Lt. Gov. Eloy S. Inos said yesterday that with only 10 days to go before the Sept. 30 deadline and still without a “compromise” budget bill, the Fitial administration is now preparing for the worst which is a repeat of a partial government shutdown in 2010 that forced some 1,400 public servants temporarily out of jobs.
Inos said a shutdown contingency plan is underway, wherein only critical government employees will be allowed to report for work starting on Oct. 1 unless a budget is passed and signed into law by Sept. 30.
As of yesterday, the joint House and Senate budget panel was still off track by some $14 million, Saipan Tribune learned.
This means their calculations have already reached some $128 million when the government's projected revenue available for operations is only $114 million for fiscal year 2013.
While the committee has agreed on increasing the budgets for some departments compared to what the House and/or Senate originally proposed, the more difficult part is identifying the agencies whose budgets have to be cut.
“Every time you increase somebody's budget, you are also cutting somebody else's budget,” said Senate Fiscal Affairs Committee chair Jovita Taimanao (Ind-Rota).
Taimanao, the lead conferee from the Senate, said the joint budget panel is trying its best to pare down the spending cap at $114 million though it has been tough.
She also said it should be standard procedure to have a government shutdown contingency plan in place, though she's hoping a budget will be timely passed so that there won't be a need to put the shutdown plan in motion.
Race against time
Inos said the administration has learned a lot from the 2010 shutdown experience so it expects a more efficient and practical listing of government employees that will be exempted in the event of another shutdown.
“What we know is that we're preparing for the worst, and that is that we're putting together plans for a possible shutdown unless we see a budget. It's still possible that the budget that's passed by the Legislature may not be a workable budget for us, which could mean a veto,” Inos said in an interview at the recognition ceremony for Good Samaritan and Saipan resident Kanis Sinounou at the governor's office yesterday.
Inos said in 2010, the administration thought that the shutdown would only for a couple of days.
“So that was an easy thing to do. Basically shut down everything, except for the critical. But it went beyond the third day to about a week and a half and at that time you have to start putting people back in for the second tier. So that's why we have a plan A, plan B, plan C. If it goes for a month, we'll probably.I hope there's no shutdown,” he said.
Inos said the Commonwealth Healthcare Corp. may not be affected if there is a shutdown because most of its funding source is not direct subsidy from the general fund.
The conference committee, however, previously agreed to double the amount of direct subsidy to CHC, from the Senate and House's proposed $2 million-plus, to $5 million.
4 percent
In addition, the conference committee on the 2013 budget bill has yet to identify funding source for the 4 percent employer contribution for government employees who will remain with the defined contribution plan.
Inos said it was the Legislature's idea to put that additional 4 percent government contribution, so the administration expects this is covered in the 2013 budget bill.
Ways and Means Committee chair Ray Basa (Cov-Saipan), however, said it will be difficult to budget for this 4 percent employer contribution for DC plan members if there is still no available data on the number of employees remaining with the plan.
Basa suggests that the budget be passed to meet the deadline and have it amended later on when the DC plan members have already been accounted for.
Sticking points
Taimanao said the conferees have already agreed at least in principle to cross off the list the Senate's proposed $300,000 in retroactive pay for the third senatorial district of Saipan since they have already been paid off years back.
But the Senate's proposed $300,000 in retroactive salary for the first senatorial district of Rota is becoming a contentious issue. House conferees do not necessarily want such appropriation.
“I will continue to push for the $300,000 retroactive salary payment because those employees deserve to get paid,” Taimanao said, adding that this is only for partial payment of the estimated $1.2 million in central government obligations to Rota employees under Public Law 7-31.
The Tinian leadership, meanwhile, has taken it upon itself to pay the retroactive salary of Tinian employees using local appropriations mostly from casino operations.
Agreed figures so far
As of yesterday, the conference committee on Basa's budget bill also agreed to go with Gov. Benigno R. Fitial's revised proposed budget of $4.9 million for the Legislature.
Prior to that, the joint House and Senate panel compromised on giving the Public School System $33 million; CHC, a direct subsidy of $5 million; Northern Marianas College, $5.9 million; and the Judiciary, $3.8 million.
Taimanao said the ongoing discussions involved the budgets for the Executive Branch, independent agencies and programs, senatorial districts and “all other” programs and activities.
Besides Basa and Taimanao, the other budget conferees are House Speaker Eli Cabrera (R-Saipan), vice speaker Felicidad Ogumoro (Cov-Saipan), Senate Vice President Jude Hofschneider (R-Tinian), and Sen. Ralph Torres (R-Saipan), along with alternate members Rep. Ray Yumul (R-Saipan) and Sen. Frank Cruz (R-Tinian).
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