ST. CROIX, VI - The Committee on Budget, Appropriations, and Finance, led by Senator Novelle E. Francis, Jr. met in the Fritz E. Lawaetz Legislative Conference Room. Lawmakers received testimony on the proposed Fiscal Year 2027 Budget for Department of Health, the Department of Human Services, and the Virgin Islands Housing Authority.

Justa Encarnacion, Commissioner of the Virgin Islands Department of Health delivered a proposed FY 2027 General Fund budget of $31,790,725.  Additional funds include federal funds of $27,563,462, the Health Revolving Fund of $1,500,000, non-appropriated funds, including the Vital Statistics Corp reimbursement, and emergency services of $538,185, and a total federal grant portfolio of $87.5 Million. The Department has 307 employees. 143 are funded through the general fund. 164 positions are federally funded.  In the last Fiscal year, there were 10 resignations, 16 retirements, and one death. There are currently 38.5 general fund vacancies and 17.5 federal fund vacancies. There were six new hires. Strategic hires included the Chief Nursing Officer, Director of Licensure and Regulatory Board, and Staff Nurse- Community Health. Encarnacion noted that the Department has reported substantial revenue generation across divisions, including $498,99 from environmental health, $112,179 from Community Health Clinics, and $907,087 in Title X Family Planning Funds. However, Encarnacion has noted challenges including staff shortages, rising costs, and reduced revenue in certain areas.

Encarnacion noted the department’s extensive capital improvement portfolio of $370.9 Million, which includes reconstruction of health facilities in the territory, including the new Donna M. Christian-Christiansen Health Center, Morris deCastro Clinic, and Knud Hansen Tower. Behavioral health has faced high demand, having served 818 individuals and managing 56 off island placements. Encarnacion noted that the territory has maintained one of the highest infant breast-feeding rates in the nation at 69%.

Averil George, Commissioner of the Virgin Islands Department of Human Services delivered a proposed FY 2027 operating budget of $200,976,727. This includes a federal grant portfolio of $128,389,652. The local General Fund request totals $72,587,075. This represents an increase of $7,445,489 over Fiscal Year 2026. An additional $545,000 is dedicated to miscellaneous general fund appropriations dedicated to community and special products, which include $500,000 for the Energy Crisis Elder/Other program, and $45,000 for the DHS Centennial Living Treasures Initiative.  The General Fund request is broken down as follows: Personnel Services at $20,862,535, Fringe Benefits at $10,864,398, Utility services at $2,750,000, supplies at $839,800, other services at $37,746,789, and capital projects at $97,398.

The Department lists numerous federal grants. These grants help support the Department in areas such as Medicaid and Healthcare, Child welfare and Protection, early childhood and childcare, senior disability and rehabilitation, food security and public assistance, and territorial development and victim support.  George reminded the body that the FY 2027 budget stays within local funding limits, but DHS is actively managing major operational changes as required by the “Big Beautiful Bill”. The Department has a total of 573 employees in the territory. 305 are in the St. Croix District and 268 are in the St. Thomas-St. John District. There have been 3 deaths, 20 resignations, 12 retirements, and 1 dismissal. DHS has also highlighted the various capital projects that have been underway, such as the opening of five new headstart facilities in the territory.

Dwayne Alexander, Director of the Virgin Islands Housing Authority, delivered its budget of $49 Million. The Authority does not receive a local general fund appropriation and is funded entirely from the United States Department of Housing and Urban Development.  The budget is distributed into Low Income Public Housing, totaling $19.4 Million, the Capital Fund Program, totaling $10.8 Million, the Housing Choice Voucher Program, totaling $16.9 Million, Housing Choice Voucher Program, totaling $1.9 Million, and the Central Office Cost Center, totaling $1.1 Million. The Authority has a total of 167 employees. There were 31 vacancies. Alexander voiced concern over aging infrastructure, rising operating costs, limited affordable housing inventory, federal funding uncertainty, workforce shortages and the operational demands of development.  Much of the housing portfolio includes developments that were built decades ago, which require major investment to improve. The authority faces major maintenance, utility, infrastructure and repair costs that rise faster than federal operating subsidies.

The President’s FY 2027 budget has proposed reductions to several housing programs. Furthermore, many housing authorities nationwide have been plagued with staffing shortages that affect operations, maintenance, and administrative capacity. Alexander has also voiced concern over limited utilization of the Housing Choice Voucher program, as many families are unable to find units that meet affordability and program requirements.  The Authority is also operating under a Compliance and Recovery Plan, which requires very strict milestones, reporting, and performance improvements.

Senators present at today’s committee hearing were Novelle E. Francis Jr., Marvin A. Blyden, Dwayne M. Degraff, Ray Fonseca, Hubert L. Frederick, Marise C. James, Carla J. Joseph, Clifford Joseph, Avery L. Lewis, and Kurt A. Vialet.

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