What began Monday as a focused measure to quickly bolster the finances of the territory’s two hospitals evolved into a sweeping funding overhaul, as the Senate approved a substitute version of Bill No. 36-0047 that redirected millions of dollars from Epstein civil settlement proceeds toward retroactive government payroll, vendor debt, and essential public services — while cutting other capital projects.
The original version of the bill — special ordered to the floor in the latter part of Monday’s regular session — proposed using $13 million from the Southern Trust Company Settlement Fund, generated from civil litigation against Jeffrey Epstein’s estate and financier Leon Black, for equipment and upgrades at Gov. Juan F. Luis Hospital and Schneider Regional Medical Center.
But by the time the bill passed later that day, it had been substantially rewritten. Senators instead adopted an amendment in the nature of a substitute, introduced by Sen. Novelle Francis — one of 14 cosponsors — that replaced the bill’s language with a broader fiscal package appropriating $25 million in new spending from the STC Settlement Fund, while reprogramming another $23.1 million from previously authorized but unused funds, primarily from Act No. 8920, passed at the tail-end of 2024 budget Finance hearings.
Among the changes was the removal of a $5 million appropriation for a gymnasium in Nazareth, which Gov. Albert Bryan Jr. has described as one of two overlapping initiatives in the area. In 2024, Bryan also approved $1.1 million from the School Maintenance and Construction Fund for improvements to the Ivanna Eudora Kean High School track and field, tying it to a broader vision of transforming the Nazareth area into a sports tourism hub. The larger plan included a cricket facility, a Sprung shelter gym supported by the V.I. Olympic Committee, and a potential FIFA-backed soccer field, he said, suggesting to senators in his 2025 State of the Territory Address that “Instead of building yet another gymnasium in Estate Nazareth, we can take that cash and pay the retirees $20 million.”
The amendment in the nature of a substitute Monday instead, prioritized:
- $22.5 million for retroactive pay to active and retired government employees and survivors of deceased retirees (due by May 30);
- $6 million to Pafford Medical Services, negotiated down from $8.2 million as part of a settlement agreement Bryan announced at a press conference earlier Monday;
- $5 million to the Waste Management Authority;
- $1.6 million to expand the Herbert Grigg Home for the Aged as an effort to provide more bed space for hospital boarders; and
- $13 million split between Juan F. Luis Hospital and Schneider Regional Medical Center.
Hospitals receiving funding must submit an austerity plan, billing and insurance collection improvements, and a detailed use-of-funds report within 30 days, according to the revised bill.
Sen. Kurt Vialet, who also cosponsored the amendment, said lawmakers settled on the $6 million appropriation to Pafford after reviewing the finalized settlement agreement, which was obtained shortly before the session. “We passed exactly what was in the agreement,” Vialet said. “We didn’t want to appropriate more than what was owed, and now we have some clarity — this allows us to close the books on that debt.” He emphasized that resolving the Pafford liability also helps stabilize the relationship between the hospitals and emergency service providers.
Asked about the final funding amounts for Schneider and JFL, Vialet said the $10 million each was based on direct discussions with hospital officials, who provided a prioritized list of urgent needs. “We asked them what was absolutely necessary to restock shelves, buy basic medical supplies, and avoid further disruption in care,” he said. “This is emergency money to stop the bleeding. We know this doesn’t solve everything — it’s meant to stabilize operations and give them breathing room to start improving their billing and collections.”
Later in the session, lawmakers adopted a second amendment, introduced and cosponsored by Sen. Avery Lewis, which added another $7 million for the hospitals. This time, the funding comes not from the settlement, but from a line of credit authorized under Act No. 8701, a 2020 law that allows the government to borrow up to $100 million to stabilize operations in the wake of the COVID-19 pandemic. According to senators, the government still had about $10 million in borrowing capacity and the $7 million will be routed through the Office of Management and Budget and split between the hospitals to address outstanding vendor obligations.
Between the two, each hospital is now set to receive a total of $10 million: $6.5 million from the STC Settlement Fund and $3.5 million from the Act 8701 credit line.
The bill also allocates $2.5 million to repair the Ivanna Eudora Kean High School track and field and $5 million for improvements to the Ann Abramson Pier and Frederiksted beach area. It further mandates the redeposit of $10.5 million into the STC Settlement Fund by the end of fiscal year 2026 to offset previous vendor spending.
Though the bill passed with broad support, the debate laid bare deeper concerns about long-term health care planning, executive spending, and how to balance urgent needs with lasting impact.
Just a day before the session, the executive committee of the Virgin Islands Government Hospital and Health Facilities Corporation sent a letter to Senate President Milton Potter describing a system in crisis. “This debt reflects a long history of fiscal imbalance that can no longer be managed with temporary or incremental measures,” the board wrote. With $80 million in vendor debt across both hospitals, the board urged senators to consider a bond-backed funding structure and warned that essential services were at risk if immediate steps weren’t taken.
The letter emphasized that “only sustained reform — across funding mechanisms, workforce policies, and structural operations – will lead to the stability and future viability of the Territory’s hospital system.” Board members pointed to outdated technology, inefficient administrative processes, and inflexible Medicaid funding rules as structural weaknesses that emergency infusions of cash alone won’t solve.
At a separate meeting last week, physicians at JFL said the hospital needed $22 million just to get current with vendors and stay operational. Some described conditions as “barely safe” and said several doctors had already resigned. “We’re losing physicians and we cannot hire because the last contract negotiation was in 2002,” one physician told board members. “That’s why no one’s coming.”
These concerns were echoed on the Senate floor. Sen. Novelle Francis cited the medical airlifting of 295 patients from January through April, saying, “We have to stop the bleeding.” He and others emphasized the need for long-term billing and service delivery reforms to accompany any new funding.
Meanwhile, Sen. Alma Francis Heyliger opposed the bill’s reallocation of funds, saying it again enabled the executive branch to correct illegal overspending with legislative approval.
“They took $22.5 million to pay retro, which — of course — we would like people to get paid,” she said. “But this is the third time. The governor took the money from before, and the Senate’s legal counsel said it was illegal to do so — and here we go again, using another source of money that could have been tapped for something else.” The amendment in the nature of a substitute directed that $10.5 million of the General Fund dollars previously earmarked for retro, which members of the governor’s financial team said had been used for government payroll, be repaid by a time certain.
Sen. Angel Bolques Jr. further voiced disappointment that the Myrah Keating Smith Health Center on St. John was not included, despite ongoing pleas. “That facility remains in a holding pattern,” he said, “and continues to rely on Schneider for backup while its own infrastructure sits waiting.”
