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News from the US Virgin Islands as of
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USVI governor submits legislation to ratify Cruzan Rum agreement
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| Published on Friday, October 9, 2009 | Email To Friend Print Version
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ST THOMAS, USVI -- Late Wednesday afternoon, Governor John deJongh submitted a bill to the US Virgin Islands Legislature that, when approved, will ratify the agreement between the government and Cruzan Rum. DeJongh also called the Legislature into Special Session on October 27th to take action on both the proposed legislation and agreement.
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USVI Governor John
deJongh, Jr. Photo:
Susan Mann |
Under the terms of the agreement, which the governor unveiled in a televised address to the territory on Tuesday night, Cruzan will build a wastewater treatment facility at its distillery site on St Croix which will allow the company to successfully address its long-standing effluent discharge challenge which has been of concern to the Department of Planning and Natural Resources and the US Environmental Protection Agency.
“This Agreement provides the mechanism for the resolution of one of the territory’s most pressing environmental issues,” deJongh wrote in correspondence to Senate President Louis Patrick Hill. The agreement also provides for the expansion of the existing Cruzan Rum facilities to provide additional production capacity, which will result in additional cover-over revenue for the territory’s coffers, deJongh added.
The legislation also authorizes the issuance of matching fund revenue bonds to finance the construction of both the wastewater treatment facility and the rum distillery expansion. The cover-over revenues generated by the rum produced at Cruzan’s facility and exported to the United States will service the bond debt. “This project is fully self-supporting from the revenues it will generate and does not require the commitment of any government resources,” deJongh said.
To support this project and pursuant to the agreement, Cruzan will receive economic development tax incentives. “This is not a new development as Cruzan already has an EDA certificate granting benefits. Cruzan also will continue to receive support in the form of marketing incentives and the statutory molasses subsidy, as it has for several years.”
In the letter to Hill, deJongh explained that the agreement now commits Cruzan to produce its rum on St Croix for the next three decades, a commitment to the territory which did not previously exist. “With this new and substantial commitment and the support of the new owner of Cruzan Rum…the Virgin Islands is now poised to support the growth of the Cruzan Rum brand as a top-shelf premium rum brand in the United States.” DeJongh said that in tandem with the previous agreement with DIAGEO USVI, the approval of the agreement would mark a “new and exciting era for the Virgin Islands rum industry. The growth of this industry will provide revenues for deposit into the General Fund and which also can be leveraged to assist the territory in addressing its significant challenges which require substantial funding to be properly addressed.”
Citing the tremendous importance of the proposed legislation and the agreement to the people and future of the Virgin Islands, deJongh called the Senate into Special Session at 10 a.m. on October 27 to take action on the legislation and agreement. “Members of my Administration and representatives of Cruzan Rum, Beam Global and Fortune Brands will be available to provide testimony and answer questions.” | | | | Reads : 653 | | | |
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