The long-awaited Governor's Reorganization Plan was presented Wednesday to the Legislature –- late, fragmented and without any questioning by senators.
Chief-of-Staff Juel Molloy, who is co-chairman of the Governor's Reorganization Task Force, said layoffs were not integral to the governor's plan.
Instead, she said, elimination of already vacant positions in many departments was the key to saving money.
"Reorganization has nothing to do with cutting benefits — making people pay more for health insurance and retirement," she said.
However, two agencies were hit with layoffs, the Labor Department and the housing arm of Housing, Parks and Recreation.
Saying Labor was one of the "most troubled departments in the whole government," Molloy confirmed that notices had gone out to Labor employees and they would be laid off by the end of September. Molloy said the Labor Department had staff "for whom not one dime" had been budgeted. She said most of the employees to be laid off were per-diem workers.
Part of the Labor Department's problem is the $6 million in back unemployment insurance fund payments that have been owing for more than 10 years -– most of which is owed by the government.
Molloy later told the Source the worst offender was the Education Department.
As was expected, housing was one of the areas of consolidation. Three of the existing agencies — the housing section of Housing, Parks and Recreation, the Housing Finance Authority and the V.I. Housing Authority — will be combined under one semi-autonomous agency called the V.I. Housing and Community Renewal Authority.
The consolidation will create layoffs, but task force co-chairman Ohanio Harris said a number of the employees will need to be supported for up to a year and are not scheduled to begin until January 2000.
It was revealed during Wednesday's hearing that the Housing Finance Authority had spent $2.8 million that had not been appropriated.
Harris said the HFA hasn't been funded for two years, but has 21 employees.
When asked how that could happen, Molloy told St. Thomas Source that the Finance Department said "they just overrode the system."
"They just do what they want," she said. "That's why I say we've got a runaway government. When I was head of Human Services, I thought you weren't supposed to use money that wasn't there."
Campbell Malone, the Legislature's post-auditor, later said, "Most funds are overdrawn."
The other agencies slated for consolidation are the Government Development Bank, the Industrial Development Commission and the Small Business Administration. They will merge under the heading of the Economic Development Authority.
Senators had a hard time following the summary Molloy presented, in part because there weren't enough copies to go around and in part because sections were missing from some of the packages.
No copies of the plan were available for the press. Government House said they would be available "tomorrow."
The hearing was delayed from a scheduled 9:30 a.m. start until 1 p.m. because Attorney General Iver Stridiron — who said he was "jostled" by a crowd of union demonstrators in front of the Legislature on his way in — told Molloy not to come to the hearing until she could be assured that she would be safe.
Teachers union members staged a protest demonstration before the session started, and had taken out newspaper ads beforehand opposing the reorganization plan.
Because of the late and only partial report, senators agreed to recess the meeting without questioning until they could review the plan.
Molloy said the total $15 million that would be saved by the government reorganization was the same money that had already been saved in the revised budgets submitted by the individual departments.
Malone confirmed, "There's nothing new here." But the post auditor did say some of the departments would be cut further by the reorganization plan.


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