[Congressional Record Volume 151, Number 30 (Monday, March 14, 2005)]
[House]
[Pages H1379-H1381]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  CREATING OFFICE OF CHIEF FINANCIAL OFFICER OF GOVERNMENT OF VIRGIN 
                                ISLANDS

  Mr. JONES of North Carolina. Mr. Speaker, I move to suspend the rules 
and pass the bill (H.R. 62) to create the Office of Chief Financial 
Officer of the Government of the Virgin Islands, and for other 
purposes.
  The Clerk read as follows:

                                H.R. 62

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. CHIEF FINANCIAL OFFICER OF THE VIRGIN ISLANDS.

       (a) Appointment of Chief Financial Officer.--
       (1) In general.--The Governor of the Virgin Islands shall 
     appoint a Chief Financial Officer, with the advice and 
     consent of the Legislature of the Virgin Islands, from the 
     names on the list required under section 2(d). If the 
     Governor has nominated a person for Chief Financial Officer 
     but the Legislature of the Virgin Islands has not confirmed a 
     nominee within 90 days after receiving the list pursuant to 
     section 2(d), the Governor shall appoint from such list a 
     Chief Financial Officer on an acting basis until the 
     Legislature consents to a Chief Financial Officer.
       (2) Acting chief financial officer.--If a Chief Financial 
     Officer has not been appointed under paragraph (1) within 180 
     days after the date of the enactment of this Act, the Virgin 
     Islands Chief Financial Officer Search Commission, by 
     majority vote, shall appoint from the names on the list 
     submitted under section 2(d), an Acting Chief Financial 
     Officer to serve in that capacity until a Chief Financial 
     Officer is appointed under the first sentence of paragraph 
     (1). In either case, if the Acting Chief Financial Officer 
     serves in an acting capacity for 180 consecutive days, 
     without further action the Acting Chief Financial Officer 
     shall become the Chief Financial Officer.
       (b) Transfer of Functions.--
       (1) In general.--Upon the appointment of a Chief Financial 
     Officer under subsection (a), the functions of the Director 
     of the Office of Management and Budget established under the 
     laws of the Virgin Islands shall be transferred to the Chief 
     Financial Officer. All employees of the Office of Management 
     and Budget become employees of the Office of the Chief 
     Financial Officer.
       (2) Documents provided.--The heads of each department of 
     the Government of the Virgin Islands, in particular the head 
     of the Department of Finance of the Virgin Islands and the 
     head of the Internal Revenue Bureau of the Virgin Islands 
     shall provide all documents and information under the 
     jurisdiction of that head that the Chief Financial Officer 
     considers required to carry out his or her functions to the 
     Chief Financial Officer.
       (c) Duties of Chief Financial Officer.--The duties of the 
     Chief Financial Officer shall include the following:
       (1) Assume the functions and authority of the office of the 
     Office of Management and Budget established under the laws of 
     the Virgin Islands as transferred under subsection (b).
       (2) Develop a report on the financial status of the 
     Government of the Virgin Islands not later than 6 months 
     after appointment and quarterly thereafter. Such reports 
     shall be available to the public and shall be submitted to 
     the Committee on Resources in the House of Representatives 
     and the Committee on Energy and Natural Resources in the 
     Senate.
       (3) Each year certify spending limits of the annual budget 
     and whether or not the annual budget is balanced.
       (4) Monitor operations of budget for compliance with 
     spending limits, appropriations, and laws, and direct 
     adjustments where necessary.
       (5) Develop standards for financial management, including 
     inventory and contracting, for the government of the Virgin 
     islands in

[[Page H1380]]

     general and for each agency in conjunction with the agency 
     head.
       (6) Oversee all aspects of the implementation of the 
     financial management system provided pursuant to section 3 to 
     ensure the coordination, transparency, and networking of all 
     agencies' financial, personnel, and budget functions.
       (7) Provide technical staff to the Governor and legislature 
     of the Virgin Islands for development of a deficit reduction 
     and financial recovery plan.
       (d) Deputy Chief Financial Officer.--Until the date that is 
     5 years after the date of the enactment of this Act, the 
     position of the Director of the Office of Management and 
     Budget of the Virgin Islands shall--
       (1) have the duties, salary (as specified in subsection 
     (f)(3)), and other conditions of the Deputy Chief Financial 
     Officer in lieu of the duties, salary, and other conditions 
     of the Director of the Office of Management and Budget of the 
     Virgin Islands as such functions existed before the 
     appointment of the Chief Financial Officer; and
       (2) assist the Chief Financial Officer in carrying out the 
     duties of the Chief Financial Officer.
       (e) Conditions Related to Chief Financial Officer.--
       (1) Term.--The Chief Financial Officer shall be appointed 
     for a term of 5 years.
       (2) Removal.--The Chief Financial Officer shall not be 
     removed except for cause. An Acting Chief Financial Officer 
     may be removed for cause or by a Chief Financial Officer 
     appointed with the advice and consent of the Legislature of 
     the Virgin Islands.
       (3) Replacement.--If the Chief Financial Officer is unable 
     to continue acting in that capacity due to removal, illness, 
     death, or otherwise, another Chief Financial Officer shall be 
     selected in accordance with subsection (a).
       (4) Salary.--The Chief Financial Officer shall be paid at a 
     salary to be determined by the Governor of the Virgin 
     Islands, except such rate may not be less than the highest 
     rate of pay for a cabinet officer of the Government of the 
     Virgin Islands or a Chief Financial Officer serving in any 
     government or semi autonomous agency.
       (f) Conditions Related to Deputy Chief Financial Officer.--
       (1) Term; removal.--The Deputy Chief Financial Officer 
     shall serve at the pleasure of the Chief Financial Officer.
       (2) Replacement.--If the Deputy Chief Financial Officer is 
     unable to continue acting in that capacity due to removal, 
     illness, death, or otherwise, another person shall be 
     selected by the Governor of the Virgin Islands to serve as 
     Deputy Chief Financial Officer.
       (3) Salary.--The Deputy Chief Financial Officer shall be 
     paid at a salary to be determined by the Chief Financial 
     Officer, except such rate may not be less than the rate of 
     pay of the Director of the Office of Management and Budget.
       (g) Resumption of Functions.--On the date that is 5 years 
     after the date of the enactment of this Act, the functions of 
     the Chief Financial Officer shall be transferred to the 
     Director of the Office of Management and Budget of the Virgin 
     Islands.
       (h) Sunset.--This section shall cease to have effect after 
     the date that is 5 years after the date of the enactment of 
     this Act.

     SEC. 2. ESTABLISHMENT OF COMMISSION.

       (a) Establishment.--There is established a commission to be 
     known as the ``Virgin Islands Chief Financial Officer Search 
     Commission''.
       (b) Duty of Commission.--The Commission shall recommend to 
     the Governor not less than 3 candidates for nomination as 
     Chief Financial Officer of the Virgin Islands. Each candidate 
     must have demonstrated ability in general management of, 
     knowledge of, and extensive practical experience at the 
     highest levels of financial management in governmental or 
     business entities and must have experience in the 
     development, implementation, and operation of financial 
     management systems. Candidates shall not have served in a 
     policy making or unclassified position of the Government of 
     the Virgin Islands in the 10 years immediately preceding 
     appointment as Chief Financial Officer.
       (c) Membership.--
       (1) Number and appointment.--The Commission shall be 
     composed of 9 members appointed not later than 30 days after 
     the date of the enactment of this Act. Persons appointed as 
     members must have recognized business, government, or 
     financial expertise and experience and shall be appointed as 
     follows:
       (A) 1 individual appointed by the Governor of the Virgin 
     Islands.
       (B) 1 individual appointed by the President of the 
     Legislature of the Virgin Islands.
       (C) 1 individual, who is an employee of the Government of 
     the Virgin Islands, appointed by the Central Labor Council of 
     the Virgin Islands.
       (D) 1 individual appointed by the Chamber of Commerce of 
     St. Thomas-St. John.
       (E) 1 individual appointed by the Chamber of Commerce of 
     St. Croix.
       (F) 1 individual appointed by the President of the 
     University of the Virgin Islands.
       (G) 1 individual appointed by the Chief Judge of the Virgin 
     Islands Territorial Court.
       (H) 1 individual, who is a resident of St. John, appointed 
     by the At-Large Member of the Legislature of the Virgin 
     Islands.
       (I) 1 individual appointed by the Advocates for the 
     Preservation of the Retirement System.
       (2) Terms.--
       (A) In general.--Each member shall be appointed for the 
     life of the Commission.
       (B) Vacancies.--A vacancy in the Commission shall be filled 
     in the manner in which the original appointment was made. Any 
     member appointed to fill a vacancy shall be appointed for the 
     remainder of that term.
       (3) Basic pay.--Members shall serve without pay.
       (4) Quorum.--Five members of the Commission shall 
     constitute a quorum.
       (5) Chairperson.--The Chairperson of the Commission shall 
     be the Chief Judge of the Territorial Court or her designee 
     and shall serve as an ex officio member of the Commission and 
     shall vote only in the case of a tie.
       (6) Meetings.--The Commission shall meet at the call of the 
     Chairperson. The Commission shall meet for the first time not 
     later than 15 days after all members have been appointed 
     under this subsection.
       (7) Government employment.--Members may not be current 
     government employees, except for the member appointed under 
     paragraph (1)(C); and
       (d) Report; Recommendations.--The Commission shall transmit 
     a report to the Governor and the Resources Committee of the 
     House of Representatives and the Committee on Energy and 
     Natural Resources of the Senate not later than 60 days after 
     its first meeting. The report shall name the Commission's 
     recommendations for candidates for nomination as Chief 
     Financial Officer of the Virgin Islands.
       (e) Termination.--The Commission shall terminate 210 days 
     after its first meeting.

     SEC. 3. FINANCIAL MANAGEMENT SYSTEM.

        It is hereby authorized to be appropriated such sums as 
     necessary for the installation of a Financial Management 
     System, including appropriate computer hardware and software, 
     to the Government of the Virgin Islands. Upon becoming 
     available, the financial management system shall be available 
     to the Chief Financial Officer and, after the date that is 5 
     years after the date of the enactment of this Act, the 
     Director of the Office of Management and Budget of the Virgin 
     Islands, to assist the Chief Financial Officer or the 
     Director of the Office of Management and Budget of the Virgin 
     Islands, as the case may be, to carry out the official duties 
     of that office.

     SEC. 4. DEFINITIONS.

       For the purposes of this Act, the following definitions 
     apply:
       (1) Chief financial officer.--In sections 1 and 2, the term 
     ``Chief Financial Officer'' means a Chief Financial Officer 
     or Acting Chief Financial Officer, as the case may be, 
     appointed under section 1(a).
       (2) Commission.--The term ``Commission'' means the Virgin 
     Islands Chief Financial Officer Search Commission established 
     pursuant to section 2.
       (3) Governor.--The term ``Governor'' means the Governor of 
     the Virgin Islands.
       (4) Removal for cause.--The term ``removal for cause'' 
     means removal based upon misconduct, failure to meet job 
     requirements, or any grounds that a reasonable person would 
     find grounds for discharge.

     SEC. 5. NO ABROGATION OF POWERS.

       Nothing in this Act shall be construed to permit the 
     Governor and Legislature of the Virgin Islands to dilute, 
     delegate, or otherwise alter or weaken the powers and 
     authority of the Office of Management and Budget established 
     under the laws of the Virgin Islands.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
North Carolina (Mr. Jones) and the gentlewoman from the Virgin Islands 
(Mrs. Christensen) each will control 20 minutes.
  The Chair recognizes the gentleman from North Carolina (Mr. Jones).


                             General Leave

  Mr. JONES of North Carolina. Mr. Speaker, I ask unanimous consent 
that all Members may have 5 legislative days within which to revise and 
extend their remarks and include extraneous material on H.R. 62.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from North Carolina?
  There was no objection.
  Mr. JONES of North Carolina. Mr. Speaker, I yield myself such time as 
I may consume.
  Mr. Speaker, our colleague, the gentlewoman from the Virgin Islands 
(Mrs. Christensen), has introduced legislation to address a potentially 
serious problem relating to her territory's financial future. Her 
legislation, H.R. 62, would create an Office of Chief Financial Officer 
for the United States Virgin Islands.
  For over a decade now, multiple factors have led to a worsening 
financial outlook in this territory. Natural disasters, a gradually 
declining tourism industry and resulting spending decisions by the 
local government have left the U.S. Virgin Islands with significant 
annual deficits. Further, this territory now faces a debt totaling $1 
billion.
  This legislation uses local and Federal input to select a Chief 
Financial

[[Page H1381]]

Officer. The CFO will tackle the difficult fiscal and related political 
decisions with regard to spending on these islands. This position will 
be temporary and will be empowered to stop wasteful spending and put 
this territory on the track to more sound economic footing.
  The financial practices of the United States Virgin Islands have 
taken a primary position in the minds of its citizens and thus remain 
of great importance to my colleague, the gentlewoman from the Virgin 
Islands (Mrs. Christensen). Without this legislation, one must worry 
that the Federal Government may have to take even more direct action if 
this debt continues to increase.
  Finally, I would like to also point out that identical legislation, 
H.R. 3589, was passed by the Committee on Resources in the 108th 
Congress and by the whole House on September 22, 2004. We are hopeful 
that early action on this legislation during the Congressional session 
will translate into more momentum for the enactment of H.R. 62.

                              {time}  1430

  I hope bipartisan support of this legislation will continue, and I 
urge adoption of the bill.
  Mr. Speaker, I reserve the balance of my time.
  Mrs. CHRISTENSEN. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, today we are poised to pass this bill for the second 
time. I thank the gentleman from North Carolina (Mr. Jones) for his 
kind and supportive remarks. I also want to take this opportunity to 
thank the gentleman from California (Mr. Pombo) and the gentleman from 
West Virginia (Mr. Rahall), particularly, but all of the members of the 
House Committee on Resources and the staff on both sides for their 
unwavering support in getting this bill to the floor again today.
  Mr. Speaker, most people in my district agree that with the passage 
of this bill, H.R. 62, which would create a Chief Financial Officer for 
the U.S. Virgin Islands, we will make an important step forward and lay 
a stronger foundation for our children's future. We also would restore 
the confidence of the public in our government.
  While it has not been an easy journey, it has become very clear that 
the people of the Virgin Islands recognize the need for more 
accountability, transparency, and efficiency in the management of 
Federal and local funding. The implementation of an independent CFO is 
clearly not the only way to achieve this, but it is the only viable 
proposal that has come forward over the last 8 years or more of 
increasing deficits and narrowly averted fiscal crises, crises which 
have only been delayed through repeated borrowing.
  Included in H.R. 62 is also funding for the planning and 
implementation of a financial management system. This is a critical 
part of the bill and the responsibility of the Chief Financial Officer 
this bill would create. While the groundwork has already begun under 
the current administration, it is my belief, given the millions of 
dollars that have been spent in the past on financial systems, that the 
only way to ensure that it is fully transparent, networked, and 
integrated is if it is overseen by someone who is independent and has 
no official territory to protect.
  This is not to cast any aspersions on the hardworking public servants 
who currently head or work at any of our departments, including our 
Office of Management and Budget. Protecting one's turf is simply human 
nature. On the other hand, the system under which they labor is 
outdated, cumbersome, ineffective and cannot support the missions of 
their offices or the optimal functioning of our government.
  I would be remiss, however, if I did not commend the Governor and his 
staff for the recent steps they have taken to restore our government to 
fiscal health. Yet our public services, our salaries, our contracting 
process with compliance with contracts, our infrastructure, and our 
accounting is not where it needs to be. And the fiscal information 
needed for effective planning is simply unavailable in a reliable form.
  While the support for my bill is not unanimous, especially in the 
higher echelons of local leadership at home, it is broad. It exists at 
all levels of our society, and it spans all three islands.
  I do not want to belabor the reasons which made it necessary for this 
bill to be here before this body today, except to say that major 
hurricanes, changes in Federal tax policy, as well as a systemic 
dysfunction in central government operations, have played a role.
  There is no need or reason to point blame, but shame on us if we do 
not provide the leadership for which we were elected, and fix the 
problem. Pushing for passage of this bill has neither been easy nor 
have I taken it lightly. I understand the consequences of stepping 
beyond the political status quo, as I have done with this legislation; 
but I have also seen in other jurisdictions the consequences of acting 
as though everything was fine and doing nothing. And I have pursued it 
on behalf of and because of the strong and unwaiving support of the 
people of the U.S. Virgin Islands.
  I want to thank my colleagues again for their support and ask for a 
``yea'' vote.
  Mr. RAHALL. Mr. Speaker, in my capacity as the ranking Democratic 
member of the Resources Committee, I would like to register my strong 
support of H.R. 62, to create the office of chief financial officer for 
the territory of the U.S. Virgin Islands.
  This Chamber passed similar legislation in the 108th Congress because 
of the tireless and tenacious efforts of Mrs. Christensen. Today, we 
are bringing up this legislation early in the Congress hoping the 
Senate will act on it expeditiously.
  The financial condition of the Virgin Islands remains in trouble. 
Skyrocketing deficits coupled with inadequate fiscal controls have left 
the local government struggling to provide basic services to the people 
of the Virgin Islands.
  Just last week, the U.S. Department of Education issued an order to 
the Virgin Islands Government to hire an independent contractor to 
manage approximately $35 million in annual grants because the local 
government did not have a financial system in place to adequately 
account for the grants. Regrettably, this recent order was not the 
first of its kind by one of our Federal agencies levied against the 
local Virgin Islands Government.
  Clearly, the lack of financial accountability and the potential for 
financial insolvency of the territory did not occur overnight. 
Nevertheless the introduction of this measure, by the distinguished 
representative of the Virgin Islands, Donna Christensen, continues to 
be met with controversy and opposition from many local political 
leaders.
  Donna Christensen has made it clear that this legislation is 
something that she would rather not have to do, but the circumstances 
of her territory have made the choices for her. She is a brave woman 
for fighting for what she believes is in the best interest of her 
constituents and for her island and she should be commended.
  Virgin Islands history will tout this legislation as a turning point 
in the fundamental approach that the territory handles its financial 
affairs.
  I have said it before, and I will say it again today: When the next 
chapter in Profiles in Courage is written, it will be about the 
gentlelady from the Virgin Islands, Donna Christensen.
  I urge my colleagues to support favorable passage by this body of 
H.R. 62.
  Ms. CHRISTENSEN. Mr. Speaker, I yield back the balance of my time.
  Mr. JONES of North Carolina. Mr. Speaker, I have no additional 
speakers, and I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Petri). The question is on the motion 
offered by the gentleman from North Carolina (Mr. Jones) that the House 
suspend the rules and pass the bill, H.R. 62.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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