‘Our government is broke’

Gov. Benigno R. Fitial thus summarized the state of the Commonwealth yesterday, as he delivered his first report to the Legislature since his inauguration a little more than 100 days ago.

In his 30-minute speech, Fitial presented the status of the government as he found it in January, the steps his administration has taken, and his short-term and long-term plans.

Contrary to tradition, Fitial tackled only economic issues. He skipped customary discussion about education, health care, and the environment, among other issues.

The governor explained that it was “no ordinary State of the Commonwealth Address.”

“Our government is broke and I will not allow our government to continue spending on a deficit. I will not allow our government to borrow from our children’s future,” he said. “We are in a financial crisis. But make no mistake. We are going to fix it.”

The governor’s speech was interrupted by applause only once. But it earned praise for presenting a no-nonsense report on the Commonwealth’s financial condition.

“I think the governor has given us a clear picture of the state of the Commonwealth,” said House Vice Speaker Justo S. Quitugua, a Democrat.

Republican Sen. Paul A. Manglona also commended the governor “for doing a good job at trying to explain to the members of the Legislature where we are and where we need to go from here.”

A government employee, who refused to be named, described the candidness of the governor’s speech as “new and refreshing.”

Fitial delivered his speech at around 11:20am, following Lt. Gov. Timothy P. Villagomez’s special report on the status of the Commonwealth Utilities Corp. and Washington Rep. Pedro A. Tenorio’s report on the activities of his D.C. office.

The governor began by saying that, when he took office, he found a government laden with problems such as falling revenues, rising costs, 640 additional government employees, garment factory closures, an unrealistic budget, and a sick economy.

He reported that the government had a $108 million deficit and it could reach $155 million if unliquidated obligations of the government were taken into account.

He added that the previous administration overspent in the first three months of fiscal year 2006 and made commitments beyond its term. As a result, the Fitial administration was left with only $117 million, or about 60 percent of the FY2006 revenue estimate to spend for the eight remaining months.

He touted his administration’s accomplishments so far. He said he had appointed a quality Cabinet, worked cooperatively with the Washington Representative and the lawmakers, supported Tinian and Rota initiatives, reactivated the Governor’s Council, and cut government costs.

Currently, Fitial said, government efforts were directed to reducing personnel costs, which amount to about 75 percent of total government costs.

He said that the government is renegotiating contracts with excepted service employees and strictly controlling overtime and other premium payments. Over 90 government positions have also been reduced.

Autonomous agencies are also being urged to look for means within their areas of responsibility to help reduce government spending.

For the remainder of the year, Fitial plans to have the Office of Personnel Management conduct a comprehensive desk audit of all positions in the CNMI government. He also intends to get the deficit down to “as near zero as humanly possible,” the governor said.

Furthermore, the administration will focus on attracting investors into the Commonwealth, he added.