Mapp Decries Taxpayer Subsidies for Casinos in Veto Message

Gov. Kenneth Mapp this week vetoed recent legislation to subsidize casino renovations with tax dollars and decried the Senate’s override of his veto of legislation giving the Casino Control Commission explicit power to waive casino investment requirements.

Mapp vetoed a measure sponsored by Sen. Kurt Vialet to expand a taxpayer subsidy for development to allow tax money to be pledged not just for new construction or new businesses, but also "for repair or remodeling of buildings."

Vialet’s measure, approved without debate during session May 10, also expands subsidies to include private casinos built in existing hotels, while Mapp said the existing law limits the "tax increment finance" subsidy to government-owned infrastructure improvements.

This sort of TIF financing was used to pay for government infrastructure for the shopping center that houses St. Croix’s Home Depot.

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Mapp said the measure would give "the owners of the hotel and casino at Caravelle Hotel access to pledge government revenues to fund its capital investment requirement." He said it would also expand the types of government revenues that can be used to pay the private debt obligations beyond incremental gross receipts taxes and incremental real property taxes within the current TIF program, adding casino and hotel room occupancy taxes.

Mapp recalled his veto in March of a bill sponsored by Sen. Kenneth Gittens to allow the Casino Control Commission to waive certain room requirements to obtain a gaming license for a hotel in the enterprise zone – particularly the Caravelle Hotel.

“At the time of my veto, I asked, why would we waive the requirement for a gaming establishment owner to make a real investment in our economy before extracting dollars from the same? I asked on March 23 about the construction jobs, the spending in the community, the purchase of land to build the new rooms,” Mapp said in his letter explaining his actions to Senate President James.

The Legislature overrode that veto on March 30, giving the Casino Control Commission the authority to waive the investment requirement of building the new rooms and public spaces before operating a casino. The commission subsequently delayed the investment requirement and, on April 21, the casino at Caravelle Hotel was opened, Mapp said.

He asked what senators believe should be the financial investment made by the owners of the Caravelle Casino into the economy of the Virgin Islands in order to operate a casino.

“The members of the 31st Legislature seem quite content by way of this amendment to heave upon the taxpayers of the territory the capital investment requirements of the casino operator,” he wrote. “The Senate is clearly saying, not only are we prepared to suspend the casino operator’s personal investment requirements, but we are now prepared to allow the operator to use taxpayers’ money to pay for them. How sad," Mapp wrote in his letter.

While the change creates a new statutory authority to grant license waivers, according to Gittens, it has the effect of limiting the ability of the Casino Control Commission to grant them, by putting conditions on them. The commission had previously granted a temporary waiver of some conditions of the Caravelle Hotel’s license. Gittens’ bill gives it explicit authority to do so, but also puts a time limit for investments to be made.

According to Mapp, the bill has drafting errors that make it impossible to implement, so even if his veto is overridden, it will not go into effect.

Mapp also vetoed a measure to reduce the minimum base wage for tip service workers to 35 percent of the territory’s minimum wage, down from the 40 percent level enacted recently by the Legislature.

“Three months ago, I signed a bill into law allowing private employers in the Virgin Islands the authority to pay only 40 percent of the hourly minimum wage to tip service employees. I signed the Senate’s proposal to increase the minimum wage and the percentage of the minimum wage paid to tip service workers because your bill was consistent with my administration’s efforts to increase pay to all employees,” Mapp said.

“Why is the Senate now reducing this paltry wage to tip service employees?” Mapp wrote. “Out of fairness and equity and on behalf of tip service workers in the Virgin Islands, I am vetoing this proposal.”

He also vetoed a bill to redistribute the revenues collected from traffic fines to the V.I. Police Department, the courts and the Bureau of Motor Vehicles. Right now, the revenues currently go to the Government Insurance Fund and he said the bill would eliminate a necessary source of revenue.

Mapp criticized the Legislature’s decision to reconsider legislation increasing the number of signatures needed to run for office from 50 to 100. The Senate passed the increase earlier this year but voted May 10 to reconsider the change in committee, due to objections from smaller V.I. political parties such as the Independent Citizens Movement and the Republican Party. Mapp said this year’s candidates did not seem to have an issue in meeting the new requirements.

“There are 44,752 registered voters in the U.S. Virgin Islands,” he wrote. “Forty-six candidates have filed nomination petitions under Act 7863, with at least 100 signatures of registered voters to vie for the offices of Delegate to Congress and the Legislature of the Virgin Islands in the current election cycle. Why are we reducing the requirement back to 50?” Mapp asked.

He also vetoed a zoning use variance for a veterinarian clinic in Estate Green Cay, saying the zoning map number within the bill was incorrect.

Mapp approved a rezoning in Estate Orange Grove to allow owner H.C. Ruparelia to subdivide an 11.471-acre parcel, which would allow him to sell it for development as small, individually owned businesses or residential homes.

He approved a measure mandating the Government Employees Retirement System to again offer loans to active members of GERS in amounts not exceeding $10,000, but Mapp asked the Senate to amend the law to limit the amount of interest GERS can charge its members.

Mapp approved a bill honoring John Tranberg of St. Croix, who turned 100 earlier this year, but questioned a decision to appropriate $7 million to buy Creque Dam from Tranberg and make it a park. The bill does not require the government to buy the land, nor set the purchase price. But Mapp questioned the amount, saying it would mean a price of $565,000 per acre for the undeveloped land.

The governor also signed an unfunded mandate to provide grief and stress counseling training to school counselors, but urged the Legislature to find funding for it.

Mapp also signed bills requiring proper storage of firearms outside of correctional facilities; creating an unfunded commission to periodically set pay for top government officials; appropriating half a million dollars to the Law Enforcement Planning Commission; and renaming the road by St. Croix Central High after the late Eddie Ortiz.

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