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June 10, 2008
GOVERNOR SIGNS TIF LEGISLATION; ACT 7004 CREATES ECONOMIC DEVELOPMENT OPTION FOR THOSE SEEKING TO MAKE SIGNIFICANT INVESTMENT IN THE V.I. Governor John P. deJongh, Jr. Tuesday approved legislation which implements tax increment financing in the Virgin Islands. The Administration proposal, which passed the Senate on an 11-4 vote last month, creates another economic development option for those interested in making significant investment in the territory. "I applaud the passage of this significant piece of legislation, and will work with the V.I. Economic Development Authority and the V.I. Public Finance Authority to implement this program, deJongh said in a letter to Senate President Usie R. Richards. The approval of this legislation puts the U.S. Virgin Islands on par with the 48 states, the District of Columbia, and the numerous local governments which utilize this vehicle to spur economic development via public-private partnerships. DeJongh said the first project anticipated to flow through this program is targeted for the island of St. Croix, and will help to stimulate that economy in particular, and the Virgin Islands economy as a whole. DeJongh approved other sections of the bill but line-item vetoed some appropriations contained in the measure. "My actions were prompted out of concern for the amount of funds available from the General Fund in Fiscal Year 2008. As you are aware, I yesterday submitted proposed legislation re-programming certain funding in order for the Government to meet the financial challenges presented during this Fiscal Year. In a similar vein, I have, and will continue to, look at new appropriations with these considerations in mind." The governor line-item vetoed Sections 3, 4, and 5 of the bill. DeJongh said he does not object to the purposes of these appropriations, but cannot approve them based on previously delineated concerns regarding the limited financial resources of the government’s coffers. Section 3 would have provided $50,000 to the Health Department to hire a dental hygienist for the dental clinic on St. John. Section 4 would have appropriated $27,200 for Little League district operations and Section 5 would have provided $73,800 to cover travel costs and expenses associated with the 2008 Little League Inter-Island Regional Tournament. "I have approved Sections 6 and 9 of this Bill, but advise you that, at this time, the government will only allot 50% of the funds appropriated in both sections. DeJongh explained that his decision to find funding to support Section 6 is driven by his commitment to assist our young people in their team sporting activities which are beneficial for their health, as well as their personal growth. "I proudly note that the Virgin Islands team is the defending champion of this tournament, and I support its continued success." Allotting funding in support of Section 9 is consistent with my theme of developing private-public partnerships which will inure to the benefit of the public at large. "I am acutely aware of the challenges facing the Virgin Islands in the area of mental health care, and my approval of this measure represents a step, albeit a small one, towards beginning to address this concern." DeJongh told senators that if additional funds come available through the remainder of Fiscal Year 2008, the government may be able to allot additional monies in the future. Section 6 provides $150,000. of which only $75,000. will be provided to the Elrod Hendricks West Charter Little League to host the Latin American / Caribbean Senior League tournament in July. Section 9 appropriates a $100,000 grant to Clear Blue Sky for administering community mental health programs, purchasing medical supplies and materials and maintenance of facilities. The Chief Executive vetoed Section 12 of the Bill as it would impact some companies which already receive tax incentive benefits from the V.I. Economic Development Commission. Section 12 would have prevented prohibited any amphibian commercial boats, water taxis or tour operators to be eligible for EDC benefits. "Our waters are one of the Virgin Islands’ most precious natural resources and an integral part of our tourism product. There are challenges we face daily on the appropriate balance between preservation of these resources and their use as an integral component of our economic activity. Therefore, a blanket prohibition as exhibited in this legislation is counter-productive. This measure would create a disincentive to develop water-based businesses, and, therefore, adversely impact our tourism product, and entrepreneurial opportunities that could be available to so many of our young people." DeJongh also said that there are local concerns, such as a taxi organization, currently exploring water-based activities to expand their existing business, and this measure would hinder this potential business expansion, at a time when we need to encourage economic development at all levels. Sections 2, 7, 8, 10, 11, and 13 of Bill No. 27-0182 were approved. Section 2 addresses administering the Tax Increment Financing legislation; Section 7 speaks to provides funding for travel per diems and retention bonuses for the V.I. Police Department; Section 8 provides funding for Kid Scope; Section 10 amends a technicality in a previously enacted legislation; Section 11 provides funding to paint public school buildings territory-wide; Section 13 makes a technical adjustment to previously passed legislation as regards the Virgin Islands Public Finance Authority. DOWNLOAD: Text of Act No. 7004 |
