The CNMI gubernatorial leadership: 1978-2004

Second of five parts

FROM 1988 THROUGH 1998

During the second decade of the CNMI government, i.e., from 1988 through 1998, the registered electorate of the island community chose Lorenzo I. De Leon Guerrero to be governor. When he came into office subsequent to Pedro P. Tenorio, the economic picture for the CNMI began to change. The fiscal surplus generated under Pedro P. Tenorio’s leadership turned into a “small deficit” during De Leon Guerrero’s term in office, according to the Bank of Hawaii report of 1995.

According to the said report, the total revenues versus total expenditures during De Leon Guerrero’s four year term in office were the following (in millions):

1991 (Revenues—151,019; Expenditures—156,319);
1992 (Revenues—159,479; Expenditures—156,939);
1993 (Revenues—138,649; Expenditures—154,063);
1994 (Revenues-152,962; Expenditures—181,501).

As the third governor for the CNMI, Lorenzo I. De Leon Guerrero generated a budgetary deficit of approximately $46.7 million while he was governor. This deficit took away more than half of the $70 million dollar surplus generated from 1988 to 1991 while Tenorio was governor.

The eradication of the majority of the surplus funding generated by Tenorio would be akin to the total spending of all the $5 trillion dollar surplus funds by George W. Bush from 2001 through 2004 that were generated by Bill Clinton when he was president from 1992 until 2000, and creating an additional deficit of $3 trillion besides.

When Froilan Tenorio, the fourth governor for the CNMI, captured the gubernatorial seat for the Democrats in 1994, the fiscal picture for the CNMI shifted somewhat. Tenorio’s administration was able to eradicate some of the red ink generated by De Leon Guerrero, but during his last year as governor in 1998, he was not able to keep expenditures from surpassing the amount of revenues generated by the government.

According to the BoH economic report of 2003, the total revenues and expenditures during Tenorio’s term in office from 1994 to 1998 were the following (in millions):

1994 (Revenues—152,962; Expenditures—181,501);
1995 (Revenues—203,650; Expenditures—191,446);
1996 (Revenues—226,701; Expenditures—221,715);
1997 (Revenues—248,036; Expenditures—268,122);
1998 (Revenues—242,282; Expenditures—255,648).

The net fiscal result from Froilan Tenorio’s leadership from 1994 to 1998 was a deficit about $44.8 million.

FROM 1998 THROUGH 2004

Pedro P. Tenorio was brought back to provide leadership for a third term in 1998 and became the CNMI’s fifth governor. During his third term for the CNMI within two decades, he would have to contend with trying to restore fiscal health to a government that had slipped into a major deficit mode.

According to the BoH economic report of 2003, the total revenues and expenditures during Tenorio’s third term as governor follows (in millions):

1998 (Revenues—242,282; Expenditures—255,648);
1999 (Revenues—240,994; Expenditures—236,347);
2000 (Revenues—228,827; Expenditures—222,040);
2001 (Revenues–219,638; Expenditures—212.089).

Although the three-term governor for the CNMI was able to generate surpluses for two of the four years he was in office, the net fiscal result from 1998 to 2002 was about a $22 million overall budgetary deficit.

Upon the official departure of Pedro P. Tenorio from the governorship in January 2002 and the commencement of Juan N. Babauta’s reign as the CNMI’s sixth governor, the cumulative unreserved Fund Balance was approximately $87,949,000 according to the BoH 2003 economic report for the CNMI.

During Juan Nekai Babauta’s first year in office as CNMI governor, the total revenues and expenditures, according to the CNMI Management Discussion & Analysis released on Sept. 30, 2002 and prior to the onset of the new fiscal year that began on Oct. 1, 2002, were $287,615,613 for revenues and $314,985,333 for expenditures. The differential for the total amount of revenues collected in the CNMI and what was spent by the Babauta administration in 2002 was approximately $27,369,720. In one year, the Babauta administration generated a budgetary deficit that exceeded Pedro Tenorio’s deficit, which took him four years to accomplish.

To be continued.

Dr. Jesus D. Camacho
Delano, California