reform period to a close and again left the islands isolated. During the submarine warfare phases of the war, the United States, fearing that the islands might be seized by Germany as a submarine base, again approached Denmark about buying them. After a few months of negotiations, a selling price of $25 million in United States gold coin was agreed, equivalent to $ million in dollars. At the same time, the economics of continued possession weighed heavily on the minds of Danish decision makers, and a consensus in favor of selling emerged in the Danish parliament. The Treaty of the Danish West Indies was signed on August 4, 1916,Convention between the United States and Denmark for cession of the Danish West Indies , with a referendum on the sale held in Denmark in December 1916 in which voters approved the decision to sell. The deal was finalized on January 17, 1917, when the United States and Denmark exchanged their respective treaty ratifications. American period The United States took possession of the islands on March 31, 1917, and the territory was renamed the Virgin Islands of the United States. Every year, Transfer Day is recognized as a holiday, to commemorate the acquisition of the islands by the United States. Paul Martin Pearson, first civilian governor, was appointed by Herbert Hoover and was inaugurated March 18, 1931. U.S. citizenship was granted to many inhabitants of the islands in 1927 and 1932. The Danish West Indian daler was replaced by the U.S. dollar in 1934, and from 1935 to 1939 the islands were a part of the United States customs area. The 1936 Organic Act and the 1954 Revised Organic Act established the local government. Tourism began to develop following World War II, over time becoming the most important sector of the islands' economy. In 1970, Virgin Islanders elected their first governor, Melvin H. Evans, and from 1976 the islands began work on creating their own constitution. Water Island, a small island to the south of St. Thomas, was initially administered by the U.S. federal government and did not become a part of the U.S. Virgin Islands territory until 1996, when of land was transferred to the territorial government. The remaining of the island was purchased from the United States Department of the Interior in May 2005 for $10, a transaction that marked the official change in jurisdiction. In 1966, Hess Oil began