U.S. Virgin Islands

The Senate will have a special session on the deal, which does not include a previously mandated interest rate cap, on Tuesday, Dec. 8.

Gov. Albert Bryan Jr. is working with the territory's lawmakers on an internet sales tax and other revenue ideas to avoid a 42% pension benefit cut on Jan. 1.

A Senate imposed 3.75% interest rate cap was a major obstacle to completing the deal.

A group of pensioners is trying to stop the bond sale.

Moody's rates the corporation's current bonds junk-level Caa2 and Caa3, but Kroll has given the new, rum-revenue-backed bonds an investment grade BBB rating.

The transaction would affect about 54% of the government's outstanding bond debt.

The governor wants to refinance all of the territory's $1.1 billion matching fund bonds by the end of September.

The Governing Board of the Virgin Islands Public Finance Authority met Tuesday via videoconference and voted unanimously to execute the term sheets with Banco Popular and First Bank for $60 million in loans to fund government operations.

The authority may fail to pay $49 million of BANs, observers say.

Moody's says the downturn in activity will put additional pressure on the Caa3-rated issuer.