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Senators Upset With Governor's Handling of Budget

Nov. 17, 2004 –– Two senators had different reactions Wednesday to Gov. Charles W. Turnbull's second line-item veto in six months of the $9.2 million in raises for unionized government employees.
Senate President David Jones had been a champion of the raises and led the successful move to override both of the governor's vetoes. Sen. Adlah "Foncie" Donastorg had voted against the override, but took exception to another action of Turnbull's.
Citing the recent changes to the tax code that could adversely affect the territory's Economic Development Commission tax incentive program, Turnbull said in his cover letter to Jones, "The new law has the potential to cause substantial damage to the EDC program, and result in significant revenue losses which could threaten the fiscal stability of the government."
Jones said Wednesday, "The veto was not unexpected because of what happened after we passed the budget. The actions of the U.S. Congress have impacted all of our projections because a significant portion of our revenue comes from the EDC program.
"Now, we don't know for sure what that impact that will be. I believe the governor took the initiative, however," Jones said. "I would much prefer if he had left it in the budget, and then delayed the implementation of the increase until such time that we knew for sure what the revenue picture would be. He could have signed it, and said he would delay implementing it, and that would have demonstrated a serious commitment to honoring the union contracts."
Donastorg, who, along with Sen. Lorraine Berry, voted against the override of the governor's previous veto, was incensed at another action the governor took Tuesday.
The Senate had funded the union pay raises by taking away funds from income tax refunds and infrastructure improvement. Turnbull left that part of the legislation intact.
Donastorg had successfully sued the government to ensure that 10 percent of income tax collected was set aside for refunds as mandated by law. (See "Income Tax Refunds in Jeopardy, Senator Warns").
Donastorg said Wednesday, "I'm extremely disturbed. I thought he would have line-item vetoed that as well as the raises. The legislators made a mistake, and that was very insensitive [to the taxpayers]. Secondly, it contradicts a consent agreement. Bear in mind that halving the 10 percent sends us back to 1956 when the government set aside 4.5 percent. That was never adhered to, and that's why I took it to court.
"I increased it to 10 percent," Donastorg said, "in a compromise with the administration. I had suggested 15 percent, but they said it was too high. To reduce it to 5 percent is to set us back years. It's a travesty for the taxpayers. They look forward to that windfall each year, private sector as well. It hits the government employees twice –– no pay raises and no refunds."
The governor took a jab at the Legislature in his line-item veto of its $16.5 million budget. Turnbull had sent down a $16 million budget, which the senators increased to $16.5 million to fund raises for Legislature employees. In his message, Turnbull said in part that he was vetoing the budget, "in light of the fact that the executive budget that serves the vast majority of the residents of the V.I., has been cut by the Legislature."
The action could not have been a complete surprise to the Legislature, as this is an almost annual dance between the two branches of government.
Jones said he is not certain when and if he will call a full session of the Legislature before his term ends in January. He said he would have to confer with his colleagues. "We won't necessarily have a session, because everybody is busy organizing things. We will see," he said. Jones, along with three other Democratic members of the 25th Legislature –– Sens. Douglas Canton, Emmett Hansen II and Luther Renee –– lost their seats in the elections earlier this month.
Democratic Sen. Ronald Russell managed to retain his seat by a small margin.
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