Tick-tock, tick-tock on budget

Gov. Ralph DLG Torres only has nine days to review the $258.1-million fiscal year 2019 budget when it reaches his desk, with both the House and Senate passing the budget in emergency sessions last Wednesday.

The back-to-back legislative sessions came after almost four days of marathon meetings by a joint House and Senate conference committee that worked from last Friday and through the weekend to come up with a compromise version late Monday afternoon.

A few hours after the House and Senate passed the House Bill 20-173 or the CNMI Appropriations and Budget Authority Act of 2019, the bill was transmitted to the Governor’s Office. Last fiscal year’s budget amounted to $236.7 million. Next fiscal year’s budget—at $258.1 million—shows a $21.4-million increase.

Torres has until Sept. 30 to review and enact the bill before the start of fiscal year 2019 on Oct. 1, to prevent a government shutdown.

The CNMI 2019 budget again went into a conference committee after the House, voting 16-1, rejected the Senate version of the bill in last week’s session.

The conference committee was composed of House Ways and Means Committee chair Angel A. Demapan (R-Saipan), Vice Speaker Janet U. Maratita (R-Saipan), Rep. BJ Attao (Ind-Saipan), and alternate Rep. John Paul Sablan (R-Saipan) and Senate Fiscal Affairs Committee chair Jude U. Hofschneider (R-Tinian), Senate Vice President Steve K. Mesngon (R-Rota), Sen. Sixto K. Igisomar (R-Saipan), and alternate Sen. Justo S. Quitugua (Ind-Saipan).

Demapan, who introduced the bill, said the budget is a result of four days of meetings by the conference committee and both panels finally met halfway at around 5pm on Monday.

“What we have before us is [a bill] which we believe represents a compromise budget package that seeks the best needs of the Commonwealth by assuring all services and programs are adequately funded,” said Demapan.

Hofschneider added: “We [conference committee] feel that this product is palatable for us. It is a compromise bill that we can finally hand it over to the governor for review and signature.”

All 19 House members present voted to pass the final budget measure while the eight senators in the Senate chamber duplicated the feat a few minutes after their colleagues acted on the bill.

Rep. Jose I. Itibus (R-Saipan) and Senate vice president Steve K. Mesngon (R-Rota) were excused.

Key highlights

The key highlights of the budget saw significant increases for the Public School System, the Commonwealth Healthcare Corp., the Northern Marianas College, the Medicaid Reimbursement program, and for the municipalities of Tinian and Rota.

PSS is allocated $43.2 million from the general fund for the coming fiscal year—an increase of $6.8 million from last year’s budget. PSS is also going to receive an additional $3.2 million from earmarks and outside sources, for a total of 46.4 million.

CHCC will have $9.1 million, with $4.9 million coming from earmarks and outside sources, while $4.2 million will come from the general fund. Last fiscal year, CHCC just got $708,000. Included in CHCC’s budget allocation is $2 million for uncompensated care.

A total of $5.9 million is appropriated for NMC, of which $5.3 million comes from the general fund and over $540,000 from earmarks and outside sources. NMC’s budget from the general fund increased by over $600,000 compared to the $4.7 million it got from the previous fiscal year.

Medicaid Reimbursement went up by $700,000, for a total of $5.2 million, compared to the $4.5 million it received in 2018.

Tinian’s allocation increased by $1.3 million—from $8.4 million to $9.7 million—while Rota will be receiving $9.5 million, an increase of $1.4 million from fiscal year 2018.

Comments

Although there were some provisions that were deleted in the conference committee’s report, there were also significant increases, said Sen. Teresita A. Santos (R-Rota)—“an increase in some areas such as CHCC, PSS, NMC, etc., which we all agreed are critical areas of concern.”

“The [budget] also maintains status quo on the budget for Rota with the deletion of the two customs [full-time employees] in reference to the transfer of the 25 FTEs of Rota’s municipal employees.”

She is hopeful the provision won’t be part of a possible line item veto by governor Torres. “Otherwise, the Rota [Legislative] Delegation will have to continue to fund these FTEs from local revenues, which may be fiscally difficult as Rota continues with its ongoing typhoon recovery.”

“It is also our hope that the governor expedites a review and sign into law the budget bill to avert a government shutdown and so our government offices can commence processing personnel actions and/or contracts.”

Quitugua hopes the Senate would allocate more funds to PSS in a supplemental budget that is expected to be pieced together in the coming weeks. “We’re not at all satisfied with what we proposed in the Senate. However, it needs…compromise because of the thought of not shutting down the government.”

“I would like to suggest to the Senate members, if there’s a supplemental budget for 2019, that we remember PSS because $42 million allocated from the general fund will not be adequate to carry them through fiscal year 2019.”

He said that some classrooms in four schools were recently issued condemnation letters by the Department of Public Works. “[These] classrooms and facilities cannot be occupied for safety reasons. I would like to remind my fellow senators: If there’s available supplemental budget, remember PSS.

Sen. Paul A. Manglona (R-Rota) said he is pleased that for the first time there’s funding allocated for inter-island medical referral stipends. “As you know, medical referral is under the Governor’s Office for off-island—outside the CNMI.”

“But this funding is for inter-island—within the CNMI. Last year, this was funded locally, now it is the CNMI government’s obligation and it is good to see it in the budget. We’re almost getting there in addressing PSS and CHCC.”

Igisomar said they cut a lot of departments from the original Senate version of the budget bill because they thought of the CNMI’s needs over wants.

“We were able to meet halfway and put back some of the areas of concern, particularly for PSS and CHCC. Although there may be a slight increase on the general fund appropriations, as mentioned by [Hofschneider], we have lots of funds in the millions locked in earmarks that we were able to maintain in our provisions for the hospital and PSS,” said Igisomar.