V.I. Delegate to Congress Donna M. Christensen on Thursday bitterly denounced the tactics being used by the National Puerto Rico Coalition (NPRC), accusing the group of willfully misrepresenting the truth in the latest round of what has become known as the "rum wars" between Puerto Rico and the U.S. Virgin Islands.
But her anger wasn’t just based on the repetition of misstatements about the deal. The Puerto Rico business group made it personal.
Earlier in the day representatives of the NPRC held a press conference in Washington calling on the Department of Justice and the Securities and Exchange Commission to investigate Christensen, Rep. Charles Rangel and Assistant Secretary of Interior Anthony Babauta to find out whether or not any of them stand to benefit from the territory’s public-private partnership with Diageo, the international spirits company set to produce rum on St. Croix.
In its call for an investigation, the NPRC included Christensen’s brother, Adam Christian, now a V.I. Superior Court judge and, at the time of the Diageo deal, the legal counsel to the governor’s office.
"I’m very angry about it," Christensen said Thursday afternoon in a telephone press conference with V.I. media. "It’s a direct attack that’s totally baseless, a contrived attack … You know how it is with family. Most of us can take the licks for ourselves, but when you start bringing in family …."
Her voice bristling with indignation, Christensen fired back, saying the Puerto Rico lobbying group has taken "a page out of the Republican playbook," launching personal attacks on its adversaries when it can’t win an argument on its merits.
“These charges are outrageous and unfounded and are nothing more than a desperate attempt to spread falsehoods and innuendo since their year-and-a-half campaign to derail legally binding agreements has failed miserably,” Christensen said.
In its morning press conference, the NPRC repeated its oft-stated claim that the V.I. government "lured" Diageo away from Puerto Rico.
"Nothing could be further from the truth," she said.
Diageo had tried to negotiate an extension of its agreement with Destilería Serrallés, which produces Captain Morgan’s Spiced Rum for the company. The current agreement expires at the end of the year.
Unable to get better terms, the company announced plans to build its own distillery. It was only after that decision, and after the company had started scouting locations in Jamaica and Guatemala, that the V.I. government began negotiating with the company.
Christensen said the Puerto Rico group was fine with Diageo leaving their island as long as it went to a foreign country, becase under a quirk in the law the territory would continue to collect a percentage of the cover-over money generated by the sale of Captain Morgan’s rum in the states.
But with Diageo – and the money – going to the U.S. Virgin Islands, Puerto Rico suddenly found itself facing the loss of funds.
And it’s their own fault, Christensen said.
"The suffering of their citizens, the loss of jobs and dire economic conditions, that is on their watch, that is their fault," she said. "Diageo tried to negotiate a new contract … The blame is on them for not doing their job."
She also challenged the NPRC’s suggestion that the V.I.–Diageo deal was "raiding the treasury."
"None of this is coming from the U.S. Treasury," she said.
"They said in their press conference that they would rather see the rum cover-over program ended than allow the V.I. agreements with Diageo and Fortune Brands stand," Christensen said incredulously. That would wreak havoc on the economies of both territories, she said.
“Now, the NPRC is proceeding with a scorched-earth policy which not only calls for a cap on the how we can use the rum cover-over, but for the elimination of the entire program if they don’t get their way."
Instead, Christensen said, the NPRC should "stop bullying the little Virgin Islands and man up and admit you were wrong … Your sour grapes and bitter diatribe will only hurt both of us."
Congresswoman Christensen has called for support from members of Congress’ Hispanic Caucus, with whom she has worked over her tenure on programs that benefit their mutual constituencies.
Even Puerto Rico’s Congressional representative, Resident Commissioner Pierluisi, has distanced himself from the actions of the NPRC.
“I have no motivation to think that any laws were broken or that any unethical conduct leading to corruption was committed,” Pierluisi told the nespaper El Nuevo Dia Thursday.
Pierluisi has not dropped his objection to the deal, but his complaint is based on the terms of the deal, not speculation that there might have been skullduggery in getting it done.
Pierluisi is the author of a bill to give the U.S. Virgin Island’s share of the cover-over money to Puerto Rico if more than 10 percent is used as a direct subsidy to the industry. That bill has been languishing in the House Ways and Means Committee for more than a year without being scheduled for a hearing. With the 111th Congress in its last months and pending legislation slated to expire, Christensen said, Puerto Rico’s advocates might have been prompted to call for the investigation out of growing desperation.
In New York, Gov. John deJongh Jr. added his voice in protest of the NPRC’s action.
“Every day, we have been focused on growing the Virgin Island’s economy and helping our citizens,” deJongh said. “Puerto Rico has instead chosen to resort to desperate attacks and ‘pulled from the air’ allegations with no basis in facts, at a time when what their economy really needs is leadership and real plans for growth.”
"Puerto Rican citizens should be asking about their government’s transparency and why its rum programs are intentionally kept so secret. They should ask where Puerto Rico’s rum revenue really goes,” de Jongh added. “And, they should also ask why their leaders are so determined to attack their neighboring sister islands, and friends, of the U.S. Virgin Islands.”
He added that the agreement protects U.S. jobs, keeping the production of Captain Morgan’s on U.S. soil.
In a written statement yesterday, Diageo’s vice president for North America, Virginia Sánchez, expressed confidence in that Congress “will see that any changes made to existing cover-over program which may impact our agreement will be extremely harmful to the economy of the USVI today and in the future.”
Diageo had previously said “no member of the U.S. Congress had any kind of role in the negotiation or the approval” of the agreement with the V.I. government which extends for a period of 30 years.
Sánchez said that allegations that there were deals made in dark rooms are “pure fiction” and denied that the tax benefits her company will receive exceed the costs of production.
