While the majority of fiscal year 2010 budget bills passed through the Senate’s Appropriations and Budget Committee Tuesday, one bill that would cut eight paid government holidays and allow the government to borrow an extra $100 million to cover various operational expenses was tabled indefinitely.
Over the past few months of budget hearings, members of the governor’s financial team have said the unpaid holiday initiative would stave off other cost-cutting measures, such reduced work weeks, furloughs and, most importantly, employee layoffs.
The initiative was projected to save the government more than $14 million in FY 2010 — a sizeable chunk of money in the midst of a budget shortfall that’s expected to top $200 million in FY 2009 alone, and even more in FY 2010. Financial team members have said the territory is currently "mired" in a deep economic downturn that’s expected to get worse before it slowly begins to get better.
On Tuesday, senators said the territory is fortunate, given the current economic climate, not to have had to consider these options. But they have consistently decried taking away employees’ holidays and instead decided to slash the FY 2010 General Fund budgets of several departments and agencies — along with the miscellaneous section of the budget — in an attempt to balance out the numbers.
"We have been prudent in trying to ensure that government employees will continue to enjoy their benefits and the salaries they get for working from the government," Senate President Louis P. Hill said Tuesday as senators considered the stack of FY 2010 budget bills.
To mitigate the projected shortfalls, senators recently passed a $250 million borrowing bill that would allow the government to draw funds from public accounts and local banks in an effort to cover its mandatory operating costs. Most recently, financial team members said they would need $100 million more to get through FY 2010, but senators also shot that request down Tuesday, saying that they expect revenues to pick up once various capital projects throughout the territory get moving.
Financial team members said they would be drawing $100 million in FY 2009 from the $250 million line of credit to be obtained through the banking syndicate formed by FirstBank and Banco Popular, leaving another $150 million to cover expenses in FY 2010, Hill said after Tuesday’s meeting.
"There is clearly a need for operating capital," he added during the meeting. "What the majority decided, however, and what will be reflected in this vote, is the fact that we do not believe it is necessary to authorize any additional borrowing for the government. As we continue to go through the fiscal year and look at how the money will be coming in, we will be in a better position to look at whether it’s necessary to borrow the another $100 million."
However, senators have decided to allow the government to use up to $50 million of the money to pay prior year’s obligations. The issue was first brought up during last week’s special session, where financial team members defended several proposed amendments to the borrowing bill — including a section to allow the government to use any money it has left over after all current expenses are paid for outstanding vendor payments and other obligations, which total around $44.2 million.
At the time, senators said they would be addressing the issue in the FY 2010 budget. But it was not made clear Tuesday at what time or in what bill the authorization would be given.
After Tuesday’s meeting, Appropriations and Budget Committee chairman Sen. Carlton "Ital" Dowe said that an omnibus bill including various policy changes would be surfacing in an upcoming Rules and Judiciary Committee meeting. Some of the changes include appropriating $600,000 to Education Department sports coordinators in each district to pay for team travel expenses; mandating that bail be immediately revoked for individuals who violate their bail conditions; calling for a review conducted through the Personnel Division of classified and unclassified government positions; and authorizing, again, the building of a government complex that would house the Internal Revenue Bureau, Lieutenant Governor’s Office, Economic Development Authority and Planning and Natural Resources.
In other news, senators also approved a 50-year lease, at $1 a year, for Frederiksted Health Care Inc.
Present during Tuesday’s meeting were Sens. Craig W. Barshinger, Dowe, Hill, Neville James, Wayne James, Terrence "Positive" Nelson, Sammuel Sanes, Patrick Simeon Sprauve and Michael Thurland.
