In the aftermath of being downgraded deep into junk territory, the U.S. Virgin Islands defended its financial efforts.
In mid-January Gov. Kenneth Mapp said without new taxes the government may not be able to make payroll in February and wouldn't be able to make it after February.
Late on Wednesday the Virgin Islands Public Finance Authority sent out a statement saying that the government was taking measures to address its financial problems.
The authority said in October the government increased hotel occupancy taxes and added tax examiners so as to increase tax collections. The government noted it was preparing a five-year plan to reduce the government's structural deficits and provide fiscal balance and economic growth.
The authority said it expected fiscal year first quarter revenues, for October to December, to beat budgeted expectations.
The governor has presented a bill to increase taxes on alcoholic beverages, cigarettes, sugary carbonated beverages, and to introduce a tax on time-share properties.
In December the U.S. Commerce Department announced that the islands' real gross national product increased by 0.2%, its first increase since 2010.
"When appropriate credit ratings and acceptable interest rates are present, the VIPFA will assess whether to re-enter the bond market."
The Virgin Islands withdrew a matching funds (rum tax) bond sale in mid-January after there were inadequate orders and the interest rate was higher than the islands wished to pay.
The islands' senior matching fund bond is now rated Caa1 by Moody's Investors Service, B by S&P Global Ratings, and BB-minus by Fitch Ratings. The islands' gross receipts tax holds speculative grades from S&P and Fitch.
