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Christensen: Rum Issue Might Be Calming Down

A vote last week by the Puerto Rico Legislature might be a sign that the dispute between that territory and the U.S. Virgin Islands over the rum cover-over is beginning to settle down, if it is sincere, Delegate Donna Christensen said Thursday.

Last week Puerto Rico’s legislature voted to increase the percentage of the rum cover-over money the territory can use to directly support the island’s rum industry, from 10 to 25 percent – with the option of increasing that to 46 percent. During the dispute over the deal that brought international liquor giant Diageo to neighboring St. Croix, Puerto Rico officials have maintained that they never use more than 10 percent to directly support the industry and have tried to convince Congress to enforce such a cap on the U.S. Virgin Islands.

That change of heart – if it is a change of heart – may indicate that Puerto Rico is ready to drop its protest over the Diageo deal, building the distillery that was commissioned last month using bond revenue backed by the V.I. government’s anticipated cover-over funds, Christensen said in a telephone interview Thursday.

"I take it at face value," the delegate said.

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At the same time, she noted that the provisions of Puerto Rico’s action includes the proviso that the limit will remain at 10 percent if Congress should enact a 10-percent cap in 2011, indicating not everyone may be willing to let the issue die. The National Puerto Rico Coalition (NPRC), a powerful lobbying group, has promised to try to get action on the issue before the end of the year.

Two bills were introduced in Congress last year to enforce such a limit, but neither received any action and will die when the session expires at the end of the year. But Puerto Rico Resident Commissioner Pedro Pierluisi has not said he will not reintroduce the legislation in the new Congress, which convenes in January.

But if last week’s action was a gambit to make Puerto Rico’s position look more reasonable or flexible, Christensen said, it might well backfire.

"This apparently is the will of the government of Puerto Rico," she said. "If the legislature passed it, and if the governor signs it, that clearly tells us that the people of Puerto Rico want to allow the use of these funds in this way."

And that has been the V.I. government’s position all along – not that one territory is right and the other is wrong, but that each territory should be free to use those funds in the way that meets its needs.

The Republican Party will take over control of the House of Representatives next year, but Christensen doesn’t think that will weaken the U.S. Virgin Islands’ position on the cover-over issue. She pointed out that both bills languishing in the current Congress were introduced by Democrats.

The NPRC has in the last year blamed the Congressional Black Caucus for supporting the V.I. government’s position and preventing its efforts to change the cover-over program from taking root. On Thursday Christensen was voted first vice chair of the caucus.

On Wednesday, Gov. John de Jongh Jr. was in Washington, D.C., meeting with Congressional leaders, as well as with the territory’s D.C. team. The rum cover-over program and the territory’s efforts to solidify the rum industry topped the agenda.

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A vote last week by the Puerto Rico Legislature might be a sign that the dispute between that territory and the U.S. Virgin Islands over the rum cover-over is beginning to settle down, if it is sincere, Delegate Donna Christensen said Thursday.

Last week Puerto Rico's legislature voted to increase the percentage of the rum cover-over money the territory can use to directly support the island's rum industry, from 10 to 25 percent – with the option of increasing that to 46 percent. During the dispute over the deal that brought international liquor giant Diageo to neighboring St. Croix, Puerto Rico officials have maintained that they never use more than 10 percent to directly support the industry and have tried to convince Congress to enforce such a cap on the U.S. Virgin Islands.

That change of heart – if it is a change of heart – may indicate that Puerto Rico is ready to drop its protest over the Diageo deal, building the distillery that was commissioned last month using bond revenue backed by the V.I. government's anticipated cover-over funds, Christensen said in a telephone interview Thursday.

"I take it at face value," the delegate said.

At the same time, she noted that the provisions of Puerto Rico's action includes the proviso that the limit will remain at 10 percent if Congress should enact a 10-percent cap in 2011, indicating not everyone may be willing to let the issue die. The National Puerto Rico Coalition (NPRC), a powerful lobbying group, has promised to try to get action on the issue before the end of the year.

Two bills were introduced in Congress last year to enforce such a limit, but neither received any action and will die when the session expires at the end of the year. But Puerto Rico Resident Commissioner Pedro Pierluisi has not said he will not reintroduce the legislation in the new Congress, which convenes in January.

But if last week's action was a gambit to make Puerto Rico's position look more reasonable or flexible, Christensen said, it might well backfire.

"This apparently is the will of the government of Puerto Rico," she said. "If the legislature passed it, and if the governor signs it, that clearly tells us that the people of Puerto Rico want to allow the use of these funds in this way."

And that has been the V.I. government's position all along – not that one territory is right and the other is wrong, but that each territory should be free to use those funds in the way that meets its needs.

The Republican Party will take over control of the House of Representatives next year, but Christensen doesn't think that will weaken the U.S. Virgin Islands' position on the cover-over issue. She pointed out that both bills languishing in the current Congress were introduced by Democrats.

The NPRC has in the last year blamed the Congressional Black Caucus for supporting the V.I. government's position and preventing its efforts to change the cover-over program from taking root. On Thursday Christensen was voted first vice chair of the caucus.

On Wednesday, Gov. John de Jongh Jr. was in Washington, D.C., meeting with Congressional leaders, as well as with the territory’s D.C. team. The rum cover-over program and the territory's efforts to solidify the rum industry topped the agenda.