April 28, 2003 – David B. Cohen, deputy assistant secretary of the Interior Department's Office of Insular Affairs, is visiting the territory this week. It is Cohen's first visit to the Virgin Islands in his position as head of the office that directly oversees the territory.
Cohen's visit follows closely on the heels of that by Interior Secretary Gale Norton, in early April. Cohen was expected to limit his meetings to government officials and has been unavailable to the Source so far.
Cohen's trip is coincidental to Gov. Charles W. Turnbull's announcement last week that the V.I. government was facing insolvency, though the V.I.'s fiscal problems are no secret. And if the territory doesn't change its ways where accountability is concerned, it could lose further federal grants and funding.
Speaking before a meeting of the Island Governments Financial Officers Association last December in Hawaii, Cohen said that the Office of Insular Affairs will look at how well each jurisdiction's public auditor's office is functioning as one of the factors to determine how millions of dollars of discretionary grants will be allocated each year.
"We will look at a number of factors," Cohen said. "For example, is the public auditor's office properly funded and staffed with qualified people? How strong are the safeguards to its independence? Is it vulnerable to having its funding cut if it offends the government? Is it actively fulfilling its role as a public watchdog?"
"We consider these factors to be relevant in deciding where our discretionary grants should go," he said.
The V.I. Bureau of Audit and Control is subject to all those shortcomings. The office is underfunded, understaffed and completely vulnerable to funding vagaries.
In fact, Inspector General Steven van Beverhoudt has been engaged in recent months in a struggle to get the full allotment appropriated for his 2003 budget, which is inadequate in the first place.
Office of Management and Budget Director Ira Mills has agreed to give van Beverhoudt the full allotment for the third quarter, but 10 percent of that allotment will be a draw on the fourth quarter monies since all departments have been ordered to cut their budgets by 10 percent.
Van Beverhoudt has said a 10 percent cut would severely limit his ability to do his job. In a letter to Mills in March, van Beverhoudt wrote: "Please be advised that if the appropriate level of funding is not received, our funds will be depleted by the summer of 2003 and we will be forced to close the office and cease operations."
Despite the recent struggles of the Inspector General's Office, Cohen has made no further statement specific to the Virgin Islands relative to his December warning.
However, Insular Affairs spokesman Keith Parsky said Saturday, "We're serious about that." Parsky said, "We are going to rely more and more on local auditors."
As that process takes place, "Our job becomes communication with the local public auditor," Parsky said.
Van Beverhoudt has proposed that his budget be set at a percentage of the entire budget – a plan that has worked well, in other jurisdictions – the Marianas specifically.
With a budget tied by a specific and adequate percentage, van Beverhoudt has said, even if the budget is reduced, there would be enough money to run his office.
The change could be made by an act of the Legislature.
Cohen, who was appointed to his post by Norton in April 2002, is the first American of Samoan descent, and only the second Pacific Islander, to head the office. Cohen holds a law degree, an M.A-B.A. in regional science, and a Bachelor of Applied Science degree with a concentration in transportation engineering, all from the University of Pennsylvania.
Prior to his appointment, Cohen worked for a law firm in Los Angeles.
Van Beverhoudt is set to meet with Cohen at 9 a.m. Monday.
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