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HomeNewsArchivesCOMMENT RELATED TO 1991-92 GRANTS, 1999 ACTION

COMMENT RELATED TO 1991-92 GRANTS, 1999 ACTION

Nov. 25, 2003 – Twice in recent days there has been mention by V.I. public officials of comments made on the floor of the U.S. House of Representatives by a member of Congress concerning the Virgin Islands misusing federal funds.
In a release on Friday announcing that she had introduced legislation in Congress to create a chief financial officer for the territory, Delegate Donna M. Christensen stated that a colleague had recently "used the mismanagement of a Virgin Islands health grant as an example of government waste."
And in Monday's legislative session, Sen. Lorraine Berry identified the speaker as U.S. Rep. Tom Feeney, a Republican from Florida, and said he had criticized the territory for what he described as irresponsible handling of $30 million in federal health grants.
It was, indeed, Feeney who made the remarks, but they were not made so recently, and they had to do with funding that dated from the 1990s, according to Arnold van Beverhoudt, the Caribbean regional audit manager of the U.S. Interior Department's Office of Inspector General.
Feeney, an avowed archconservative, made his comments on Oct. 1. They accounted for two sentences within a five-minute address in the House chambers. He began by referring to himself and two colleagues as "the Washington Waste Watchers" and citing the statistic that the average American family must work 130 days out of the year to pay the taxes that fund the federal government.
Noting the federal government's "dramatically expanding new deficit," he said that, notwithstanding military and homeland security needs, "here at home, we have a lot of spending that is simply out of control." And called on his congressional colleagues "to look at programs that simply are not being well run, are not efficient or are meaningless."
Then he cited, in the order below, what he described as four examples of such programs:
– Fraud within the Pell Grant program of aid to college students. He said the U.S. Department of Education estimated that some $336 million in grants was improperly disbursed in 2001 and that outright fraud exceeded $3.1 million.
– Embezzlement of money within the Bureau of Indian Affairs. He cited $66,000 intended for a high school in New Mexico and $60,000 meant for Native American education programs in Arizona.
– Ineffective administering of grants in excess of $30 million to the V.I. Health Department. Specifically in this instance Feeney stated: "In the Virgin Islands, if you look at the Office of Insular Affairs, in the Virgin Islands the Department of Health failed to effectively administer grants that total over $30.5 million. Errors included failure to engage in competitive bidding, improper land acquisition, undocumented cost claims and even the failure to complete a health clinic."
– Use of Federal Emergency Management Agency (which he referred to repeatedly as Federal Emergency Management Administration) funds for "free stress reduction and personal growth classes as a response to the hurricane … Multicultural initiatives, presenting a series that will allow discussion of who we are, where we are from, why we are here and how we are doing … workshops to address the issues of diversity, peace, and violence versus nonviolence … anger management programs … things like a yearlong celebration of trees, of gardens and other healing places."
Feeney concludes his remarks by saying of the Waste Watchers: "We are going to go after the waste in government."
It is likely that Feeney's information in three of the four instances was based on reports of audits by the Interior Department's Office of Inspector General. Certainly this appears to be the case with regard to the Virgin Islands reference. Efforts to verify this information from the congressman's Washington office on Tuesday were unsuccessful.
All four points raised by Feeney concerning the $30.5 million in the Virgin Islands are contained in the three-paragraph Executive Summary on page 6 of a September 2002 audit report of two grants made in fiscal years 1991 and 1992 to the V.I. Health Department "for the construction of eight health-care facilities on the islands of St. Thomas, St. Croix and St. John."
The summary states that "As of February 2002, $26.6 million of the $30.5 million grants had been expended on the projects. Some projects were not well managed."
The eight facilities were the then-St. Thomas Hospital, Knud Hansen Complex and St. Thomas Community Rehabilitation Center on St. Thomas; the then-St. Croix Hospital, Charles Harwood Complex, Ingeborg Nesbitt Clinic and St. Croix Community Rehabilitation Center on St. Croix; and the Myrah Keating Smith Clinic (now Community Health Center) on St. John.
The "failure to complete a health clinic" Feeney cited appears to be a reference to the Charles Harwood Complex and what was at one point supposed to replace it. In 1997, according to the audit report, the government decided to halt renovations to the Harwood facility and instead build a new clinic. In 1998, it said, contracts were signed to acquire the land and construct the new clinic, and the Office of Insular Affairs approved the reprogramming of $4.62 million from the renovation project to construction of the new clinic. But in 1999, the contract for the new clinic was terminated after the builder had already been paid $449,400 for work on that project.
According to van Beverhoudt, there had been earlier audit reports on the construction projects, "and last year we did a follow-up on the last of the money."
To access the 31-page audit report as a .pdf file, click here.

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