‘Senate budget version more clear, provides security’

Patrick H. San Nicolas

Rep. Patrick H. San Nicolas (R-Tinian), who were  among the three minority members in the House of Representatives who voted “yes” to pass the House’s budget bill for government’s operations for Fiscal Year 2023, explained during Tuesday’s emergency session why he changed his mind and now supports the Senate version of the budget bill.

During discussions on a motion to reject the Senate’s budget bill version, San Nicolas said although it is very obvious that the House and the Senate’s versions differ considerably, he would like to state for the record  that he will support the Senate version of the budget.

He said the Senate version is more clear and provides more security for government employees and most importantly the full time employees for the municipalities of Tinian and Rota.

“As we all know the end of fiscal year 2022 is this Friday, Sept. 30. Mr. Speaker, if we don’t pass this budget, the government  will partially shut down and many government employees will not be reporting to work,” San Nicolas said.

He said the partial shutdown will have an immediate effect  on the government employees’ personal finances as well as public services in the community.

San Nicolas is a member of the House Ways and Means Committee that conducted budget hearings. He, minority leader Angel A. Demapan (R-Saipan), and Rep. Roy Christopher A. Ada (R-Saipan) voted “yes” to the House’s budget bill last Aug. 27,  but on Tuesday voted “no” to the rejection of the Senate’s budget version.

Reps. Joseph Lee Pan T. Guerrero (R-Saipan) and Joseph A. Flores (Ind-Saipan), who were absent when the House passed their version of the budget on Aug. 27, were among the five who voted “no” to the rejection of the Senate version.

In addressing Rep. Richard T. Lizama’s (D-Saipan) concern that retirees may not be getting pension benefits if there is insufficient funds, Ada said the Torres administration has not failed the retirees in getting their pension benefits.

Ada said on top of that, the Torres administration also found money to give some bonuses to the retirees.

“I think this administration has done a good job with making sure that retirees are taken care of,” he said.

In regards to the liaison office to take care of off island students and medical referral, Ada said he agrees that the medical referral program should be under the hospital.

“But then the hardship that people have been talking about ever since that transition happened, the resources and the benefits that were afforded to them when the medical referral  was under the Executive Branch, is no longer allowed under CHCC (Commonwealth Healthcare Corp.),” he said.

Ada said this liaison office will help the medical referral patients out there get the services that they need.

He said right now what he heard is that the Medical Referral Office under CHCC now requires medical referral patients to utilize Uber.

“These are our people and we know how to treat our people,” the lawmaker said.

Ada said he does not know if an Uber driver could assist these patients as it is uncertain what kind of vehicle is going to show up when calling for an Uber driver.

“So I think that the liaison office under the Executive Branch with this new office is a good idea. I am in full support of the Senate version,” Ada said.

Rep. Celina R. Babauta (D-Saipan) said Rep. Ada voted “yes” to the House version and agreed last Aug. 27 when they passed the bill that the House version was the best that they could come up with.

“I want to remind you of your agreement and your ‘yes’ vote,” Celina Babauta told Ada.

She said as to Ada’s comments that he agrees with a new liaison office under the Governor’s Office, it is nothing a redundant office and only creates a lot of bureaucracies and inefficiencies.

As to San Nicolas, she said the Tinian lawmaker also voted “yes” to the House’s version.

“You definitely, you are a member unlike Rep. Ada, you are a member of the Ways and Means Committee. You raised no concerns. You did not bring up any financial needs of the Municipality of  Tinian,” Celina Babauta said.

San Nicolas repeatedly raised his hand to say something, but House Speaker Edmund S. Villagomez (Ind-Saipan) did not recognize him as Babauta continued talking.

“Your silence tells us you agreed with all our debates, all our discussions, and that we were trying to be fair to everybody, all municipalities. And we did not hear from you,” Celina Babauta said.

Rep. Corina L. Magofna (Ind-Saipan) basically reiterated what he explained in the House majority’s recent press conference with regards to the authority that the Legislature has on the allocation of the American Rescue Plan Act funds.

Magofna said the governor and the Senate appear to be in agreement that the House has no legal authority to allocate ARPA funds.

She said the House firmly maintains its position that it has the legal authority  to allocate the ARPA funds identified in the governor’s revised budget submission.

Magofna said based  on their reading and understanding  of a section of the Commonwealth Code, the members of the Ways and Means committee interpreted and considered the ARPA funds to be additional revenues.

Rep. Sheila J. Babauta (D-Saipan) said in the Senate version, there were many sections that were deleted such as sections around payment in excess of base salary which is essentially pay raises, sections around budget authority, suspending the auditor’s fee, emergency powers, utilities.

Sheila Babauta said there’s also added language to establish offices such as the liaison office under the governor’s office.

She said this liaison office is to provide services to CNMI students, residents, and medical referral patients in need of emergency assistance or medical services not under the jurisdiction of the CNMI medical referral program.

“And that just doesn’t make sense. Why not empower the  agencies, and departments that are already in place to address any emergency that comes up,” Sheila Babauta said.

She said they don’t need to encourage the people to prepare for a government shutdown.

“I think we can do it. We’ve done it before. And so I’m ready to reject this version and continue with the process,” she said.

Rep. Richard T. Lizama (D-Saipan) said when the governor’s proposed budget was submitted to the Legislature, zero was proposed for the government’s operations.

“We worked hard, put some  money in it. When it went to the Senate, they made a change. They start using Section 501 reprogramming authority,” Lizama said.

He said what if the governor may find insufficient funds from the operational activities of departments, agencies, and offices of the Executive Branch to fund any shortfalls of retirees 25% pension benefits.

Rep. Leila Staffler (D-Saipan) said Torres talked about playing politics in his press conference Tuesday so she will discuss an appropriation bill to allocate funding for the Kagman Watershed Project.

“And I just wanted to put this out there that the Kagman Watershed has been vetoed. The money that we were trying to appropriate to continue this long standing project was vetoed in April [2022],” Staffler said.

She said they tried to override, but the Senate did not follow along with the House.

“And so we are here again and it was included in the budget. And the reason why it was included is that this has been a long standing project,” Staffler said.

She said it says Kagman Watershed, but it’s not just for Kagman as this watershed is for  the entire island of Saipan and for all the farmers who use the Kagman Peninsula to grow crops.

Rep. Ralph N. Yumul (R-Saipan) said under Section 702 Appropriations, the Senate changed the word “appropriate” to “allocate it.”

Yumul asked the House legal counsel Joe Taijeron Jr. if there is any definition in the Planning and Budgeting Act  for the word “allocated.”

Taijeron said he does not believe there is a term “allocated” defined in the Planning and Budgeting act, but the word “appropriation” is defined.

Taijeron said the definition in 7103, appropriation, means an act of the legislature that allows Commonwealth agencies to incur obligations and make payments from the treasury for a specified purpose.

He said appropriation is the most common means of providing budget authority.

Taijeron agreed with Yumul that it is safe to say  that the ARPA fund is embedded in the budget right now.

House and Ways Committee chair Donald M. Manglona (Ind-Rota) said it was the administration that had failed to properly inform the Legislature of the available resources. Manglona said the governor submitted the budget on April 1st, 2022.

He said upon discovering discrepancies, they informed the administration of the overpayment  to the Settlement Fund. Because of this, he said, the House identified $3 million in additional resources.

Additionally, Manglona said, Finance Secretary David DLG Atalig mentioned  that he will include operational funds in the revised submission.

However, he said, when they received the revised budget in July, none of the things they mentioned were addressed, and this again forced the House to address  the needs of the departments.

“However, the House could not have passed a budget early on. Let me remind the governor that the House cannot act on a budget without the Senate passing the House concurrent resolution in mid-August,” Manglona said.

Manglona said the House then passed the budget bill shortly thereafter.

He said they received information on Aug. 16, 2022 that  the Medicaid payment funds in the amount of $20 million was being returned, so they took the time to allocate these funds to the operations budget of various underfunded departments and other critical needs that they identified.

“We passed the budget on a Saturday instead of waiting for the beginning of the week to avoid wasting a single day,” Manglona said.

Rep. Christina E. Sablan (D-Saipan) said she, like Staffler, doesn’t understand at all how the Finance secretary can now say that the $20 million that Medicaid just recently returned to the central government, is now already spent and was spent on local stimulus when the stimulus cards  went out months ago.

“What that tells me is that there is no real control in the administration over how these funds are being spent or managed,” Sablan said.

She said they do have the authority to appropriate and allocate ARPA funding if the Legislature chooses to exercise that authority.

She said they do have the authority to include taxation provisions in the Appropriations Act and appropriate those new revenues as they see it.

“Yes we do have the power of the purse if we choose to claim it,” Sablan said.

Rep. Edwin K. Propst (D-Saipan) said they together passed the House version of the budget and that they were in unison.

“We  blamed the House leadership, but we all voted together. And now some of us are going to change that tune because we are listening to the wisdom of the Senate?” Propst said.

Senate minority members Edith E. DeLeon Guerrero (D-Saipan) and Teresita A. Santos (Ind-Rota) voted to pass the Senate version of the budget.

Propst said the only problem is politics and that’s the difficulty of it.

“Each of everyone of us was not elected by the governor. Maybe he voted for you, but he didn’t put you in this office. The people did,” he said.