Ten days ago Sen. George LeMieus (R), from Florida proposed a bill that would have ruined the Virgin Island economy! This week, through the behind the scenes efforts of Gov. deJongh from the USVI and several of the Territory’s influential friends were successful in having it voted down by the U.S. Senate!!!
“The Rum Cover-Over War” was one worth fighting. A war starts generally because one territory is angry with another, and they want to punish the people they are angry with. Well, the offending party in this war is Puerto Rico. Puerto Rico is angry that the giant liquor conglomerate, Diageo, did not renew an agreement with a rum distillery in their territory. It happens to be the distillery that produces Captain Morgan’s label representing significant jobs and BIG revenue to any territory that has the contract.
Because they didn’t renew their contract with Puerto Rico, Diageo contracted with the US Virgin Islands to build their new distillery on St. Croix with a 30 year lease and a rum production agreement. The agreement has the USVI providing tax benefits for the contract and the USVI would begin to receive the Cover-Over funds that had been paid to Puerto Rico for so many years. Puerto Rico didn’t like it that Diageo pulled out of their territory and are now setting up shop in the USVI. So, that is why Senator LeMieus proposed the bill so he could appear to be a supporter of the many Puerto Ricans who live in Florida and are potential voters for his re-election.
Puerto Rico claims it is an inappropriate use of the cover-over money and excessively awards a foreign company. The rum cover-over payment is currently based on the production of rum in a specific Territory. Senator Lemieux’s proposal would have instead based the allocation on population. The population of Puerto Rico is 3.9 million, compared to almost 110,000 for the USVI territory. Do you think he has Puerto Rico’s interest in mind? Of course he did. Gov. deJongh said the proposal ignored almost 100 years of federal precedent and counter to all Congressional intent, and it would have severely harm the USVI economy in favor of Puerto Rico.
“The proposed amendment takes excise tax revenue paid by Virgin Islands rum makers on rum produced in the Virgin Islands and directly transfers it to Puerto Rico’s government coffers,” deJongh’s statement said. “Puerto Rico would end up with billions of dollars generated by rum production in the Virgin Islands. … Sen. LeMieux is directly attacked his fellow Americans in the Virgin Islands by doing Puerto Rico’s bidding.” Gov. deJongh continued by stating, “By promoting this amendment, Puerto Rico now seems willing to walk away from the long history of friendship and collaboration, which has linked America’s two Caribbean possessions.”
This phase of the “Rum Carry-Over War” has now ended. Let’s hope that each of these Caribbean U.S. Territories can move on to addressing the needs of their citizens instead of wasting the Congress’s time by proposing bills that have business to even be addressed. I look forward to any of your opinions and comments regarding this Rum War that just ended with the USVI – 1 and Puerto Rico – nil. Until next time…your Caribbean lifestyle reporter continues his work!
