Amendment to transfer insurance guaranty funds causes furor

ST. THOMAS - Senators attached a handful of unrelated amendments to a bill to reprogram Community Development Block Grant funds this week.

The bill was the last on Thursday's session agenda, and Senate President Ronald Russell allowed each senator to offer up to two unrelated amendments.

One amendment, offered by Sen. Carlton Dowe, caused a commotion on the Senate floor, with senators yelling across the room at each other and everyone talking at once.

It was voted down.

Then it was reconsidered, altered and approved.

The amendment as it was first offered would have transferred $40 million from the Insurance Guaranty Fund to the General Fund for general governmental use.

The Insurance Guaranty Fund collects premium taxes assessed to insurance companies that operate in the territory, and the money is available after a natural disaster if an insurance company cannot pay its claims and becomes insolvent. The fund is required by law to have a $50 million balance.

In 2007, legislation was passed to use $45 million from the fund to make retroactive wage increases owed to government workers. The legislation required a letter of credit to secure a loan if the money is needed before the fund replenishes itself. Once the Insurance Guaranty Fund is restored to $50 million, the letter of credit is canceled. If the credit line established by the letter should be needed, the V.I. Public Finance Authority would loan the money to the government.

Last year, the Public Finance Authority chose Banco Popular de Puerto Rico to secure the letter of credit. The loan was scheduled to mature in three years, with an option to extend it for three years.

The amendment initially offered Thursday would have extended the agreement further, until the Insurance Guaranty Fund is fully restored after the new appropriation.

As part of the transfer, $3 million would have been given to the territory's hospitals to pay outstanding V.I. Water and Power Authority bills. In addition, the amendment would have freed up prior appropriations for specific purposes - restricted funds - and unrestricted them so the hospitals could use the money however they need.

"These are some serious and critical times for our medical facilities, and I think we must do all we can to assist them at this time," Dowe said Thursday.

Several senators strongly opposed taking money from the Insurance Guaranty Fund and dumping it into the General Fund with no restrictions.

Sen. Nereida Rivera-O'Reilly was particularly vocal about making a $300,000 appropriation to Luis Hospital for a mammography machine unrestricted. She said it would rob the women of St. Croix of a much-needed tool to fight breast cancer.

After the amendment failed, Sen. Usie Richards motioned to reconsider the amendment with two measures removed from it - the $40 million transfer from the Insurance Guaranty Fund and maintaining the restriction on the $300,000 appropriation for the mammography machine.

The revised amendment was approved by the Senate in a 10-4 vote.

Sen. Craig Barshinger, Sen. Alicia Hansen, Sen. Neville James, Sen. Shawn-Michael Malone, Sen. Terrence Nelson, O'Reilly, Richards, Russell, Sen. Sammuel Sanes and Sen. Patrick Simeon Sprauve voted in favor.

Sen. Louis Hill, Dowe, Sen. Celestino White Sr. and Sen. Janette Millin Young voted against the revised measure. Sen. Alvin Williams Jr. was absent.

The revised amendment would allow the government to forgive any outstanding financial obligations for Schneider Hospital and Luis Hospital. It also would eliminate the line item budgets for both hospitals, giving the facilities more flexibility.

In addition, the revised amendment frees up a number of other appropriations to be used for general operations by Luis Hospital, including: $250,000 for the Luis Hospital Nursing School; the balance of $16,512 from a $200,000 appropriation to purchase a dialysis machine; and the balance of $1,134,818.63 from a $1.5 million appropriation to develop plans for renovations to the Luis emergency room.

Other amendments passed Thursday include:

- Reprogramming a prior $160,000 appropriation to the V.I. Education Department for the purchase of four vans - two for each district. The change would leave the department with $123,000 for the vans and $37,000 to purchase sports equipment in both districts.

- Reprogramming a prior appropriation of $40,000 to Public Works to construct public restrooms and benches in downtown Christiansted. The amendment shifts the funds to the V.I. Tourism Department to purchase mobile public restroom trailers.

- Fixing a mistake in the recently passed Legislative Youth Advisory Council legislation. The bill was sent to Government House with a line missing. It was signed into law by the governor, so an amendment had to be made to the law to fix the legislation.

- Restoring the V.I. Code to allow departments and agencies to spend up to $5,000 without going out to bid. A recent law reduced the limit to $1,000.

- Allowing rental car companies that have a lease with the V.I. Port Authority to give courtesy rides to customers between the vehicle drop off lot and the airport terminal.

- Changing the V.I. Code to ensure that all construction, repair and maintenance of public highways use certified temporary traffic control technicians who have been certified by the U.S. Department of Transportation.

- Correcting the parcel number on a piece of government property so the V.I. Housing Finance Authority can use the property to build new homes.