May 23, 2009 — Gov. John deJongh Jr. is asking for legislative approval to issue $75 million in Matching Fund Revenue Bonds for projects across the territory.
“The aggregate economic impact of these projects will supplement the programs, infrastructure investment, tax allowances and energy initiatives of the American Recovery and Reinvestment Acts of 2009," deJongh said in a Government House statement Saturday.
“This legislation and these projects provide an opportunity to support employment at a time when the private sector investment will continue to be slow. In addition, pushing forward our investment activity in a time of slowing private sector construction, will allow us to take advantage of lower construction costs as we face less competition for our construction dollars.”
The international economic recession has slowed tourism, construction, and other industries, which, in turn, has decreased Gross Receipts taxes, so the administration is proposing to seek bonds secured by Matching Fund revenues, which are based on the territory's current and future rum production.
"This source of funding remains steady presently and will increase when the (Diageo) rum distillery goes online, and as (Cruzan) continues to grow its production capacity," deJongh said.
If authorized by the Legislature and secured in the private bond market, the bonds would finance over $12 million of investments in schools, almost $6 million for solid waste facilities to assist in coming into compliance with federal mandates, over $9 million in emergency management infrastructure and over $20 million for improvements to and upgrading of local roads.
As with the federal stimulus, the goal is to support small business activity, continued employment and the flow through of resources to government coffers by investing in critical infrastructure and other capital needs. By boosting economic activity during the downturn, the bond spending should generate governmental revenue in the form of gross receipts, income, and other taxes, according to Government House.
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