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Government House,
St. Thomas, Virgin Islands Of The United States,

August 31,1935. The honorable the Secretary or The Interior,

Department of the Interior, Washington, D. C. Sir: I have the honor to submit the following report of the Governor of the Virgin Islands for the fiscal year ended June 30, 1935.


The outstanding event of the year was the visit of President Franklin D. Roosevelt, arriving at St. Thomas on the U. S. S. Houston on July 7. 1934, and proceeding the next day to St. Croix. Governor Pearson welcomed the President on board the Houston at St. Thomas, and together they headed a long parade of cars containing the members of the Colonial Council, Government officials, and press representatives. The President visited a number of important governmental activities in each island, and at receptions at the Government houses in St. Thomas and in Christiansted, St. Croix, prominent citizens and officials were introduced to him. To commemorate his visit, he placed a marker on a homestead house in each island and at the new Bluebeard Castle Hotel in St. Thomas.


Despite a considerable reduction in activities of the National Recovery Program, improved private business, added to the several emergency activities still being carried on, resulted in a fair measure of employment during the year. Operations of the Virgin Islands Co., with an average of 1,400 field and industrial workers in St. Croix during half the year, greatly improved the employment picture.

The benefits to business accruing from the recovery activities of the preceding year, when the program was at its peak, as well as from other improvements in the economics of the islands, are evidenced by the income-tax collections this year. Totaling $28,970.25 for the two municipalities, they are more than double the collections in the previous year.

The health record for the year has been equally gratifying, with the lowest death and infant mortality rates on record for all time in the Virgin Islands, and with malaria and typhoid under complete control. In educational and welfare activities and in the promotion of handicraft industries, homesteading, and other agricultural activities progress has been marked.


Appropriate legislation was passed by the Colonial Council of St. Thomas and St. John to facilitate the liquidation of the National Bank of the Danish West Indies and to enable transfer of funds to the new Virgin Islands National Bank. A revolving fund for the purchase and sale of drugs and medicines by the commissioner of St. John was constituted with a loan from the hurricane-loan fund of $200. An amendment to the ordinance for the recording of vital statistics, to provide for more accurate records, was passed. The collection of ships' dues on vessels discharging coal and fuel oil at St. Thomas for the bunkering of ships calling at the port, suspended 2 years before by ordinance of the council, was further suspended for a period of 2 years from July 1, 1935, to July 1,1937, in order to place the port of St. Thomas in a favorable position to compete with other West Indian bunkering stations and thus bring added business to the port.

Legislation enacted by the Colonial Council of St. Croix included extension for 1 year of the ordinance of 1933 imposing certain excise taxes; an ordinance imposing certain additional excise taxes; an ordinance authorizing and providing operating capital for government liquor stores; an ordinance to control the sale of rum in St. Croix; an ordinance regulating advances from the immigration fund for assistance of planters and of other activities in promotion of agriculture and industry; and an ordinance for protection of wildlife.


The actual revenues of the municipality of St. Thomas and St. John during 1934-35 showed a 38.5-percent increase over those of the preceding fiscal year and 69.5-percent increase over those of 1932-33. The following are the revenues collected during the last 3 fiscal years:

Fiscal year:

1932-33 $86, 524.10

1933-34 105, 898. 76

1934-35 146, 650.02

The increase in revenues during 1934r-35 is accounted for principally by an increase of $19,000 in internal-revenue taxes, due to the fact that this tax was in force during the entire fiscal year, whereas it had been in force during only the last 5 months of the previous year. In addition, the income-tax collections were about twice those of the preceding year, $14,572.73 as compared with $7,198.54, due largely to increased business attributable to the emergency activities; customs dues increased by 29.5 percent, or $9,825.32, as compared with $7,590.78, due to import duty on liquors; and the real-property taxes increased by over $5,000, primarily because of the settlement of 10-year-old tax arrears on property in St. Thoms Harbor used by the United States Shipping Board as a bunkering station during the war. (These arrears were deducted from settlement made during the year by the Shipping Board of rental claims for the property.)

The cost of the municipal government was approximately $234,000, with actual expenditures of $209,024.70 and unliquidated obligations estimated at $25,000. The expenditures, however, include a sum of approximately $8,000 set aside in the internal-revenue tax special fund, in accordance with the terms of the ordinance levying that tax, for the purpose of road improvements in the municipality.

The major objects of expenditure actually made to June 30 are:


Including the estimated obligations, the Federal Government will pay 37 percent and the local government 63 percent of the cost of operation of the municipality of St. Thomas and St. John during the fiscal year 1935, when the difference of approximately $87,000 between local revenues and expenditures is met by Federal appropriations.


The actual revenues of the municipality of St. Croix during the fiscal year 1934-35 showed an increase of 13.9 percent over those for the preceding fiscal year and 26.8 percent over those for the fiscal year 1932-33. The following are the revenues collected during the last 3 years:

Fiscal year:

1932-33 §107,440. 57

1933-34 119, 663. 25

1934-35 136, 266. 58

The increase in revenues during the fiscal year 1934-35 is accounted for principally by an increase of $8,000 in income taxes and a loan of $9,000 from the immigration fund to permit the purchase of modern fire equipment.

The cost of the municipal government was $229,022.43. The major objects of expenditure were:


The Federal Government paid 41 percent and the local government paid 59 percent of the cost of operation of the municipality of St. Croix during the fiscal year 1934-35, when the difference of $93,775.58 between local revenues and expenditures was met by Federal funds. Of this sum, $82,600 was covered by the annual congressional appropriation for the municipal deficit, and the balance was met by transfer of funds within the appropriations of the Interior Department to offset partially the loss in revenue attributable to the operations of the Virgin Islands Co. and the fact that the properties purchased by the United States in connection with the rehabilitation program paid no taxes to the municipality.

The loss of municipal revenue due to Federal ownership of properties in St.'Croix incident to the rehabilitation program seriously complicates the budgetary problems in that municipality, and early relief is necessary. Legislation has been introduced in Congress to accomplish this purpose.


Revenues of the board during the fiscal year totaled $26,860.57, as compared with $28,018.58 the preceding year and $25,144.69 in 1932-33. The operating surplus of the year, $9,357.42, compares with $11,875.69 the preceding year and $9,106.28 in 1932-33.


The appropriation "Temporary Government for the Virgin Islands, 1935 ", as contained in the Interior Department Appropriation Act, was as follows:

Central administration $117, 840

Agricultural station and vocational school 29, 968

Deficit, municipality of St. Thomas and St. John 90, 000

Deficit, municipality of St. Croix 82,600

Special projects 14, 350

Total 334,758

The appropriation was supplemented by the following special grants:

For Federal salary restorations $8,980.06

Transfers from other Interior Department appropriations:
For maintenance costs of central administration and

agricultural station and vocational school $7, 895

To offset loss of municipal revenues, St. Croix, due to

Virgin Islands Co. operations 12, 300

20.285. 00

Total 29, 265.06

The total Federal appropriations made available for the Virgin Islands as above was $364,023.06, the lowest figure since 1930.


Grants under the National Recovery Program for the Virgin Islands during the year totaled $376,680, as follows:

Federal Emergency Relief:

To Virgin Islands government $162, 700

To Virgin Islands Co 160,000

$322, 700

National Industrial Recovery 53, 980

Total 376,680

Expenditures under the Recovery Program during the year totaled $893,513.84, as follows:

Federal Emergency Relief:

St. Thomas and St. John $104,202.88

St. Croix 75,637.16

Total, Virgin Islands government 179, 840. 04

The Virgin Islands Co 22,041.91

$201, 881. 95

National Industrial Recovery:

Virgin Islands government 135, 790. 49

Virgin Islands Co 555,841. 40

691, 631. 89

Total 893, 513. 84

The excess of expenditures over grants was covered by balances brought forward from grants during the preceding year.


The major employment under the Recovery Program has been furnished through projects that will prove of lasting benefit. In all three islands there has been much activity in road and street

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