TROUBLE IN PARADISE: Fiscal Crisis And Corruption Loom Over Virgin Islands Federal Hurricane Money
The Virgin Islands was out of sight and out of mind in Washington, D.C. until category-five hurricanes Irma and Maria devastated the U.S. territory in the Caribbean.
Washington’s benign neglect made it easy for the territorial government to overspend, overtax and over-borrow itself into a fiscal crisis that was only made worse by Irma and Maria. The lack of direct accountability and real oversight has fostered a culture of corruption that has hindered the competent delivery and performance of basic public services.
High-profile murders in the territory, which the FBI said had the country’s highest murder rate in 2016, go unsolved. Public corruption is so prevalent that a now-former senator in the islands’ legislature infamously said there was nothing wrong with embezzling public money on a Friday provided it was paid back Monday.
The Daily Caller uncovered extensive corruption by the then-governor, John deJongh Jr., in 2012. DeJongh and the former director of the Public Finances Authority were later arrested and charged with embezzling nearly a half a million dollars.
There have also been serious questions over the legitimacy of elections, as the Democrat-controlled elections board rigged the 2016 vote by keeping Republican nominees off the ballot. Irregularities were so bad at one point that the Democrat attorney general refused to represent the board.
Even before the hurricanes, the territorial government was for all intents and purposes bankrupt with two days’ cash-on-hand. With a junk bond rating, the islands have a public debt higher than bankrupt Puerto Rico.
While it failed to provide basic services competently — a government-run hospital struggled to maintain federal certification and St. Croix, the biggest island, was left without a working ambulance — Gov. Kenneth Mapp spent as much as $400,000 on a Cadillac limousine and two armored Chevrolet Suburban sport utility vehicles that were akin to what the Secret Service has for the U.S. president.
Mapp, a former Republican-turned-independent who as a senator was expelled from the legislature for voter fraud, wants $7.5 billion for hurricane recovery, despite initially asking Washington for $5.5 billion.
Considering the diminished capacities of the territorial government before Irma and Maria — to say nothing of the corruption and incompetence — it is reasonable to question how it will handle billions in federal dollars.
Just last week, the head of the insolvent pension fund said he wants hurricane money to pay for a $4.5 billion bailout of the Government Employees’ Retirement System. The fund is notoriously mismanaged with a history of bad investments that include a $15 million loan to a hotel that the Virgin Island sinspector general called illegal.
There is no question that the Virgin Islands is entitled to its fair share of federal recovery dollars. It should receive every dollar it is due, just like Puerto Rico and Texas.
The problem is the manner in which Congress oversees the Virgin Islands hasn’t worked.
Congress needs to reform the system to increase scrutiny and strengthen the role of the administration, regardless of the president of the day, to ensure that every dollar appropriated to the territory goes to where it is intended.
Otherwise, it will be business as usual in the Virgin Islands.
Dennis Lennox is a political commentator and public affairs consultant. He was executive director of the Republican Party of the Virgin Islands. Follow @dennislennox on Twitter.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of The Daily Caller.