Inos nixes bill that could lead to ‘payless Fridays’

Gov. Eloy S. Inos vetoed yesterday a bill that would allow the government to satisfy judgments—totaling more than $27 million—without an appropriation, saying it is “unconstitutional,” “contrary to public policy,” and fails to define “available funds” that could spur litigations. The governor warned that the bill, if enacted, could lead to payless Fridays and even a complete government shutdown.

Rep. Ray Tebuteb (Ind-Saipan) said last night he was “surprised” by the governor’s veto of his bill, but he said he will consider his options after he has seen the full veto message.

While the Planning and Budgeting Act allows the governor to waive the requirement of a legislative appropriation, Tebuteb said the governor does not appear to be willing to make that waiver.

“The governor has never exercised that waiver provision. The bill makes the governor and the government responsible for government obligations,” he told Saipan Tribune.

Inos, in vetoing Tebuteb’s House Bill 18-143, House Draft 2, said he wholeheartedly agrees that the government must make good on its obligations but the bill is “not a legally viable solution.” He cited three legal issues that the bill raises.

First, the bill violates the doctrine of separation of powers by permitting the Legislature to delegate—or even abdicate—its power of the purse. Section 5 of Article 2 and Article 10 of the NMI Constitution “imbue the Commonwealth Legislature with exclusive control over the direct or indirect expenditure of public funds.”

Second, the bill is contrary to public policy in that it authorizes judgment creditors to execute on government property—“property that is held by the government for the people,” the governor said.

Third, the bill does not define “available funds.” The governor said the omission of this definition will spur litigation over the meaning of the term and public resources will be wasted on these litigation proceedings.

The governor said there is good reason for treating judgments against the government as different from judgments against private entities.

“Signing this bill into law would be a disservice to the people overall and would unconstitutionally permit the Legislature to abdicate its power of the purse. The current law allows the government to meet its obligations, and to do so the Legislature must exercise its power over the purse and appropriate monies to satisfy these outstanding judgments. Obligations must be prioritized and addressed by way of appropriation,” the governor said in his three-page veto message to legislative leaders.

The bill allows payment of judgments “from any available funds with or without appropriation” from the Legislature.

House Speaker Joseph Deleon Guerrero (Ind-Saipan), the only one who voted “no” to the bill in the House, earlier said he is concerned that the measure gives a “blank check” by allowing the court to enforce judgments without legislative appropriation so long as it does not exceed 15 percent of funds appropriated to the Executive Branch for a respective fiscal year.

If applied liberally, the bill “can hurt or jeopardize the delivery of essential public services,” he had said.

While the governor vetoed Tebuteb’s bill, Senate vice president Victor Hocog’s (R-Rota) bill allowing the governor to negotiate a settlement and resolution of judgments against the CNMI government, including offsets and credits on any tax obligation by the claimants or members of their immediate family, became law. Hocog’s Senate Bill 18-26 became Public Law 18-37 on Feb. 23, after the 40-day period lapsed without the governor’s action.

All these come at a time when lawmakers have been pushing for a fair distribution or payment of land compensations when funding becomes available, to avoid previous practices of paying only a few families while over 300 other landowners have yet to receive a penny in exchange for their private property used by the government.

The Office of the Attorney General told the Legislature last year that the government’s outstanding and unpaid judgments and settlements is now more than $27 million, excluding accruing interests.

Under current law, the government is restricted from making settlement of claims and payment of judgments because a legislative appropriation is necessary for such payments.

Although the law allows the governor to waive the requirement of a legislative appropriation, the governor “does not appear to be willing to make such a waiver,” Tebuteb said.

In his bill, he said “judgments sit for years without the governor making a waiver or requesting an appropriation. Since the government is shielded from the judicial enforcement of judgments, the government has become irresponsible and neglectful in addressing its obligations.”