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Finance secretary: Govt scraping the bottom
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Posted on Jul 04 2011
The CNMI government is “scraping the bottom” as its estimated monthly revenue is only about $9 million and even fluctuating, yet the payroll per month alone is $6 million, according to Finance Secretary Larrisa Larson.
Larson disclosed the government’s revenue and its obligations when asked by Superior Court associate judge Kenneth L. Govendo during a status hearing last week in the NMI Retirement Fund’s lawsuit against the government.
Larson said the $9 million monthly revenue comes from the Business Gross Receipts taxes, wage and salary taxes, Commonwealth Health Center services, and various other government services.
In response to assistant attorney general Meaghan Hassel-Shearer’s inquiry about payments, Larson said the government is paying now $1 million per month to the Commonwealth Utilities Corp., leaving the government’s monthly revenue at $8 million.
Monthly payments to CHC range from $1 million to $2 million, she added.
By deducting $1 million to $2 million from the $8 million, the government is left with just $6 million to $7 million, Larson said.
Hassel-Shearer asked Larson if, after deducting the estimated $6 million for payroll per month from that $6 million to $7 million remaining, she feels there is almost nothing left.
“Yes, we are scraping bottom,” the Finance secretary replied.
When asked how much the government owes others, not counting the Retirement Fund, Larson replied: “$80 million.”
Attorney Viola Alepuyo, counsel for the Fund, asked if Fund payments are considered a priority under the unofficial “life and death” policy to receive payments.
“That would not be possible,” the secretary candidly answered.
From a revenue of more than $200 million just over a decade ago, the CNMI government is now making do with revenue projected to reach just $102 million in fiscal year 2010. The steep revenue plunge is due to the death of the garment industry in 2009, consistently low tourist arrivals, and the ripple effects of the persistently anemic U.S. economy.
