House rejects Senate’s budget plan

The House of Representatives voted unanimously yesterday to reject the Senate’s budget proposal that set lump-sum funding levels to government units.

The House members, who earlier passed a budget bill that allocated $50 million for the Public School System and left the funding of all the other agencies unspecified, disapproved the Senate’s proposal to prevent confusion among expenditure authorities.

Citing the House legal counsel’s advice, House majority leader Oscar Babauta said fiscal problems might occur if the Legislature passed a budget law that provided no separate figures for personnel and operating expenses.

Babauta also noted that the Senate’s proposal failed to grant the requested $50-million budget for PSS.

The Senate’s budget bill sets the PSS’ funding level at $48 million. However, it also mandates the Department of Finance to remit to PSS the deficit reduction amounts collected from all government agencies. These amounts are estimated to reach $2 million.

“I recommend that we put this on hold and look at it further,” Babauta said during the first House session in almost two months.

In an interview, House minority leader Arnold Palacios said the Senate’s proposal was not the proper way to do the budget. “It will cause confusion,” he said.

For the next step, the Senate president and the House speaker will have to convene a conference committee that would resolve the differences between both houses. About three to six members are expected to represent each house in the committee, Palacios said.

On Oct. 25, the Senate passed an amended House Bill 14-371, the appropriation bill for fiscal year 2006.

The Senate budget created a breakdown of the $206.5-million resources identified as available to the Commonwealth for the fiscal year, which started Oct. 1, 2005.

The Senate’s budget sought to allocate $48 million and required Finance to remit deficit reduction funds to PSS. It would also suspend for the entire FY2006 the earmarking provision of Public Law 13-37 and P.L. 13-38, the laws that created the Tobacco Settlement Expenditure Fund and the Tobacco Control Fund.

Furthermore, the Senate’s bill would set a $166-million ceiling for the entire CNMI government’s personnel expenses. It would require that all vacant positions for full time employees be left unfilled for FY2006. It would also prohibit the termination of any existing employee based on the funding reduction resulting from the application or implementation of the budget bill.

A $5 million budget was allocated for the government’s utility expenses. However, PSS would have to pay for its own utility service, which costs about $3 million a year.

The bill did not set specific funding levels for 16 independent programs, including Karidat, Micronesian Legal Services, Council for Developmental Disabilities, Domestic Violence Intervention Center, Coastal Resources Management, and Crime Stoppers International. Rather, it provides them a lump sum budget of $465,128.

The Departments of Public Health and Public Safety, Northern Marianas College, and the Scholarship Office would operate under the same funding level as they have been since FY2003.