Inos: Revenue estimate could drop by $5M more

The projected local revenue for Fiscal 2009 could be reduced by another $5 million, Finance Secretary Eloy Inos said yesterday.

Inos has already adjusted the collection numbers once before. In December, the Legislature passed a $165.4 million budget ($156.7 million from local revenue), but Gov. Benigno Fitial vetoed that bill, citing a drop of $8.7 million in projected revenue. The Legislature then passed a revised budget of $156.76 million ($148.1 million from local revenue), but Fitial vetoed that as well. Last week, the Legislature overrode the veto and the budget is now law.

But there are two resources that are questionable, Inos said.

The budget includes $4 .1 million in interest from the Marianas Public Land Trust received from the Northern Marianas House Corp. and $1 million from the Tinian Casino Gaming Control Commission for an advanced payment it received in the 1990s.

“The $148 million includes two extraordinary items,” Inos said. “By extraordinary I mean it’s not supposed to be recurring. It’s a one-shot deal. If we collect that in this current year, we do not expect to collect that in subsequent years,” he said, adding that the FY 2010 budget would have to reflect that.

The Legislature had enacted a law that allowed MPLT to keep the money rather than it being collected in the general funds, he said.

“But maybe it was a blessing that we didn’t receive that, because if we received that money we might have spent it already,” Inos said.

Finance has been discussing the matter with the MPLT since the beginning of the fiscal year, but he said additional action might be needed.

“We’ve been talking with MPLT since early in FY 2009, but what we need is hopefully a legislation that would request the MPLT to return that money,” the Secretary said.

Rep. Ray Yumul, the chairman of the House Ways and Means Committee, met with Inos Tuesday about budget matters. Yumul said he had brought up the fact in the past that collecting the revenue from the MPLT and the Gaming Commission were “doubtful at best.”

He said he is now speaking with the Legislature’s legal counsel to see what Inos can do to compel the MPLT and Gaming Commission to pay the funds.

The $4.1 million in MPLT funds has been included in previous budgets as well. It was included in the FY 2008 budget, but was never received. It was placed again on the FY 2009 original budget estimate, along with the Gaming Commission funds; $1 million for the 1 percent fee agencies must pay the Office of the Public Auditor, and $2.575 million for past OPA fees that went unpaid.

However, the revised estimated revenue projections that Finance submitted after Fitial vetoed the first budget does not include the $2.575 million for prior OPA fees.

The Legislature could prepare a supplemental budget that would reduce certain entities, although that idea has not been discussed fully, Yumul said.

Inos said he is doubtful the $1 million from the Tinian Gaming Commission will be collected because of the slow activity at the Tinian Dynasty Hotel and Casino.

“We understand the situation, so we will try to see if we can work something out. But my outlook right now is that the possibility of receiving that is quite remote at this time,” he said.

He added that if the money is not collected this year, the Finance Department would try again next year.

Both Inos and Yumul said if the $5 million is not collected, government departments will be affected adversely.