ST.THOMAS—The Committee on Finance, chaired by Sen. Clifford F. Graham, met Monday to receive an overview of the 2017 fiscal year budget from the governor’s financial team at the Earle B. Ottley Legislative Hall.
“This starts the beginning of all the budget hearings of all the various departmental agencies.”
Nellon Bowry, Director of the Office of Management and Budget, testified that “the grand total of the Fiscal Year 2017 Budget of the Government of the U.S. Virgin Islands (the “FY2017 Budget”) is $1.35 billion in current year expenditures and debt service. This is funded from $1.16 billion of local funds and $193.5 million from federal grant funds.” Of the local funds $844.9 million is composed of expenditures and debt service from the general fund, $112.8 million from other local funds and $203.4 million is from funds not subject to annual appropriations.
The $844.9 million budget includes a proposed expenditure of $715.5 million for executive departments and agencies, $60.9 million for the Legislature and the Judiciary combined, and $68.5 million for long term (Gross Receipt Tax Bonds) debt service.
Officials said that the government currently has 33 days of cash on hand, a total of approximately $67 million. Ideally though, the goal is to have 180 days of cash on hand, a goal Bowry says the government is working toward.
“We don’t want to alarm the public into thinking, because we don’t have 180 days worth of cash, that we’re in some type of red alert situation,” clarified Senate President Neville A. James. “But we’d prefer that we generate revenue on a more fluid basis to allow for us to have disposable income.”
Sen. Graham questioned officials about working capital financing, allocating appropriations to address the critical financial needs of hospitals territory-wide, ideas to help the grim fiscal landscape going forward, and the possibility of missed opportunities to receive taxes from imports.
Sen. Graham also reminded officials that travel through the territory to the British Virgin Islands needs to be tracked and marketing efforts need to be made to encourage those travelers to return to the territory as a destination.
Senator-at-large, Almando “Rocky” Liburd noted that debt in the Virgin Islands is greater than that of Puerto Rico, with a rate of more than $23,000 per person. Bowry agreed.
“We have a structural deficit” said Bowry, noting that it was a comment he’d made many times before. The solution is not to cut the budget, because it would mean cutting public safety and education. Instead the solution is to “grow the economy,” he said.
Bowry said that he would “continue to look for opportunities to address the cashflow shortage” and added that the government has a plan to increase revenues to sustain increased costs, like that cause by implementing raises for government employees. But “economic development takes a while for the impact to show up,” he said.
Additionally legislators held Bill No. 31-0377, a measure to appropriate $100,000 from the general fund in the fiscal year ending September 30, 2016 to the Department of Human Services to address the critical needs of senior citizens residing at he Queen Louise Home for the Aged.
The bill will be reconsidered on June 23rd, on St. Croix, once testifiers have been given time to prepare to appear before the committee.
The Committee on Finance will reconvene on June 15, at the Fritz E. Lawaetz Legislative Conference Room on St. Croix to hear budget requests from the Virgin Islands Police Department, the Law Enforcement Planning Commission and the Bureau of Information Technology.
All committee members, including Senators Marvin A. Blyden, Jean A. Forde, Myron D. Jackson, Positive T.A. Nelson, Tregenza A. Roach, Sammuel L. Sanes and Kurt A. Vialet, were present. Non-committee members, Senators Kenneth L. Gittens, Justin Harrigan Sr., Almando “Rocky” Liburd, Neville A. James, Nereida Rivera O’Reilly, and Janette Millin Young were also present.