An Open Letter to o...
 

An Open Letter to our Executive and Legislative Representatives.  

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IslandHops
Posts: 929
(@IslandHops)
Trusted Member
Joined: 11 years ago

Interesting suggestions in this letter in the 2/9 Daily News......

Dear Governor, Lt. Governor, Members of the 29th Legislature,

There have been many good suggestions from your constituents regarding reducing government expenditures. I hope you all have the courage to take the steps necessary to reduce your numbers, and eliminate unrelated employment perks that we, as a territory, can no longer afford. Restructuring must include the need to increase the responsiveness and efficiency of all government departments. However, the purpose of this letter is not to address reductions in expenditure. Instead I implore you to implement steps to grow our economy by providing increased job/business opportunities, which will result in government revenue, without the need to increase taxes!

Firstly, I would like to address the need for manufacturing jobs in the territory. Companies face higher expenses when setting up and operating in our territory, and incur greater shipping costs. A suggestion is to set up a simple 'Export Company Status' for business that export 100% of their end product. We can encourage companies to manufacture here by eliminating the customs/excise tax on the import of specialized manufacturing equipment and raw production materials. If the end product is not for sale within the territory then we should not be taxing the raw materials used to produce it. This must be a simple program, possibly administered by the Economic Development Authority (EDA), without the need for excessive reporting or compliance issues. It can create job opportunities and bring taxable revenue to the territory while not subjecting potential new business to the complexities and delays of the full EDA/EDC benefits application process.

Secondly, we need to be able to encourage new businesses within the territory, and make it easier for existing small business owners to offer new employment opportunities. I would encourage the legislature to collaborate with the executive branch to create and pass the following measures to reduce the expense and administrative burden on businesses.

Fire inspections for all businesses would be valid for two years instead of one. The Department of Natural Resources (DPNR) Generator permits for all businesses would be valid for three years instead of two. This would immediately reduce the administrative burden on all business owners, the fire department, and DPNR.

Establish a new business classification for Home/Virtual Based Service Business - A service business operated from a residence, or mailing address. Examples of this would be landscape maintenance, pool maintenance, business consultant, etc. where the need for an office or facility is not required, and the revenue generating activities occur either remotely, or at the customers residence/place of business. These businesses would be exempt from Fire Inspections and DPNR approval. We need to encourage recently displaced workers and future local entrepreneurs to start new business without throwing up undue barriers.

Sole Proprietors/Partnerships with 5 or fewer employees (not including owners) could elect to operate under an 'at-will' employment category where employees would have to sign a statement stating that they can be released or reassigned hours/duties without recourse. These businesses would also be exempt from unemployment reporting and contributions, as their employees would not be eligible. The purpose is to allow small businesses to legally add and lay-off employees as needed, while paying payroll taxes, without being subject to excessive Department of Labor (DOL) legislation. Currently some employers elect to bypass the system by hiring as needed under the table, or using 'contract labor' where no taxes are collected by the government.

Next, we need to re-purpose the existing Department of Licensing and Consumer Affairs (DLCA) to become an advocate for creating, and sustaining, new and existing business. Too often DLCA, and other government departments, take an adversarial role to prevent new business instead of helping them navigate the system to a successful conclusion. Each and every member of staff at DLCA should ask themselves 'How can I help this new business get established and succeed?'. The process of business license applications simply disappearing without formal response must end. There should be clear guidelines for obtaining a business license and starting/executing a business. Simplifying the business license categories would be a good step. License applications should not be a source of revenues from annual fees, but be about helping business get formally established so they can grow the economy and provide tax revenue. Is it really necessary to have three separate business license categories for a Burro Farm, a Donkey Farm, and a Mule Farm, and are your inspectors really qualified to tell the difference without making an 'Ass' of themselves?

One possible solution is to merge the EDA with DLCA, splitting DLCA duties into two distinct functions; new/existing business advocacy, and enforcement/consumer affairs. Part of the role of advocacy would be assisting business in resolving issues with other government departments.

Which brings me to the need for DOL and Bureau of Internal Revenue (BIR) to be more responsive to their customers and to become advocates for resolving issues. I'm about to pay my 6th visit to BIR to resolve a 501VI payment from 2010, where the company has already supplied proof of payment as copies of the stamped payment and cancelled check. Yet the company continues to battle in order to receive proper credit and reverse penalties. Phone messages left with these departments are never returned, and correspondence never acknowledged. Businesses continue to receive notices of penalties due, even for erroneous DOL items dating back 12 years! And yet despite direct correspondence refuting the items, even addressing commissioners directly, no responses are ever received.
Something must be done to create a more conducive business environment; otherwise the barriers to economic growth will continue to exceed the level of entrepreneurial spirit and innovation. Increasing taxes, while a simple solution to the deficit will not help build our economy in the long term and it will likely cause many struggling existing business to fail, further reducing employment and government revenue.

Lastly, as a longer term challenge for you all, I implore you to work with licensed insurers in the territory to establish a Small Business Insurance pool. Open to all businesses with less than 25 employees, employees could purchase catastrophic and preventative health insurance at a reasonable cost. Employers would need to register (at no cost) in order for their employees to be eligible for the program, but the employee would be responsible for signing up and paying for coverage. Employers could elect to contribute towards coverage (tax deductible expense) paid directly to the insurance provider. Not only would this directly help individuals obtain coverage, and encourage healthier lifestyles through preventative care, but also reduce the burden of uncompensated care from our financially challenged hospitals.

Thank you for taking the time to consider the above suggestions, and I wish you all success in quickly developing real solutions to overcome the many difficulties faced by the territory in these challenging times.

16 Replies
poorthang
Posts: 312
(@poorthang)
Advanced Member
Joined: 9 years ago

Does anyone know who wrote this?He/she doesn't sound like a "LOCAL".This person maybe a New Governor candidate ?Maybe the Great White Hope!!!!!!!:@)

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IslandHops
Posts: 929
(@IslandHops)
Trusted Member
Joined: 11 years ago

Yes, the author is a full time resident of St. Croix, although not a born-here local.

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stiphy
Posts: 956
(@stiphy)
Trusted Member
Joined: 11 years ago

Excellent letter IslandHops, every single one of your points is well thought out and makes great sense. I've talked and thought about many of these same things not just now but since moving here 9 years ago and setting up a business a few years after that.

Sean

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Lucy
Posts: 297
 Lucy
(@Lucy)
Advanced Member
Joined: 11 years ago

Very well written and thought out. All of these points basically address improving of how we (the government) operates in a way that is conducive to ourselves and encourages investment in the USVI. Cut out the unnecessary steps and wasted time.

This is actually one of three priorities that the government should be working right on. And nothing else until we get out of the mess and on the path to recovery. The other 2 are:

- Right sizing the government to meet the needs of priority one and based on projected revenues ...let's have a balanced budget. Cut out all unessential functions until a time when we can afford them. Then decide if they should be re-introduced.

- Adopt an long-term energy plan. The high price of electric affects everyone and also inhibits growth / new investment. The WAPA plants are old and inefficient. WAPA has no money for modernization, so they push the responsibility off to outside developers (like Alpine) and then the rest of the USVI gets in the way. All technologies and operational scenarios should be studied and a plan approved / followed. This plan should include a set of phases. The first phase will address the current near term situation. The time is now. When Hovensa goes away in June, the LEAC will go up and so will our electric bills.

And I think there are enough smart people in the USVI, so we don't need an RFQ for some outside paid consultants to help. I'm sure there is at least one economist on the government dole that we should keep and consider the position essential. Plus there are probably enough private individuals and business leaders that would volunteer to help in order to right size this sinking ship.

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