Murkowski wants delay, not cutback in CNMI’s CIP funds

In an apparent major shift, Sen. Frank Murkowski (R-Alaska) now wants delay in the funding of capital improvement projects for the Northern Marianas, instead of cutting the federal grants as proposed under President Clinton’s budget for Fiscal Year 2000.

The senator, who chairs the Senate Committee on Energy and Natural Resources which deals with island issues, said the Commonwealth should not be punished for its failure to meet the matching requirement for CIP funds.

“To the extent that the CNMI is unable to obligate the $11 million scheduled for next fiscal year and there are more immediate needs in other island, I would support deferring (not repealing) construction funding until the CNMI can provide the necessary local match,” he said.

Murkowski made the request to Sen. Slade Gorton, chair of the Subcommittee on Interior under the Senate Committee of Appropriations, which is currently reviewing the budget proposal submitted by the Office of Insular Affairs.

Under the White House’s spending plan, the CNMI will receive $5.6 million for its annual construction grants — a 51 percent drop from the $11 million in yearly CIP assistance provided to the island government since 1996.

The cutback in infrastructure funds will benefit Guam, where Clinton promised to pump in more federal money during a visit last November, getting a $10 million in total appropriation for FY2000. Part of increase represents payment for the cost of hosting citizens from the Freely Associated States.

The proposed reduction stemmed from the significant backlog in previous year grants that remain unspent due to the Commonwealth’s inability to set aside local matching funds.

Island officials had warned against the move, saying it would further push the CNMI into economic instability when its failure to make use of the multi-year grants has been a result of the worsening financial crisis besetting the government.

“The fact that the CNMI has been slow in obligating appropriations should not be a basis for the federal government withdrawing from its portion of the agreement,” Murkowski said in a letter to Gorton.

“A match is a remarkable requirement, especially in the territories, and we would send the wrong signal to the islands were we to use their difficulties in meeting requirements as an excuse to repeal a grant,” he added.

Influential: A known ally of the CNMI, the committee chairman earlier had backed the island against any cut in U.S. assistance, prodding the federal government to stick with its commitment.

The modification in his initial position could influence outcome of the proposal as the Murkowski’s committee authorizes spending and its recommendations to the Appropriations Subcommittee carry “great weight” in the budget deliberation, according to Juan N. Babauta, CNMI representative to Washington.

Murkowski, meanwhile, also questioned the plan by the Clinton Administration to increase funding to Guam despite the absence of a master plan to obligate the current appropriation level of $4.58 million for construction.

The neighboring island needs additional allocation for operations to meet funding needs for FAS nationals and not construction, which is a violation of the intent of the $27.7 million set aside for the next fiscal year by OIA for infrastructure development in the territories.

Murkowski recommended to the Appropriations Subcommittee to ask the Clinton Administration to develop a plan and funding schedule for impact assistance for the CNMI, Guam and Hawaii as part of the forthcoming renegotiation of the Compact agreement.

“Assistance should be targeted with some precision on actual additional costs incurred by these governments. Those effects can be comfortably accommodated within existing federal programs,” he said.

The three governments are demanding Washington for reimbursement of millions of dollars in expenditures associated with the influx of Micronesians under the Compact which is set to expire in two years.