‘DPL’s $4.1M being reserved for FY 2020 budget’

Public Lands Secretary Sixto K. Igisomar said they have already remitted $516,596 reserved for Homestead Projects to the Marianas Public Land Trust, but will not remit to MPLT its $4.1 million reserved for the fiscal year 2020 budget. 
In his July 2, 2021 response to MPLT board of trustees chair Martin B. Ada’s demand letter, Igisomar said the $516,596 funds consist of appropriations requested from the Legislature as part of DPL’s FY 2018 and FY 2019 budget requests pursuant to the Commonwealth Code.

Igisomar said the Commonwealth Code allows DPL to request “sums required to be held in reserve for approved homesteads or other department programs in the next two fiscal years.”

Although the funds were not spent during the years they were requested, they were nevertheless encumbered for appropriated homestead programs, he said.

However, Igisomar said, their counsel did advise them to remit the funds to MPLT.

Last July 29, Igisomar notified Ada that $516,596 had been remitted to MPLT’s bank account via fund transfer a day before.

Regarding DPL’s FY 2020 budget in the amount of $4,103,365, the DPL secretary said these funds consist of revenues received by DPL for deposit into the “DPL Operations Fund” and are awaiting appropriation.

“They were, in fact, properly appropriated for DPL’s use by Public Law 21-08,” Igisomar said.

He said even taken at its broadest possible constitutional scope, MPLT’s right to revenues from public lands would not encompass the entirety of DPL’s appropriated budget for a fiscal year.

Consequently, Igisomar said, DPL will not be remitting its entire FY 2020 budget to MPLT as demanded.

Igisomar said the scope of MPLT’s right to public land revenues is unclear. He finds this lack of clarity a great concern for DPL, considering that MPLT has expanded the scope of its demands from just the excess remaining after DPL has paid the reasonable expenses of administration and management, to include the entirety of DPL’s fiscal year budget appropriation and funds encumbered for multi-year homestead projects.

Igisomar said this is why DPL proposes that the remaining constitutional scope of MPLT’s entitlement be submitted to the CNMI Supreme Court as a certified question in order to definitively resolve the matter.

Last May 20, MPLT sent a second demand letter to DPL to remit $5,620,461 that is allegedly due to MPLT in fiscal year 2019 and warned of an investigation and a lawsuit if DPL fails to immediately remit the money.

Specifically, MPLT demanded that DPL pay to MPLT $5,620,461 based on Deloitte and Touche’s Fiscal Year 2018 and 2019 audit of DPL.

Specifically MPLT demanded payment of $516,596 reserved for Homestead Projects, $4,103,865 comprising DPL’s FY 2020 budget, and $1 million that DPL had received as a result of a settlement from litigation between Kan Pacific and Imperial Pacific International (CNMI) LLC.

Torres said the audit reported the action by DPL to “improperly segregate and allocate funds in the amount of $5.62 million for itself without lawful authority.

In DPL’s July 2, 2021 reply, Igisomar said DPL objects to what they describe as the adversarial tone of the May 20,2021 letter from MPLT’s counsel Robert T. Torres.

Igisomar said as a co-equal fiduciary who paid a $4.45 million request swiftly and in full earlier this year to MPLT, DPL believes that a more civil tone would have been more appropriate.

With respect to the $1 million in settlement funds, Igisomar said they will not remit these funds to MPLT and instead propose that a certified question on the matter be submitted to the Supreme Court.

He said the Attorney General advised them previously that there were arguments both for and against treating the $1-million settlement funds as arising from public lands and whether they should go to MPLT or the general fund.