Despite strong objections from Government House, Delegate to Congress Donna M. Christensen pushed a bill through the U.S. House of Representatives Wednesday that would give the territory a chief financial officer.
“I am pleased to have the support of my colleagues for this legislation which is important to the Virgin Islands people,” Christensen said in a press release issued late Wednesday.
The bill is not a done deal. It still needs approval by the U.S. Senate.
“I remain hopeful that this time, that there will be more support in the Senate,” Christensen said.
Government House responded early Thursday morning to the bill’s passage. In a press release, Gov. John deJongh Jr. said he remains opposed to what he considers a deeply flawed piece of legislation. He said the measure simply creates a new level of bureaucracy rather than addressing the fundamental causes of the territory’s fiscal challenges.
“Not only does the bill miss the mark in its diagnosis of the problems, it creates a false illusion of fixing them,” he said.
He said the current financial challenges were caused by a drastic drop in revenue that started four years ago, the result of the global economic downturn.
Additionally, he said this legislation represents the first proposal by a member of Congress to impose a federally created office to manage the financial affairs of a state or territory. He said it restricts the rights of voters and elected officials to address the territory’s problems and instead puts those responsibilities in the hands of Congress.
“This is the most troubling aspect of the bill, because simply put, it is a step backwards. It is unfortunate that at a time when our Legislature is taking up the issue of advancing a constitution for the Virgin Islands, our delegate is handing the reigns of our financial future over to Congress without even a voice from our people on the matter,” deJongh said.
According to the bill, the CFO’s duties are to develop and report on the financial status of the Virgin Islands government not later than six months after appointment and quarterly thereafter. Such reports shall be available to the public. Secondly, the CFO each year prepares and certifies spending limits of the annual budget, including annual estimates of all revenues of the territory without regard to sources, and whether or not the annual budget is balanced. And the chief financial officer revises and updates standards for financial management, including inventory and contracting, for the Virgin Islands government and for each agency in conjunction with the agency head.
The governor appoints the CFO from a list developed by the V.I. Chief Financial Officer Search Commission. The commission is made up of eight members appointed no more than 30 days after the date the bill goes into law. Those appointed must have recognized business, government, or financial expertise and experience.
One member of the commission is appointed by the governor, with the Legislature’s president appointing another. The Central Labor Council appoints a territorial government employee. The St. Thomas/St. John and St. Croix Chambers of Commerce and the president of the University of the Virgin Islands each get to appoint one member. An at-large member who must live on St. John is appointed by the Legislature. The final member is appointed by the president of AARP of the Virgin Islands.
The chairman of the commission is the chief justice of the territory’s Supreme Court or a designee. The chairman serves as an ex officio member of the commission and votes only in the case of a tie.
This is the fourth time in nine years the House has taken up the CFO bill. In Christensen’s last effort, the bill passed the House, but the Senate didn’t consider it. Christensen reintroduced the bill in December 2011.
“I believe that having an independent third party to determine the amount of revenues the local government has available to spend for the ensuing fiscal year is a positive development for our government. It is generally supported by a broad cross section of our electorate,” she said.
Christensen pointed to the differing budget projections of the executive and legislative branches last year and the request by unions and other citizens for transparency and verification.
“I am not under any illusion that my CFO bill will be a cure all for what ails the Virgin Islands,” she said. “I am proposing a five-year pilot program for improving transparency and trust in our budgetary and fiscal practices. If Virgin Islanders approve of the process and system for determining our annual budget limits, then they can vote to make the office permanent through the referendum that the bill provides for after year four of the CFO’s five-year term.”
Christensen linked the CFO legislation with the federal government’s assistance during the current economic crisis.
“The federal government has and will be providing significant funds to the Virgin Islands,” she said. “I am sure that having such an office will enhance our ability to successfully navigate through this very critical time because of the accountability and the transparency that it would provide.
Here is Bill HR-3706.