Mangloña: We owe PSS $11M, Settlement Fund $6M

In explaining his vote against the budget bill for fiscal year 2018, Sen. Paul Mangloña (Ind-Rota) believes the Legislature owes the Public School System $11 million more and the Settlement Fund $6 million in additional funding.

Mangloña, a former Senate president, was the sole “nay” vote on the budget bill during an emergency Senate session last Saturday, while Sen. Teresita Santos (R-Rota) voted for the budget “with reservation.” The House passed the budget unanimously.

Mangloña, who read his comments into the record based on a four-page letter, pointed out that the CNMI Constitution mandates a budget for PSS that is 25 percent “of what is considered the general fund.” With general fund revenues estimated at $46 million, 25 percent of that is $11 million, he said.

“Our actions…could mean an approximately $11 million shortfall for PSS this coming fiscal year alone,” said Mangloña, adding that the amount could be even more if fiscal years 2015 to 2017 are included.

Mangloña also believes PSS should receive 25 percent of casino-generated gross revenue tax, or CGRT,. He said that this year’s CGRT is estimated at about $58 million and that PSS should receive $14.5 million, a quarter of the total amount.

“For this year so far, we have not given PSS a single dollar. Yet we have passed several CGRT piecemeal appropriations totaling more than $28 million,” he said.

A previous supplemental appropriation went to the payment of land compensation judgments as well as the retroactive lump-sum pay.

“I am convinced that in this fiscal year 2018 budget bill, we owe PSS [about] $11 million…and [the] Settlement Fund [about] $6 million more in adjusted annual minimum payment,” said Mangloña, adding that the $6 million is possibly owed the Settlement Fund as per the Settlement Fund Agreement., which sets an annual minimum payment to be remitted to the Fund annually. If the annual minimum payment is less than 17 percent of the total annual revenue for that certain fiscal year, then the difference must be paid to the Settlement Fund. The Legislature previously appropriated a total of $7.1 million to the Settlement Fund to settle the balances for fiscal years 2014 and 2015.

Senate President Arnold I. Palacios (R-Saipan) explained that the audit report for fiscal year 2016 has yet to be released so the amount owed to the Settlement Fund for fiscal year 2016 has not been determined.

Same passion

Sen. Sixto Igisomar (R-Saipan) said during budget deliberations that the Senate is fully aware of what Mangloña was stating. He also assured Mangloña that the Senate hears him.

“We all feel the same way—we all believe in the same priorities,” said Igisomar, adding that all the items Mangloña mentioned were discussed during Senate Fiscal Affairs Committee meetings.

Igisomar told the Senate floor that he agrees with Manglona that the “retirees’ pension should not be diminished or impaired.”

“That statement was brought to this Legislature when I was chairman of the Retirement Fund and then [I was] fired when I came here telling this Legislature to pay their employer contributions,” he said.

“I feel you, I hear you. We are all share the same passion. Our people need our help,” said Igisomar.

‘Yes with reservation’

Prior to this, Santos told the Senate that she noticed a reduction of “over a hundred thousand” in the budget of the first senatorial district.

“I have also noticed that in the compromise budget, the controversial and ludicrous salary increases were restored…such that if the court rules that the salary increase is enforceable, the funding is readily available,” she said, referring to the certified question filed with the CNMI Supreme Court by Attorney General Edward Manibusan and Finance Secretary Larissa Larson.

If the court deems the increase to be unconstitutional, $104,759 will be diverted to the Department of Public Works for streetlights and $380,900 will go to the Commonwealth Healthcare Corp.

“The [salary increase] issue could be addressed through a standalone legislation so more reviews or studies could be made as to what is actually a reasonable salary for legislators,” said Santos, adding that she hopes the court comes out with a ruling so that if it is deemed unconstitutional, the funding could be “released immediately” to DPW and CHCC.