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Charlotte Amalie
Monday, August 15, 2022
HomeNewsArchivesFood for Thought on V.I. Financial Problems

Food for Thought on V.I. Financial Problems

Dear Source:

I read Mr. Callwood's well-written commentary on the "State of Emergency" with respect to the US Virgin Islands Government finances. I agree with much of your approach but offer the following for your [and other readers' consideration].
Yes, I believe that there is and has been a perpetual period of when the Government of the VI finances have been in a "State of Emergency", going back decades of time. A truer financial picture should come in to view once the ERP Financial System is fully functioning with good management information.
Let's face it, WAPA may be owed $20 Million, but WAPA may also owe the GERS $50 Million! It may make sense to reconcile all related Governmental amounts due and from each other at one time. That would be once the ERP provides accurate balances and those balances are audited by the outside auditors. This way, we will know how much the GERS is under funded, how much is owed To [or From] WAPA, the Hospitals, Government Employees, etc.
An interesting idea is to allow the PFA manage the excess cash of Governmental entities. I see this as way to manage and invest excess cash located in the myriad of bank accounts held by the various entities. It would surely provide better safeguarding of the funds and may avoid the recent articles that I have read regarding "Alric Simmonds". This may also minimize the amount due from the Government of the Virgin Islands to the PFA. The most recent financial statements provided from the PFA [on the PFA website as of 2005] indicates that over $1 Billion is due from the VI Government!
I do not see "Tax Exemptions and Subsidies" as being necessarily bad or evil. It seems to me that it is a contract that needs to be enforced. A quick calculation would reveal that any loss in tax revenues through subsidies is more than made up if the proper number of agreed-upon labor support is hired and those employees timely and properly file and pay their personal income taxes.
More than anything it comes down to a few basic principles. The Government of the Virgin Islands should:
1. Acquire and maintain proper management information from their financial management systems. Enforce IDC contracts and require the timely filing and payment of the employees tax returns.
2. Allow the PFA to manage the cash flow of the Government. The PFA is owed over a $1 Billion from the Government, in any event.
3. Maximize the use of all US and VI Government Funds. Get the most "Bang for the Buck."
Mr. Callwood, I do not see our views as being all that different and offer the proceeding as additional "food for thought".
John J. DeLuca
Odenton, Maryland

Editor's note: We welcome and encourage readers to keep the dialogue going by responding to Source commentary. Letters should be e-mailed with name and place of residence to source@viaccess.net.

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Dear Source:

I read Mr. Callwood's well-written commentary on the "State of Emergency" with respect to the US Virgin Islands Government finances. I agree with much of your approach but offer the following for your [and other readers' consideration].
Yes, I believe that there is and has been a perpetual period of when the Government of the VI finances have been in a "State of Emergency", going back decades of time. A truer financial picture should come in to view once the ERP Financial System is fully functioning with good management information.
Let's face it, WAPA may be owed $20 Million, but WAPA may also owe the GERS $50 Million! It may make sense to reconcile all related Governmental amounts due and from each other at one time. That would be once the ERP provides accurate balances and those balances are audited by the outside auditors. This way, we will know how much the GERS is under funded, how much is owed To [or From] WAPA, the Hospitals, Government Employees, etc.
An interesting idea is to allow the PFA manage the excess cash of Governmental entities. I see this as way to manage and invest excess cash located in the myriad of bank accounts held by the various entities. It would surely provide better safeguarding of the funds and may avoid the recent articles that I have read regarding "Alric Simmonds". This may also minimize the amount due from the Government of the Virgin Islands to the PFA. The most recent financial statements provided from the PFA [on the PFA website as of 2005] indicates that over $1 Billion is due from the VI Government!
I do not see "Tax Exemptions and Subsidies" as being necessarily bad or evil. It seems to me that it is a contract that needs to be enforced. A quick calculation would reveal that any loss in tax revenues through subsidies is more than made up if the proper number of agreed-upon labor support is hired and those employees timely and properly file and pay their personal income taxes.
More than anything it comes down to a few basic principles. The Government of the Virgin Islands should:
1. Acquire and maintain proper management information from their financial management systems. Enforce IDC contracts and require the timely filing and payment of the employees tax returns.
2. Allow the PFA to manage the cash flow of the Government. The PFA is owed over a $1 Billion from the Government, in any event.
3. Maximize the use of all US and VI Government Funds. Get the most "Bang for the Buck."
Mr. Callwood, I do not see our views as being all that different and offer the proceeding as additional "food for thought".
John J. DeLuca
Odenton, Maryland

Editor's note: We welcome and encourage readers to keep the dialogue going by responding to Source commentary. Letters should be e-mailed with name and place of residence to source@viaccess.net.