Things have reached such a state that the governor should declare a "state of emergency for Government House and the Cabinet," legislative post auditor Campbell Malone told his audience at a League of Women Voters meeting Monday on St. Thomas.
Lambasting the Five-Year Operating and Strategic Financial Plan presented by the governor's economic recovery task force, Malone said the territory's fiscal state is "dismal and rapidly getting worse." In his indictment of the administration, he noted that Gov. Charles W. Turnbuill had declared states of emergency in the Education and Public Works Departments, but added, "The most rapid decline has been seen in the Cabinet."
Speaking at a luncheon gathering at L'Escargot Restaurant, Malone said he cannot get reliable estimates from the Office of Management and Budget of the revenues in the government's assorted coffers. He called the figures he has been provided "bogus and unrealistic." Referring to the oft-debated $432 million projection for the current fiscal year cited in the five-year-plan, he accused the administration of overstatement by "several hundreds of millions of dollars."
Malone suggested putting in place a control board, a reformed budgetary process and a complete reform of administrative financial systems as a means of countering the fiscal crisis. He said that "even with all its defects," the five-year plan is probably the only way to "pull the rabbit out of the hat."
His comments sparked lively debate before the audience of about 45, starting with the response of Juel Molloy, the governor's chief of staff. Molloy asked why, "if the government owes all those millions of dollars you stated," the 23rd Legislature raised the ante even higher, increasing the fiscal year 2000 budget to $459 million.
Molloy said the territory's financial situation has been worsening for "18 to 20 years." The government has been transferring money from one fund to another for years, she said, and the situation couldn't have been resolved in the 18 months the current administration has been in office. She said the legislative and executive branches should try for a partnership, and deal with the truth.
She asked how the Senate planned to work with the administration to save money, when it has already rejected the first cost-cutting proposal, the plan to impose school bus fees recently announced by Education Commissioner Ruby Simmonds.
Responding to Malone's statement that he couldn't get accurate figures, St. Thomas-St. John teachers union president Glen Smith, who has announced he is running for the 24th Legislature, suggested Malone subpoena the financial records. Smith said he got "no sense of direction" from Malone's criticisms of the five-year plan and said the control board that Malone suggested would do away with the need for a post auditor.
Sen. Lorraine Berry said she agreed with Molloy's idea for a "partnership" between the legislative and executive branches but said she didn't know what the Legislature was supposed to do when it couldn't get hard fiscal data to work with. Berry, who chairs the Senate Finance Committee, said she has called all Internal Revenue Bureau supervisors to a hearing on July 6 for a reconciliation of government accounts.
Berry also said she hopes the administration's 2001 budget, due June 30 – a date representing a one-month extension granted at the governor's request, will incorporate mandates of the five-year plan as well as the Memorandum of Understanding between the territory and the federal government that Turnbull signed last year.
Molloy said Finance Commissioner Bernice Turnbull has pledged to have a final reconciliation of government funds completed by July 31 and suggested to Malone and Berry that they await that information. She reiterated, "You can't expect something that has been out of control for more than 15 years to turn around in 18 months."
Molloy, who served as chief of staff to Berry in the Legislature in the last administration, voiced the view that "there is hope. We can change it if we work together."
On that point, Malone agreed.
