GOVERNMENT HOUSE REACTS

TO FEDERAL INDICTMENTS

OF EDC ABUSE

March 26, 2007 -- In response to the announcement that the United States Attorney for the Southern District of Illinois had filed a criminal indictment of various individuals and entities for engaging "in a scheme to defraud a legitimate economic development program in the U.S. Virgin Islands," Governor John P. deJongh Monday made the following statement:

"My Administration has been made aware that certain past abuses of the Virgin Islands EDC program have been investigated and that these investigations led to the indictment filed on March 23rd. The EDC program should and will be used only to stimulate economic opportunities for our residents as both employees and owners of businesses contributing to our economic growth. It must at all times be strictly regulated and fully compliant with all applicable laws. Whatever steps need be taken by the local government to safeguard this program which is essential to our economic future will be taken, and wrongdoing will be investigated and prosecuted by the appropriate government, local or federal."

The Governor further noted that it would be inappropriate to comment on the specifics or the merits of this or any other particular case, but that all should be assured that the Virgin Islands Government remains committed to growing our local economy in a lawful manner and to fully supporting the EDC program and its beneficiaries.

If at any time after the issuance of an executed certificate, a beneficiary determines that it necessary to cease operations and/or reduce the level of employees below the employment requirement, a notice of intent shall be written as follows:

• A notice of action must be written to Commissioner and copied to the Director of Labor Relations of the Department of Labor and, Chief Executive Officer of the Economic Development Commission no less than 90 days prior to a reduction in workforce or ceasing operations.

• Specifically state the option elected to address the existing business condition
  • Termination of Benefits: To fully give up the EDC Certificate
  • Suspension of Benefits: To request a postponement of  benefits for a specified period
  • Waiver of  Employment Requirements: To request a reduction of employment requirement

• Such notice shall state in full detail the reasons that the beneficiary has determined that it would not be economically feasible and/ or practicable to continue operating in the US Virgin Islands or to continue at the same level of operation. In addition, for a Termination of Benefits, such notice shall state the requested date for termination of benefits; for a Suspension of Benefits, such notice shall state the period of suspension; and for a Waiver of Employment, such notice shall include all of the information required of Rules & Regulations §708-602 & §708-603(a).

• An affidavit indicating the employees to be released, anticipated termination or layoff date, and current salary must be provided.

• Information on severance package to be offered, if any.

• Statement of any other changes in working conditions such as reduction of working hours, changes in employee benefits, etc.