Business

Plaskett Says It's Now Governor's Turn To Move On Potential $100 Million Rum Cover-Over Windfall

ST. CROIX -- Could it be the Virgin Islands' saving grace? Delegate to Congress Stacey Plaskett sent a dose of positive news throughout the territory on Monday when she announced that her office had potentially identified over $100 million in rum cover-over (matching fund) monies that the U.S. Treasury had failed to allocate to the territory because of miscalculations. What is rum cover-over funds? Rum cover-over, or matching fund revenues are remittances paid by the federal government to the Virgin Islands’ government, pursuant to U.S. statutes, of a portion of federal excise taxes collected on rum produced in the Virgin Islands and shipped to the US mainland. They have been paid to the government annually for over 50 years. Payments are made based on a “cover-over rate” set by Congress. Current statutes provide for a cover-over rate of $10.50 per proof gallon. Congress has annually increased the cover-over rate to $13.25 since 1999, in some cases retroactively. In August of each...