In the nation’s capital this week to lobby on behalf of the Virgin Islands, Gov. John deJongh Jr. met with members of Congress and President Obama’s cabinet Tuesday, including Internal Revenue Service Commissioner Doug Shulman and Secretary of Health and Human Services Kathleen Sebelius.
He also met with Senate Majority Leader Harry Reid and House Majority Whip James Clyburn and pushed to advance key policy issues including taxation, strengthening the new business tax benefit program of the territory’s Economic Development Commission, resolution of outstanding tax audit issues with the IRS, and continuing the push for fair and equal treatment of all Virgin Islanders in national healthcare reform, according to a statement from Government House.
DeJongh discussed issues affecting the territory’s national parks with Senator Tom Udall of New Mexico and met with Rep. Jimmy Duncan, a leading Republican on the House Transportation Committee to lobby for additional funding for the territory’s highways.
He also spoke at length with IRS National Taxpayer Advocate Nina Olson, in an effort to resolve a long-standing dispute between the local government and the IRS over the continued auditing of EDC beneficiaries.
“The issues of statute of limitations and residency have been hovering over the Virgin Islands for some time," deJongh said during a meeting with Shulman and Olson. "The lack of taxpayer certainty caused by the arbitrary and unjustified position of the IRS in refusing to recognize a statute of limitations for the Virgin Islands has eroded an important revenue stream to our treasury and has jeopardized a program that was lawfully sanctioned by Congress to solidify the financial footing of the territory.”
DeJongh’s second day in Washington was also highlighted by a meeting with Secretary of Health and Human Services Kathleen Sebelius. In the afternoon meeting he and acting V.I. Health Commissioner Julia Sheen spoke of the need to build a strong partnership with the Obama Administration to finally end the discriminatory treatment of American citizens living in the Virgin Islands.
“Our Medicaid program is grossly underfunded and not a full entitlement program," he said. "As a result, we are able to provide Medicaid health care coverage to only about seven percent of the Virgin Islands.” That rate is much lower than the 20 percent national average because of current limits on federal Medicaid to the Virgin Islands that allow the government to provide coverage only to those with incomes below 50 percent of the federal poverty level. Most states are able to provide coverage to up to 100 percent of the federal poverty level.
“This is a huge and unacceptable disparity,” deJongh said.
DeJongh framed the issue in terms of the need to work together to help make the children and all citizens of the U.S. living in the territory healthier by ensuring they receive needed heath care services.
“As you can see, we are transforming our program and working to expend all available federal funding," he said. "Nonetheless, in order for us to develop and run a full Medicaid program that provides necessary services to those in need, especially our children, we need and deserve a state-like full-entitlement program. This means a lifting of the Medicaid cap and a formula-driven federal matching rate based on our relative income levels."
Wednesday deJongh is meeting with Steve Lilly, the chief financial officer of the Rural Telephone Financing Cooperative and later with tax attorneys to discuss some unresolved federal taxation issues. Meetings are also on the agenda with Representatives Sander Levin, (D-MI) Joseph Crowley (D-NY) and Senator Mark Udall (D-CO).
