The governor needs to veto the entire budget package, and we hope he will!
The senators approved borrowing $265 million in September as an "emergency measure." Now, they want to begin the 2004 fiscal year by borrowing another $70 million. This makes no sense.
No one can borrow his way to prosperity since sooner or later what is borrowed must be repaid. (If we cannot raise enough money to pay our current expenses, how can we pay back the money we have already borrowed?) Over the past five years the government has operated on loans and one-time revenue that averages $120 million each year. This is the time to stop and be responsible.
Another reason for discarding the recently passed budget is that it appears that almost no thought was given to the spending priorities. When the second-largest item in the budget is "Miscellaneous," at $123 million, someone isnt thinking. If the Senate doesn't know what the money is to be used for they should take the money out of the budget, and then there is no need to raise taxes and borrow more money. If the senators know what the money is going to be used for, they should spell it out and let the citizens judge the merits of the spending. Proposing $123 million for unnamed expenses is reckless and deceitful.
It is insulting to tell the people they are getting over a million dollars of value from each senator. Surely they can pay themselves, staff their offices, travel and entertain on a half-million dollars a year in these difficult times. Over $1 million per senator per year is insane.
Since the governor announced in April that there was a financial "crisis," the Senate majority has had seven months to work on a plan, and yet it appears that very little thought has been given to the problem. Although during that time they received input from all segments of the community, the governor, and the minority senators, all they can come up with is borrow, borrow, tax, tax and spend, spend. Not much creative thinking is evident. There is no plan to create jobs and increase employment and no effort to reduce expenses, In fact the only proposals in the budget are anti-jobs, anti-private-sector growth, and anti-investment.
Specifically, over the past few years the sole economic bright spot on St. Croix has been the arrival of EDC companies to the island. They have brought jobs, income to the government, renovation of buildings and contributions to our charities and to the quality of life on St. Croix. So what does the senate propose? They propose to increase the application fee, increase the compliance fee and on top of these increase their taxes by 50 percent.
These actions will not help attract companies to the territory. (In case the senators haven't noticed, it is expensive to live here: Electricity recently went up, telephone costs are up, housing and office rents are up, insurance costs are increasing and will go up even more when the Insurance Guaranty Fund is raided, etc. Why would they want to slow down the only economic engine we have? I could understand raising the taxes 10 percent upon renewal of a beneficiary's contract; however, a 50-percent increase on new companies will definitely hinder, if not retard, economic growth on St. Croix and the territory in general.
Presently, it is very expensive to vacation on St. Croix. There is little competition between airlines, and the ticket prices are high. (This week American is offering $179 round trip from Miami to St. Thomas while a round trip from Miami to St. Croix is $562.) Undaunted, however, the Senate proposes to increase the cost of car rentals, increase the cost of gasoline, and nearly got through a 25-percent increase in the hotel occupancy tax.
On the subject of taxes: Where did the idea to borrow the 2005 property taxes come from? It makes no sense to borrow from the future without a plan to pay back the money. Is the plan to next year borrow the 2006 property tax? If that isnt enough money, will the senators want to borrow the 2007 and 2008 taxes, too?
I would like very much to see the majority senators take approximately 80 to 85 percent of the minority's plan and adopt it at once. Then work with all the stakeholders to modify the objectionable parts of the minority's plan and the governors plan and come up with a budget proposal that makes sense. The senators need to start by reducing the expenditures of the government, then look at ways to pay for the essentials. Not start with borrowing and taxing with not even the mention of expense reduction. "Borrow and borrow and tax and tax" is not a "budget" — it is a plan for disaster and financial ruin!
– First, if the senators do not know where $123 million in "miscellaneous" spending is going, then take it out of the budget. If they know, tell us.
– Second, do not imperil the EDC growth engine by a 50-percent tax increase and higher fees.
– Third, follow the minority's example and devote some time, thought and energy to reducing expenses. (You can begin by trying to survive on only a half million dollars a year.)
Frank J. Fox, President
St. Croix Chamber of Commerce
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