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Deficit at $57.3M, audit shows
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Posted on Dec 16 1998
The CNMI government has a cumulative deficit of $57.3 million from 1986 to Sept. 30, 1997, audited financial statements show.
The deficit began to mount between 1986 and 1987, but Gov. Pedro P. Tenorio, who was then into his second term, managed to hold if off at $27 million, from $15.98 million, when he left office. (Please see graph)
The deficit took a huge leap in the ensuing years, notably during the gubernatorial term of Larry Guerrero. By then, the deficit made a steep climb, rising 226 percent.
When Froilan C. Tenorio took office, he had to deal with a $44.6 million deficit. He made only token efforts to pare it down with two deficit-reduction outlays totalling $9.7 million in 1995. He, too, failed to rein in the deficit, which at the end of his term stood at $57 million.
Public Auditor Leo LaMotte said slack implementation of spending rules contributed to the deficit accumulation.
In 1997, for instance, an audit report repeated a bunch of ignored recommendations from a previous audit, which found questionable expenses of $11.8 million.
“Of the 61 audit findings, 34 have been cited in prior year’s reports, for which no corrective actions have been taken,” LaMotte said.
The auditor also attibuted $22.5 million of the deficit to overspending by agencies, including the governor’s office under the stewardship of Froilan C. Tenorio.
In 1997, he spent $10 million more of his $16.5 million allocation, the auditor said.
The three other agencies that exceeded their spending limits are:
•Department of Public Safety, $4 million;
•Department of Finance, $1 million; and
•Department of Public Works, $732,585.
Other offices that overspent their budget:
•Tinian mayor, $1.3 million;
•Rota mayor, $243,992;
•Saipan mayor, $144,309; and
•About $3 million was spent for other government programs.
Although 14 agencies did not exhaust their budget, their combined $16.4 million savings were too insignificant toward reducing the deficit, the report said.
