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MINORITY OFFERS ITS OWN BUDGET-BALANCING PLAN

Sept 24, 2003 – "If you don't agree with the governor's proposals, submit some of your own," Nathan Simmonds, director of the governor's Office of Fiscal and Economic Recovery Implementation, told senators at a Finance Committee meeting on Tuesday.
The 25th Legislature minority caucus needed no further encouragement. On Wednesday, the group called for an extensive list of cost-saving and revenue-generating measures as an alternative to Gov. Charles W. Turnbull's proposed Fiscal Year 2004 budget.
Expressing sometimes vehement disapproval of the governor's budget at Tuesday's hearing, the minority senators said they would submit a plan of their own "soon." The group has made no secret of its low opinion of Turnbull's measures to balance the budget. Sen. Celestino A. White Sr. said the administration budget "should go back to the governor, stamped 'Rejected.'"
The minority bloc — Sen. Usie Richards, the minority leader, and his colleagues Carlton Dowe, Norman Jn Baptiste, Almando "Rocky" Liburd and White — sent the list of proposals to Senate President David Jones on Wednesday. They also sent it to the Legislature's legal counsel to be drafted as an omnibus bill.
Some of what the five refer to as "policy actions" are likely to get a lot of reaction from their own colleagues as well as from the executive and judicial branches of government. Leading by example, they propose to cut their own salaries, as well as those of many others.
First, the minority caucus calls for rolling back salary increases granted prior to November 2002 to non-unionized and exempt government employees, including those granted to unclassified personnel by the governor via executive orders dated Oct. 24 and Nov. 1, 2001. Those pay raises, affecting as many as a thousand exempt employees, averaged 24.19 percent for upper-level personnel and 20.18 percent for mid-level personnel.
All 15 senators signed a letter to Turnbull this summer saying they would not approve his request for authorization to float another $235 million in bonds unless he rolled back those executive branch raises, which add more than $33 million to the payroll. However, they did approve the bonding bill, and the governor did not roll back the raises, although he imposed a six-month reduction ranging from 2 to 10 percent for those making at least $40,000 a year, depending on salary level.
Second, the minority calls for a cap of $60,000 on the salaries of all non-unionized and exempt government employees except for senators, the lieutenant governor, the governor and Territorial Court judges, all of whom would receive a 10 percent pay cut.
"The counter-proposals we have made are clearly in opposition to certain items the governor has suggested," Richards said Wednesday evening, "and we have suggested certain actions that can be taken to remove the need to reduce hours and other of the governor's proposals."
The minority caucus told Jones that it holds "unwavering opposition" to the following elements of the governor's budget:
– Cutting back to a 36-hour work week and reducing the allowable amount of accrued annual and sick leave.
– Increasing the gross receipts tax to 4.25 percent from 4 percent.
– Imposing a 10 percent personal income tax surcharge.
– Authorizing the Office of Management and Budget to allocate among executive branch departments and agencies any unused funds allocated for personnel costs and benefits.
– Authorizing the governor to furlough government employees.
– Imposing a one-year moratorium on collective bargaining with government employees.
– Creating a Waste Management Authority at a cost of $8 million. Several senators on Tuesday had asked for a breakdown of that money. Richards said on Wednesday that the minority caucus believes the existing waste disposal system can be improved at less cost and serve the same purpose.
Heading the minority's list of revenue-generating proposals is assessing a $5 cruise ship head tax expected to generate about $9.5 million a year. Elsewhere in the Caribbean, members of the Caricom common market have increased the head tax to $20, Dowe said at Tuesday's hearing. Richards said doubling the tax could generate about $1.9 million a year.
Another proposal would both give and take away. It calls for reducing the gross receipts tax to 3 percent, but at the same time imposing a 2 percent sales tax on everything but motor fuel, which already is heavily taxed, and prescription medicines.
Recycled cost-reduction measures
A large part of the minority's proposal presented on Wednesday draws on recommendations it presented to the governor's financial advisers five months ago when they were developing a recovery plan to address the territory's recently announced fiscal crisis. The cost-reduction and government-improvement policy actions (issued April 29 and revised Sept. 24) are:
– Repeal the executive branch lump-sum budgets authorized by the 25th Legislature.
– Reduce vehicle fuel consumption by 50 percent, except for the hospitals, law-enforcement entities, Fire Service and the Health and Human Services Departments.
– Make all government personnel authorized to utilize vehicles on a 24-hour basis responsible for the fuel and maintenance costs of their respective vehicles.
– Require all government agencies to consolidate offices wherever possible and to utilize government-owned buildings in order to reduce rental costs.
– Implement a hiring freeze except for the Corrections Bureau, Fire Service, hospitals and the Police, Education, Health and Human Services Departments.
– Terminate all cellular phone contracts except for law-enforcement agencies and social workers.
– Establish a Government Travel Bank to receive deposits of frequent flyer mileage accrued outside the territory by government employees, to assist in providing air transportation for youth and sports activities.
– Cease purchasing government vehicles except for the hospitals, Fire Service, Health Department and law-enforcement agencies.
– Consolidate and reorganize certain executive branch departments, agencies and/or services to increase efficiency of operation and reduce cost.
– Authorize the executive branch, where appropriate, to fill vacant positions within federally funded programs with employees now paid out of the General Fund.
– Implement Act No. 6292, which authorizes the Justice Department to utilize prisoners eligible for work-release to provide essential public services.
– Utilize teleconference facilities to conduct inter-island meetings in order to reduce air travel costs.
– Authorize the executive branch to fill personnel vacancies in the Fire Service, the hospitals, the Corrections Bureau and the Health Department so as to reduce overtime costs by 50 percent.
– Repeal Act No. 6571, Section 17, which allows for the rehiring of retired government employees while they concurrently collect government retirement benefits.
– Establish a ceiling on government roadside-cleaning contracts.
– Suspend all professional and personal service contracts for persons to fill exempt and non-classified positions since November 2002, except for those contracts entered into to fulfill the requirements of federally funded programs.
– Cease per-diem payments to government employees.
– Authorize the executive branch to approach all Economic Development Agency beneficiary companies to renegotiate a cash payment in return for a certificate of extension of benefits.
– Implement energy-saving and conservation measures to include utilizing diesel generators, turning electrical power off outside of work hours in government offices, installing energy-efficient lighting in government buildings, implementing the current State Energy Conservation Policy Plan and encouraging recycling to reduce the cost of office supplies.
Recycled revenue-generating measures
Similarly, the minority proposal include
s a number of the bloc's earlier revenue-generating and government efficiency actions. These proposals (issued May 14 and revised Sept. 24) are to:
– Repeal certain provisions of Acts. 6463 and 6391 relating to the collection of excise taxes and customs on such items as cameras.
– Deposit a 50 percent contribution from Economic Development Commission beneficiaries into an Education, Youth and Sports Fund.
– Impose penalties for failing to comply with the V.I. Community Re-Investment Act (to be administered by the V.I. Banking Board).
– Increase banking license fees by 25 percent.
– Impose a $2 head tax for water tour boats using government facilities (to be collected by the Port Authority or The West Indian Co.).
– Require WICO and VIPA to pay Motor Vehicle Bureau fees.
– Implement a Caribbean Energy Resources Corp. project which proposes an immediate infusion of about $290 million into the St. Croix economy with the creation of an estimated 1,200 jobs.
– Increase the stamp tax to 2.5 percent for residential real estate sales of more than $5,000, with 50 per cent earmarked for the Housing, Parks and Recreation Department's Home Loan and Veterans Home Loan programs.
– Increase the stamp tax to 3 percent for commercial and non-residential investment property sales, again with 50 percent going to the HPR home loan programs.
– Grant a 10 percent discount for payment of property taxes at least six months in advance, and adopt a quarterly payment schedule.
– Approve a self-funded health plan to be developed by the Health Insurance Board of the Government Employees Service Commission and presented to the Legislature within eight months of enactment.
– Repeal the recent increase in government employee health insurance contributions and establish a 5 percent tax on the premium.
– Limit Economic Development Commission benefits to 80 percent exemption from gross receipts, income, property and excise taxes and customs duties.
The minority senators also expressed concern about the territory's mass transit system, calling for the Public Works Department to purchase smaller, more efficient buses and to implement more cost-efficient operations.
Nine of the minority's other April and May recommendations have since become law, including doubling of marriage license fees; increasing tire and road taxes; requiring WICO to transfer 50 percent of its annual dividend payments to the Public Finance Authority into the General Fund for health, education and human services; increasing unemployment benefits; increasing banking license fees by 25 percent; and expanding the acceptance of charge card payments for government services.
Richards did not say when he expected the minority bloc legislation to be brought to the Senate floor. Sen. Adlah "Foncie" Donastorg, the Finance Committee chair, said on Tuesday that he hoped to have the marked-up budget to the full Senate for review in the first two weeks of October.

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