With Virgin Islands' Bonds At Junk Status, Mapp Administration Seeks $430 Million In New Debt
ST. THOMAS — The Mapp administration’s finance team sat before senators at the Earl B. Ottley Legislative Hall on Wednesday to make its case for $430 million in new borrowing, while introducing a new five-year plan that it says is aimed at stimulating the economy.
Finance Commissioner Valdemier Collens broke down the new bonds, to be secured by the matching revenue funds and gross receipt tax, as $250 million in capital projects through Bill No. 31-0447, $150 million in working capital, and $30 million to finance what Mr. Collens said were past due costs mandated under existing consent decrees with the U.S. Environmental Protection Agency and the U.S. Department of Justice — namely the Bovoni and Anguilla landfill consent decrees.
But the borrowing comes at a time when the territory’s bond ratings are at junk status, which in turn increases interest rates on new bonds being floated.
Mr. Collens said the downgrades forced the Mapp administration to exclude debt restructuring, which he has said wouldn’t be prudent because the new interest rate would be higher than what the government is currently paying. Instead, the administration saw the floating of new bonds for what Mr. Collens says are working capital and essential capital projects, as the best route in stimulating the economy.
Read more: http://viconsortium.com/breaking-news/with-territorys-bonds-at-junk-status-mapp-administration-seeks-430-million-in-new-debt/
