House approves cuts in tax rebate

The House of Representatives passed a measure yesterday that would reduce tax rebates to raise funds for infrastructure projects for the schools and the college.

House Bill 15-51 would guarantee an annual funding of $500,000 plus 10 percent of the revenue generated from the rebate reduction for the infrastructure needs of Northern Marianas College.

All of the remaining funds from the rebate reduction would be used for the construction and repair of classrooms for the Public School System.

Authored by Rep. Justo S. Quitugua, H.B. 15-51 offers a reduced rebate structure.

Currently, taxpayers with a rebate base of $20,000 or less receive 90 percent of the base. If the bill was enacted, they would receive only 80 percent.

The second category consists of taxpayers with a rebate base between $20,000 and $100,000. They currently receive $18,000 plus 70 percent of the rebate base over $20,000. H.B. 15-51 would divide this group into four classes:

* If the rebate base is over $20,000 but not over $40,000, the rebate amount would be $16,000 plus 70 percent of the rebate base over $20,000.

* If the rebate base is over $40,000 but not over $60,000, the rebate amount would be $30,000 plus 60 percent of the rebate base over $40,000.

* If the rebate base is over $60,000 but not over $80,000, the rebate amount would be $42,000 plus 50 percent of the rebate base over $60,000.

* If the rebate base is over $80,000 but not over $100,000, the rebate amount would be $62,000 plus 40 percent of the rebate base over $80,000.

The last category, which consists of taxpayers with a rebate base of over $100,000, currently get $74,000 plus 50 percent of the rebate base over $100,000. If enacted, the House bill would cut the rebate amount to $82,000 plus 30 percent of the rebate base over $100,000.

In addition, the proposed legislation seeks to further reduce rebate amounts by 10 percent in the second year, and an additional 10 percent in the third year upon enactment.

H.B. 15-51 would provide the funding for PSS’ seven-year capital improvement plan which covers 2005 through 2012, as well as NMC’s capital improvement plan for 2006-2013.

PSS’ plan identifies a need for 139 new classrooms and 31 replacement classrooms at a cost of $50 million. The plan aims to address the overcrowding in the schools.

The bill identified 10 schools where the total enrollment exceeded the capacity of classrooms available. The schools, according to the bill, have a combined over-enrollment of 1,191 students.

PSS’ projects also include two elementary schools, a high school serving grades 7-12, classroom additions at seven schools, and classroom replacements at five schools. Other projects include gymnasiums, cafeterias, playground equipment, parking, bus shelters, track and field, and other facilities.

NMC has also identified a need for major renovations and additional infrastructure.