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PFA and ODR Questioned About Projects and Spending

Adrienne Williams-Octalien, director of the Office of Disaster Recovery, said it would need more money next year. (Photo courtesy V.I. Legislature)

Nathan Simmonds, director of Finance and Administration at the Public Finance Authority, testified Tuesday that the authority’s budget for fiscal year 2025 was $27.42 million, a 40 percent increase, or $7.84 million, over fiscal year 2024.

He said this was due primarily to increased funding required for the Office of Disaster Recovery, a Public Finance Authority subsidiary division.

Adrienne Williams-Octalien, director of ODR, also testified at the Committee on Budget, Appropriations and Finance hearing.

She testified that for FY 2024, ODR’s total operating expenses were just over $10 million and were funded by $2.5 million from the General Fund and $7.6 million from federal disaster grant programs.

However, she said ODR would need almost $16 million this year “as the territory sets out to launch the new comprehensive territorial recovery strategy — Rebuild USVI and tackle more complex projects.” She said the proposed budget supports including a specialized project management office.

Federal reimbursements would fund $12 million of the ODR budget through FEMA and HUD disaster programs.

She said 34 recovery projects were completed in 2023, including the successful territory-wide training initiative, Skills for Today, the WIC building at the Knud Hansen Complex on St. Thomas, and the Elaine Sprauve Public Library on St. John.

Committee Chair Sen. Donna Frett-Gregory was concerned about a project that had not progressed much. The EnVIsion Tomorrow Homeowner Rehabilitation and Reconstruction Program has been under criticism almost since its inception in 2020. The program is to repair and rebuild homes damaged during hurricanes Irma and Maria in 2017.

Williams-Octalien testified that 30 homes had been completed and $44 million of the $245 million obligated to the program had been spent. Frett-Gregory said, “That is a lot of money. A lot more Virgin Islanders should have been helped.”

At the meeting, senators also expressed concerns about the funds allocated to the Government Employees’ Retirement System Rescue Plan. The plan was based on the territory receiving back from the United States $13.25 for each proof gallon of rum sold stateside. However, for the last two years, the territory has only been receiving $10.50, and Simmonds said there is no indication it will be raised in the upcoming year. He said the government covered the shortfall to GERS in the first year but not in the second year. He said he expected it to be larger in the upcoming year. This year, the shortfall was $34 million.

Frett-Gregory said it was a critical issue, and Congress needed to act to get the sum back up to $13.25. Simmonds said Congress “is caught in dysfunction.”

Williams-Octalien said ODR had successfully increased its original funding projections from $8 billion to $15 billion. Notable projects include Roy Lester Schneider Hospital, which will receive $1 billion; Charlotte Amalie High School, which will receive $402 million; St. Croix Central High School, which will receive $248 million; John H. Woodson, which will receive $188 million, and Charles H. Emmanuel, which will receive $100 million.

Simmonds was questioned about the award of a contract for Turnaround Management Services for the Water and Power Authority to Ernst & Young. Sen. Carla Joseph wanted to know if Ernst & Young was an independent enough firm since it has worked with WAPA before.

Simmonds said the firm receiving the contract was independent from the one that had previously worked with WAPA.

Senators Marvin Blyden, Dwayne DeGraff, Ray Fonseca, Novelle Francis Jr., Frett-Gregory, Javan James, and Carla Joseph attended the meeting.

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