Nov. 8, 2007 — After receiving unanimous support Thursday from members of the Senate Rules and Judiciary Committee, a bill designed to put a $45 million dent in wages owed to government employees made its way to the full Senate body for a final vote.
The bill has been heavily touted over the past few weeks, with bill sponsors Sens. Carlton "Ital" Dowe and Usie R. Richards calling it an innovative way to help settle some of the government's old debts.
The bill hinges upon $45 million from the Insurance Guaranty Fund, which would be secured by a letter of credit obtained from a local bank. Seeking to clarify some of bill's language, senators also tacked on and approved a couple of amendments, which also identified a funding source that could help repay the letter of credit in case of an emergency.
During a recent interview, Dowe explained that each year, five percent of the gross premium receipts tax paid on every insurance policy in the Virgin Islands is deposited into the government's insurance guaranty fund, a pool of money used in the event of a natural disaster. The fund generates about $16 million a year, Dowe said, and has been capped at $50 million.
While the bill does not seek to eliminate the fund's cap, it does allow the government to use $45 million from the fund to start paying off retroactive wages, which are estimated to total around $400 million. The bill also authorizes the Public Finance Authority to obtain a $45 million letter of credit from a local bank, which will be used in case the fund has to be tapped into before it can be replenished.
The insurance-guaranty fund is only used if an insurance company registered to do business in the territory becomes insolvent and cannot pay its claims. If such an emergency does occur, the $45 million letter of credit will be used as a loan, and will be repaid by the local government. To secure the loan, senators have pledged funds paid to the government each year by the West Indian Co. Ltd (WICO).
WICO's annual contribution has also been reduced from $1 million to $700,000.
Another amendment tacked onto the bill stated that the insurance guaranty fund may not be used again until the balance is restored to the $50 million cap — except to pay claims and expenses incurred by the Insurance Guaranty Association.
The bill also authorizes the governor to establish a Retroactive Wage Commission, a group of experts who will work to determine how much is owed in retroactive wages, and to whom the money will be going. A $500,000 appropriation included in the bill will go toward paying for the commission's personnel costs and office expenses.
An amendment tacked onto the bill on Thursday designates the director of the Division of Personnel as the commission's chairperson, and allows retirees serving on the commission to work in excess of the 75-day limit set up by law.
Looking for more accountability from the executive branch, senators also approved a bill that calls for annual performance reports generated by government departments and agencies to be submitted on a quarterly basis to the Legislature.
First introduced in this year's budget proposal, the initial version of the bill simply adjusts the date by which the government's annual performance reports are submitted, from Dec. 1 to Nov. 15 of each fiscal year. At that time, the report would only be transmitted to members of the Senate's Finance Committee, the bill stated. Subsequently, the director of the Office of Management and Budget (OMB) would have until Jan. 31 to transmit a comprehensive performance report to all members of the Legislature.
Airing his concerns about the bill on Thursday, Richards said that existing law mandates government departments and agencies to simultaneously submit annual performance reports to both OMB and each member of the Legislature. The law should not be changed to include only members of the Finance Committee, he added, saying that all senators should be given access to the documents at the same time.
Richards' subsequently cut the section via an amendment that was later tacked onto the bill. The amendment, combined with another introduced by Sen. James Weber III, also mandates that the reports be submitted to the Legislature on a quarterly basis, on or before Jan. 31, April 30, July 31 and Oct 30 of each calendar year.
Once the amendments were approved, the bill was forwarded to the full Senate body for a final vote.
Senators also approved the nominations of Joel E. Fleming, Leonard B. Francis Jr., Le'Vette T. Hedrington and Eltino S. Pickering to serve on the St. Thomas-St. John Horse Racing Commission.
Present during Thursday's meeting were Dowe, Sen. Shawn-Michael Malone, Richards and Weber, along with Sens. Carmen M. Wesselhoft, Celestino A. White Sr. and Alvin L. Williams.
Non-committee member Sen. Liston Davis was also present.
Back Talk
Share your reaction to this news with other Source readers. Please include headline, your name and city and state/country or island where you reside.
