ST. THOMAS, VI - The Committee on Budget, Appropriations, and Finance, led by Senator Novelle E. Francis, Jr. met in the Earle B. Ottley Legislative Hall. Lawmakers received testimony from the Governor’s Financial team on the proposed Fiscal Year 2027 Executive Budget for the Government of the US Virgin Islands. Lawmakers considered measures that would appropriate monies for technological upgrades at the Virgin Islands Taxicab Commission, as well as a measure that would redirect the appropriation from the First Time Homebuyers program to the Williams Delight Community Homeownership Program. Additionally, lawmakers considered a measure that would require the Virgin Islands Housing Finance Authority to pay compensation to homeowners within the LBJ Gardens community who have been required to vacate their homes as a result of the actions related to the demolition of properties owned by the Virgin islands Housing Finance Authority, and associated with the operations of the Virgin Islands Water and Power authority and the Virgin Islands Waste Management Authority.  Approved items on today’s agenda will be forwarded to the Committee on Rules and Judiciary for further consideration and action.

Julio Rhymer, Director of the Office of Management and Budget delivered testimony on behalf of the Governor’s Financial Team. The total proposed budget is $1,638,468,438. This includes the general fund appropriation of $958.2 Million, $93.39 Million in other appropriated funds, $43.6 Million in other non-appropriated funds, and $543.28 million in federal funds. Rhymer also highlighted that access to safe and affordable housing remains one of the territory’s pressing challenges.  $733.9 Million is expected to be spent on disaster recovery in FY 2027.  Major construction projects include health facilities, projects to replace power generation, and rebuilding schools. Total government workers total 9,825 employees, with the Central Government totaling 5,550 employees. For FY 2026 to date, there have been 474 hires, with 272 new hires, 244 separations and 805 salary changes. Group health insurance costs have increased from FY 2024 through FY 2026. Approximately 25,000 individuals are covered.

Rhymer highlighted that the economy of the US Virgin Islands continues to recover with modest growth being driven by government spending, expanding tourism activity and low unemployment. The economy remains stable, supported mainly by strong visitor arrivals and sustained federal funding. Tourism remains a key contributor to economic stability in the territory. Visitor arrivals reached approximately 2.6 million in 2025 and approached 1.1 million as of March 2026.  Hotel occupancy rates reached 67.9% in March 2026. The labor market has also shown improvement with the workforce having grown by .8% between 2024 and 2025. It is expected to reach 41,350 by 2027, with unemployment remaining low at 3.55%

Rhymer stated that the five major local revenue categories have shown varied growth compared to the Fiscal Year 2026, with a year-end estimate of $846,081,260,000 for all revenues before obligated transfers in and out. Personal Income Tax (PIT) collections indicate a 2% projected increase from FY 2026 from $421.79 million to FY 2027’s $427.95 Million. There is minimal growth in corporate income tax, from FY 2026’s $72.32 Million to FY 2027’s $72.45 Million. Real Property Tax has increased from FY 2026’s $55.01 Million to FY 2027’s $56.23 Million.  Gross Receipts Tax has a baseline increase of 6.3% from FY 2026’s $230.24 Million to FY 2027’s $244.97 Million, with disaster related activity up to $274.7 Million. Excise tax has increased 14.2% from FY 2026’s $37.67 million to FY 2027’s $43.01 million. Hotel/Non Hotel taxes have increased from FY 2026’s $64.44 million to FY 2027’s $68.62 Million, about 6% supporting the Tourism Revolving Fund.  General Fund Revenue is expected to increase from FY 2026’s $848.8 million to $958.2 Million for FY 2027. Gross collections total $1.04 Billion.

When questioned about the outstanding vendor payments, Commissioner of Finance Kevin McCurdy stated that there was approximately 40 to 45 million in outstanding vendor payments. Additionally, McCurdy also stated that the government currently has 13 days or approximately $53 Million in cash on hand. McCurdy also stated that revenue collection remained flat compared to FY 2025.  Joel Lee, Director of the Bureau of Internal Revenue stated that through the End of May 2026, $610 million had been collected in revenue.  Lee stated that while they are ahead of last year, he stated that it could have been more.

Senators considered Bill No. 36-0045, An Act appropriating the sum of $400,000 from the Tourism Advertising Revolving Fund to the Virgin Islands Taxicab Commission for the implementation of technological upgrades. The measure was sponsored by Senator Angel L. Bolques, Jr; and cosponsored by Senator Marvin A. Blyden.

Kevin McCurdy, Commissioner of the Department of Finance did not support the proposed measure. McCurdy said that the Tourism Advertising Revolving fund is dedicated to supporting tourism related contractual obligations, seasonal cash flow needs, and ongoing program commitments. While he stated that the modernization of taxi technology is a reasonable and forward looking policy goal, the department did not support the proposed funding mechanism. The Department of Tourism does not draw from the general fund and relies on its own revenue to cover vendor contracts, marketing activities, grant matches, and special events. McCurdy stated that drawing from this fund would risk service interruptions, vendor nonpayment and harm the  tourism sector. McCurdy recommended that daily economic reconciliation of fares and fees should be instituted,  centralizing of cash handlining or move aggressively towards cashless payment systems, and conducting thorough internal and external financial audits, as well as a comprehensive operations review to identify new revenue opportunities and areas for cash reduction.

Rupert Ross, Director of the Bureau of Information Technology said that the Department took no position on the funding source or appropriation mechanism in the measure. Ross stated that the need for modernization was needed as the agency currently relies on manual processes and paper based records, which limit efficiency.  The Bureau of Information Technology had already been actively supporting the Virgin Islands Taxicab Commission to strengthen its technology environment. This has included deploying fully operational computer systems for staff, integrating them into the government domain, and implementing enhanced network infrastructure.

Melissa Smith, Acting Executive Director of the Virgin Islands Taxicab Commission, stated that the measure presents the transformative opportunity to bring the Commission into alignment with modern administrative regulatory practices. Smith states that through automation and digital integration, we can significantly improve internal workflows, enhance public service delivery and strengthen regulatory enforcement. Modernization would digitize licensing and regulatory processes for taxi drivers and vehicles,  streamline faire monitoring, improve investigative and compliance tracking capabilities, and enhance transparency and accountability through real time data access. Smith states that a modernized, fully digital system would allow the Taxi Cab Commission to connect in real time with key government agencies, such as the BMV, IRB, VIPD, DOF, DPP, OMB and BIT, which would verity fax clearances, licensing and compliances data, reducing delays, and improving accuracy.

Lawmakers considered Bill No. 36-0273, An act amending Act No. 8465 redirecting the appropriation from the First-Time Homebuyers Program to the Williams Delight Community Homeownership Program and the VI Slice Homeownership Program. The measure was sponsored by Senator Kurt A. Vialet.

Julio Rhymer, Director of the Office of Management and Budget delivered testimony in strong support of the proposed measure. Rhymer stated that the measure reflects a thoughtful and strategic approach to one of the most pressing needs in the community, affordable and attainable housing. The measure would allocate $2 million to the Virgin Islands Economic Development Authority to support the Slice Moderate Income Homebuyer Assistance Program. The program has demonstrated success in helping working families bridge the financial gap associated with buying a home. Additionally, the measure would restructure $2 Million currently earmarked for first time homebuyer assistance at VIHFA by converting it into a grant program that provides up to $50,000 per eligible applicant for the cistern and slab program. When combined with existing assistance, eligible applicants can receive up to $100,000, which can significantly improve their ability to initiate home construction.   It also would provide $376,000 to support residents in the Williams Delight community on St. Croix to purchase the rental homes they currently occupy.

Valdez Shelford, Interim Executive Director of the Virgin Islands Housing Finance Authority voiced concern over the proposed measure. She stated that the first time homebuyers program is a revolving loan fund designed to support moderate incoming holds who do not qualify for federal subsidies. Shelford states that redirecting these funds could weaken VIHFA’s ability to maintain a balanced set of homeownership programs, reduce financing options for prospective buyers, and undermine several upcoming developments across St. Thomas and St. Croix. Shelford informed the body that while grant based programs like VI Slice attract strong public interest, they do not replenish themselves, unlike the revolving loan model. Shelford states that removing funding from the First-Time Homebuyers Program would limit homeownership opportunities, reduce support services such as financial literacy and create operational challenges as VIHA develops new housing units without sufficient financing tools for buyers. She urged lawmakers to preserve the program’s funding to ensure sustainable long term homeownership pathways and maintain a diversified portfolio of housing assistance options for Virgin Islanders.

Dwayne Alexander, Executive Director of the Virgin Islands Housing Authority voiced strong support for the measure. Alexander noted that several homes in Williams Delight have already transitioned to private ownership, more are being rehabilitated and additional families are progressing through the qualification process.  Alexander said that while the proposed appropriation of $265,000 is modest, it would meaningfully advance rehabilitation, buyer assistance and community stabilization. Alexander also stated that the broader value of home ownerships is a pathway to generational wealth, neighborhood stability and long term economic mobility for Virgin Islanders. Additionally, Alexander states that  aligning local homeownership initiatives with HUD’s Housing Choice Voucher Homeownership program could significantly expand access for low-income working families, especially amid proposed federal budget cuts that reduce HUD funding by 44%.

Testimony was read into the record from Wayne Biggs, Executive Director of the Virgin Islands Economic Development Authority.  Biggs’ testimony stated that there is a strong demand for the VI Slice program, with 117 applications being received since May 31, 2026.  87 applications were approved and 84 have been fully closed, totalling $8.6 million in dispersed gap financing with over $25 million in primary lender financing. Funding was exhausted quickly previously with the last $2 Million appropriation lasting only 60 days, which forced the portal to close early, despite continued daily inquiries.

Policymakers considered Bill No. 36-0274, An act requiring the Virgin Islands Housing Finance Authority to pay compensation to the homeowners within the LBJ Gardens community who have been required to vacate their homes as a result of the actions related to the demolition of properties owned by the Virgin Islands Housing Finance Authority and associated with the operations of the Virgin Islands Water and Power Authority and the Virgin Islands Waste Management Authority. The measure was sponsored by Senators Clifford A. Joseph, Sr., Marise C. James, Novelle E. Francis, Jr. and Hubert L. Frederick;  and cosponsored by Senators Angel L. Bolques, Jr., and Ray Fonseca.

Julio Rhymer, Director of the Office of Management and Budget supported the measure. Rhymer called the measure a matter of public safety, stating that the families of LBJ Gardens are living in an area where is there is a recognized risk, and we have a moral and governmental obligation to act decisively to ensure their safety and well-being. The measure would allocate $7 Million in funding from stamp tax revenues to facilitate the buyout and relocation of the residents. Rhymer recommended that instead of using stamp tax revenues, the territory leverage the already approved US HUD mitigation grant funding of up to $3 Million to initiate the relocation and buy out process and actively pursue a Brownfield’s Grant to secure the balance of funding needed, up to an additional $4 million to fully support the relocation effort. Rhymer stated that stamp tax funds are essential to the Territory’s broader housing strategy, which would expand affordable housing development, strengthen the infrastructure investments tied to housing, and maximize the long term impacts of existing federal recovery funds.

Valdez Shelford, Interim Executive Director of the Virgin Islands Housing Finance Authority did not support the proposed measure.  Shelford stated that the VIHFA is not displacing an LBJ gardens homeowners as a part of its demolition work and clarified that it is only demolishing long abandoned, unsafe apartment buildings that it owns, structures that have long become hubs for crime and public safety hazards.  She stated that no occupied homes are being touched and that no residents are being asked to leave.  Shelford stated that any impacts from the demolition would be minimal. Shelford voiced opposition to using Stamp Tax Funds to compensate owners, stating that it is essential for infrastructure and affordable housing developments  in the territory.  Alternatives proposed by Shelford include the CDBG-MIT Buyout program which currently identifies LBJ as a strong candidate, and EPA Brownfield grants due to environmental impacts from WAPA and WMA facilities nearby.

Dionne Sinclair, General Counsel for the Virgin Islands Water and Power Authority voiced support for the measure. Stating that the LBJ Gardens has evolved from a primarily residential neigbhorhood into a more industrialized zone, it is surrounded by critical infrastructure including the Waste Management Authority’s LBJ pump station, a board yard and WAPA’s Richmond power plant and related facilities, such as the fuel dock. These are essential assets that cannot be relocated.  Wanda Centeno, President of LBJ Gardens voiced concern, stating that residents of the LBJ community have endured years of environmental hazards, health concerns and deteriorating living conditions caused by their proximity to major industrial and government facilities. Centeno’s testimony urged the body to take decisive action by establishing a clear 6 month timeline for relocation, compensation, and environmental mitigation. She called for dedicated funding and fair compensation based on replacement value rather than depressed and appraised values, and the safe removal of abandoned structures without endangering nearby homeowners.

Upon further discussion, Bill No. 36-0045 was held in Committee at the call of the Chair. Bill No. 36-0273 and Bill No. 36-0274 were voted upon favorably. They will be forwarded to the Committee on Rules and Judiciary for further consideration and action.

Senators present at today’s committee hearing were Novelle E. Francis Jr., Marvin A. Blyden, Angel L. Bolques, Jr., Dwayne M. DeGraff, Ray Fonseca, Hubert L. Frederick, Kenneth L. Gittens, Clifford A. Joseph, Carla J. Joseph, Milton E. Potter, and Kurt A. Vialet.

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