, 1958-11-14
ST. Thomas. Virgin Islands

for the fiscal year 1859 over the current year. Actually
certain factions in the Congress have been supporting a
reduction in the personal income tax rates which, if enact
ed, would decrease our total estimates by $4,000 to
$500, 900. However, strong resistance to this proposal has
altered somewhat the general consensus of Congressional
opinion and unless a sharper deterioration occurs within
the National economy there is little chance of disturbing
the existing tax structure. Therefore, let us not over-esti-
mate revenues for the coming fiscal year but rather adj
here to the recommendations of the government officers
who deal with revenue collections on a professional and
daily basis.
According to present estimates of the current fiscal
year the Government will realize a surplus of $500, 900 in
the General Fund and 100000 in the Matching Fund, bv
June 80, 1858. / should like to express to you the fiscal
policy which | feel should be adopted with regard to these
SURPRISES.
The estimated surplus of 10000 in the General
Fund is there as a result of strict surveillance over the
operations of the Government. It is a one-time occurrence
and should not be incorporated in the general estimates
for fiscal year 1859. Since it is in large part the result Of
capital gains deposits its expenditure should be effected
for capital improvements-extensive repairs to schools,
hospitals, and other government building; critical equip
ment; and similar necessary items. AS the fee'1ar sor;0n
develops and the reality of a surplus crystalizes / urge
that you spend against this surplus in the manner an1
with the scope that / have outlined. The officers Of tho
Executive Branch have been directed to devote to yo1'r
committee their full time and knowledge to be of assist
ance to you to carry out your responsibilities in this
regard.
would now like to discuss with YOU the surplus Of
100000 which will probably exist in the Matching Fund
at the expiration of the current year. You are aware Of
the fact that the Matching Fund is a Federal grant to the
Virgin Islands and that it cannot be OBLIGATED or exnend-
ed without the prior approval Of the President of the
United States or his designated representative. It is the
intent of Congress that unobligated balances in this fund
shall be covered into the Essential Public Projects Fr7"d
and used for emergency purposes and essential rublic
projects only and with the prior approval of the Presi-
dent Of the United States or his designated representative.
In this regard / can assure you that the. Secretary If the
Interior, acting as the designated representative of the
President, will not approve for obligation or expenditure
funds appropriated for purposes which, in the opinion of
government officials, remains outside the scope Of an
emergency or an essential public project. y
The more direct Federal grant to this Government.
the I'll" contribution, expired at the close of Fiscal Year
1856 and the sole source Of funds for emergency purposes
or essential public projects in the unobligated balance of
the Matching Fund at the expiration of the Fiscal Year
during which it was granted. Therefore the surplus Of
which / have spoken which is presently in the Matching
Fund will be transferred and paid over into the Essential
Public Projects Fund by June 80, 1858 and appropriation
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