Facing an uncertain federal landscape and entering its final year in office, the Bryan-Roach administration on May 30 submitted a $1.76 billion spending plan to the 36th Legislature, marking the last executive budget proposal of the two-term administration.
The fiscal year 2026 proposal charts a conservative financial course while banking on continued economic recovery, tourism growth, and billions in disaster-related federal aid, according to the governor.
The General Fund portion totals $936.4 million — up slightly from last year — and comes with a warning: volatility in Washington and delayed federal grant cycles could impact how much of the plan becomes reality. Lawmakers are scheduled to begin their review on June 3, with the first budget overview hearing set before the Senate Finance Committee.
Gov. Albert Bryan Jr., in his transmittal letter to former Senate President Novelle Francis, described the budget as a reflection of his administration’s legacy of responsible governance, accurate forecasting, and long-term investments in public infrastructure and operations. It is, he wrote, “a forward-looking vision for the Virgin Islands” and a final expression of the administration’s approach to stability, accountability, and modernization.
Office of Management and Budget Director Julio Rhymer, in a letter included in the budget book, described FY 2026 as “based on the premise of Empowering Progress: Revitalization, Sustainability and Financial Stability.” While forecasting modest revenue growth, he said the government had taken “a highly conservative approach” due to uncertainties stemming from paused or canceled federal grants, executive orders, and delays in issuing funding opportunities. Rhymer outlined targeted enforcement strategies to help reduce government receivables, including stepped-up efforts to collect delinquent property taxes older than five years, and new compliance checks on short-term rentals through the Licensing and Consumer Affairs Department.
The projected General Fund revenue for FY 2026 is $936,426,140, up from $864,132,155 in FY 2025 — a 7.7% increase. That number is based on cautious estimates, but accompanying analysis shows several areas where collections could surpass projections if economic conditions hold.
Personal income tax, for example, is forecast to decrease slightly from $423.4 million to $414.1 million, but collections could rise to $492.5 million if capital project spending increases as expected. Corporate income tax is expected to dip from $78.8 million to $74.8 million, while real property tax is forecast to rise 2.5%, from $64 million to $65.6 million. Gross receipts tax is projected at $220.2 million — up 3% — with a potential ceiling of $269.2 million if major construction projects continue to ramp up. Excise tax is expected to total $37 million, but could climb to $48.7 million when factoring in imports tied to disaster recovery.
Rhymer also noted that hotel and non-hotel tax revenues, though not part of the General Fund, are expected to increase approximately 3%, from $44.4 million to $45.7 million, reflecting continued strength in the tourism economy and a stable outlook for the Tourism Revolving Fund. Additionally, legislation passed late in FY 2025 is expected to result in new revenues not yet reflected in the current projections. These will be factored into future forecasts and used to offset projected reductions in other areas, he said.
While non-disaster federal funding is projected at $691.9 million, the broader picture includes a dramatic increase in overall federal funds available to the territory, estimated at $20.65 billion, up from $8.7 billion last year. That surge is driven largely by ongoing disaster recovery and mitigation allocations, but Rhymer cautioned that new executive orders out of Washington have introduced compliance hurdles and delayed award cycles.
In many cases, grant programs are being revised midstream, and some territories have seen application timelines extended or canceled. Although formula-based grants remain stable, Rhymer emphasized that the government must remain “aggressive” in spending awarded funds in a timely and compliant manner. He also expressed cautious optimism that the evolving federal environment may lead to greater autonomy for states and territories, giving local governments more control over how federal dollars are spent.
The total proposed FY 2026 budget includes $68.8 million in other appropriated funds and $62.6 million in non-appropriated local funds, bringing the full request to $1,759,678,223. Among the major appropriations, the judicial and legislative branches are collectively budgeted at $71.2 million. The judicial branch would receive $46.5 million, with the bulk —$40.2 million — going to the Supreme Court, and the Legislature is allocated $24.7 million, including smaller line items for participation in national organizations and mandated events.
Health care continues to be a major focus, with $62 million proposed for the territory’s two hospitals — $31.75 million for Schneider Regional Medical Center and $30.25 million for Gov. Juan F. Luis Hospital. The Health Department is allocated $1.5 million from the Health Revolving Fund, with an additional $1.4 million from that same fund swept into the General Fund. Fire and EMS services would receive $1.4 million for operational support.
Education agencies and institutions are also a priority. The Education Department would receive $3 million for school maintenance and an additional $5.5 million to support the development and printing of Virgin Islands history textbooks, as well as the completion of a K-8 social studies curriculum. The University of the Virgin Islands is proposed to receive $34.98 million in total, including $29.1 million for general operations and $5.8 million for specialized initiatives such as the University Bound program ($355,901), the BSN program on St. Croix ($400,000), the UVI Medical Reserve Fund ($1 million), EPSCoR ($250,000), and the Caribbean Culture Center ($150,470). Other earmarks support simulation training, vocational programs, scholarships, and the maintenance of Brewers Bay beach.
Tourism remains a central pillar of the spending plan, with $39 million allocated to the Tourism Department from the Tourism Advertising Revolving Fund. Of that amount, more than $34 million is budgeted under “other services and charges,” typically associated with marketing and promotions. An additional $6.66 million from the same fund would support a wide range of interagency activities — from festival cleanup and youth sports to cannabis regulation and agricultural support.
The budget also leans heavily on special revenue funds to sustain agency operations and boost the General Fund. This includes $6 million from the Caribbean Basin Initiative Fund, $20 million from the Virgin Islands Insurance Guaranty Fund, $950,000 from the V.I. Lottery, and $11 million from the Transportation Trust Fund, of which $5 million would go directly into the General Fund. The Indirect Cost Fund would provide $2.9 million to support agencies like OMB, Finance, Personnel, and Property and Procurement.
Waste Management and Public Works are also major recipients. Waste Management is set to receive $32.5 million from the General Fund and another $8.5 million from various funds, including the Sewer System, Anti-Litter and Beautification, and Tourism Revolving Fund. The Public Works Department is budgeted to receive roughly $7.2 million across several funding sources for roadwork, maintenance, and abandoned vehicle removal.
Other agency operations are funded through a mix of general and special funds. That includes $2.9 million to the Office of the Inspector General, $2.1 million to the Public Services Commission, $1.7 million to the Public Employees Relations Board, and $394,197 to the V.I. Taxicab Commission, supplemented by $160,440 from the tourism cleanup bill.
The Justice Department has also requested $12 million for a new Child Support payment system to meet federal grant guidelines; however, no response from the grantor has yet been received. If approved, the territory would be required to cover a 34% match, which Rhymer recommended be drawn from non-General Fund sources.
Finally, the administration has submitted a separate bill proposing a salary increase for members of the Casino Control Commission. The legislation would raise annual compensation to $110,000 for commissioners and $125,000 for the chairperson, replacing a decades-old salary cap. The measure cites the commission’s full-time responsibilities and a statutory ban on outside employment as justification for the raise, and seeks to align the agency with other executive branch entities.
St. Croix Source
Local government, Local news
