‘Tis the season for numbers

Lawmakers have six months to review or procrastinate on Gov. Eloy S. Inos’ proposed fiscal year 2016 operational budget of $145.8 million, which is not only the highest in seven years but also brings back the level closer to 2009’s $148 million and 1992 to 1994’s $158 million.

In 27 fiscal years beginning in 1990, the CNMI government’s annual resources available for personnel salaries, public health, public safety, education and other public services have ranged from a measly $102 million in 2012 to a record high of $247 million in 1997. This is based on compiled data from the Office of Management and Budget.

Whether the CNMI can ever go back to having a government budget that’s anywhere near $247 million during the heyday of the Saipan garment industry is everyone’s guess.

Barring any major negative external events, tourism arrivals are expected to climb even more in the years ahead and further increase government revenue.

But tourism growth also requires the CNMI to properly and continuously maintain and improve its tourism sites, add more activities for tourists such as building an integrated casino resort, aggressively promote the islands as a destination of choice, and curb criminal activities.

Separate and conflicting proposals from the 19th Legislature to impose new charges and fees for tourists all at once won’t help.

Once Best Sunshine International Ltd.’s touted $7.1-billion integrated casino resort on Saipan actually gets off the ground, the expectation is that it would further boost economic activities and therefore result in more government revenues.

But the $11.49 million in projected increase in operational budget in 2016 compared to 2015 is lower than the prior years’ increases, prompting some lawmakers to seek clarification from the administration.

Between 2012 and 2013, there was a $12 million increase.

The operational budget increased by $21 million from 2013 to 2014.

That $21-million budget growth—$114 million in 2013 versus $135.786 million in 2014 inclusive of the supplemental budget of $12.386 million—was partly a result of the economic windfall brought by the release of over $40 million in defined benefit plan contribution refunds in October 2013 and Best Sunshine’s $30 million advance license fee payment.

The budget dropped slightly from $135.786 million in 2014 to $134.33 million in 2015.

But because Best Sunshine’s temporary casino or live training facility at T Galleria is touted to start operating as early as June—more than a year earlier than the initial plan of starting any casino operation—there is room for more government revenue for 2015.

The governor is proposing to allocate $12.7 million for utilities to defray utility consumption charges for the three branches of government. This includes $2 million for direct payment of outstanding utilities by the central government for the Commonwealth Healthcare Corp., but lawmakers might want to add more to this or push for separate appropriation bills addressing the same obligation.

One such bill appropriates $4.2 million in lapsed funds from the Alien Deportation Fund business unit to help CHC pay a portion of its utility bills totaling nearly $15 million.

But the administration has yet to acknowledge whether there is still money in this particular account that some lawmakers describe as a “slush fund” for previous administrations.

Allocating all $1.7 million in Commonwealth-only worker or CW fees to the Department of Labor seems to be “another layer of red tape” or bureaucracy.

But as early as 2014, Inos already made clear his intention of using CW funds to pay the actual on-the-job training salaries of U.S. workers in the private sector and less CW funds pumped into the Public School System and Northern Marianas College where results, he said, may be harder to come by. He called this a “targeted” and “more aggressive” approach.

Others question bloating the government with a total of at least 128 more positions (78 additional fulltime equivalents or FTEs and another 50 reserved slots) when the administration, they say, insists on maintaining the 2015 level.

The transition committee itself recommended increasing the size of the CNMI government to meet the needs of the new casino industry on Saipan.

The governor is also again asking the Legislature to grant him the flexibility to hire another 50 personnel for the entire Executive Branch; provided they are hired with his approval and that the hiring is restricted to positions that are “essential” to the delivery of public services. They include police cadets, fire and emergency personnel and corrections officers.

Whether the same standard was used to create a new post that only former Corrections commissioner Ramon Mafnas could qualify for, according to the governor, remains a mystery. Mafnas is now special assistant for project development.

But at the same time, the governor continues to reduce redundancy in other areas of government; this time by seeking to merge two divisions within the Department of Labor that share similar functions. This eliminates the Division of Labor and transitions its two staff into the Employment Services Division.

The governor is also requesting lawmakers to include a budget provision authorizing advances for the CNMI Scholarship Program and other programs that require one-time payment. This has long been pushed by members of previous legislatures and it looks like it will finally happen this time around.

Other lawmakers believe that the projected increase in revenue of $11 million for 2016 is too modest, considering that there’s “at least $40 million” more that will be infused into the economy related to the Saipan casino project and further tourism arrivals growth not associated with the Saipan casino.

Lawmakers should have their chance to press the governor’s finance and budget chiefs for answers when they call them in to discuss the 2016 projected revenues.

Departments and agencies have already started asking the Legislature for funding that’s more than what the governor is proposing.

And while it’s true that budget deliberations at the Legislature pick up close to the budget deadline despite a six-month window (some have not even read the governor’s budget transmittal), lawmakers have at least not repeated the mistakes of 2010 when the House and Senate failed to timely compromise on a spending plan that led to a partial government shutdown. (Haidee V. Eugenio)