Last year’s hurricanes will help the U.S. Virgin Islands make its bond payments, its governor said.
“Bondholders can be assured that their investments in Virgin Islands’ securities are safe, secure, and valuable,” Gov. Kenneth Mapp said in his annual State of the Territory speech. “Both of our rum producers are operating and shipping rum products to the U.S. mainland.
“Our Gross Receipts Revenue Bonds are more secure and valuable given the devastation caused by two Category 5 hurricanes," he said. "Consumer buying power, consumption, construction, and employment will remain robust for the foreseeable future as we rebuild our lives and businesses as well as repair and construct numerous public facilities throughout the territory.”
The Virgin Islands and its water and power authority have more than $2 billion in outstanding bond debt. In the last year there have been increasing worries among municipal analysts, ratings agencies, and even on Capitol Hill that this debt may be restructured.
Mapp said he has asked his financial team to update a five-year fiscal plan settled upon before the hurricanes. The goal is to achieve a structurally balanced budget within five years.
The government has hired a firm to propose solutions to the islands’ underfunded pension systems.
About 4.5 months after Hurricane Irma and about four months after Hurricane Maria, electrical service has been restored to 96% of the islands’ customers.