Palacios: Brace yourself

Gov. Arnold I. Palacios expresses appreciation to the people who showed up at their potluck gathering to celebrate the smooth and successful transition and inauguration activities of the new administration, at the Civic Center in Susupe Sunday. Also in the photo seated at the same table is Lt. Gov. David M. Apatang. (FERDIE DE LA TORRE)

Gov. Arnold I. Palacios said Sunday that people in the CNMI should brace themselves because there’s a lot of information about the financial state of the CNMI that the administration is still trying to determine.

“The transition reports are in, but there are still other critical information that need to be fleshed out,” said Palacios in a brief speech during a potluck gathering by his and Lt. Gov. David M. Apatang’s supporters at the Civic Center in Susupe to celebrate the smooth and successful transition and inauguration activities for the new administration.

The governor said they are working on getting all the information and they hope to begin next week the task of putting together a general picture of the Commonwealth government.

“But I’ll tell you it’s [going to] be a challenging first 100 days. But we will get there. We’ll do our best and work hard,” Palacios said.

According to a 2022 transition report on the Department of Finance submitted last Jan. 4 to the Palacios-Apatang administration, a preliminary reconciliation has determined that the CNMI received $481.8 million in American Rescue Plan Act funds but, as of Dec. 27, 2022, it has overspent and overcommitted and has a deficit of $86 million.

ARPA was used to fund disaster-related expenditures pending reimbursements, amounting to approximately $48.7 million. Upon reimbursements, the transition report disclosed, the ARPA deficit will be reduced to $37.4 million.

Saying the CNMI government’s financial situation is dire, the transition team report stated that the months and years ahead will not be without hardship.

Among the recommendations of the transition report are to discontinue the 25% additional retiree pension payment until the government stabilizes its current financial state, and initiate a revision to the ARPA spending plan with U.S. Treasury.

Palacios on Sunday acknowledged the hard work that is on the table before him, Lt. Gov. David M. Apatang, and legislative leaders. “It’s [going to] be a lot of hard work ahead for Dave and I and the rest of the team,” said Palacios, adding that he is confident that the administration can pull through these challenges.

At the moment, he and Apatang don’t have their individual offices and desks. The offices of the governor and lieutenant governor are undergoing minor renovations.

“We still manage to work together and maybe that’s a good omen because we’re both sharing the same round table at the governor’s old office. I can’t do anything secretly or he can’t do anything confidentially,” Palacios joked, drawing laughter from the crowd.