CHRISTIANSTED — Nobody who is running for governor this year has as many good ideas for generating revenue streams for the Virgin Islands government as hedge fund mogul Warren Mosler.
In Part Three of this series featuring independent candidate Mosler, we examine eight of the 10 proposals that we are aware of.
In Part Two of the series, we considered in detail Mosler’s proposal to refinance the rum cover over bonds at lower rates with the federal government.
Mosler also has a proposal to attract new “satellite” medical facilities that will pay income taxes here by providing infrastructure for them.
“The US states don’t keep their income tax payments, so private medical facilities often mean reduced revenues for the hospital,” Mosler said. “In the USVI, however, we get to keep our income taxes, which means our government gets to keep the income taxes paid by private medical businesses, along with income taxes paid by their employees, and we also collect other taxes as well. Therefore it is to our advantage both from a medical services point of view and from a financial point of view to support and expand our private medical facilities. And this includes making sure our hospitals provide the highest quality of medical services both for all of us individually and also as back up for our private medical businesses.”
Another idea is for the Virgin Islands government to partner with the cruise ship industry to once again make St. Thomas the preeminent cruise ship destination in the Caribbean.
“Cruise ships are the financial lifeblood of St. Thomas and are financially critical to the entire territory,” Mosler says in Radio Ad #2. “So I am asking the governor to work together with the cruise ship executives who know exactly what it takes to again make St. Thomas their prime and featured destination.”
Related to that proposal, Mosler suggests that the governor coordinate with the West Indian Company Ltd. (WICO) and the Virgin Islands Port Authority (VIPA) to increase cruise ship visits by lowering docking fees.
“Note that Port Authority charges the cruise ships what they consider to be very high fees, because Port Authority needs those fees to pay their expenses, and therefore they can’t agree to lower fees in return for getting more cruise ship visits, even though it would be a large net benefit for the USVI,” Mosler said. “So, for example, by working with the cruise ship companies to reduce fees in exchange for more visits, and then allowing Port Authority to receive lost fees from the general fund, the USVI would greatly benefit. Likewise, we can work with the cruise ship company executives to structure our facilities that serve cruise ship passengers again to increase visits and enhance our overall revenues.”
Offering hotels cash incentives to bring in working tourists attending seminars and other professional conferences, and “capture” their federal income tax payments is another proposal.
“Because federal income taxes paid on income earned by visitors attending seminars and conferences belongs to the USVI, we can use a portion of those revenues to attract more of those visitors,” he said. “This means working with our hotels to provide funding to subsidize this type of professional tourism, giving the a large competitive advantage over hotels in the states. It would also, for example, provide an incentive for the construction of a new convention center, and for a facility to attract highly paid professional athletes for off season training, etc.”
Mosler notes that some of the amenities we used to enjoy before the storms hit, need to be aggressively brought back.
“I’ve long argued that non-stop flights between New York and St. Croix would generate tens of millions of dollars in revenues just like they did before Hurricane Hugo hit in 1989,” he says in Radio Ad #1. “And so I’m asking our governor to do what it takes to secure non-stop New York to St. Croix flights in advance of next year’s tourist season.”
Some of Mosler’s other proposals include:
- Working with the Bureau of Internal Revenue (BIR) and the Internal Revenue Service (IRS) on facilitating the transfer of taxes paid on Virgin Islands source income from the IRS to the BIR.
- Working with the Virgin Islands Water & Power Authority (WAPA) to refinance their debt at lower rates
- Working with the Virgin Islands Water & Power Authority (WAPA) to provide “off peak,” low marginal cost electric power, and sell it at reduced rates in a designated area for new companies that require large amounts of electric power
- Working with national non profit organizations to locate their high income donors in the USVI who would then pay their income taxes here, enabling our government to make contributions to the non profits
To read more:
When I read the headline on the Warren Mosler article, I wondered why the Governor would be hopeful this candidates plans wore succeed. Perhaps a better choice of wording would have been “Governor Candidate hopeful…”
Just wondering…
That was for the people who don’t know what “gubernatorial” means. We are not counting you as one of them … yet!