‘Appropriation laws, annual budget law do not affect amounts allocated to PSS’

The NMI Settlement Fund asserts that the appropriation laws for the settlement agreement payments in Betty Johnson’s class action and the CNMI’s fiscal year 2020 annual budget law are valid continuing appropriations and do not affect the amounts allocated to the Public School System.

The NMI Settlement Fund, through counsel Nicole M. Torres-Ripple, said the Planning and Budgeting Act does not prohibit the Legislature from setting the amount of general revenues in which to base PSS’ 25% appropriation, or from making an appropriation to PSS based on that amount.

Torres-Ripple cited these points in the NMI Settlement Fund trustee’s reply Tuesday to PSS’ opposition to the Settlement Fund’s motion asking the U.S. District Court for the NMI to enforce the final judgment against PSS in connection with the Johnson class action.

Torres-Ripple said they filed this reply despite PSS’ opposition not being filed on time under the District Court Local Rules and Federal Rules of Civil Procedure.

Torres-Ripple said the Legislature may lawfully appropriate amounts for the Settlement Fund and provide for those appropriations in the annual budget law while also appropriating PSS’ 25% based on total general revenues and still achieve a balanced budget.

PSS and Education Commissioner Dr. Alfred Ada, through counsel Tiberius Mocanu, are suing Gov. Ralph DLG Torres and Finance Secretary David Atalig before the Superior Court to guarantee for PSS an annual budget of not less than 25% of the Commonwealth’s general revenue. PSS and Ada allege that Torres and Atalig are in violation of the NMI Constitution.

PSS and Ada said that Public Law 21-08, which set the Commonwealth government’s budget for fiscal year 2020, appropriated $37,718,904 to PSS, which is approximately 16% of the budget.

Because of PSS and Ada’s lawsuit, the Settlement Fund filed a motion requesting that the District Court resolve PSS’ challenges to the constitutionally-mandated payment obligations owed the Settlement Fund under the settlement agreement entered in Johnson class action.

Ada and PSS opposed the motion.

In the Settlement Fund’s reply Tuesday, Torres-Ripple said a declaration that the budget law appropriations for the Johnson settlement agreement payments are unconstitutional does not remedy and is not a legal solution to PSS’ problem.

She said PSS sought to invalidate the appropriations to the Settlement Fund in the Superior Court action, and that the Settlement Fund argued that the appropriations laws are not invalid or unconstitutional.

Torres-Ripple said PSS now concedes that Section 2 of Public Law 20-33 and a statute are “valid earmarks,” and that the “Legislature may divert business gross revenue taxes into a special fund” to make the Johnson settlement agreement payments.

She noted that PSS further concedes that the payments under the Johnson settlement agreement are “constitutionally rooted” and that the “obligation…is mandatory.”

Considering these concessions, Torres-Ripple said, the federal court should grant the Settlement Fund’s motion and find that the appropriations laws are valid and constitutional, and PSS is not entitled to amounts appropriated to the Settlement Fund (past, present, or future).