Statement by Governor John P. de Jongh, Jr. at a Press Conference to Discuss His Administration's Ongoing Fiscal Recovery Strategy 

GOVERNOR de Jongh: Thank you all for coming this afternoon. I would like to begin by first making a statement and then I will take your questions. 

The violent criminal acts that we saw this past weekend were a stark reminder that there is still more needed to be done by all of us in order to push back on those individuals who commit these deliberate acts of violence in our community.

During my meetings yesterday with Commissioner Novelle Francis, Assistant Commissioner Hyndman, as well as the territorial Chiefs and Deputy Chiefs, I reviewed the plans that the police have underway and the actions they will be taking to combat the types of violence as we saw this past weekend. I reiterated my support to them and assured them that they will have all the resources of the Administration that they need as they tackle this problem head on.

As I said yesterday, we will continue to work against those individuals who are involved in these acts of retaliation and street justice. There is no place in our community for it and we will continue to increase our efforts to stop it. These violent individuals, some of whom are out on bail, some of whom are outfitted with electronic monitors, are concerns that I intend to address with the Judiciary when I sit down with them, my Attorney General and the Commissioner of Police. 

I also ask for the continued vigilance of our community at large. As I said, we have seen increased involvement from the public in reporting wrongdoing and criminal acts and I want to thank those members of our community who have helped and ask for your continuing support.

The past week has also been a reckless time politically and unfortunately, a time of exaggerated rhetoric and posturing when it comes to the state of the territory’s finances and our economy. 

I will not spend too much time looking backwards as our challenges lie ahead and my job is to continue to find ways to move us forward. But in order to move forward we must do it together and that has been made considerably more difficult by a widespread campaign of misinformation and misdirection that needs to be understood by all and dealt with appropriately.

First: One of the big mischaracterizations currently out there, and that some continue to perpetuate, is that my Administration intended to sell individual’s real property. This is simply false. The proposal we submitted would have allowed us access to immediate financing with a pledge to repay the monies when future tax revenues were received. I even submitted a letter to the Senate President to make our intent clear and there was still a campaign promoting what was not true. So, let me dispel the usual election year rumors and melee by stating, for the record, that there has not been and there will never be any plans to sell individual’s real property – If someone says this to you, they are either misinformed or worse, they are lying to you.

Second: Bill 28-0227, to increase our borrowing authorization to $500 million, was approved by an 8-7 vote. And for that, all in the Virgin Islands should be thankful. The passage of this bill is by no means a cure all but it does mean that we do not have to lay off our workers and we do not have to cut essential government services, which would have had a terrible impact on our local economy and by association everyone in the territory. The passage of the bill is a step in the right direction, and provides us with more time to institute required government reforms and continue with our plans for economic growth: and to those eight (8) who voted to approve the measure I again offer my sincere thanks on behalf of the people of the territory to Senate President Louis Hill and Senators Sammuel Sanes, Michael Thurland, Patrick Sprauve, Wayne James, Alvin Williams, Carlton Dowe, and Celestino White .

But the debate that took place on this important measure was what was more troubling to me. The lack of respect and civility that was shown by some to our government representatives was inexcusable. And, now we are seeing that such behavior can incite similar actions outside the walls of the Legislature. I have said before and I will say again, that everyone is entitled to his or her own opinion, but one is not entitled to their own facts. And neither is it in the best interests of our people for their business to be conducted in such a manner that the process demeans and lessens us all.

I fully understand that it is an election year and since so much of this is obviously politically motivated, I am hopeful that we see and understand it for what it is. But we must also stick to the facts!

So here is a fact – The seven senators who voted against the measure plain and simply voted to shut down government, lay off government workers, and cut-off critical services. Do not let any of the post - vote spinning or press releases fool anyone – Those seven senators who voted No said very loud and very clearly: “Governor we want you to lay off government workers!!!”

But this was not just about government workers but instead was about how to avoid the kind of economic collapse that such layoffs would cause to our entire economy including our small businesses, thereby causing our private sector to suffer, and eventually causing our private sector workers to be laid off. I did not want to see the domino effect that such a reckless vote would have caused and I am glad the eight senators held their ground on this important issue that affects us all. 

It is extremely troubling when a senator says that he could not vote in favor of such an important measure for our territory until the Legislature and the Administration met together to work on cost-cutting measures – when, in fact, my financial team had met with senators over eleven times on these issues, quarterly budget hearings were held with nineteen departments and agencies, and all requests for information have been answered. This is plain, and simply, political posturing and grandstanding and it is an untruth that I will not allow to go unanswered. It must be shown and exposed for the empty statement that it is. 

What also became increasingly clear was the fact that many of those seven senators who opposed the legislation decided to use the debate to attack me personally. They have shown repeatedly now by their actions that they will do everything they can in opposition to our work even if it means bringing down the house around all of us, so long as I am in it. This type of leadership is wrong and it only ends up hurting the people of our territory.

I want to remind everyone that after twenty hours of testimony and debate not one of those seven senators who opposed the legislation offered a single cost cutting amendment to the borrowing bill – not a one. In other words, there was plenty of posturing and political attacks to go around but not one concrete amendment on how to help our people was offered from any of that group.

There were also senators in this recent debate who said we have not taken any hard decisions to reduce expenses before asking for the authority to borrow to fund our shortfalls. Yet, these same individuals:

• Rejected our proposal to implement unpaid holidays that would have reduced our costs by $10.4 million;
• Voted on the current year’s budget last year and knew that this budget and the Administration’s limited hiring freeze and attrition program have led to a net reduction of 313 employees for a savings of $27.8 million;
• Knew last year that we would need the additional funding that they waited almost a full year to authorize as part of Bill 28-0227; 
• And they all know something else. They all understand that the passage of Bill 28-0227 is not a fix-all that allows us to go forward as if all our problems are behind us. 

They knew all this and they still chose to put politics ahead of the well-being of our people. We are all operating in the same environment – it is a financial environment that has seen many states and territories close schools and hospitals, cut police forces, lay-off workers, and even raise taxes. And while we are also operating in this same space, our economic partnerships have provided us with the means to have some options while we institute more measures that will help us eventually grow. 

I have said before – and I will repeat it again today – this bill is not the solution to all of our problems. It is only the next step on the difficult path to recovery. A recovery that we have worked very hard on and I am proud to say that to date we have managed to avoid some of the disastrous cuts we have seen in other states and territories.

I am also proud of the work done by members of my Cabinet and my Financial Team. Contrary to the assertions of some senators, who say otherwise and have tried to diminish our efforts, we have already undertaken many measures to reduce costs including: 

• The Office of Management and Budget reduced allotments to departments and agencies by $23.1 million;
• Our limited hiring freeze and attrition program resulted in a smaller workforce and $27.8 million in savings; 
• Our fleet management program reduced fuel consumption for savings of $1.2 million in additional gasoline costs due to a 17.5% decrease in consumption;
• Travel is always an easy target to go on about – but it should be recognized that we have significantly reduced the use of General Fund monies when it comes to travel expenses and that will continue.

So now, we need to look ahead to what is next. If the current national economic trends continue, we will still be looking at a $170 million dollar shortfall at the end of this year. What we will need to do is make some very hard choices when it comes to next year’s budget. 

The budget is due at the end of May but, in part because of the Senate’s delay in acting on the matters before them, we are going to postpone delivery of the budget for approximately two weeks.

All in the Senate know – and have known – that the budget process is the next step – and for those who have been quick to proclaim that they are ready to stand up and make the tough choices that they claim we have avoided – they will soon have the chance to stop talking and instead let their actions do the talking.

We shall present some hard choices. But these further cutbacks, cost reductions, increases in fees and costs, whatever may prove necessary, have all been anticipated. None of this can be claimed to be a surprise by any senator – Not after the show we saw put on last week. 

And believe me when I say that the choices ahead are hard. 

• We are looking at the consolidation of some of our schools to save monies in our Department of Education;
• We are examining and prioritizing our federal grants in order to decide which grants we will have to forgo because we cannot afford the local matching funding;
• We will be implementing the freezing of all government salaries for exempt employees for the next year;
• We will also be freezing all government rents throughout the territory for a minimum of one year;
• And, we will be proposing a moratorium on transfers out of the General Fund for other purposes.

And if Senators want to set the right tone and send the right signal that they understand the true dimensions of the financial and budgetary crisis that we face, and that sacrifice starts at the top. I invite them to pass a provision reducing the salaries of all elected officials in the Virgin Islands by ten percent for a period of one year. When they send me such a provision that applies to us all, I will happy to sign it into law.

However, all should take note that there are some expenditures that need to be made for the valid economic reason that they are more than just owed; they are a stimulus to our economy, especially with our local businesses. Tax refunds are just such an item, and I am pleased to report that because of the passage of Bill 28-0227, tax refunds have resumed and the first wave of such payments have already been mailed.

Before taking your questions, I want to again thank Senators Hill, Sanes, Thurland, Dowe, Sprauve, Williams, White, and Wayne James who acted in the best interests of all Virgin Islanders last week to give us the authority we needed to keep our government operating without disruption. 

These individuals understood what others either do not understand, or pretended not to understand, and that the issue before the Senate last week had nothing to do with whether we wanted to borrow because we lack the discipline to spend less, but rather it was that we must continue to do both – cut where cuts can be made and most importantly, keep our government functioning. 

They understood that our challenge was – and remains -- not just how to avoid laying off government workers, but how to avoid the kind of economic collapse all in the territory to suffer. 

We are all in this together. And by working together, we will keep our economy working and rise together as our economic future improves.

Thank you. I will now take your questions.

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