
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FYI FROM SEN. SHAWN-MICHAEL MALONE
The following material is being published, unedited, exactly as it was received via e-mail from the office of the government official named, as a Source community service. Government office holders wishing to contribute to the FYI bulletin board must e-mail source@viaccess.net. The Source reserves the right
to choose what is published.
MALONE'S BILL TO ESTABLISH ELECTION FUND PASSES FULL SENATE; V.I. TO RECEIVE FOUR MILLION DOLLARS IN FEDERAL FUNDS
(Charlotte Amalie, U.S. Virgin Islands, June 19, 2003) Bill No. 25-0050 sponsored by Senator Shawn-Michael Malone, to establish the Virgin Islands Election Fund to comply with Public Law No. 107-252 (the Help America Vote Act of 2002, or HAVA), passed the full senate last night with thirteen (13) members voting in favor with two absent. The legislation will be forwarded to the governor for further consideration.
The purpose of the fund is to receive all and any funds appropriated by the U.S. Congress for the purpose of implementing HAVA 2002 requirements. Additionally, the Act requires that each state and territory provide 5% matching funds for federal dollars throughout each budget year. The passage of this legislation puts the territory in a position to gain access to four million dollars ($4,000,000), projected for the Virgin Islands.
"This could not have happened at a better time as we wrestle with our fiscal crisis," Senator Malone stated. As we begin to look at the fiscal year 2004 budget, this $4,000,000 eases the burden on the General Fund, the fund which $796,451 dollars comes out of to fund the Election System of the Virgin Islands and $100,000 used to fund both district boards of elections each fiscal year, which is a good start as we begin to look at the upcoming Fiscal Year 2004 budget and the austerity measures that must be implemented"" Senator Malone said.
"This is also another opportunity to help us fund some of the necessary reforms to our election system that otherwise could not be implemented due to the lack of finances," Senator Malone continued.
Although the Virgin Islands historically has not had any problems with the conducting of elections, the Territory has benefited immensely from the problems arising out of the most recent national presidential elections which were the basis for HAVA 2002. The Virgin Islands, once again, will be "ahead of the game" when it comes to the conduct and administration of local elections. "As a former election board member and chairman, I can say without reservation, that the Election System of the Virgin Islands is one of the best, fail-safe systems in the nation," Senator Malone said.
The funds from HAVA 2002 will be used to implement aspects of the proposed Virgin Islands HAVA 2002 State Plan, as required by the Act, which include, among other things:
– Improved Access for Disabled Voters at Polling Places
– A Pilot Program to Demonstrate and Introduce New Voting Machines
– The Computerization of each Poll throughout the territory
– The Conducting of a Voter Information, Education, and Outreach Program from grades K-12, and
– Funding for Administrative Costs
"I would like to take this time to commend Mr. John Abramsen, Supervisor of Elections, his staff, members of the Joint Boards of Elections and the local HAVA 2002 Committee for their hard work and persistence in realizing this excellent opportunity," malone exclaimed. "Also, my colleagues in the 25th Legislature are to be commended for supporting this very important piece of legislation which helps us financially and places us on the right track towards election reforms in the Territory. I respectfully ask that Governor Charles W. Turnbull sign this bill into law as soon as it reaches his desk," Senator Malone concluded.
to choose what is published.
MALONE'S BILL TO ESTABLISH ELECTION FUND PASSES FULL SENATE; V.I. TO RECEIVE FOUR MILLION DOLLARS IN FEDERAL FUNDS
(Charlotte Amalie, U.S. Virgin Islands, June 19, 2003) Bill No. 25-0050 sponsored by Senator Shawn-Michael Malone, to establish the Virgin Islands Election Fund to comply with Public Law No. 107-252 (the Help America Vote Act of 2002, or HAVA), passed the full senate last night with thirteen (13) members voting in favor with two absent. The legislation will be forwarded to the governor for further consideration.
The purpose of the fund is to receive all and any funds appropriated by the U.S. Congress for the purpose of implementing HAVA 2002 requirements. Additionally, the Act requires that each state and territory provide 5% matching funds for federal dollars throughout each budget year. The passage of this legislation puts the territory in a position to gain access to four million dollars ($4,000,000), projected for the Virgin Islands.
"This could not have happened at a better time as we wrestle with our fiscal crisis," Senator Malone stated. As we begin to look at the fiscal year 2004 budget, this $4,000,000 eases the burden on the General Fund, the fund which $796,451 dollars comes out of to fund the Election System of the Virgin Islands and $100,000 used to fund both district boards of elections each fiscal year, which is a good start as we begin to look at the upcoming Fiscal Year 2004 budget and the austerity measures that must be implemented"" Senator Malone said.
"This is also another opportunity to help us fund some of the necessary reforms to our election system that otherwise could not be implemented due to the lack of finances," Senator Malone continued.
Although the Virgin Islands historically has not had any problems with the conducting of elections, the Territory has benefited immensely from the problems arising out of the most recent national presidential elections which were the basis for HAVA 2002. The Virgin Islands, once again, will be "ahead of the game" when it comes to the conduct and administration of local elections. "As a former election board member and chairman, I can say without reservation, that the Election System of the Virgin Islands is one of the best, fail-safe systems in the nation," Senator Malone said.
The funds from HAVA 2002 will be used to implement aspects of the proposed Virgin Islands HAVA 2002 State Plan, as required by the Act, which include, among other things:
– Improved Access for Disabled Voters at Polling Places
– A Pilot Program to Demonstrate and Introduce New Voting Machines
– The Computerization of each Poll throughout the territory
– The Conducting of a Voter Information, Education, and Outreach Program from grades K-12, and
– Funding for Administrative Costs
"I would like to take this time to commend Mr. John Abramsen, Supervisor of Elections, his staff, members of the Joint Boards of Elections and the local HAVA 2002 Committee for their hard work and persistence in realizing this excellent opportunity," malone exclaimed. "Also, my colleagues in the 25th Legislature are to be commended for supporting this very important piece of legislation which helps us financially and places us on the right track towards election reforms in the Territory. I respectfully ask that Governor Charles W. Turnbull sign this bill into law as soon as it reaches his desk," Senator Malone concluded.
FOUNDATIONS FORM REGIONAL ASSOCIATION
June 23, 2003 – The Community Foundation of the Virgin Islands and the St. Croix Foundation for Community Development are among the founding members of the new Association of Caribbean Community Foundations.
The association came into existence at a meeting in Anguilla last week attended by more than 20 foundation representatives. The three-day gathering — the first joint meeting of the organizations — "enabled attendees to explore the mission of advancing philanthropy in the Caribbean," according to a release.
Five groups signed on as the founding members – the National Community Foundation, St. Lucia; the BVI Investment Club Foundation; the Anguilla Community Foundation and the two U.S. Virgin Islands organizations. The mission of the association is "to strengthen efforts to improve the quality of life of island residents through organized community-based philanthropy and to work together to increase resources on individual islands and in the region," the release stated.
A number of consultants from the U.S. mainland took part in the meeting, including Cindy Ballard of the Coalition for Community Foundations for Youth, which coordinated a grant from the Annie E. Casey Foundation to conduct the meeting.
"We are enthusiastic that our meeting led to the formation of a regional association," Emma Hippolyte, director of the St. Lucia foundation, said. A steering committee was named to develop a proposed organizational structure for the group over the next 90 days. "We are very excited about the opportunity to work together and to connect the group with others in the worldwide field of community foundations," she said.
Community foundations are philanthropic organizations that build long-term permanent resources on the local level and provide grants to non-government organizations to address identified needs and opportunities within the community.
More information about the new association may be obtained by e-mailing Carrolle Perry Devonish, director of the Anguilla Community Foundation, or by calling Dee Baecher-Brown, CFVI president, at 774-6031.
Publisher's note : Like the St. Croix Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
The association came into existence at a meeting in Anguilla last week attended by more than 20 foundation representatives. The three-day gathering — the first joint meeting of the organizations — "enabled attendees to explore the mission of advancing philanthropy in the Caribbean," according to a release.
Five groups signed on as the founding members – the National Community Foundation, St. Lucia; the BVI Investment Club Foundation; the Anguilla Community Foundation and the two U.S. Virgin Islands organizations. The mission of the association is "to strengthen efforts to improve the quality of life of island residents through organized community-based philanthropy and to work together to increase resources on individual islands and in the region," the release stated.
A number of consultants from the U.S. mainland took part in the meeting, including Cindy Ballard of the Coalition for Community Foundations for Youth, which coordinated a grant from the Annie E. Casey Foundation to conduct the meeting.
"We are enthusiastic that our meeting led to the formation of a regional association," Emma Hippolyte, director of the St. Lucia foundation, said. A steering committee was named to develop a proposed organizational structure for the group over the next 90 days. "We are very excited about the opportunity to work together and to connect the group with others in the worldwide field of community foundations," she said.
Community foundations are philanthropic organizations that build long-term permanent resources on the local level and provide grants to non-government organizations to address identified needs and opportunities within the community.
More information about the new association may be obtained by e-mailing Carrolle Perry Devonish, director of the Anguilla Community Foundation, or by calling Dee Baecher-Brown, CFVI president, at 774-6031.
Publisher's note : Like the St. Croix Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
FOUNDATIONS FORM REGIONAL ASSOCIATION
June 23, 2003 – The Community Foundation of the Virgin Islands and the St. Croix Foundation for Community Development are among the founding members of the new Association of Caribbean Community Foundations.
The association came into existence at a meeting in Anguilla last week attended by more than 20 foundation representatives. The three-day gathering — the first joint meeting of the organizations — "enabled attendees to explore the mission of advancing philanthropy in the Caribbean," according to a release.
Five groups signed on as the founding members – the National Community Foundation, St. Lucia; the BVI Investment Club Foundation; the Anguilla Community Foundation and the two U.S. Virgin Islands organizations. The mission of the association is "to strengthen efforts to improve the quality of life of island residents through organized community-based philanthropy and to work together to increase resources on individual islands and in the region," the release stated.
A number of consultants from the U.S. mainland took part in the meeting, including Cindy Ballard of the Coalition for Community Foundations for Youth, which coordinated a grant from the Annie E. Casey Foundation to conduct the meeting.
"We are enthusiastic that our meeting led to the formation of a regional association," Emma Hippolyte, director of the St. Lucia foundation, said. A steering committee was named to develop a proposed organizational structure for the group over the next 90 days. "We are very excited about the opportunity to work together and to connect the group with others in the worldwide field of community foundations," she said.
Community foundations are philanthropic organizations that build long-term permanent resources on the local level and provide grants to non-government organizations to address identified needs and opportunities within the community.
More information about the new association may be obtained by e-mailing Carrolle Perry Devonish, director of the Anguilla Community Foundation, or by calling Dee Baecher-Brown, CFVI president, at 774-6031.
Publisher's note : Like the St. John Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
The association came into existence at a meeting in Anguilla last week attended by more than 20 foundation representatives. The three-day gathering — the first joint meeting of the organizations — "enabled attendees to explore the mission of advancing philanthropy in the Caribbean," according to a release.
Five groups signed on as the founding members – the National Community Foundation, St. Lucia; the BVI Investment Club Foundation; the Anguilla Community Foundation and the two U.S. Virgin Islands organizations. The mission of the association is "to strengthen efforts to improve the quality of life of island residents through organized community-based philanthropy and to work together to increase resources on individual islands and in the region," the release stated.
A number of consultants from the U.S. mainland took part in the meeting, including Cindy Ballard of the Coalition for Community Foundations for Youth, which coordinated a grant from the Annie E. Casey Foundation to conduct the meeting.
"We are enthusiastic that our meeting led to the formation of a regional association," Emma Hippolyte, director of the St. Lucia foundation, said. A steering committee was named to develop a proposed organizational structure for the group over the next 90 days. "We are very excited about the opportunity to work together and to connect the group with others in the worldwide field of community foundations," she said.
Community foundations are philanthropic organizations that build long-term permanent resources on the local level and provide grants to non-government organizations to address identified needs and opportunities within the community.
More information about the new association may be obtained by e-mailing Carrolle Perry Devonish, director of the Anguilla Community Foundation, or by calling Dee Baecher-Brown, CFVI president, at 774-6031.
Publisher's note : Like the St. John Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
FOUNDATIONS FORM REGIONAL ASSOCIATION
June 23, 2003 – The Community Foundation of the Virgin Islands and the St. Croix Foundation for Community Development are among the founding members of the new Association of Caribbean Community Foundations.
The association came into existence at a meeting in Anguilla last week attended by more than 20 foundation representatives. The three-day gathering — the first joint meeting of the organizations — "enabled attendees to explore the mission of advancing philanthropy in the Caribbean," according to a release.
Five groups signed on as the founding members – the National Community Foundation, St. Lucia; the BVI Investment Club Foundation; the Anguilla Community Foundation and the two U.S. Virgin Islands organizations. The mission of the association is "to strengthen efforts to improve the quality of life of island residents through organized community-based philanthropy and to work together to increase resources on individual islands and in the region," the release stated.
A number of consultants from the U.S. mainland took part in the meeting, including Cindy Ballard of the Coalition for Community Foundations for Youth, which coordinated a grant from the Annie E. Casey Foundation to conduct the meeting.
"We are enthusiastic that our meeting led to the formation of a regional association," Emma Hippolyte, director of the St. Lucia foundation, said. A steering committee was named to develop a proposed organizational structure for the group over the next 90 days. "We are very excited about the opportunity to work together and to connect the group with others in the worldwide field of community foundations," she said.
Community foundations are philanthropic organizations that build long-term permanent resources on the local level and provide grants to non-government organizations to address identified needs and opportunities within the community.
More information about the new association may be obtained by e-mailing Carrolle Perry Devonish, director of the Anguilla Community Foundation, or by calling Dee Baecher-Brown, CFVI president, at 774-6031.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
The association came into existence at a meeting in Anguilla last week attended by more than 20 foundation representatives. The three-day gathering — the first joint meeting of the organizations — "enabled attendees to explore the mission of advancing philanthropy in the Caribbean," according to a release.
Five groups signed on as the founding members – the National Community Foundation, St. Lucia; the BVI Investment Club Foundation; the Anguilla Community Foundation and the two U.S. Virgin Islands organizations. The mission of the association is "to strengthen efforts to improve the quality of life of island residents through organized community-based philanthropy and to work together to increase resources on individual islands and in the region," the release stated.
A number of consultants from the U.S. mainland took part in the meeting, including Cindy Ballard of the Coalition for Community Foundations for Youth, which coordinated a grant from the Annie E. Casey Foundation to conduct the meeting.
"We are enthusiastic that our meeting led to the formation of a regional association," Emma Hippolyte, director of the St. Lucia foundation, said. A steering committee was named to develop a proposed organizational structure for the group over the next 90 days. "We are very excited about the opportunity to work together and to connect the group with others in the worldwide field of community foundations," she said.
Community foundations are philanthropic organizations that build long-term permanent resources on the local level and provide grants to non-government organizations to address identified needs and opportunities within the community.
More information about the new association may be obtained by e-mailing Carrolle Perry Devonish, director of the Anguilla Community Foundation, or by calling Dee Baecher-Brown, CFVI president, at 774-6031.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
YOUNG MURALISTS WANTED FOR YACHT HAVEN WALL
June 23, 2003 – With the old Yacht Haven Hotel structures soon to come tumbling down to make way for redevelopment, the resort's new ownership is seeking up to 20 community youth groups to paint a mural on the wall that temporarily cuts the work site off from the street.
The company, IN-USVI, LLC, will host the mural Paint-a-Thon next month, but Tuesday is the last day to sign up teams to participate.
The Paint-a-Thon will allow local young people to showcase their talents on the wall, which will remain standing for several months while contractors demolish the old structures, according to a release from the company. The wall's fresh layer of white paint will serve as the undercoating for the artwork.
Youth group and summer camp leaders are encouraged to sign up a team for the Paint-a-Thon, the release stated. IN-USVI will provide all art materials needed.
"We are only asking that the children bring their ideas and enthusiasm," Andrew Farkas, chief executive officer of Insignia Nautica, said. Insignia Nautica is the parent company of IN-USVI.
Painters must be between the ages of 7 and 15. Each team must have 10 members, including two adult chaperones.
The groups selected to participate will be required to develop their own ideas and design concepts focusing on any of the following themes:
– Virgin Islands history.
– The land or sea environment.
– The marine industry and local watersports.
To sign up a team, go by the Yacht Haven Marina office on Tuesday between noon and 5 p.m. and fill out a short application form. The application must include a brief description of the planned mural design.
"We can't wait to see what they come up with," Farkas said. "The IN-USVI team is really excited about this. We see it as the first phase in the Yacht Haven transformation, and we want to make it fun and include the entire community."
The Paint-a-Thon will take place on July 12, with mural painting beginning at 9 a.m. The day will conclude with a barbecue and an awards ceremony. For more information, contact the Yacht Haven Marina office at 774-6050.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
The company, IN-USVI, LLC, will host the mural Paint-a-Thon next month, but Tuesday is the last day to sign up teams to participate.
The Paint-a-Thon will allow local young people to showcase their talents on the wall, which will remain standing for several months while contractors demolish the old structures, according to a release from the company. The wall's fresh layer of white paint will serve as the undercoating for the artwork.
Youth group and summer camp leaders are encouraged to sign up a team for the Paint-a-Thon, the release stated. IN-USVI will provide all art materials needed.
"We are only asking that the children bring their ideas and enthusiasm," Andrew Farkas, chief executive officer of Insignia Nautica, said. Insignia Nautica is the parent company of IN-USVI.
Painters must be between the ages of 7 and 15. Each team must have 10 members, including two adult chaperones.
The groups selected to participate will be required to develop their own ideas and design concepts focusing on any of the following themes:
– Virgin Islands history.
– The land or sea environment.
– The marine industry and local watersports.
To sign up a team, go by the Yacht Haven Marina office on Tuesday between noon and 5 p.m. and fill out a short application form. The application must include a brief description of the planned mural design.
"We can't wait to see what they come up with," Farkas said. "The IN-USVI team is really excited about this. We see it as the first phase in the Yacht Haven transformation, and we want to make it fun and include the entire community."
The Paint-a-Thon will take place on July 12, with mural painting beginning at 9 a.m. The day will conclude with a barbecue and an awards ceremony. For more information, contact the Yacht Haven Marina office at 774-6050.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
WHAT'S BEEN PROPOSED, AMENDED AND APPROVED
June 23, 2003 – The Senate Finance Committee is meeting Thursday on St. Thomas to consider the $235 million bond issue Gov. Charles W. Turnbull is seeking to bridge the territory's Fiscal Year 2003 budget deficit, currently projected at $152 million, and have some spending money left over.
The 15 senators acting in unison wrote Turnbull last month telling him they would not consider the borrowing bill until he rescinded the hefty raises he granted exempt employees last year.
Since then, the brief marriage between the majority and minority blocs has gone asunder and other rifts have appeared. Two of the majority's veteran senators have chosen opposite sides of the fence: Sen. Lorraine Berry once again asserted on her Monday radio program that she will not approve any borrowing. Sen. Roosevelt David has said repeatedly he will support the bond measure, that it's the only way out.
Other senators have not been so forthcoming in their views, but observers say the Senate will probably capitulate and approve some borrowing. A big question is how the bonds will be repaid. Turnbull proposed using an 18.75 percent increase in the gross receipts tax, but the Senate shot that down.
The governor's comeback to the ultimatum on pay raises was an offer to trim salaries exceeding $40,000 by 2 percent to 10 percent on a sliding scale, for six months. Last year's proposed pay hikes averaged 24 percent for upper-level personnel and 20 percent for mid-level personnel. The Senate has not formally responded to the offer.
As background for the Finance Committee's hearing on Thursday, here is a summary of the governor's six fiscal crisis-related bills and the amendments thereto that have come down the pike in the last month.
Bill No. 25-0035: amended and passed.
– Add hazardous duty Water and Power Authority workers to those allowed by law to take early retirement at full benefits.
– Appropriate $600,000 from the Land Bank Fund to the Public Works Department for a new public cemetery on St. Thomas.
– Appropriate $2.3 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. – Appropriate $50,000 from the General Fund to the Legal Judgments Special Fund.
Amendment:
– Eliminate the $50,000 appropriation for the Legal Judgments Special Fund.
Vote: 13-1-1. For: Sens. Norman Jn Baptiste, Lorraine Berry, Douglas Canton, Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Emmett Hansen II, Louis Hill, David Jones, Almando "Rocky" Liburd, Shawn-Michael Malone, Luther Renee and Ronald Russell. Against: Sen. Celestino A. White. Absent: Sen. Raymond "Usie" Richards.
Bill No. 25-0036: amended and passed.
– Appropriate $9.4 million ($5.4 million by July 31 and another $4 million by Sept. 30) from the General Fund to the Public Works Department for wastewater collection and treatment system repair and maintenance territorywide as mandated by District Court orders, consent orders and the government's memorandum of understanding with the U.S. Environmental Protection Agency.
– Appropriate $750,000 from the General Fund to Public Works for emergency repairs to the wastewater collection system territorywide.
– Appropriate $7 million from the General Fund to cover the government's share of increased health insurance premium costs.
– Appropriate $750,000 from the General Fund to the Property and Procurement Department for "plans and other related costs" of a Workforce Development Center.
– Change date provisions of the V.I. Tax Study Commission (citations of Sept. 30, 2001 become Nov. 30, 2003; citations of Sept. 30, 2002 become June 20, 2005).
– Increase allocations to the Finance Department to cover the cost of audits (replacing the figure $1,348,198 with $2,544,800, and replacing the figure $2,686,451 with $3,883,053).
– Increase an appropriation from the Transportation Trust Fund "as a contribution" to the General Fund from $10 million to $11.5 million. – Set the contributions to the cost of health insurance premiums at 60 percent by the government and 40 percent by employees.
Amendments:
– Funding for the Workforce Development Center deleted. In its place, the funding will go for wastewater treatment.
– Health insurance premium changed to 65 percent by the government and 40 percent by the employees.
Vote: 12-2-1. For: Sens. Berry, Canton, David, Donastorg, Dowe, Hansen, Hill, Jones, Liburd, Malone, Renee and Russell. Again: Sens. Baptiste and White. Absent: Sen. Richards.
Bill No. 25-0037: amended and passed.
– Create an "environmental excise tax" of 2 cents per pound on commodities imported into or produced in the territory for business purposes, to be collected until such time as the administration's proposed Waste Management Authority is enacted, to fund "immediate environmental changes." Leases and rentals of imported commodities would be included, unless obtained for use for 180 days or less. For crude oil refined in the territory and refined petroleum products imported into the territory there would instead be an environmental excise tax of 20 cents per barrel. Exemptions: molasses for rum production and agricultural purposes; animal feed and commercial fertilizers; cement, steel, lumber and sheetrock for construction; merchandise disposed of in the course of export trade by V.I. importers and manufacturers to buyers taking delivery outside the territory; and other goods declared exempt by the Public Services Commission.
– Impose a $5-a-day surcharge on vehicles rented from car rental agencies.
– Increase taxes on gasoline and diesel fuel to 17 cents per gallon from 14 cents.
– Increase the highway user tax, commonly call the "road tax," to 16 cents per pound from 11 cents and making the tax applicable to taxis, which currently are exempt.
– Designate road tax revenues from taxis for a new Road Fund to be used for road maintenance and repair.
– Impose fees on containers shipped into the territory at the rate of $30 per trip of containers 20 feet in length and of $50 per trip on containers 40 feet or more in length.
Amendments:
– Change the terminology "environmental excise tax" to "environmental user fee."
– When the Waste Management Authority is established, transfer collection and administration of the tax to the authority.
– Eliminate the fee of 20 cents a barrel on crude oil and petroleum products.
– Eliminate the $5-a-day surcharge on rental cars; the gas tax increase to 17 cents a gallon; and the highway user tax for taxis.
– Eliminate the V.I. Lottery executive director's authority, enacted earlier, to assume powers of the Lottery Commission when there are insufficient members to attain a quorum.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Bill No. 25-0038: amended and passed.
– Increase license fees for banking institutions to $75,000 from the current $50,000, to $150,000 from the current $100,000, and to $2,500 from the current $1,500.
– Impose a 2 percent surcharge on hotel room charges in addition to the current 8 percent hotel room tax, with revenues to go into the General Fund.
– Increase the gross receipts tax to 4.75 percent from the current 4 percent.
– Impose a 2 percent excise tax on food items; however, candy, chewing gum, sodas and other items "not consumed primarily for nutritive purposes" would be exempted.
– Impose a 4 percent tax on merchandise and commodities valued at more than $500 that are brought into the territory for personal use.
– Impose a sliding scale stamp tax on the sale of real property to replace the current 2 percent tax; rates would be: 2 percent for property valued up to $100,000, 2.5 percent for property valued $100,001 to $500,000, 3 percent for property valued $500,001 to $1 million and 3.5 percent for property valued over $1 million.
– Change the payroll schedule to twice a month instead of every other week, thus eliminating two pay periods per year. (This would not affect the annual salaries of employees.)
Amendments:
– Eliminate the gross receipts tax increase; the excise tax on food items; and the 2 percent surcharge on hotel rooms.
– Reduce executive branch FY2003 appropriations by $55 million. (Turnbull had already implemented a $46 million reduction.)
– Require The West Indian Co. to pay $1 million annually to the General Fund, in lieu of taxes.
– Appropriate $2.5 million for the University of the Virgin Islands Technology Park on St. Croix from the Insurance Guaranty Fund.
– Make the threshold $1,000 for imposing the 4 percent personal use tax on merchandise and commodities brought into the territory for personal use.
– Add $25 to unemployment benefits for each beneficiary's dependent child.
– Impose a moratorium on fees for new business licenses on St. Croix, and reduce by 50 percent the fees for renewing existing business licenses on the island.
– Authorize inter-fund borrowing for the executive branch.
– Allow the government to increase fees by as much as $100 per year, instead of the 10 percent limit.
– Change the commencement date for reduction in overtime to the effective date of this act.
Vote: 10-4-1. For: Sens. Berry, Canton, David, Donastorg, Hansen, Hill, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sen. Richards.
Bill No. 25-0039: amended and passed.
– Provide for property owners who pay their 1999 through 2004 commercial and personal property tax bills prior to the enactment of a District Court-ordered revised property assessment system to be entitled to a credit applied to their subsequent year's tax bill for any overpayment; and for any such taxpayers who underpay said taxes to be billed retroactively for prior-year tax obligations.
– Make the above provision null and void if a higher court reverses the District Court order and upholds the territory's present assessment system.
– Give the Board of Tax Review power to designate a hearing officer to conduct hearings to compile evidence and establish findings of fact in appeals or complaints, providing, however, that the final decision shall rest with the board itself.
– Establish a Tax Assessor's Revolving Fund which shall consist of 1 percent of real property taxes collected annually by the Finance Department, or an amount not to exceed $500,000, plus any legislative appropriations.
– Provide for the Tax Assessor's Revolving Fund money to go for equipment, staffing, training and professional services to maintain and improve the Office of the Tax Assessor.
Amendments:
– Change the basis of assessing real property for tax purposes to market value, not replacement value.
– Base property taxes on 1998 assessments until a new assessment method is in place.
– Allow for persons who may have underpaid to have up to 120 days, as opposed to 30 days, to pay the balance of their property taxes without interest and penalties.
– Credit taxpayers subsequently found to have overpaid their taxes with that amount for subsequent tax years after 60 days of that redetermination.
Vote: 9-4-2. For: Sens. Baptiste, Berry, Canton, David, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Donastorg, Dowe, Liburd and White. Absent: Sens. Hill and Richards
Bill No. 25-0040: to be considered on Thursday by the Finance Committee.
– Authorize the Public Finance Authority to issue up to $235 million in bonds, with up to $100 million to finance the government's working capital obligations, up to $20 million to finance private economic development initiatives on St. Croix, up to $10 million for a Guaranty Reserve Fund to provide credit enhancement for financing of the Carifest theme park, and up to $80 million to finance the construction of a 250-room hotel on St. Croix.
– Authorize the government to pledge gross receipts taxes as security for repayment of the loan note.
– Provide for gross receipts taxes to be deposited in a Gross Receipts Taxes Special Escrow Account, other than the first $250,000 per annum, which by law is to be remitted to the Moderate Income Housing Fund.
– Provide for the government to continue granting gross receipts tax exemptions as an economic development incentive, so long as such exemptions do not cause any given year's estimated gross receipts taxes to be less than 150 percent of the maximum scheduled payments of principal and interest on all outstanding bonds, notes or other evidences of indebtedness secured by a pledge of the gross receipts taxes. (The governor's proposed gross receipts tax increase, as previously noted, was killed, in the Senate Finance Committee.)
Bill No. 25-0051: a resolution amended and passed.
This resolution, sent to Turnbull last week along with the five amended bills, petitions the governor to consider a number of fiscal recovery measures. A resolution doesn't carry the weight of a bill; it is not something to be enacted as law.
The resolution was proposed by Sens. Berry, Canton, David, Hansen, Hill, Jones, Malone, Renee and Russell.
Among other things, the resolution asks the governor to:
– Negotiate with Hovensa for the refinery to pay up to $14 million of its property taxes in advance of the date due.
– Request that the Finance commissioner within 45 days of passage of the resolution issue a request for proposals to a third party for collection of $80 million in delinquent property taxes.
– Submit the FY2004 budget as soon as practicable, the May 30 deadline by law for doing so having passed.
Amendment:
– To tap the Insurance Guaranty Fund for up to $30 million.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Turnbull said on Friday he would "not jeopardize the solvency of the Insurance Guaranty Fund" on the brink of hurricane season. His remark was in response to the Legislature's authorization for him to tap the fund for up to $30 million. (See "Senate allows tapping Insurance Guaranty Fund".)
The amendment allowing the action would help ward off a payless payday next week, senators said last week. It urges the governor to substitute up to the $30 million with a standby letter of credit, and to come to the Legislature should he decide to act on it.
As of Tuesday, the bills passed in last week's full Senate session were still in the legislative legal counsel's office for review before being sent up to Government House for Turnbull to sign, veto in whole or in part, or allow to become law without his signature.
Short of an unheralded miracle, the territory's immediate fiscal future is no closer to resolution than it was on April 24 – the day the governor announced that the territory was facing not just a shortfall but a crisis.
Publisher's note : Like the St. Croix Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
The 15 senators acting in unison wrote Turnbull last month telling him they would not consider the borrowing bill until he rescinded the hefty raises he granted exempt employees last year.
Since then, the brief marriage between the majority and minority blocs has gone asunder and other rifts have appeared. Two of the majority's veteran senators have chosen opposite sides of the fence: Sen. Lorraine Berry once again asserted on her Monday radio program that she will not approve any borrowing. Sen. Roosevelt David has said repeatedly he will support the bond measure, that it's the only way out.
Other senators have not been so forthcoming in their views, but observers say the Senate will probably capitulate and approve some borrowing. A big question is how the bonds will be repaid. Turnbull proposed using an 18.75 percent increase in the gross receipts tax, but the Senate shot that down.
The governor's comeback to the ultimatum on pay raises was an offer to trim salaries exceeding $40,000 by 2 percent to 10 percent on a sliding scale, for six months. Last year's proposed pay hikes averaged 24 percent for upper-level personnel and 20 percent for mid-level personnel. The Senate has not formally responded to the offer.
As background for the Finance Committee's hearing on Thursday, here is a summary of the governor's six fiscal crisis-related bills and the amendments thereto that have come down the pike in the last month.
Bill No. 25-0035: amended and passed.
– Add hazardous duty Water and Power Authority workers to those allowed by law to take early retirement at full benefits.
– Appropriate $600,000 from the Land Bank Fund to the Public Works Department for a new public cemetery on St. Thomas.
– Appropriate $2.3 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. – Appropriate $50,000 from the General Fund to the Legal Judgments Special Fund.
Amendment:
– Eliminate the $50,000 appropriation for the Legal Judgments Special Fund.
Vote: 13-1-1. For: Sens. Norman Jn Baptiste, Lorraine Berry, Douglas Canton, Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Emmett Hansen II, Louis Hill, David Jones, Almando "Rocky" Liburd, Shawn-Michael Malone, Luther Renee and Ronald Russell. Against: Sen. Celestino A. White. Absent: Sen. Raymond "Usie" Richards.
Bill No. 25-0036: amended and passed.
– Appropriate $9.4 million ($5.4 million by July 31 and another $4 million by Sept. 30) from the General Fund to the Public Works Department for wastewater collection and treatment system repair and maintenance territorywide as mandated by District Court orders, consent orders and the government's memorandum of understanding with the U.S. Environmental Protection Agency.
– Appropriate $750,000 from the General Fund to Public Works for emergency repairs to the wastewater collection system territorywide.
– Appropriate $7 million from the General Fund to cover the government's share of increased health insurance premium costs.
– Appropriate $750,000 from the General Fund to the Property and Procurement Department for "plans and other related costs" of a Workforce Development Center.
– Change date provisions of the V.I. Tax Study Commission (citations of Sept. 30, 2001 become Nov. 30, 2003; citations of Sept. 30, 2002 become June 20, 2005).
– Increase allocations to the Finance Department to cover the cost of audits (replacing the figure $1,348,198 with $2,544,800, and replacing the figure $2,686,451 with $3,883,053).
– Increase an appropriation from the Transportation Trust Fund "as a contribution" to the General Fund from $10 million to $11.5 million. – Set the contributions to the cost of health insurance premiums at 60 percent by the government and 40 percent by employees.
Amendments:
– Funding for the Workforce Development Center deleted. In its place, the funding will go for wastewater treatment.
– Health insurance premium changed to 65 percent by the government and 40 percent by the employees.
Vote: 12-2-1. For: Sens. Berry, Canton, David, Donastorg, Dowe, Hansen, Hill, Jones, Liburd, Malone, Renee and Russell. Again: Sens. Baptiste and White. Absent: Sen. Richards.
Bill No. 25-0037: amended and passed.
– Create an "environmental excise tax" of 2 cents per pound on commodities imported into or produced in the territory for business purposes, to be collected until such time as the administration's proposed Waste Management Authority is enacted, to fund "immediate environmental changes." Leases and rentals of imported commodities would be included, unless obtained for use for 180 days or less. For crude oil refined in the territory and refined petroleum products imported into the territory there would instead be an environmental excise tax of 20 cents per barrel. Exemptions: molasses for rum production and agricultural purposes; animal feed and commercial fertilizers; cement, steel, lumber and sheetrock for construction; merchandise disposed of in the course of export trade by V.I. importers and manufacturers to buyers taking delivery outside the territory; and other goods declared exempt by the Public Services Commission.
– Impose a $5-a-day surcharge on vehicles rented from car rental agencies.
– Increase taxes on gasoline and diesel fuel to 17 cents per gallon from 14 cents.
– Increase the highway user tax, commonly call the "road tax," to 16 cents per pound from 11 cents and making the tax applicable to taxis, which currently are exempt.
– Designate road tax revenues from taxis for a new Road Fund to be used for road maintenance and repair.
– Impose fees on containers shipped into the territory at the rate of $30 per trip of containers 20 feet in length and of $50 per trip on containers 40 feet or more in length.
Amendments:
– Change the terminology "environmental excise tax" to "environmental user fee."
– When the Waste Management Authority is established, transfer collection and administration of the tax to the authority.
– Eliminate the fee of 20 cents a barrel on crude oil and petroleum products.
– Eliminate the $5-a-day surcharge on rental cars; the gas tax increase to 17 cents a gallon; and the highway user tax for taxis.
– Eliminate the V.I. Lottery executive director's authority, enacted earlier, to assume powers of the Lottery Commission when there are insufficient members to attain a quorum.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Bill No. 25-0038: amended and passed.
– Increase license fees for banking institutions to $75,000 from the current $50,000, to $150,000 from the current $100,000, and to $2,500 from the current $1,500.
– Impose a 2 percent surcharge on hotel room charges in addition to the current 8 percent hotel room tax, with revenues to go into the General Fund.
– Increase the gross receipts tax to 4.75 percent from the current 4 percent.
– Impose a 2 percent excise tax on food items; however, candy, chewing gum, sodas and other items "not consumed primarily for nutritive purposes" would be exempted.
– Impose a 4 percent tax on merchandise and commodities valued at more than $500 that are brought into the territory for personal use.
– Impose a sliding scale stamp tax on the sale of real property to replace the current 2 percent tax; rates would be: 2 percent for property valued up to $100,000, 2.5 percent for property valued $100,001 to $500,000, 3 percent for property valued $500,001 to $1 million and 3.5 percent for property valued over $1 million.
– Change the payroll schedule to twice a month instead of every other week, thus eliminating two pay periods per year. (This would not affect the annual salaries of employees.)
Amendments:
– Eliminate the gross receipts tax increase; the excise tax on food items; and the 2 percent surcharge on hotel rooms.
– Reduce executive branch FY2003 appropriations by $55 million. (Turnbull had already implemented a $46 million reduction.)
– Require The West Indian Co. to pay $1 million annually to the General Fund, in lieu of taxes.
– Appropriate $2.5 million for the University of the Virgin Islands Technology Park on St. Croix from the Insurance Guaranty Fund.
– Make the threshold $1,000 for imposing the 4 percent personal use tax on merchandise and commodities brought into the territory for personal use.
– Add $25 to unemployment benefits for each beneficiary's dependent child.
– Impose a moratorium on fees for new business licenses on St. Croix, and reduce by 50 percent the fees for renewing existing business licenses on the island.
– Authorize inter-fund borrowing for the executive branch.
– Allow the government to increase fees by as much as $100 per year, instead of the 10 percent limit.
– Change the commencement date for reduction in overtime to the effective date of this act.
Vote: 10-4-1. For: Sens. Berry, Canton, David, Donastorg, Hansen, Hill, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sen. Richards.
Bill No. 25-0039: amended and passed.
– Provide for property owners who pay their 1999 through 2004 commercial and personal property tax bills prior to the enactment of a District Court-ordered revised property assessment system to be entitled to a credit applied to their subsequent year's tax bill for any overpayment; and for any such taxpayers who underpay said taxes to be billed retroactively for prior-year tax obligations.
– Make the above provision null and void if a higher court reverses the District Court order and upholds the territory's present assessment system.
– Give the Board of Tax Review power to designate a hearing officer to conduct hearings to compile evidence and establish findings of fact in appeals or complaints, providing, however, that the final decision shall rest with the board itself.
– Establish a Tax Assessor's Revolving Fund which shall consist of 1 percent of real property taxes collected annually by the Finance Department, or an amount not to exceed $500,000, plus any legislative appropriations.
– Provide for the Tax Assessor's Revolving Fund money to go for equipment, staffing, training and professional services to maintain and improve the Office of the Tax Assessor.
Amendments:
– Change the basis of assessing real property for tax purposes to market value, not replacement value.
– Base property taxes on 1998 assessments until a new assessment method is in place.
– Allow for persons who may have underpaid to have up to 120 days, as opposed to 30 days, to pay the balance of their property taxes without interest and penalties.
– Credit taxpayers subsequently found to have overpaid their taxes with that amount for subsequent tax years after 60 days of that redetermination.
Vote: 9-4-2. For: Sens. Baptiste, Berry, Canton, David, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Donastorg, Dowe, Liburd and White. Absent: Sens. Hill and Richards
Bill No. 25-0040: to be considered on Thursday by the Finance Committee.
– Authorize the Public Finance Authority to issue up to $235 million in bonds, with up to $100 million to finance the government's working capital obligations, up to $20 million to finance private economic development initiatives on St. Croix, up to $10 million for a Guaranty Reserve Fund to provide credit enhancement for financing of the Carifest theme park, and up to $80 million to finance the construction of a 250-room hotel on St. Croix.
– Authorize the government to pledge gross receipts taxes as security for repayment of the loan note.
– Provide for gross receipts taxes to be deposited in a Gross Receipts Taxes Special Escrow Account, other than the first $250,000 per annum, which by law is to be remitted to the Moderate Income Housing Fund.
– Provide for the government to continue granting gross receipts tax exemptions as an economic development incentive, so long as such exemptions do not cause any given year's estimated gross receipts taxes to be less than 150 percent of the maximum scheduled payments of principal and interest on all outstanding bonds, notes or other evidences of indebtedness secured by a pledge of the gross receipts taxes. (The governor's proposed gross receipts tax increase, as previously noted, was killed, in the Senate Finance Committee.)
Bill No. 25-0051: a resolution amended and passed.
This resolution, sent to Turnbull last week along with the five amended bills, petitions the governor to consider a number of fiscal recovery measures. A resolution doesn't carry the weight of a bill; it is not something to be enacted as law.
The resolution was proposed by Sens. Berry, Canton, David, Hansen, Hill, Jones, Malone, Renee and Russell.
Among other things, the resolution asks the governor to:
– Negotiate with Hovensa for the refinery to pay up to $14 million of its property taxes in advance of the date due.
– Request that the Finance commissioner within 45 days of passage of the resolution issue a request for proposals to a third party for collection of $80 million in delinquent property taxes.
– Submit the FY2004 budget as soon as practicable, the May 30 deadline by law for doing so having passed.
Amendment:
– To tap the Insurance Guaranty Fund for up to $30 million.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Turnbull said on Friday he would "not jeopardize the solvency of the Insurance Guaranty Fund" on the brink of hurricane season. His remark was in response to the Legislature's authorization for him to tap the fund for up to $30 million. (See "Senate allows tapping Insurance Guaranty Fund".)
The amendment allowing the action would help ward off a payless payday next week, senators said last week. It urges the governor to substitute up to the $30 million with a standby letter of credit, and to come to the Legislature should he decide to act on it.
As of Tuesday, the bills passed in last week's full Senate session were still in the legislative legal counsel's office for review before being sent up to Government House for Turnbull to sign, veto in whole or in part, or allow to become law without his signature.
Short of an unheralded miracle, the territory's immediate fiscal future is no closer to resolution than it was on April 24 – the day the governor announced that the territory was facing not just a shortfall but a crisis.
Publisher's note : Like the St. Croix Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
WHAT'S BEEN PROPOSED, AMENDED AND APPROVED
June 23, 2003 – The Senate Finance Committee is meeting Thursday on St. Thomas to consider the $235 million bond issue Gov. Charles W. Turnbull is seeking to bridge the territory's Fiscal Year 2003 budget deficit, currently projected at $152 million, and have some spending money left over.
The 15 senators acting in unison wrote Turnbull last month telling him they would not consider the borrowing bill until he rescinded the hefty raises he granted exempt employees last year.
Since then, the brief marriage between the majority and minority blocs has gone asunder and other rifts have appeared. Two of the majority's veteran senators have chosen opposite sides of the fence: Sen. Lorraine Berry once again asserted on her Monday radio program that she will not approve any borrowing. Sen. Roosevelt David has said repeatedly he will support the bond measure, that it's the only way out.
Other senators have not been so forthcoming in their views, but observers say the Senate will probably capitulate and approve some borrowing. A big question is how the bonds will be repaid. Turnbull proposed using an 18.75 percent increase in the gross receipts tax, but the Senate shot that down.
The governor's comeback to the ultimatum on pay raises was an offer to trim salaries exceeding $40,000 by 2 percent to 10 percent on a sliding scale, for six months. Last year's proposed pay hikes averaged 24 percent for upper-level personnel and 20 percent for mid-level personnel. The Senate has not formally responded to the offer.
As background for the Finance Committee's hearing on Thursday, here is a summary of the governor's six fiscal crisis-related bills and the amendments thereto that have come down the pike in the last month.
Bill No. 25-0035: amended and passed.
– Add hazardous duty Water and Power Authority workers to those allowed by law to take early retirement at full benefits.
– Appropriate $600,000 from the Land Bank Fund to the Public Works Department for a new public cemetery on St. Thomas.
– Appropriate $2.3 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. – Appropriate $50,000 from the General Fund to the Legal Judgments Special Fund.
Amendment:
– Eliminate the $50,000 appropriation for the Legal Judgments Special Fund.
Vote: 13-1-1. For: Sens. Norman Jn Baptiste, Lorraine Berry, Douglas Canton, Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Emmett Hansen II, Louis Hill, David Jones, Almando "Rocky" Liburd, Shawn-Michael Malone, Luther Renee and Ronald Russell. Against: Sen. Celestino A. White. Absent: Sen. Raymond "Usie" Richards.
Bill No. 25-0036: amended and passed.
– Appropriate $9.4 million ($5.4 million by July 31 and another $4 million by Sept. 30) from the General Fund to the Public Works Department for wastewater collection and treatment system repair and maintenance territorywide as mandated by District Court orders, consent orders and the government's memorandum of understanding with the U.S. Environmental Protection Agency.
– Appropriate $750,000 from the General Fund to Public Works for emergency repairs to the wastewater collection system territorywide.
– Appropriate $7 million from the General Fund to cover the government's share of increased health insurance premium costs.
– Appropriate $750,000 from the General Fund to the Property and Procurement Department for "plans and other related costs" of a Workforce Development Center.
– Change date provisions of the V.I. Tax Study Commission (citations of Sept. 30, 2001 become Nov. 30, 2003; citations of Sept. 30, 2002 become June 20, 2005).
– Increase allocations to the Finance Department to cover the cost of audits (replacing the figure $1,348,198 with $2,544,800, and replacing the figure $2,686,451 with $3,883,053).
– Increase an appropriation from the Transportation Trust Fund "as a contribution" to the General Fund from $10 million to $11.5 million. – Set the contributions to the cost of health insurance premiums at 60 percent by the government and 40 percent by employees.
Amendments:
– Funding for the Workforce Development Center deleted. In its place, the funding will go for wastewater treatment.
– Health insurance premium changed to 65 percent by the government and 40 percent by the employees.
Vote: 12-2-1. For: Sens. Berry, Canton, David, Donastorg, Dowe, Hansen, Hill, Jones, Liburd, Malone, Renee and Russell. Again: Sens. Baptiste and White. Absent: Sen. Richards.
Bill No. 25-0037: amended and passed.
– Create an "environmental excise tax" of 2 cents per pound on commodities imported into or produced in the territory for business purposes, to be collected until such time as the administration's proposed Waste Management Authority is enacted, to fund "immediate environmental changes." Leases and rentals of imported commodities would be included, unless obtained for use for 180 days or less. For crude oil refined in the territory and refined petroleum products imported into the territory there would instead be an environmental excise tax of 20 cents per barrel. Exemptions: molasses for rum production and agricultural purposes; animal feed and commercial fertilizers; cement, steel, lumber and sheetrock for construction; merchandise disposed of in the course of export trade by V.I. importers and manufacturers to buyers taking delivery outside the territory; and other goods declared exempt by the Public Services Commission.
– Impose a $5-a-day surcharge on vehicles rented from car rental agencies.
– Increase taxes on gasoline and diesel fuel to 17 cents per gallon from 14 cents.
– Increase the highway user tax, commonly call the "road tax," to 16 cents per pound from 11 cents and making the tax applicable to taxis, which currently are exempt.
– Designate road tax revenues from taxis for a new Road Fund to be used for road maintenance and repair.
– Impose fees on containers shipped into the territory at the rate of $30 per trip of containers 20 feet in length and of $50 per trip on containers 40 feet or more in length.
Amendments:
– Change the terminology "environmental excise tax" to "environmental user fee."
– When the Waste Management Authority is established, transfer collection and administration of the tax to the authority.
– Eliminate the fee of 20 cents a barrel on crude oil and petroleum products.
– Eliminate the $5-a-day surcharge on rental cars; the gas tax increase to 17 cents a gallon; and the highway user tax for taxis.
– Eliminate the V.I. Lottery executive director's authority, enacted earlier, to assume powers of the Lottery Commission when there are insufficient members to attain a quorum.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Bill No. 25-0038: amended and passed.
– Increase license fees for banking institutions to $75,000 from the current $50,000, to $150,000 from the current $100,000, and to $2,500 from the current $1,500.
– Impose a 2 percent surcharge on hotel room charges in addition to the current 8 percent hotel room tax, with revenues to go into the General Fund.
– Increase the gross receipts tax to 4.75 percent from the current 4 percent.
– Impose a 2 percent excise tax on food items; however, candy, chewing gum, sodas and other items "not consumed primarily for nutritive purposes" would be exempted.
– Impose a 4 percent tax on merchandise and commodities valued at more than $500 that are brought into the territory for personal use.
– Impose a sliding scale stamp tax on the sale of real property to replace the current 2 percent tax; rates would be: 2 percent for property valued up to $100,000, 2.5 percent for property valued $100,001 to $500,000, 3 percent for property valued $500,001 to $1 million and 3.5 percent for property valued over $1 million.
– Change the payroll schedule to twice a month instead of every other week, thus eliminating two pay periods per year. (This would not affect the annual salaries of employees.)
Amendments:
– Eliminate the gross receipts tax increase; the excise tax on food items; and the 2 percent surcharge on hotel rooms.
– Reduce executive branch FY2003 appropriations by $55 million. (Turnbull had already implemented a $46 million reduction.)
– Require The West Indian Co. to pay $1 million annually to the General Fund, in lieu of taxes.
– Appropriate $2.5 million for the University of the Virgin Islands Technology Park on St. Croix from the Insurance Guaranty Fund.
– Make the threshold $1,000 for imposing the 4 percent personal use tax on merchandise and commodities brought into the territory for personal use.
– Add $25 to unemployment benefits for each beneficiary's dependent child.
– Impose a moratorium on fees for new business licenses on St. Croix, and reduce by 50 percent the fees for renewing existing business licenses on the island.
– Authorize inter-fund borrowing for the executive branch.
– Allow the government to increase fees by as much as $100 per year, instead of the 10 percent limit.
– Change the commencement date for reduction in overtime to the effective date of this act.
Vote: 10-4-1. For: Sens. Berry, Canton, David, Donastorg, Hansen, Hill, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sen. Richards.
Bill No. 25-0039: amended and passed.
– Provide for property owners who pay their 1999 through 2004 commercial and personal property tax bills prior to the enactment of a District Court-ordered revised property assessment system to be entitled to a credit applied to their subsequent year's tax bill for any overpayment; and for any such taxpayers who underpay said taxes to be billed retroactively for prior-year tax obligations.
– Make the above provision null and void if a higher court reverses the District Court order and upholds the territory's present assessment system.
– Give the Board of Tax Review power to designate a hearing officer to conduct hearings to compile evidence and establish findings of fact in appeals or complaints, providing, however, that the final decision shall rest with the board itself.
– Establish a Tax Assessor's Revolving Fund which shall consist of 1 percent of real property taxes collected annually by the Finance Department, or an amount not to exceed $500,000, plus any legislative appropriations.
– Provide for the Tax Assessor's Revolving Fund money to go for equipment, staffing, training and professional services to maintain and improve the Office of the Tax Assessor.
Amendments:
– Change the basis of assessing real property for tax purposes to market value, not replacement value.
– Base property taxes on 1998 assessments until a new assessment method is in place.
– Allow for persons who may have underpaid to have up to 120 days, as opposed to 30 days, to pay the balance of their property taxes without interest and penalties.
– Credit taxpayers subsequently found to have overpaid their taxes with that amount for subsequent tax years after 60 days of that redetermination.
Vote: 9-4-2. For: Sens. Baptiste, Berry, Canton, David, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Donastorg, Dowe, Liburd and White. Absent: Sens. Hill and Richards
Bill No. 25-0040: to be considered on Thursday by the Finance Committee.
– Authorize the Public Finance Authority to issue up to $235 million in bonds, with up to $100 million to finance the government's working capital obligations, up to $20 million to finance private economic development initiatives on St. Croix, up to $10 million for a Guaranty Reserve Fund to provide credit enhancement for financing of the Carifest theme park, and up to $80 million to finance the construction of a 250-room hotel on St. Croix.
– Authorize the government to pledge gross receipts taxes as security for repayment of the loan note.
– Provide for gross receipts taxes to be deposited in a Gross Receipts Taxes Special Escrow Account, other than the first $250,000 per annum, which by law is to be remitted to the Moderate Income Housing Fund.
– Provide for the government to continue granting gross receipts tax exemptions as an economic development incentive, so long as such exemptions do not cause any given year's estimated gross receipts taxes to be less than 150 percent of the maximum scheduled payments of principal and interest on all outstanding bonds, notes or other evidences of indebtedness secured by a pledge of the gross receipts taxes. (The governor's proposed gross receipts tax increase, as previously noted, was killed, in the Senate Finance Committee.)
Bill No. 25-0051: a resolution amended and passed.
This resolution, sent to Turnbull last week along with the five amended bills, petitions the governor to consider a number of fiscal recovery measures. A resolution doesn't carry the weight of a bill; it is not something to be enacted as law.
The resolution was proposed by Sens. Berry, Canton, David, Hansen, Hill, Jones, Malone, Renee and Russell.
Among other things, the resolution asks the governor to:
– Negotiate with Hovensa for the refinery to pay up to $14 million of its property taxes in advance of the date due.
– Request that the Finance commissioner within 45 days of passage of the resolution issue a request for proposals to a third party for collection of $80 million in delinquent property taxes.
– Submit the FY2004 budget as soon as practicable, the May 30 deadline by law for doing so having passed.
Amendment:
– To tap the Insurance Guaranty Fund for up to $30 million.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Turnbull said on Friday he would "not jeopardize the solvency of the Insurance Guaranty Fund" on the brink of hurricane season. His remark was in response to the Legislature's authorization for him to tap the fund for up to $30 million. (See "Senate allows tapping Insurance Guaranty Fund".)
The amendment allowing the action would help ward off a payless payday next week, senators said last week. It urges the governor to substitute up to the $30 million with a standby letter of credit, and to come to the Legislature should he decide to act on it.
As of Tuesday, the bills passed in last week's full Senate session were still in the legislative legal counsel's office for review before being sent up to Government House for Turnbull to sign, veto in whole or in part, or allow to become law without his signature.
Short of an unheralded miracle, the territory's immediate fiscal future is no closer to resolution than it was on April 24 – the day the governor announced that the territory was facing not just a shortfall but a crisis.
Publisher's note : Like the St. John Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here..
The 15 senators acting in unison wrote Turnbull last month telling him they would not consider the borrowing bill until he rescinded the hefty raises he granted exempt employees last year.
Since then, the brief marriage between the majority and minority blocs has gone asunder and other rifts have appeared. Two of the majority's veteran senators have chosen opposite sides of the fence: Sen. Lorraine Berry once again asserted on her Monday radio program that she will not approve any borrowing. Sen. Roosevelt David has said repeatedly he will support the bond measure, that it's the only way out.
Other senators have not been so forthcoming in their views, but observers say the Senate will probably capitulate and approve some borrowing. A big question is how the bonds will be repaid. Turnbull proposed using an 18.75 percent increase in the gross receipts tax, but the Senate shot that down.
The governor's comeback to the ultimatum on pay raises was an offer to trim salaries exceeding $40,000 by 2 percent to 10 percent on a sliding scale, for six months. Last year's proposed pay hikes averaged 24 percent for upper-level personnel and 20 percent for mid-level personnel. The Senate has not formally responded to the offer.
As background for the Finance Committee's hearing on Thursday, here is a summary of the governor's six fiscal crisis-related bills and the amendments thereto that have come down the pike in the last month.
Bill No. 25-0035: amended and passed.
– Add hazardous duty Water and Power Authority workers to those allowed by law to take early retirement at full benefits.
– Appropriate $600,000 from the Land Bank Fund to the Public Works Department for a new public cemetery on St. Thomas.
– Appropriate $2.3 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. – Appropriate $50,000 from the General Fund to the Legal Judgments Special Fund.
Amendment:
– Eliminate the $50,000 appropriation for the Legal Judgments Special Fund.
Vote: 13-1-1. For: Sens. Norman Jn Baptiste, Lorraine Berry, Douglas Canton, Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Emmett Hansen II, Louis Hill, David Jones, Almando "Rocky" Liburd, Shawn-Michael Malone, Luther Renee and Ronald Russell. Against: Sen. Celestino A. White. Absent: Sen. Raymond "Usie" Richards.
Bill No. 25-0036: amended and passed.
– Appropriate $9.4 million ($5.4 million by July 31 and another $4 million by Sept. 30) from the General Fund to the Public Works Department for wastewater collection and treatment system repair and maintenance territorywide as mandated by District Court orders, consent orders and the government's memorandum of understanding with the U.S. Environmental Protection Agency.
– Appropriate $750,000 from the General Fund to Public Works for emergency repairs to the wastewater collection system territorywide.
– Appropriate $7 million from the General Fund to cover the government's share of increased health insurance premium costs.
– Appropriate $750,000 from the General Fund to the Property and Procurement Department for "plans and other related costs" of a Workforce Development Center.
– Change date provisions of the V.I. Tax Study Commission (citations of Sept. 30, 2001 become Nov. 30, 2003; citations of Sept. 30, 2002 become June 20, 2005).
– Increase allocations to the Finance Department to cover the cost of audits (replacing the figure $1,348,198 with $2,544,800, and replacing the figure $2,686,451 with $3,883,053).
– Increase an appropriation from the Transportation Trust Fund "as a contribution" to the General Fund from $10 million to $11.5 million. – Set the contributions to the cost of health insurance premiums at 60 percent by the government and 40 percent by employees.
Amendments:
– Funding for the Workforce Development Center deleted. In its place, the funding will go for wastewater treatment.
– Health insurance premium changed to 65 percent by the government and 40 percent by the employees.
Vote: 12-2-1. For: Sens. Berry, Canton, David, Donastorg, Dowe, Hansen, Hill, Jones, Liburd, Malone, Renee and Russell. Again: Sens. Baptiste and White. Absent: Sen. Richards.
Bill No. 25-0037: amended and passed.
– Create an "environmental excise tax" of 2 cents per pound on commodities imported into or produced in the territory for business purposes, to be collected until such time as the administration's proposed Waste Management Authority is enacted, to fund "immediate environmental changes." Leases and rentals of imported commodities would be included, unless obtained for use for 180 days or less. For crude oil refined in the territory and refined petroleum products imported into the territory there would instead be an environmental excise tax of 20 cents per barrel. Exemptions: molasses for rum production and agricultural purposes; animal feed and commercial fertilizers; cement, steel, lumber and sheetrock for construction; merchandise disposed of in the course of export trade by V.I. importers and manufacturers to buyers taking delivery outside the territory; and other goods declared exempt by the Public Services Commission.
– Impose a $5-a-day surcharge on vehicles rented from car rental agencies.
– Increase taxes on gasoline and diesel fuel to 17 cents per gallon from 14 cents.
– Increase the highway user tax, commonly call the "road tax," to 16 cents per pound from 11 cents and making the tax applicable to taxis, which currently are exempt.
– Designate road tax revenues from taxis for a new Road Fund to be used for road maintenance and repair.
– Impose fees on containers shipped into the territory at the rate of $30 per trip of containers 20 feet in length and of $50 per trip on containers 40 feet or more in length.
Amendments:
– Change the terminology "environmental excise tax" to "environmental user fee."
– When the Waste Management Authority is established, transfer collection and administration of the tax to the authority.
– Eliminate the fee of 20 cents a barrel on crude oil and petroleum products.
– Eliminate the $5-a-day surcharge on rental cars; the gas tax increase to 17 cents a gallon; and the highway user tax for taxis.
– Eliminate the V.I. Lottery executive director's authority, enacted earlier, to assume powers of the Lottery Commission when there are insufficient members to attain a quorum.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Bill No. 25-0038: amended and passed.
– Increase license fees for banking institutions to $75,000 from the current $50,000, to $150,000 from the current $100,000, and to $2,500 from the current $1,500.
– Impose a 2 percent surcharge on hotel room charges in addition to the current 8 percent hotel room tax, with revenues to go into the General Fund.
– Increase the gross receipts tax to 4.75 percent from the current 4 percent.
– Impose a 2 percent excise tax on food items; however, candy, chewing gum, sodas and other items "not consumed primarily for nutritive purposes" would be exempted.
– Impose a 4 percent tax on merchandise and commodities valued at more than $500 that are brought into the territory for personal use.
– Impose a sliding scale stamp tax on the sale of real property to replace the current 2 percent tax; rates would be: 2 percent for property valued up to $100,000, 2.5 percent for property valued $100,001 to $500,000, 3 percent for property valued $500,001 to $1 million and 3.5 percent for property valued over $1 million.
– Change the payroll schedule to twice a month instead of every other week, thus eliminating two pay periods per year. (This would not affect the annual salaries of employees.)
Amendments:
– Eliminate the gross receipts tax increase; the excise tax on food items; and the 2 percent surcharge on hotel rooms.
– Reduce executive branch FY2003 appropriations by $55 million. (Turnbull had already implemented a $46 million reduction.)
– Require The West Indian Co. to pay $1 million annually to the General Fund, in lieu of taxes.
– Appropriate $2.5 million for the University of the Virgin Islands Technology Park on St. Croix from the Insurance Guaranty Fund.
– Make the threshold $1,000 for imposing the 4 percent personal use tax on merchandise and commodities brought into the territory for personal use.
– Add $25 to unemployment benefits for each beneficiary's dependent child.
– Impose a moratorium on fees for new business licenses on St. Croix, and reduce by 50 percent the fees for renewing existing business licenses on the island.
– Authorize inter-fund borrowing for the executive branch.
– Allow the government to increase fees by as much as $100 per year, instead of the 10 percent limit.
– Change the commencement date for reduction in overtime to the effective date of this act.
Vote: 10-4-1. For: Sens. Berry, Canton, David, Donastorg, Hansen, Hill, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sen. Richards.
Bill No. 25-0039: amended and passed.
– Provide for property owners who pay their 1999 through 2004 commercial and personal property tax bills prior to the enactment of a District Court-ordered revised property assessment system to be entitled to a credit applied to their subsequent year's tax bill for any overpayment; and for any such taxpayers who underpay said taxes to be billed retroactively for prior-year tax obligations.
– Make the above provision null and void if a higher court reverses the District Court order and upholds the territory's present assessment system.
– Give the Board of Tax Review power to designate a hearing officer to conduct hearings to compile evidence and establish findings of fact in appeals or complaints, providing, however, that the final decision shall rest with the board itself.
– Establish a Tax Assessor's Revolving Fund which shall consist of 1 percent of real property taxes collected annually by the Finance Department, or an amount not to exceed $500,000, plus any legislative appropriations.
– Provide for the Tax Assessor's Revolving Fund money to go for equipment, staffing, training and professional services to maintain and improve the Office of the Tax Assessor.
Amendments:
– Change the basis of assessing real property for tax purposes to market value, not replacement value.
– Base property taxes on 1998 assessments until a new assessment method is in place.
– Allow for persons who may have underpaid to have up to 120 days, as opposed to 30 days, to pay the balance of their property taxes without interest and penalties.
– Credit taxpayers subsequently found to have overpaid their taxes with that amount for subsequent tax years after 60 days of that redetermination.
Vote: 9-4-2. For: Sens. Baptiste, Berry, Canton, David, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Donastorg, Dowe, Liburd and White. Absent: Sens. Hill and Richards
Bill No. 25-0040: to be considered on Thursday by the Finance Committee.
– Authorize the Public Finance Authority to issue up to $235 million in bonds, with up to $100 million to finance the government's working capital obligations, up to $20 million to finance private economic development initiatives on St. Croix, up to $10 million for a Guaranty Reserve Fund to provide credit enhancement for financing of the Carifest theme park, and up to $80 million to finance the construction of a 250-room hotel on St. Croix.
– Authorize the government to pledge gross receipts taxes as security for repayment of the loan note.
– Provide for gross receipts taxes to be deposited in a Gross Receipts Taxes Special Escrow Account, other than the first $250,000 per annum, which by law is to be remitted to the Moderate Income Housing Fund.
– Provide for the government to continue granting gross receipts tax exemptions as an economic development incentive, so long as such exemptions do not cause any given year's estimated gross receipts taxes to be less than 150 percent of the maximum scheduled payments of principal and interest on all outstanding bonds, notes or other evidences of indebtedness secured by a pledge of the gross receipts taxes. (The governor's proposed gross receipts tax increase, as previously noted, was killed, in the Senate Finance Committee.)
Bill No. 25-0051: a resolution amended and passed.
This resolution, sent to Turnbull last week along with the five amended bills, petitions the governor to consider a number of fiscal recovery measures. A resolution doesn't carry the weight of a bill; it is not something to be enacted as law.
The resolution was proposed by Sens. Berry, Canton, David, Hansen, Hill, Jones, Malone, Renee and Russell.
Among other things, the resolution asks the governor to:
– Negotiate with Hovensa for the refinery to pay up to $14 million of its property taxes in advance of the date due.
– Request that the Finance commissioner within 45 days of passage of the resolution issue a request for proposals to a third party for collection of $80 million in delinquent property taxes.
– Submit the FY2004 budget as soon as practicable, the May 30 deadline by law for doing so having passed.
Amendment:
– To tap the Insurance Guaranty Fund for up to $30 million.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Turnbull said on Friday he would "not jeopardize the solvency of the Insurance Guaranty Fund" on the brink of hurricane season. His remark was in response to the Legislature's authorization for him to tap the fund for up to $30 million. (See "Senate allows tapping Insurance Guaranty Fund".)
The amendment allowing the action would help ward off a payless payday next week, senators said last week. It urges the governor to substitute up to the $30 million with a standby letter of credit, and to come to the Legislature should he decide to act on it.
As of Tuesday, the bills passed in last week's full Senate session were still in the legislative legal counsel's office for review before being sent up to Government House for Turnbull to sign, veto in whole or in part, or allow to become law without his signature.
Short of an unheralded miracle, the territory's immediate fiscal future is no closer to resolution than it was on April 24 – the day the governor announced that the territory was facing not just a shortfall but a crisis.
Publisher's note : Like the St. John Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here..
WHAT'S BEEN PROPOSED, AMENDED AND APPROVED
June 23, 2003 – The Senate Finance Committee is meeting Thursday on St. Thomas to consider the $235 million bond issue Gov. Charles W. Turnbull is seeking to bridge the territory's Fiscal Year 2003 budget deficit, currently projected at $152 million, and have some spending money left over.
The 15 senators acting in unison wrote Turnbull last month telling him they would not consider the borrowing bill until he rescinded the hefty raises he granted exempt employees last year.
Since then, the brief marriage between the majority and minority blocs has gone asunder and other rifts have appeared. Two of the majority's veteran senators have chosen opposite sides of the fence: Sen. Lorraine Berry once again asserted on her Monday radio program that she will not approve any borrowing. Sen. Roosevelt David has said repeatedly he will support the bond measure, that it's the only way out.
Other senators have not been so forthcoming in their views, but observers say the Senate will probably capitulate and approve some borrowing. A big question is how the bonds will be repaid. Turnbull proposed using an 18.75 percent increase in the gross receipts tax, but the Senate shot that down.
The governor's comeback to the ultimatum on pay raises was an offer to trim salaries exceeding $40,000 by 2 percent to 10 percent on a sliding scale, for six months. Last year's proposed pay hikes averaged 24 percent for upper-level personnel and 20 percent for mid-level personnel. The Senate has not formally responded to the offer.
As background for the Finance Committee's hearing on Thursday, here is a summary of the governor's six fiscal crisis-related bills and the amendments thereto that have come down the pike in the last month.
Bill No. 25-0035: amended and passed.
– Add hazardous duty Water and Power Authority workers to those allowed by law to take early retirement at full benefits.
– Appropriate $600,000 from the Land Bank Fund to the Public Works Department for a new public cemetery on St. Thomas.
– Appropriate $2.3 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. – Appropriate $50,000 from the General Fund to the Legal Judgments Special Fund.
Amendment:
– Eliminate the $50,000 appropriation for the Legal Judgments Special Fund.
Vote: 13-1-1. For: Sens. Norman Jn Baptiste, Lorraine Berry, Douglas Canton, Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Emmett Hansen II, Louis Hill, David Jones, Almando "Rocky" Liburd, Shawn-Michael Malone, Luther Renee and Ronald Russell. Against: Sen. Celestino A. White. Absent: Sen. Raymond "Usie" Richards.
Bill No. 25-0036: amended and passed.
– Appropriate $9.4 million ($5.4 million by July 31 and another $4 million by Sept. 30) from the General Fund to the Public Works Department for wastewater collection and treatment system repair and maintenance territorywide as mandated by District Court orders, consent orders and the government's memorandum of understanding with the U.S. Environmental Protection Agency.
– Appropriate $750,000 from the General Fund to Public Works for emergency repairs to the wastewater collection system territorywide.
– Appropriate $7 million from the General Fund to cover the government's share of increased health insurance premium costs.
– Appropriate $750,000 from the General Fund to the Property and Procurement Department for "plans and other related costs" of a Workforce Development Center.
– Change date provisions of the V.I. Tax Study Commission (citations of Sept. 30, 2001 become Nov. 30, 2003; citations of Sept. 30, 2002 become June 20, 2005).
– Increase allocations to the Finance Department to cover the cost of audits (replacing the figure $1,348,198 with $2,544,800, and replacing the figure $2,686,451 with $3,883,053).
– Increase an appropriation from the Transportation Trust Fund "as a contribution" to the General Fund from $10 million to $11.5 million. – Set the contributions to the cost of health insurance premiums at 60 percent by the government and 40 percent by employees.
Amendments:
– Funding for the Workforce Development Center deleted. In its place, the funding will go for wastewater treatment.
– Health insurance premium changed to 65 percent by the government and 40 percent by the employees.
Vote: 12-2-1. For: Sens. Berry, Canton, David, Donastorg, Dowe, Hansen, Hill, Jones, Liburd, Malone, Renee and Russell. Again: Sens. Baptiste and White. Absent: Sen. Richards.
Bill No. 25-0037: amended and passed.
– Create an "environmental excise tax" of 2 cents per pound on commodities imported into or produced in the territory for business purposes, to be collected until such time as the administration's proposed Waste Management Authority is enacted, to fund "immediate environmental changes." Leases and rentals of imported commodities would be included, unless obtained for use for 180 days or less. For crude oil refined in the territory and refined petroleum products imported into the territory there would instead be an environmental excise tax of 20 cents per barrel. Exemptions: molasses for rum production and agricultural purposes; animal feed and commercial fertilizers; cement, steel, lumber and sheetrock for construction; merchandise disposed of in the course of export trade by V.I. importers and manufacturers to buyers taking delivery outside the territory; and other goods declared exempt by the Public Services Commission.
– Impose a $5-a-day surcharge on vehicles rented from car rental agencies.
– Increase taxes on gasoline and diesel fuel to 17 cents per gallon from 14 cents.
– Increase the highway user tax, commonly call the "road tax," to 16 cents per pound from 11 cents and making the tax applicable to taxis, which currently are exempt.
– Designate road tax revenues from taxis for a new Road Fund to be used for road maintenance and repair.
– Impose fees on containers shipped into the territory at the rate of $30 per trip of containers 20 feet in length and of $50 per trip on containers 40 feet or more in length.
Amendments:
– Change the terminology "environmental excise tax" to "environmental user fee."
– When the Waste Management Authority is established, transfer collection and administration of the tax to the authority.
– Eliminate the fee of 20 cents a barrel on crude oil and petroleum products.
– Eliminate the $5-a-day surcharge on rental cars; the gas tax increase to 17 cents a gallon; and the highway user tax for taxis.
– Eliminate the V.I. Lottery executive director's authority, enacted earlier, to assume powers of the Lottery Commission when there are insufficient members to attain a quorum.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Bill No. 25-0038: amended and passed.
– Increase license fees for banking institutions to $75,000 from the current $50,000, to $150,000 from the current $100,000, and to $2,500 from the current $1,500.
– Impose a 2 percent surcharge on hotel room charges in addition to the current 8 percent hotel room tax, with revenues to go into the General Fund.
– Increase the gross receipts tax to 4.75 percent from the current 4 percent.
– Impose a 2 percent excise tax on food items; however, candy, chewing gum, sodas and other items "not consumed primarily for nutritive purposes" would be exempted.
– Impose a 4 percent tax on merchandise and commodities valued at more than $500 that are brought into the territory for personal use.
– Impose a sliding scale stamp tax on the sale of real property to replace the current 2 percent tax; rates would be: 2 percent for property valued up to $100,000, 2.5 percent for property valued $100,001 to $500,000, 3 percent for property valued $500,001 to $1 million and 3.5 percent for property valued over $1 million.
– Change the payroll schedule to twice a month instead of every other week, thus eliminating two pay periods per year. (This would not affect the annual salaries of employees.)
Amendments:
– Eliminate the gross receipts tax increase; the excise tax on food items; and the 2 percent surcharge on hotel rooms.
– Reduce executive branch FY2003 appropriations by $55 million. (Turnbull had already implemented a $46 million reduction.)
– Require The West Indian Co. to pay $1 million annually to the General Fund, in lieu of taxes.
– Appropriate $2.5 million for the University of the Virgin Islands Technology Park on St. Croix from the Insurance Guaranty Fund.
– Make the threshold $1,000 for imposing the 4 percent personal use tax on merchandise and commodities brought into the territory for personal use.
– Add $25 to unemployment benefits for each beneficiary's dependent child.
– Impose a moratorium on fees for new business licenses on St. Croix, and reduce by 50 percent the fees for renewing existing business licenses on the island.
– Authorize inter-fund borrowing for the executive branch.
– Allow the government to increase fees by as much as $100 per year, instead of the 10 percent limit.
– Change the commencement date for reduction in overtime to the effective date of this act.
Vote: 10-4-1. For: Sens. Berry, Canton, David, Donastorg, Hansen, Hill, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sen. Richards.
Bill No. 25-0039: amended and passed.
– Provide for property owners who pay their 1999 through 2004 commercial and personal property tax bills prior to the enactment of a District Court-ordered revised property assessment system to be entitled to a credit applied to their subsequent year's tax bill for any overpayment; and for any such taxpayers who underpay said taxes to be billed retroactively for prior-year tax obligations.
– Make the above provision null and void if a higher court reverses the District Court order and upholds the territory's present assessment system.
– Give the Board of Tax Review power to designate a hearing officer to conduct hearings to compile evidence and establish findings of fact in appeals or complaints, providing, however, that the final decision shall rest with the board itself.
– Establish a Tax Assessor's Revolving Fund which shall consist of 1 percent of real property taxes collected annually by the Finance Department, or an amount not to exceed $500,000, plus any legislative appropriations.
– Provide for the Tax Assessor's Revolving Fund money to go for equipment, staffing, training and professional services to maintain and improve the Office of the Tax Assessor.
Amendments:
– Change the basis of assessing real property for tax purposes to market value, not replacement value.
– Base property taxes on 1998 assessments until a new assessment method is in place.
– Allow for persons who may have underpaid to have up to 120 days, as opposed to 30 days, to pay the balance of their property taxes without interest and penalties.
– Credit taxpayers subsequently found to have overpaid their taxes with that amount for subsequent tax years after 60 days of that redetermination.
Vote: 9-4-2. For: Sens. Baptiste, Berry, Canton, David, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Donastorg, Dowe, Liburd and White. Absent: Sens. Hill and Richards
Bill No. 25-0040: to be considered on Thursday by the Finance Committee.
– Authorize the Public Finance Authority to issue up to $235 million in bonds, with up to $100 million to finance the government's working capital obligations, up to $20 million to finance private economic development initiatives on St. Croix, up to $10 million for a Guaranty Reserve Fund to provide credit enhancement for financing of the Carifest theme park, and up to $80 million to finance the construction of a 250-room hotel on St. Croix.
– Authorize the government to pledge gross receipts taxes as security for repayment of the loan note.
– Provide for gross receipts taxes to be deposited in a Gross Receipts Taxes Special Escrow Account, other than the first $250,000 per annum, which by law is to be remitted to the Moderate Income Housing Fund.
– Provide for the government to continue granting gross receipts tax exemptions as an economic development incentive, so long as such exemptions do not cause any given year's estimated gross receipts taxes to be less than 150 percent of the maximum scheduled payments of principal and interest on all outstanding bonds, notes or other evidences of indebtedness secured by a pledge of the gross receipts taxes. (The governor's proposed gross receipts tax increase, as previously noted, was killed, in the Senate Finance Committee.)
Bill No. 25-0051: a resolution amended and passed.
This resolution, sent to Turnbull last week along with the five amended bills, petitions the governor to consider a number of fiscal recovery measures. A resolution doesn't carry the weight of a bill; it is not something to be enacted as law.
The resolution was proposed by Sens. Berry, Canton, David, Hansen, Hill, Jones, Malone, Renee and Russell.
Among other things, the resolution asks the governor to:
– Negotiate with Hovensa for the refinery to pay up to $14 million of its property taxes in advance of the date due.
– Request that the Finance commissioner within 45 days of passage of the resolution issue a request for proposals to a third party for collection of $80 million in delinquent property taxes.
– Submit the FY2004 budget as soon as practicable, the May 30 deadline by law for doing so having passed.
Amendment:
– To tap the Insurance Guaranty Fund for up to $30 million.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Turnbull said on Friday he would "not jeopardize the solvency of the Insurance Guaranty Fund" on the brink of hurricane season. His remark was in response to the Legislature's authorization for him to tap the fund for up to $30 million. (See "Senate allows tapping Insurance Guaranty Fund".)
The amendment allowing the action would help ward off a payless payday next week, senators said last week. It urges the governor to substitute up to the $30 million with a standby letter of credit, and to come to the Legislature should he decide to act on it.
As of Tuesday, the bills passed in last week's full Senate session were still in the legislative legal counsel's office for review before being sent up to Government House for Turnbull to sign, veto in whole or in part, or allow to become law without his signature.
Short of an unheralded miracle, the territory's immediate fiscal future is no closer to resolution than it was on April 24 – the day the governor announced that the territory was facing not just a shortfall but a crisis.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
The 15 senators acting in unison wrote Turnbull last month telling him they would not consider the borrowing bill until he rescinded the hefty raises he granted exempt employees last year.
Since then, the brief marriage between the majority and minority blocs has gone asunder and other rifts have appeared. Two of the majority's veteran senators have chosen opposite sides of the fence: Sen. Lorraine Berry once again asserted on her Monday radio program that she will not approve any borrowing. Sen. Roosevelt David has said repeatedly he will support the bond measure, that it's the only way out.
Other senators have not been so forthcoming in their views, but observers say the Senate will probably capitulate and approve some borrowing. A big question is how the bonds will be repaid. Turnbull proposed using an 18.75 percent increase in the gross receipts tax, but the Senate shot that down.
The governor's comeback to the ultimatum on pay raises was an offer to trim salaries exceeding $40,000 by 2 percent to 10 percent on a sliding scale, for six months. Last year's proposed pay hikes averaged 24 percent for upper-level personnel and 20 percent for mid-level personnel. The Senate has not formally responded to the offer.
As background for the Finance Committee's hearing on Thursday, here is a summary of the governor's six fiscal crisis-related bills and the amendments thereto that have come down the pike in the last month.
Bill No. 25-0035: amended and passed.
– Add hazardous duty Water and Power Authority workers to those allowed by law to take early retirement at full benefits.
– Appropriate $600,000 from the Land Bank Fund to the Public Works Department for a new public cemetery on St. Thomas.
– Appropriate $2.3 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. – Appropriate $50,000 from the General Fund to the Legal Judgments Special Fund.
Amendment:
– Eliminate the $50,000 appropriation for the Legal Judgments Special Fund.
Vote: 13-1-1. For: Sens. Norman Jn Baptiste, Lorraine Berry, Douglas Canton, Roosevelt David, Adlah "Foncie" Donastorg, Carlton Dowe, Emmett Hansen II, Louis Hill, David Jones, Almando "Rocky" Liburd, Shawn-Michael Malone, Luther Renee and Ronald Russell. Against: Sen. Celestino A. White. Absent: Sen. Raymond "Usie" Richards.
Bill No. 25-0036: amended and passed.
– Appropriate $9.4 million ($5.4 million by July 31 and another $4 million by Sept. 30) from the General Fund to the Public Works Department for wastewater collection and treatment system repair and maintenance territorywide as mandated by District Court orders, consent orders and the government's memorandum of understanding with the U.S. Environmental Protection Agency.
– Appropriate $750,000 from the General Fund to Public Works for emergency repairs to the wastewater collection system territorywide.
– Appropriate $7 million from the General Fund to cover the government's share of increased health insurance premium costs.
– Appropriate $750,000 from the General Fund to the Property and Procurement Department for "plans and other related costs" of a Workforce Development Center.
– Change date provisions of the V.I. Tax Study Commission (citations of Sept. 30, 2001 become Nov. 30, 2003; citations of Sept. 30, 2002 become June 20, 2005).
– Increase allocations to the Finance Department to cover the cost of audits (replacing the figure $1,348,198 with $2,544,800, and replacing the figure $2,686,451 with $3,883,053).
– Increase an appropriation from the Transportation Trust Fund "as a contribution" to the General Fund from $10 million to $11.5 million. – Set the contributions to the cost of health insurance premiums at 60 percent by the government and 40 percent by employees.
Amendments:
– Funding for the Workforce Development Center deleted. In its place, the funding will go for wastewater treatment.
– Health insurance premium changed to 65 percent by the government and 40 percent by the employees.
Vote: 12-2-1. For: Sens. Berry, Canton, David, Donastorg, Dowe, Hansen, Hill, Jones, Liburd, Malone, Renee and Russell. Again: Sens. Baptiste and White. Absent: Sen. Richards.
Bill No. 25-0037: amended and passed.
– Create an "environmental excise tax" of 2 cents per pound on commodities imported into or produced in the territory for business purposes, to be collected until such time as the administration's proposed Waste Management Authority is enacted, to fund "immediate environmental changes." Leases and rentals of imported commodities would be included, unless obtained for use for 180 days or less. For crude oil refined in the territory and refined petroleum products imported into the territory there would instead be an environmental excise tax of 20 cents per barrel. Exemptions: molasses for rum production and agricultural purposes; animal feed and commercial fertilizers; cement, steel, lumber and sheetrock for construction; merchandise disposed of in the course of export trade by V.I. importers and manufacturers to buyers taking delivery outside the territory; and other goods declared exempt by the Public Services Commission.
– Impose a $5-a-day surcharge on vehicles rented from car rental agencies.
– Increase taxes on gasoline and diesel fuel to 17 cents per gallon from 14 cents.
– Increase the highway user tax, commonly call the "road tax," to 16 cents per pound from 11 cents and making the tax applicable to taxis, which currently are exempt.
– Designate road tax revenues from taxis for a new Road Fund to be used for road maintenance and repair.
– Impose fees on containers shipped into the territory at the rate of $30 per trip of containers 20 feet in length and of $50 per trip on containers 40 feet or more in length.
Amendments:
– Change the terminology "environmental excise tax" to "environmental user fee."
– When the Waste Management Authority is established, transfer collection and administration of the tax to the authority.
– Eliminate the fee of 20 cents a barrel on crude oil and petroleum products.
– Eliminate the $5-a-day surcharge on rental cars; the gas tax increase to 17 cents a gallon; and the highway user tax for taxis.
– Eliminate the V.I. Lottery executive director's authority, enacted earlier, to assume powers of the Lottery Commission when there are insufficient members to attain a quorum.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Bill No. 25-0038: amended and passed.
– Increase license fees for banking institutions to $75,000 from the current $50,000, to $150,000 from the current $100,000, and to $2,500 from the current $1,500.
– Impose a 2 percent surcharge on hotel room charges in addition to the current 8 percent hotel room tax, with revenues to go into the General Fund.
– Increase the gross receipts tax to 4.75 percent from the current 4 percent.
– Impose a 2 percent excise tax on food items; however, candy, chewing gum, sodas and other items "not consumed primarily for nutritive purposes" would be exempted.
– Impose a 4 percent tax on merchandise and commodities valued at more than $500 that are brought into the territory for personal use.
– Impose a sliding scale stamp tax on the sale of real property to replace the current 2 percent tax; rates would be: 2 percent for property valued up to $100,000, 2.5 percent for property valued $100,001 to $500,000, 3 percent for property valued $500,001 to $1 million and 3.5 percent for property valued over $1 million.
– Change the payroll schedule to twice a month instead of every other week, thus eliminating two pay periods per year. (This would not affect the annual salaries of employees.)
Amendments:
– Eliminate the gross receipts tax increase; the excise tax on food items; and the 2 percent surcharge on hotel rooms.
– Reduce executive branch FY2003 appropriations by $55 million. (Turnbull had already implemented a $46 million reduction.)
– Require The West Indian Co. to pay $1 million annually to the General Fund, in lieu of taxes.
– Appropriate $2.5 million for the University of the Virgin Islands Technology Park on St. Croix from the Insurance Guaranty Fund.
– Make the threshold $1,000 for imposing the 4 percent personal use tax on merchandise and commodities brought into the territory for personal use.
– Add $25 to unemployment benefits for each beneficiary's dependent child.
– Impose a moratorium on fees for new business licenses on St. Croix, and reduce by 50 percent the fees for renewing existing business licenses on the island.
– Authorize inter-fund borrowing for the executive branch.
– Allow the government to increase fees by as much as $100 per year, instead of the 10 percent limit.
– Change the commencement date for reduction in overtime to the effective date of this act.
Vote: 10-4-1. For: Sens. Berry, Canton, David, Donastorg, Hansen, Hill, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sen. Richards.
Bill No. 25-0039: amended and passed.
– Provide for property owners who pay their 1999 through 2004 commercial and personal property tax bills prior to the enactment of a District Court-ordered revised property assessment system to be entitled to a credit applied to their subsequent year's tax bill for any overpayment; and for any such taxpayers who underpay said taxes to be billed retroactively for prior-year tax obligations.
– Make the above provision null and void if a higher court reverses the District Court order and upholds the territory's present assessment system.
– Give the Board of Tax Review power to designate a hearing officer to conduct hearings to compile evidence and establish findings of fact in appeals or complaints, providing, however, that the final decision shall rest with the board itself.
– Establish a Tax Assessor's Revolving Fund which shall consist of 1 percent of real property taxes collected annually by the Finance Department, or an amount not to exceed $500,000, plus any legislative appropriations.
– Provide for the Tax Assessor's Revolving Fund money to go for equipment, staffing, training and professional services to maintain and improve the Office of the Tax Assessor.
Amendments:
– Change the basis of assessing real property for tax purposes to market value, not replacement value.
– Base property taxes on 1998 assessments until a new assessment method is in place.
– Allow for persons who may have underpaid to have up to 120 days, as opposed to 30 days, to pay the balance of their property taxes without interest and penalties.
– Credit taxpayers subsequently found to have overpaid their taxes with that amount for subsequent tax years after 60 days of that redetermination.
Vote: 9-4-2. For: Sens. Baptiste, Berry, Canton, David, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Donastorg, Dowe, Liburd and White. Absent: Sens. Hill and Richards
Bill No. 25-0040: to be considered on Thursday by the Finance Committee.
– Authorize the Public Finance Authority to issue up to $235 million in bonds, with up to $100 million to finance the government's working capital obligations, up to $20 million to finance private economic development initiatives on St. Croix, up to $10 million for a Guaranty Reserve Fund to provide credit enhancement for financing of the Carifest theme park, and up to $80 million to finance the construction of a 250-room hotel on St. Croix.
– Authorize the government to pledge gross receipts taxes as security for repayment of the loan note.
– Provide for gross receipts taxes to be deposited in a Gross Receipts Taxes Special Escrow Account, other than the first $250,000 per annum, which by law is to be remitted to the Moderate Income Housing Fund.
– Provide for the government to continue granting gross receipts tax exemptions as an economic development incentive, so long as such exemptions do not cause any given year's estimated gross receipts taxes to be less than 150 percent of the maximum scheduled payments of principal and interest on all outstanding bonds, notes or other evidences of indebtedness secured by a pledge of the gross receipts taxes. (The governor's proposed gross receipts tax increase, as previously noted, was killed, in the Senate Finance Committee.)
Bill No. 25-0051: a resolution amended and passed.
This resolution, sent to Turnbull last week along with the five amended bills, petitions the governor to consider a number of fiscal recovery measures. A resolution doesn't carry the weight of a bill; it is not something to be enacted as law.
The resolution was proposed by Sens. Berry, Canton, David, Hansen, Hill, Jones, Malone, Renee and Russell.
Among other things, the resolution asks the governor to:
– Negotiate with Hovensa for the refinery to pay up to $14 million of its property taxes in advance of the date due.
– Request that the Finance commissioner within 45 days of passage of the resolution issue a request for proposals to a third party for collection of $80 million in delinquent property taxes.
– Submit the FY2004 budget as soon as practicable, the May 30 deadline by law for doing so having passed.
Amendment:
– To tap the Insurance Guaranty Fund for up to $30 million.
Vote: 9-4-2. For: Sens. Berry, Canton, David, Donastorg, Hansen, Jones, Malone, Renee and Russell. Against: Sens. Baptiste, Dowe, Liburd and White. Absent: Sens. Hill and Richards.
Turnbull said on Friday he would "not jeopardize the solvency of the Insurance Guaranty Fund" on the brink of hurricane season. His remark was in response to the Legislature's authorization for him to tap the fund for up to $30 million. (See "Senate allows tapping Insurance Guaranty Fund".)
The amendment allowing the action would help ward off a payless payday next week, senators said last week. It urges the governor to substitute up to the $30 million with a standby letter of credit, and to come to the Legislature should he decide to act on it.
As of Tuesday, the bills passed in last week's full Senate session were still in the legislative legal counsel's office for review before being sent up to Government House for Turnbull to sign, veto in whole or in part, or allow to become law without his signature.
Short of an unheralded miracle, the territory's immediate fiscal future is no closer to resolution than it was on April 24 – the day the governor announced that the territory was facing not just a shortfall but a crisis.
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JUNE 2003 BRAINSTORM
I spent three weeks in the United States recently and ran across a few "only in America" items. For instance, in the States you can now have the ashes of your loved one compressed into a diamond mounted on a ring … You can take an animal on board an airplane with you if you have a doctor certify that you need it for "emotional support." … Airlines have had to up their estimate of average passenger weight by 10 pounds because so many Americans are obese. And most fast food places now let you "supersize" your order for only a bit more money.
Anyway, I hope the following will be useful.
What would make your summer successful?
Often we define what "success" means to us in terms of our careers, but have you stopped to think about what it means in the other aspects of your life? How about what would make the next three months of your life an outstanding period?
Your turn: This is a good time to define what will make this a successful summer for you. What do you want to do? When do you plan to do it? What will give your summer a good balance of work and play? What pictures do you want to have in your photo album in the autumn?
Turning a potential weakness into a strength
Drew Hodges, creative director at Spot Design in New York, explained how he was able to turn a potential weakness into a strength in the advertising campaign for a Broadway production of "Chicago." The show was a stripped-down production, with platforms but no sets. In an interview in Creative Arts magazine, Hodges said: "We often try to support a show's weak points … We had to find a way to own the show's minimalism." They decided, he said, "let's make it look as if we always wanted it that way. Let's use black-and-white. Let's use fashion photography in which minimalism is an asset."
Your turn: What is one weakness you know you have in your work (or another part of your life)? Brainstorm some ways you could turn it into an asset. For example, let's say you're an introvert who finds it difficult to go to business events to network. You could make up a list of people you would like to make aware of what you offer, then write them a letter that starts: "I confess! I hate networking events! But I'd like you to know what I offer, and to find out whether there are ways we might benefit each other. That's why I'm sending this letter…"
I'll bet at least half the recipients will feel the same way about networking and will like the letter.
Are your eyes open?
When we travel, we tend to notice all kinds of things, maybe because we have a different mindset when we're away from our usual surroundings. Can we do the same thing at home? Artist Barbara Gordon has noted how one can tune in to the national psyche anywhere: "Start by absorbing like a sponge. Read: Read newspapers, magazines, newsletters, books. Try to read all views, liberal, conservative, radical. Make note of the popular songs, movies, TV series that are succeeding and those that are failing.
Go to seminars and meetings. Talk to friends, family, clients about their fears and aspirations. Talk to children, strangers about the same things. Listen with an open mind to all points of view, and slowly you'll see a pattern evolve. You'll have your finger on the current pulse."
Your turn: Spend a day pretending you're a tourist in your own country and city. As you travel around, read the billboards, look at the store signs, eavesdrop on the conversations. Find an excuse to talk to a few strangers and ask them their opinions about where they live. You can take a camera along and record the most interesting things you see.
What's your USP?
I've encountered the idea of a Unique Selling Proposition before. It means the aspect of a product or service (or the person providing the service) that sets it, him or her apart from the competition. However, I was a bit surprised to read in International Artist magazine that it's an important concept in the art world. Art consultant Graeme Smith wrote: "When I was running my own gallery, we tried to identify the USP for each artist we represented … The more we cemented the USP in the minds of our clients, the more easily they were able to remember each artist and their work."
Here is Smith's advice on how to identify your USP:
– Write down everything you do that is characteristic of you or your work.
– Now go through your list and cross out all those points you have in common with other artists (or others in your profession).
– What you have left is your USP. If you have crossed everything out, you need to consider what you'd like your USP to be and then work toward it. Smith advises: "Don't allow yourself to be sidetracked. You must be persistent." Without a USP, "you are lost; you won't even get noticed."
Your turn: Do you already have a USP? It can be useful to ask colleagues what they think your USP is, and find out whether you are being perceived the way you'd like to be.
Big ideas from small pieces
Related to the notion of a USP is the idea of identifying a niche market. In the book "Niche and Grow Rich" by Jennifer Basye Sander and Peter Sander, one suggestion is to look at how a big market can be broken up into smaller ones. They give the example of an entrepreneur who saw the popularity of frozen meals for adults and came up with a line of frozen meals for kids. The low-budget airlines are thriving now because they identified a sub-set of the traveling public, namely those who don't want frills if that means they can have rock-bottom fares.
Your turn: Within your field, what smaller chunks of the market might you serve? The elements you can play with include geographical location, characteristics of the target audience, speed of service (remember Domino's Pizza), quality of service, exclusivity and many more. This is a great exercise to do with friends, especially if they aren't in the same field you're in. They'll bring fresh ideas to the table.
A quote of note:
"When we plant a rose seed in the earth, we notice that it is small, but we do not criticize it as 'rootless' or 'stemless.' We treat it as a seed, giving it the water and nourishment required by a seed. When it first shoots out of the earth, we don't condemn it as 'immature' and 'underdeveloped'; nor do we criticize the buds for not being open when they appear. We stand in wonder at the process taking place and give the plant the care that it needs at each stage of its growth. The rose is a rose from the time it is a seed to the time that it dies. Within it, at all times, it contains its whole potential. It seems to be constantly in the process of change; yet at each stage, at each moment, it is perfectly all right as it is."
– Timothy Gallway, from "The Inner Game of Tennis"
Until next time, Jurgen
Visit our Brainstorm Web site to access a number of archived e-Bulletins and additional features. To give us any feedback, e-mail to Brainstorm.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
Anyway, I hope the following will be useful.
What would make your summer successful?
Often we define what "success" means to us in terms of our careers, but have you stopped to think about what it means in the other aspects of your life? How about what would make the next three months of your life an outstanding period?
Your turn: This is a good time to define what will make this a successful summer for you. What do you want to do? When do you plan to do it? What will give your summer a good balance of work and play? What pictures do you want to have in your photo album in the autumn?
Turning a potential weakness into a strength
Drew Hodges, creative director at Spot Design in New York, explained how he was able to turn a potential weakness into a strength in the advertising campaign for a Broadway production of "Chicago." The show was a stripped-down production, with platforms but no sets. In an interview in Creative Arts magazine, Hodges said: "We often try to support a show's weak points … We had to find a way to own the show's minimalism." They decided, he said, "let's make it look as if we always wanted it that way. Let's use black-and-white. Let's use fashion photography in which minimalism is an asset."
Your turn: What is one weakness you know you have in your work (or another part of your life)? Brainstorm some ways you could turn it into an asset. For example, let's say you're an introvert who finds it difficult to go to business events to network. You could make up a list of people you would like to make aware of what you offer, then write them a letter that starts: "I confess! I hate networking events! But I'd like you to know what I offer, and to find out whether there are ways we might benefit each other. That's why I'm sending this letter…"
I'll bet at least half the recipients will feel the same way about networking and will like the letter.
Are your eyes open?
When we travel, we tend to notice all kinds of things, maybe because we have a different mindset when we're away from our usual surroundings. Can we do the same thing at home? Artist Barbara Gordon has noted how one can tune in to the national psyche anywhere: "Start by absorbing like a sponge. Read: Read newspapers, magazines, newsletters, books. Try to read all views, liberal, conservative, radical. Make note of the popular songs, movies, TV series that are succeeding and those that are failing.
Go to seminars and meetings. Talk to friends, family, clients about their fears and aspirations. Talk to children, strangers about the same things. Listen with an open mind to all points of view, and slowly you'll see a pattern evolve. You'll have your finger on the current pulse."
Your turn: Spend a day pretending you're a tourist in your own country and city. As you travel around, read the billboards, look at the store signs, eavesdrop on the conversations. Find an excuse to talk to a few strangers and ask them their opinions about where they live. You can take a camera along and record the most interesting things you see.
What's your USP?
I've encountered the idea of a Unique Selling Proposition before. It means the aspect of a product or service (or the person providing the service) that sets it, him or her apart from the competition. However, I was a bit surprised to read in International Artist magazine that it's an important concept in the art world. Art consultant Graeme Smith wrote: "When I was running my own gallery, we tried to identify the USP for each artist we represented … The more we cemented the USP in the minds of our clients, the more easily they were able to remember each artist and their work."
Here is Smith's advice on how to identify your USP:
– Write down everything you do that is characteristic of you or your work.
– Now go through your list and cross out all those points you have in common with other artists (or others in your profession).
– What you have left is your USP. If you have crossed everything out, you need to consider what you'd like your USP to be and then work toward it. Smith advises: "Don't allow yourself to be sidetracked. You must be persistent." Without a USP, "you are lost; you won't even get noticed."
Your turn: Do you already have a USP? It can be useful to ask colleagues what they think your USP is, and find out whether you are being perceived the way you'd like to be.
Big ideas from small pieces
Related to the notion of a USP is the idea of identifying a niche market. In the book "Niche and Grow Rich" by Jennifer Basye Sander and Peter Sander, one suggestion is to look at how a big market can be broken up into smaller ones. They give the example of an entrepreneur who saw the popularity of frozen meals for adults and came up with a line of frozen meals for kids. The low-budget airlines are thriving now because they identified a sub-set of the traveling public, namely those who don't want frills if that means they can have rock-bottom fares.
Your turn: Within your field, what smaller chunks of the market might you serve? The elements you can play with include geographical location, characteristics of the target audience, speed of service (remember Domino's Pizza), quality of service, exclusivity and many more. This is a great exercise to do with friends, especially if they aren't in the same field you're in. They'll bring fresh ideas to the table.
A quote of note:
"When we plant a rose seed in the earth, we notice that it is small, but we do not criticize it as 'rootless' or 'stemless.' We treat it as a seed, giving it the water and nourishment required by a seed. When it first shoots out of the earth, we don't condemn it as 'immature' and 'underdeveloped'; nor do we criticize the buds for not being open when they appear. We stand in wonder at the process taking place and give the plant the care that it needs at each stage of its growth. The rose is a rose from the time it is a seed to the time that it dies. Within it, at all times, it contains its whole potential. It seems to be constantly in the process of change; yet at each stage, at each moment, it is perfectly all right as it is."
– Timothy Gallway, from "The Inner Game of Tennis"
Until next time, Jurgen
Visit our Brainstorm Web site to access a number of archived e-Bulletins and additional features. To give us any feedback, e-mail to Brainstorm.
Publisher's note : Like the St. Thomas Source now? Find out how you can love us twice as much — and show your support for the islands' free and independent news voice … click here.
