Norita: DeLeon Guerrero statements lack context, misleading, inaccurate

Finance Secretary Tracy B. Norita described yesterday as “unfortunate” Senate President Edith E. DeLeon Guerrero (D-Saipan) statements about approximately $93 million in American Rescue Plan Act funding, saying the senator’s “irresponsible” public statements are “dangerously misleading, inaccurate, and lacking in context.”

Clarifying, among other things, that the $93-million ARPA funding is a budget and not actual cash, Norita said that DeLeon Guerrero’s statements last Friday that the administration terminated 500-plus employees despite having $93 million in ARPA funds were wholly inaccurate and dangerously misleading.

In her letter to DeLeon Guerrero, Norita said that, although it was a painful decision to terminate the 500-plus ARPA-funded employees, it was absolutely necessary to maintain critical operations considering the general fund is not able to shoulder the personnel cost.

The previous Torres administration hired the 500 employees using ARPA money.

At the Senate special session last Friday, DeLeon Guerrero said the administration preaches the words of transparency, accountability, and rebuilding trust, yet 500 employees whose posts were funded by ARPA, have lost their jobs despite evidence showing a positive number that there is still ARPA money.

DeLeon Guerrero noted that when they first took office, a worksheet was provided showing that as of Dec. 31, 2022, the available ARPA was $65,789.171. She said the latest report from Finance showed that, as of May 31, 2023, available ARPA was $93,419,465.

The Senate president also disclosed that the Tinian Department of Community and Cultural Affairs is being asked to surrender a car, which was processed through ARPA, as allegedly there is no more ARPA money.

DeLeon Guerrero issued the strong statements against the administration before voting “yes” to Senate floor leader Sen. Corina L. Magofna’s (Ind-Saipan) motion to override Palacios’ veto on Sections 604 and 713 of Public Law 23-04, or the amended budget law, during the special session.

Norita said in her letter yesterday that, as of May 31, 2023, the Fiscal Response Team issued an update to the budgetary ARPA reconciliation of approximately $93 million (in budget, not actual cash), with $116 million in expenses that had yet to be booked against ARPA funds and that are still being scrutinized by the FRT for allowability.

Basically, Norita is saying that what is budgeted is not necessarily what is available to disburse in cash. She said the very little that is remaining in cash is already overcommitted.

The secretary said Deleon Guerrero has already received this information and was also provided information about an ARPA cash balance of approximately $24 million, which is currently allocated for critical expenditures, such as utilities, fuel, communications and health/life insurance, for all branches of government.

Additionally, Norita said, the administration has kept its commitment to both the Judiciary and the Legislature to maintain ARPA allocation for critical operations only.

She said they cannot pay vendors with figures represented on a budget and that ultimately, cash is the real decision-making factor.

Norita said the remaining ARPA cash of $24 million is barely sufficient to sustain critical operations for a very limited amount of time, thus cost-containment measures have been taken and the revised fiscal year 2023 budget was passed into law.

On the issue of ARPA Spending Plan, Norita said that she met virtually with the U.S. Treasury last April 27 regarding the CNMI’s need to revise the current ARPA Spending Plan. Norita said they were advised that the revision is communicated in the semi-annual compliance reporting on expenditures.

“No other submission is required at this time. The fact that you are unaware of this information is questionable,” she told the president.

This information, Norita pointed out, was immediately provided to those present at the subsequent FRT meetings, including the Legislature’s fiscal analyst.

The secretary said the Palacios-Apatang administration began with a reported $86 million deficit in funds from ARPA and this prompted the creation of the FRT. She said the administration invited the Legislature, including DeLeon Guerrero, to join the FRT.

Since then, Norita said, the FRT has been meeting weekly, providing updates on the reconciliation process and continuously changing balances.

Although DeLeon Guerrero has not been attending these meetings, the Legislature’s fiscal analyst has been provided documents showing the progress of the reconciliation, she added.

The secretary said it is their full understanding that figures are updated weekly when there are new findings.

Norita said through the FRT’s work, they were able to organize financial information that initially was in disarray into a reporting format that could help them make better, informed decisions. She said the FRT continues to update both budgetary and cash balances of the ARPA Fund.

The secretary said it was the FRT that advised both Gov. Arnold I. Palacios and lawmakers that a revised budget was necessary, cost-containment measures must be implemented, and government obligations must be reduced in order to protect critical operations.

Norita said other legislators who needed more information to understand the numbers have made the effort to attend these meetings to gain insights and directly communicate their questions, concerns, and proposed solutions.

“I encourage you to do the same; the invitation to actively participate remains open,” Norita told DeLeon Guerrero.

Tracy B. Norita and Edith E. DeLeon Guerrero

She said the administration has reduced employee hours to 72 hours per pay period, vacated rental spaces, disconnected phone lines, returned vehicles, canceled contracts—all to cut costs.

“We welcome the same effort from others,” Norita said.

To reduce outstanding obligations for unpaid vehicles, a meeting was held with certain agencies to determine how the Executive Branch could assist in reassigning current government vehicles so that unpaid purchase orders could be canceled and vehicles returned to the vendor, Norita said. Unfortunately, she said, some agencies did not attend and did not fully understand the intent.

“Thus, you have taken this genuine effort to assist agencies in reducing their outstanding obligations and have blown it out of context,” Norita told DeLeon Guerrero.

The secretary said this is an example of numerous meetings being held to come up with solutions to help the current fiscal crisis, while DeLeon Guerrero’s statements mislead the public.

She said the work to help the CNMI out of this fiscal crisis continues and can only be achieved if they work together.

“We remain committed to transparency, openness, and the responsible dissemination of accurate information and updates to the people we serve,” Norita added.