CNMI govt again overspends on referrals, utilities by at least $2M

The government exceeded again its spending cap for medical referrals and utilities by at least $2 million during the first half of fiscal year 2012, Lt. Gov. Eloy S. Inos said, citing preliminary figures.

In terms of revenue, the government collected around $50 million during the first half of the year, which, Inos said, is just about right given a $102 million budget for fiscal year 2012.

The estimated $2 million in overspending consists of about $1 million for medical referrals and another $1 million in utilities, said Inos, who oversees government finances.

Inos cited as an example the government’s $5 million spending cap on utilities for 2012 or $2.5 million for each half. That should have been some $416,000 in utilities spending every month. Instead, the government spent an average of $600,000 a month on utilities during the first half of 2012, Inos said. This easily exceeded the monthly budget by $184,000 or over $1.1 million in six months.

Inos said the financial report should be ready for submission to the Legislature soon.

“We’re not saying that we expect to get more-at least we’re not at that point where we can make a statement yet,” he said.

The governor has until July 1 to submit a supplemental budget. That’s the same day when Saipan Air is to launch its inaugural flight that the Fitial administration, the Legislature, and the business community are expecting to boost tourism arrivals and help improve the local economy.

House Ways and Means Committee chair Ray Basa (Cov-Saipan) and other lawmakers said they are looking forward to seeing the actual financial report covering the first six months of fiscal year 2012 or from October to March.

Basa said the report would also help guide his committee as it deliberates on the fiscal year 2013 budget. The Ways and Means Committee will continue this week its budget hearings on the Public School System, Northern Marianas College, and the Judiciary.

In fiscal year 2011, the government reported a $25.8 million deficit when it spent $25.241 million over its projected revenue and a shortfall of some $565,000. This, despite 16-hour work cuts, unpaid holidays and other austerity measures that the Fitial administration put in place purportedly for the government to be able to live within its means.

The initial $2 million in deficit that Inos was talking about included only those for utilities and medical referrals.