Saipan Tribune

Sunday, May 26, 2013

Thursday, September 06, 2012

House, Senate budget deadlock again

Pension recovery bill now heads to governor

As expected, the House of Representatives rejected yesterday a Senate-amended $114 million budget bill barely three weeks before the Sept. 30 deadline to pass a fiscal year 2013 budget.

A bicameral conference committee will be formed to remove the budget deadlock between the House and Senate.

If no budget is passed by Sept. 1, the government will be forced to temporarily shut down starting Oct. 1 until as budget passes.

Among the contentious issues House Speaker Eli Cabrera (R-Saipan) sees are the $300,000 for retroactive salary payments on Saipan and Rota that the Senate added, as well as the Public School System's budget versus the needs of other agencies such as the hospital.

The House rejected the Senate version of the House budget bill by a vote of 13-4.

Those who voted “no” to rejecting the Senate version of the bill were Reps. Janet Maratita (Ind-Saipan), Joe Palacios (R-Saipan), Teresita Santos (Ind-Rota), and Trenton Conner (R-Tinian).

Absent were Reps. Froilan Tenorio (Cov-Saipan), George Camacho (Ind-Saipan), and Sylvester Iguel (Cov-Saipan).

Cabrera said he will name the members of the conference committee today, with Ways and Means Committee chair Rep. Ray Basa (Cov-Saipan) leading the House conferees.

Conner said he voted “no” to the motion to reject the Senate-amended bill because he believes that the $33 million that PSS asked for and the Senate granted runs the risk of being dropped by a few millions of dollars once it goes to the conference committee.

Most of the comments heard from the public during the House session were in support of the $33 million PSS budget. PSS asked for this amount, but the House gave it only $28 million, while the governor gave some $30 million.

Education Commissioner Rita Sablan, Ph.D., said that giving 29 percent of the government's $114 million projected revenue will “provide quality and the best education to our children from birth through 21 and in most cases school age children from 3 to 17 years of age.”

Sablan said if they get the $33 million, they will be able to reduce the large class size from 30 or 42 to 25 to one teacher at PSS, eliminate double sessions and prevent future modified schedules, and be able to hire about 60 classroom teachers, school counselors and school administrators on Saipan, Tinian, and Rota.

Sablan said a $33 million budget will also enable PSS to secure schools and deter thieves at night.

In the last three weeks, PSS had one of its buildings vandalized, and copper wires were removed. A similar incident took place last week, with school equipment stolen.

“If we are to operate efficiently and effectively, we ask for a budget package of $33 million. If the House should move to reject the Senate budget bill for a special reason, please revise what is necessary without changing the $33 million that has been pegged by the Senate,” Sablan said.

Board of Education chair MaryLou Ada raised concerns about the Senate's amendments to the budget bill restricting the expenditure authority of the education commissioner, which she said violates the Constitution.

Besides Sablan and Ada, others who testified in support of retaining the $33 million budget for PSS were PSS federal programs officer Tim Thornburg, Kagman Elementary School acting principal Ruth Bigalbal and their school's counselor, Marianas High School principal Cherlyn Cabrera, PSS' Jackie Quitugua, and BOE member Herman Sablan.

Pension reform bill

In other news, the House passed a Senate-amended pension recovery bill by a vote of 16-1, with Rep. Edmund Villagomez (Cov-Saipan) the only one voting “no.”

House Bill 17-315, House Draft 1, Senate Draft 1 now heads to the governor for action.

If signed into law, the measure allows active members to decide whether to refund their contributions without being penalized, continue working, and transition into the U.S. Social Security system, or remain with the NMI Retirement Fund in hopes that the pension program improves as it receives additional funding from the central government.

Employees will also get back 25 percent of their contributions after deciding to withdraw within 30 days and the remaining 75 percent will be disbursed to them within 90 days.

Joe Pangelinan, representing active government employees, expressed relief yesterday that the bill finally passed the House.

“It's been nine long months since House Bill 17-226 was introduced, vetoed, override was defeated, and then Lt. Gov. Eloy Inos came up with a solution that became HB 17-315. We thank those who made this happen,” Pangelinan told Saipan Tribune.

Dozens of uniformed police officers, corrections officers and other government employees were at the House session to show support to HB 17-315.

The Fitial administration wants to transition government employees to the U.S. Social Security program and place the NMI Retirement Fund under the Department of Finance mostly to disburse pensions for current retirees, as part of the plan to address mounting concerns about the troubled public pension agency. Fitial placed the NMI Retirement Fund under a state of emergency.