[Congressional Record (Bound Edition), Volume 150 (2004), Part 14]
[House]
[Pages 19020-19023]
[From the U.S. Government Publishing Office, www.gpo.gov]




  CREATING OFFICE OF CHIEF FINANCIAL OFFICER OF THE GOVERNMENT OF THE 
                             VIRGIN ISLANDS

  Mr. NEUGEBAUER. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 3589) to create the Office of Chief Financial Officer of the 
Government of the Virgin Islands, as amended.
  The Clerk read as follows:

                               H.R. 3589

       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

[[Page 19021]]

     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 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 semiautonomous 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

[[Page 19022]]

Texas (Mr. Neugebauer) and the gentlewoman from the Virgin Islands 
(Mrs. Christensen) each will control 20 minutes.
  The Chair recognizes the gentleman from Texas (Mr. Neugebauer).


                             General Leave

  Mr. NEUGEBAUER. 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. 3589.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.
  Mr. NEUGEBAUER. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, the gentlewoman from the Virgin Islands (Mrs. 
Christensen) has introduced this legislation to address a potentially 
serious problem relating to her territory's financial future. Her 
legislation, H.R. 3589, will create an Office of the Chief Financial 
Officer for the United States Virgin Islands.
  For over a decade now, multiple factors have lead to a worsening 
financial outlook in this territory. Natural disasters, a gradually 
declining tourism industry, and the 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.
  Given this economic instability and the worsening conditions, serious 
actions should be considered. For this reason, the Delegate has 
introduced 3589. This legislation uses local and Federal input to 
select an Office of the Chief Financial Officer. The CFO will tackle 
the difficult fiscal and related political decisions with regard to 
spending on these islands.
  It is important to note that this individual and his or her staff 
will functionally be independent of the executive and legislative 
branches of the local government. This position will be temporary and 
will be empowered to stop wasteful spending and put this territory back 
on the track to more sound economic footing.
  Without this legislation, one must worry that the Federal Government 
may have to take an even more serious action if this debt continues to 
increase. I am thus hopeful that the House can support the gentlewoman 
from the Virgin Islands' (Mrs. Christensen) bill so that we can begin 
to address the dire financial situation in this territory.
  Finally, I would like to point out that H.R. 3589, as amended, was 
passed by the Committee on Resources by voice vote on July 14, and I 
appreciate the bipartisan work of the committee in acting quickly on 
this legislation.
  I hope we can act in the same bipartisan fashion. I urge adoption of 
this 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, I want to begin by thanking the gentleman from 
California (Mr. Pombo) and the ranking member, the gentleman from West 
Virginia (Mr. Rahall), for their support in making it possible for H.R. 
3589 to get through the committee and be on the floor of the House 
today. I am really heartened by the support I received from both sides 
of the leadership and the members of my committee, the hard work of the 
staff, as well as from the gentlewoman from the District of Columbia 
(Ms. Norton), and members of the Congressional Black Caucus on this 
issue, which I believe to be important to the short and long term well-
being of the Virgin Islands.
  I want to thank the ranking member, the gentleman from West Virginia 
(Mr. Rahall), for standing shoulder to shoulder with me on this issue 
in the face of significant opposition and insisting that my bill be a 
top priority of the Democratic Caucus of our committee.
  Mr. Speaker, today is a day of great moment for the people of the 
Virgin Islands and for me because with passage of this bill we are a 
significant step closer to achieving a goal to put in place a mechanism 
to address the fiscal challenges that continue to face our territory. 
Many Members' districts have been in similar situations, and Members 
have addressed them in similar ways.
  I have introduced this bill before us today, H.R. 3589, because 
throughout my tenure as the Representative of the people of the Virgin 
Islands in the House of Representatives, I have seen the territory's 
fiscal condition come dangerously close to collapse on several 
occasions.
  In the absence of any similar local action being taken, I believe 
that the only course to reverse this trend is to create an office with 
the independence and the authority to help us exercise the fiscal 
restraint and better fiscal management of both Federal and local funds, 
something all of our local leadership agrees must be done.
  Mr. Speaker, it has not been easy for me to watch the fiscal health 
of the territory steadily decline since I have been in office. Since 
the middle 1990s, successive administrations and legislatures have, for 
good reason, not been able to maintain sound fiscal management and 
financial policies.

                              {time}  1900

  While some of the reasons for this condition have been outside of our 
control, such as recurrent catastrophic hurricanes and the tax cuts and 
credits passed by Congress, much of the blame for this condition can be 
traced to the unfortunate reality that the territory's managers and 
lawmakers have not substantively addressed the imbalance between the 
needs and demands of the community and its revenues.
  It was not, and still is not, my intention in introducing H.R. 3589 
to cast aspersions on the fiscal policies of the current administration 
or the legislature or past ones. However, I feel very strongly that I 
could not sit idly by while we continue to face fiscal crisis after 
fiscal crisis without offering some solution to temper or soften the 
difficult decisions that we ourselves, not the Federal Government, have 
to make to get us out of this roller-coaster approach to managing our 
fiscal affairs.
  Nevertheless, in taking this action, I was opposed by the governor 
and lieutenant governor, as well as my party leadership back home, who 
disagreed with this approach. A resolution that went so far as to 
condemn my action was passed by the Members of the 25th legislature, 
but the people of the Virgin Islands, who have long called for 
accountability and transparency in our government, have supported this 
bill strongly from the outset.
  As I reflect on what led me to this point today, I am reminded of a 
quote by Dr. Martin Luther King, Jr., which was brought to my attention 
by a local attorney, in which Dr. King said, ``The ultimate measure of 
a man is not where he,'' or she, I would say, ``stands in moments of 
comfort and convenience, but where they stand in times of challenge and 
controversy.''
  Mr. Speaker, we are indeed facing challenging and difficult times in 
the Virgin Islands. The actions of those of us in leadership today will 
have profound effects for our future.
  While H.R. 3589 will not be a panacea or solve all of our problems, 
it will help to keep our finances in order and prevent us from sinking 
further into a fiscal black hole.
  I urge my colleagues to support this bill, and I again want to thank 
the gentleman from California (Chairman Pombo) and the gentleman from 
West Virginia (Ranking Member Rahall) and the staff.
  Mr. Speaker, I yield back the balance of my time.
  Mr. NEUGEBAUER. Mr. Speaker, I yield myself such time as I may 
consume.
  I would just like to commend the gentlewoman for bringing this 
solution forward and for taking on the responsibility of representing 
and making sure that the folks in her island are represented correctly.
  So I commend her for that and for her great work on this.
  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. 3589, to create the office of chief financial officer 
for the territory of the U.S. Virgin Islands. I commend the

[[Page 19023]]

gentlelady from the U.S. Virgin Islands, Donna Christensen, for her 
tireless work in getting this legislation to the floor for our 
consideration.
  As has been noted this evening, the financial condition of the Virgin 
Islands is 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.
  The potential 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, 
was still 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 done, 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 show that this legislation was a turning 
point in the fundamental approach that the territory handles its 
financial affairs. Indeed, this evening may one day be looked upon by 
the residents of the Virgin Islands as one of those rare moments when 
history itself seemed to hold its breath. When the voice of the people, 
on that beautiful Carribean island, rose louder and louder and 
thundered over various political obstacles and was heard, and acted 
upon, in this hallowed chamber that is the U.S. House of 
Representatives.
  I have said it before, and I will say it again this evening. 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. 3589.
  Mr. NEUGEBAUER. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Terry). The question is on the motion 
offered by the gentleman from Texas (Mr. Neugebauer) that the House 
suspend the rules and pass the bill, H.R. 3589, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________