Government agencies may have to absorb an across-the-board cut of over 8 percent, more than the 5 percent earlier anticipated, to help balance a $114-million spending package for fiscal year 2013 as a bicameral panel has yet to come up with a final budget bill to present to the House and Senate six days before Sept. 30 deadline.
House Ways and Means Committee chair Ray Basa (Cov-Saipan) said yesterday that the over 8 percent across-the-board budget cut is expected to cover the $4 million excess in spending so far showing in the panel's calculations.
But as the conference committee on the budget bill's meeting resumes at 9am today, the across-the-board budget cut percentage may still change, Basa said.
If no new budget is passed and signed into law by Sept. 30, the government will have to partially shut down starting on Oct. 1 until a spending package is in place.
When a partial shutdown happens, over 1,400 public servants will once again be forced to be out of jobs temporarily.
“We are very cognizant of that and we are convening again on Monday to go over the final figures and come up with a bill that hopefully can be passed as early as Tuesday or Wednesday,” Basa told Saipan Tribune yesterday.
Basa said the projected 8.2 percent across-the-board cut is considered “too severe” by some conference committee members.
Government departments and programs will be given the flexibility how to implement the over 8 percent cut, either in personnel or operations, or both. It could also mean work hour reduction of eight or more hours per payroll.
The Fitial administration's budget proposal restores 80 work hours per payroll, but the budget panel is finding this hard to meet as they work on a compromise spending package.
“But if we don't have a choice, we will have to support it. The numbers are not balancing. If we find an alternative way, we don't have to cut by over 8 percent but right now that seems to be the best way,” said Basa, the lead conferee from the House.
Senate Fiscal Affairs Committee chair Jovita Taimanao (Ind-Rota) separately said yesterday that the biggest problem now is “balancing” the budget, or making sure it stays within the $114 million projected revenue available for government appropriation in FY 2013.
She also said that the across-the-board cut is over 8 percent, more than the 5 percent that the committee earlier projected.
But both Basa and Taimanao said the priority agencies will still get the agreed amount. The committee, for example, will ensure that the Public School System will still get $33 million.
Lt. Gov. Eloy S. Inos met with the conference committee on the 2013 budget bill on Friday afternoon.
During that meeting, Inos told the conferees that their proposal to suspend tax rebates in 2013 is not allowed, Basa and Taimanao said.
“The 2013 tax rebates are already committed so we can't touch that. That's why the rebate suspension is now off the discussion table,” Taimanao said.
Basa said the Fitial administration is working closely with the conference committee to ensure that a budget bill is passed and signed by the deadline.
Inos, however, said that the Fitial administration is already preparing for the worst by working on a government shutdown contingency plan, identifying what agencies and which personnel will be exempted from the shutdown.
Among those that will be exempted are needed doctors, nurses, police officers, corrections officers, and utility crews.
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 alternates Sen. Frank Cruz (R-Tinian), and Rep. Ray Yumul (R-Saipan).
The committee worked until late Friday night. But because no budget bill was produced until that time, Senate President Paul Manglona (Ind-Rota) “postponed until further notice” the Senate session set for 2pm on Saturday to act on the budget bill.
If a budget bill is finalized late this afternoon, a session may be called for Tuesday.
The CNMI went through a partial government shutdown in 2010 over a bitter budget deadlock between the House and Senate. That shutdown, which lasted for some 10 days, resulted in having over 1,400 government employees temporarily out of jobs.