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USVI governor welcomes US senate extension of rum cover-over for two years
Published on April 5, 2014 Email To Friend    Print Version

ST THOMAS, USVI -- US Virgin Islands Governor John de Jongh has hailed the action taken by the US Senate Finance Committee to extend the rum cover-over rate for two years without limitations or restrictions. The bill makes the extension retroactive to January 1 of this year.

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US Virgin Islands Governor John de Jongh
De Jongh said on Thursday that the action by the Committee is a direct result of his administration’s efforts on this issue.

“During our meetings in Washington, we pressed not only for reconsideration of the decision taken by the Department of the Interior that reduced the advance payment of rum cover-over revenues to $10.50 per gallon, rather than the $13.25 extender rate which had been in place up until December 31, 2013, but for Congressional action to make the higher rate permanent. Our hard work on this issue resulted in the reversal of the Department of Interior's original decision and the release of some $30 million dollars to the territory at the $13.25 rate. Following on the heels of that victory, I am pleased by the vote on the legislation in the US Senate Finance Committee which moves us closer to our goal of full Congressional approval of the extender rate at the $13.25 level. The support of Chairman Wyden and his colleagues, most especially Senators Rockefeller, Hatch and Crapo, who have been steadfast supporters of the interests of the Virgin Islands, is much appreciated,” de Jongh said.

The governor pledged the continuing efforts of all in his administration to make all members of the US House and Senate aware of the importance of the rum cover-over revenues to the government of the US Virgin Islands, and the need for the extenders to be approved permanently at the higher rate.

Locally, all should be reminded that the 2014 fiscal year budget was passed by the Legislature based on the assumption that the rum cover-over would be at the higher $13.25 rate. The $30 million received in February after the governor’s meetings in Washington moved the territory $30 million closer to meeting the budgeted revenue assumption, but there remains an expected budget shortfall to $40.5 million which still must be addressed.

On Thursday, de Jongh reiterated that he and his financial team “will continue to meet with the members of the 30th Legislature to determine what must be done to deal with the shortfall.”

“Although I am pleased by the action taken by the US Senate Finance Committee, we cannot forget that our financial challenges have not disappeared. Only increasing revenues or enacting austerity measures, or a combination of both, will see us through the remainder of this fiscal year,” he said.
 
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