House OKs new $156.76M budget

The House of Representatives passed a revised budget yesterday that allocates $156.76 million for government operations in fiscal year 2009—nearly $9 million less than the original Legislature-approved budget vetoed by the governor and 106 days already into the fiscal year.

The budget includes $148.1 million of projected government revenue, augmented with $5.17 million in Compact Impact funds and $3.5 million of “unencumbered” money taken from numerous accounts outside the general fund, for a total of $156.76 million.

A separate $3.1 million is proposed for the Department of Public Lands, whose revenue is constitutionally reserved for the agency’s administrative costs and for investment by the Marianas Public Land Trust, and cannot be used for central government operations.

The revised budget passed 18-1. Rep. Oscar Babauta voted against the bill, while Rep. Edwin Aldan was absent.

This is the House’s second attempt at the budget. Last month both the House and Senate passed a $165.4 million budget, but Gov. Benigno Fitial notified them that he was vetoing it because of an $8 million drop in projected revenue. He then slashed government budgets across the board by 5.5 percent for the rest of the fiscal year.

Rep. Ray Yumul, the chairman of the House Ways and Means Committee, said he used the governor’s 5.5 percent budget cut as a model for the revised budget.

“Basically we followed what the governor did when he took the $156 million [in local government revenue] and taking that 5.5 percent and reducing it to $148 million,” he said. “We’ve complied with that. We complied with his notification, so everything we did is based on his notification to us through his transmittals with the Secretary of Finance. So this legislation should be exactly what he’s looking for.”

Earlier this week the House failed to achieve a two-thirds majority to override the governor’s veto of the original budget.

During yesterday’s session, the House members debated for hours on several provisions dealing with the hiring of faculty for Northern Marianas College; retirement for immigration employees affected by federalization; certification of vacant positions; and the pooling of government contributions.

Rep. Tina Sablan said she was disappointed by some of the provisions, especially with the provision allowing the pooling of Retirement Fund contributions.

“But as a whole, what matters is the bigger picture, and the bigger picture is we passed the budget,” she added.

Yumul agreed with Sablan that it’s not a perfect bill, but added that it’s difficult to develop revenue-generating bills when there is no budget in place. Once the budget becomes law, Yumul said he would assemble the Ways and Means committee and other members of the House to start looking at ways to develop a broader tax base, in order to find new ways of generating revenue.

The Senate is expected to reconvene and take up the budget in the next few days. If the Senate passes the bill it will go before the governor. Once with the governor, he has 20 days to sign the bill, line item veto it or veto it altogether.