Finance chief gets power to collect debts owed to govt

The Department of Finance is now expected to collect more revenues as emergency regulations were recently adopted granting the Finance secretary authority to offset outstanding debts against rebates or overpayments.

The Attorney General’s Office, which signed the regulations on Nov. 23, said the public interest and welfare requires the adoption of emergency amendments to set up rules and regulations to aid in the administration of duties granted to the Department Secretary.

The regulation is pursuant to Public Law 14-35 which provides the secretary with the authority to collect debts owed to Commonwealth government agencies “through the reduction in the amount of rebate/refund or other overpayment of taxes that are payable to a debtor.”

The AGO said several agencies have presented debts to be collected as offsets against any rebates or overpayments processed by the department currently or in the future.

“In order to provide timely processing of both these submitted debts and any affected refunds or overpayments, emergency adoption of implementing regulations is required,” said the AGO.

The regulation, titled DoF Regulations Format (9-14-05), aims to establish basic structure for the development and maintenance of future regulations for the department.

It said that although primary authority and responsibility for the development and administration of department regulations reside with the Secretary of Finance, each division director has the responsibility to evaluate legal and administrative requirements and make proposals to the secretary for addressing identified needs.

Finance Secretary Fermin M. Atalig said yesterday that the emergency regulation now allows the department to offset debts.

“It means that if you owe money to the government and you have tax rebate, I can take that tax rebate,” said Atalig.

This came even as an audit report released last May by Deloitte & Touche showed that the government has some $18 million receivables from taxes as of Sept. 30, 2003.

The report said that the CNMI government’s gross receivables reached $312 million as of 2003.

The central government’s receivables including “uncollectibles” totaled $118 million while component units or the autonomous agencies gross receivables totaled $194 million.

Receivables are funds owed to the government.

The central government, which consists of the Executive, Legislative, and Judicial offices, listed $75 million as uncollectibles or those accounts that are more than 90 days delinquent as of Sept. 30, 2003, resulting in net receivables of $43 million.

The component units—Public School System, Commonwealth Ports Authority, Commonwealth Development Authority, Commonwealth Utilities Corp., Northern Marianas College, Marianas Public Lands Trust, Marianas Public Lands Authority, and Marianas Visitors Authority—recorded $121 million in uncollectibles, resulting in net receivables of $73 million.

The primary government’s records showed $20 million receivables from the federal agencies, $78 million from other agencies, $18 million in taxes, $1.1 million in “general” and $728,200 from “others.”

Meantime, the Office of the Public Auditor said in a report recently that the AGO action is needed for the recovery of approximately $2.7 million improperly expended by various government agencies as far back as 1995.

These include some $1.13 million from the Tinian Casino Gaming Control Commission for overpayment of a consultant, breach of fiduciary trust by three commission officials, and outstanding travel transactions and another $1.3 million overpayments of professional services contracts by the CNMI government.

The remaining amount is recoverable from the departments of Public Works, Finance, and Public Health, Commonwealth Utilities Corporation, Marianas Public Lands Authority, and Commonwealth Ports Authority.

The cases involve improper payments to contractors or board members, travel and per diem overpayments, non-collection of rentals or lease payments, or funds misuse by agency officials.