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Governor: No MVA budget cuts
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Posted on Dec 07 1998
Gov. Pedro P. Tenorio assured Friday anew the Marianas Visitors Authority that he will exclude the agency in the planned reduction of budget for fiscal year 1999 so as not to disrupt its main task of promoting the Northern Marianas abroad.
In fact, Tenorio said he wants to give MVA additional funds so that it can continue marketing the CNMI in other countries amid the plunge in tourists arrivals.
The governor gave the assurance after board chairman Dave M. Sablan warned Finance Secretary Lucy Nielsen against including MVA in the budget cut because it would devastate the promotional campaign of the half-a-billion-dollar tourism industry.
Nielsen explained to the board last week how the administration’s austerity measure will be carried out because of the continuous decline in government revenue. She said that if the governor decides to exclude the MVA and other agencies which are also seeking exemption, this will result in a much bigger reduction for other departments which could reach as high as 24 percent.
“We might as well close shop if you don’t give us the money. MVA is a unique agency and a drastic cut in the budget would severely hamper its operation to entice tourists to come here,” said Sablan.
The Office of Management and Budget had earlier projected revenues generated from room tax to reach $7.98 million and $1.65 million from beverage tax.
However, if the budget cut would be carried out, MVA stands to receive only $358,000 from its 25 percent container tax and $4.8 million from the 70 percent share from occupancy tax.
Sablan said MVA’s budget will naturally decrease since its share in the hotel occupancy tax and income from the beverage container tax have been dropping due to the downtrend in visitor arrivals.
The finance department had promised MVA that it will release some $1.7 million due to the agency for fiscal year 1998. Of this amount, Nielsen said MVA will get some $1.2 million this month.
The tourism office got a $7 million budget for fiscal year 1999, way below the $13 million appropriation it was seeking. Due to the uncertainty in the economic condition of the government, MVA had suspended temporarily the implementation of various projects.
