USVI Governor Touts Environmental Improvements to Key U.S. Senator

Letter to Senator Boxer Highlights State-of-the-Art Rum Distilleries, Advanced Wastewater Treatment Center

WASHINGTON, April 28 /PRNewswire-USNewswire/ -- In a letter sent Monday to U.S. Senator Barbara Boxer, chair of the Senate Committee on Environment and Public Works, U.S. Virgin Islands (USVI) Governor John P. deJongh, Jr., proudly detailed the significant environmental progress underway in the modernization of the territory's rum industry. Through two long-term agreements, the USVI and its rum industry partners, Diageo and Fortune Brands, are constructing distilling and wastewater treatment facilities that significantly lessen the industry's impact on the environment and preserve the natural beauty of the territory.

Fortune Brands, maker of Cruzan Rum, recently broke ground on a new wastewater treatment facility that will eliminate visible wastewater discharge – totaling more than 150,000 pounds of chemical oxygen demand – into the Caribbean Sea each day and use new recycling systems to reduce fresh water usage by 38 percent. Diageo, owner of Captain Morgan rum, will complete construction later this year of its world-class distillery, which will convert distillation by-products into clean water and biogas for green energy and employ a closed-loop water system to reduce water waste.

"We are working hand-in-hand with our [rum industry] partners to ensure they are not just compliant with environmental regulations, but that they set the highest standards in the rum industry," wrote Governor deJongh. "I am excited by both Diageo's and Fortune Brands' dedication to protect the USVI's natural beauty and precious resources by investing in the most sustainable technology, construction and manufacturing processes available."

The public-private partnerships will keep the two spirits companies and their jobs and economic impact in the USVI for at least the next thirty years. Revenue from the rum excise tax cover-over program, an economic development tool granted to the territories, will support the investments in environmentally responsible rum production.

"The USVI has a plan to address environmental challenges and, in partnership with Diageo and Fortune Brands, transform the industry," wrote Governor deJongh. "I urge you to support the USVI's innovative plan to use a federal program to ensure the sustainability of our rum industry and protect our natural beauty."

Full text of the letter follows.

Dear Chairman Boxer:

I am writing to update you on important advances that will improve the U.S. Virgin Islands' environment. Given your position as the Senate's foremost advocate for protecting our planet's health, I am proud to share details of the USVI's efforts to transform its historic rum industry—an industry that is central to our economy and affects our natural environment.

Rum production in the U.S. territories and Caribbean countries is based on an outdated 1900s model that uses large quantities of water and produces waste that, if improperly treated, poses a threat to the surrounding environment. The USVI will solve this problem through innovative public-private partnerships that bring our rum industry into the modern age and ensure three decades of environmental benefits. We will use the longstanding rum excise tax cover-over program to mitigate environmental issues from the rum-making process, develop our economy and provide for our citizens.

The USVI government has signed landmark public-private partnerships with two of the world's largest spirits companies, Diageo plc and Fortune Brands, that will transform the Territory into the world's most technologically advanced and environmentally sustainable rum-producing region. Under the thirty-year agreements, the USVI is financing construction of Diageo's new state-of-the-art Captain Morgan distillery—the industry's most environmentally friendly rum distillery. We also have issued bonds to finance expansion of Fortune Brands' existing Cruzan Rum distillery and construction of the Caribbean's most advanced wastewater treatment facility. These facilities are designed in accordance with LEED certification principles, with a closed-loop water system, organic solids reclamation and storm water management best practices.

Fortune Brands recently broke ground on Cruzan Rum's new wastewater treatment facility on St. Croix, introducing a host of new environmental benefits to the USVI's rum industry, including:

• Elimination of visible wastewater discharge - in the form of more than 150,000 lbs of chemical oxygen demand - into the Caribbean Sea each day
• Elimination of 94 metric tons of landfill waste annually
• Reduction of fresh water usage by 38 percent per proof gallon of rum produced
• Reduction of volatile organic compounds emissions into the air in the fermentation and distillation process by 90 percent, using new scrubber technology to recover ethanol
• Improved energy efficiency by evaporating, recycling, compressing and reusing excess water

Diageo's world-class Captain Morgan distillery, currently under construction and on schedule to begin producing rum next year, will also modernize our rum industry and improve our environment by:

• Converting by-products from the distillation process into clean water and biogas for green energy through high-tech wash water treatment
• Employing a closed-loop water system to reduce water waste
• Utilizing organic waste reclamation
• Using natural warehouse lighting and roof ventilation systems to lower energy use
• Reusing existing materials on site to reduce waste

Without our investments in these companies, the Caribbean rum industry would have little incentive to improve its environmental record. We are working hand-in-hand with our partners to ensure they are not just compliant with environmental regulations, but that they set the highest standards in the rum industry. It is refreshing to have both Diageo's and Fortune Brands' dedication to protect the USVI's natural beauty and precious resources by investing in the most sustainable technology, construction and manufacturing processes available.

Puerto Rico Resident Commissioner Pedro Pierluisi is promoting federal legislation (H.R. 2122) that would nullify our deals with Diageo and Fortune Brands. Senator Robert Menendez has also introduced similar legislation (S. 3208) that would block our investments. These bills would undermine the anticipated environmental benefits for the USVI, the United States and the Caribbean.  Passage of either of these bills would have a devastating impact on our financial solvency as a U.S. Territory.

Diageo holds a contract with Destileria Serralles, a Puerto Rican rum supplier currently making Captain Morgan, which expires in 2011. Destileria Serralles refused to provide fair market pricing during contract extension negotiations, and Diageo decided to move production to a foreign country such as Guatemala, Honduras or Jamaica—where it could avoid stringent U.S. environmental oversight. Diageo then approached the USVI, reaching a commitment that will preserve U.S. jobs otherwise headed overseas and help modernize the region's rum production.  Cruzan Rum has been a USVI company since 1934 and after six owners in less than ten years became part of Fortune Brands in 2009.  Our agreement offered stability.

The USVI has a plan to address environmental challenges and, in partnership with Diageo and Fortune Brands, transform the industry. We know that the status quo is not an option. I urge you to support the USVI's innovative plan to use a federal program to ensure the sustainability of our rum industry and protect our natural beauty.

The environment is ours to destroy, ours to save, and ours to share -- particularly in places like the USVI that rely on our beauty for economic purposes like sustainable tourism. We must develop and implement plans today so future generations can share in it as well. Thank you for your commitment to protect our environment and for your support in the efforts of the USVI and other territories to do their part in the fight to save our planet.

Sincerely,

John P. de Jongh, Jr.

Governor

SOURCE Office of U.S. Virgin Islands Governor John P. deJongh, Jr.

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