Finance Commissioner Bernice Turnbull said Tuesday she will not break the law by authorizing payroll checks for the 30 employees of the Housing Finance Authority.
Recent Finance Committee budget hearings revealed that $2.8 million had been paid to workers at the Housing Finance Authority over the past two years for which there was no appropriation.
Turnbull, called before the committee again Tuesday to explain how this happened, said her department has a big problem: the ability to override the system. She said she intends to fix it.
The HFA is charged with building and managing low- and middle-income housing in the territory. A statement presented by HFA comptroller Harry Quetel on behalf of Claude Richards, acting director, said due to the cyclical nature of cash flow into the agency, an agreement had been struck between Finance and HFA: Finance pays the payroll, and HFA reimburses Finance.
Earle B. Ottley, HFA's first executive director, was reportedly the architect of this agreement. Ottley died late last month.
The last time HFA received an appropriation and allotment was for Fiscal Year 1997, according to Ira Mills, director of Management and Budget. It was for $308,000, but HFA's annual payroll is approximately $1.2 million.
Under the governor's reorganization plan, the HFA is to become part of a semi-autonomous agency called the V.I. Housing and Community Renewal Authority, which will include the V.I. Housing Authority and the housing portion of Housing, Parks and Recreation.
Quetel pointed out that in FY 1999, HFA paid $962,513 to Finance. This is short of what is owed for payroll.
"It's not difficult to pay a payroll," Turnbull said. "If Mr. Quetel wants his people to be paid, he can pay it with the money he has."
Finance Committee chair Lorraine Berry said $400,000 had been included for HFA in the revised FY 2000 budget.
Turnbull voiced concern that the payroll agreement between Finance and HFA had never been formalized.
Senate legal counsel Amos Carty said two things could be done. The Legislature could appropriate money for HFA's payroll and senators could amend the V.I. Code to clarify HFA's responsibility to pay its own payroll.
The Legislature is expected to deal with the issue when it meets in session Friday.
Meanwhile, Turnbull and Quetel were left to work things out on their own for the short term.
