ARPA funds placed in investment account garnered over $700K in interest

The American Rescue Plan Act funds that were placed in investment accounts have garnered over $700,000 in interest, according to CNMI Treasurer Asuncion “Connie” Agulto.

Last Tuesday, Department of Finance Secretary Tracy Norita and Agulto appeared before the Senate special committee on the Bank of Guam investment account ($225 million) and American Rescue Plan Act spending plans for the CNMI to answer questions regarding ARPA funds and how they were handled under the previous administration.

Agulto told the special committee that the $225 million in ARPA funds in question that were placed in a BOG investment account during the previous administration accrued interest of $728,000.

Senate floor leader Sen. Corina Magofna (D-Saipan), during her line of questioning, asked Asuncion if it is common practice to place federal funds in investment accounts.

“I believe the intent of ARPA funds was to pay for the spending plan, do you know if part of the spending plan was to take a sum of the money and put it into an investment account? Is it allowed to take federal funds and put them in an investment account to generate income. Did you find that concerning that it was put into an investment account,” asked Magofna.

To which, Agulto shared that it is not, but previous Finance secretaries did take local funds (totaling $50 million) and placed them into investment accounts.

“Prior to ARPA, I’ve never seen federal grants placed into investment accounts. Former secretaries [have] placed local funds in investment accounts. It’s not a common practice anymore but it has happened. Around $50 million,” she said.

In addition, Agulto shared that the previous administration’s ARPA expenditures were all over the place and now, over a year since taking on the daunting task to properly record and recoup ARPA funds, DOF is still in the process of reconciliation.

However, as for the $225 million, Agulto adds that to this day what the $225 million that was discovered in an investment account was used for remains undetermined.

“The team has done a lot to right the wrongs, record them, you will see those in the report. As far as what the $225 million was used for, we cannot really determine that just that it went back to ARPA therefore that’s available for spending,” she said.

Previously, the Senate special committee on the Bank of Guam investment account ($225 million) and ARPA spending plans for the CNMI voted in favor of issuing a subpoena against Agulto to answer questions regarding a trust account opened by the previous administration using ARPA funds in the amount of $225 million.

The Finance secretary, for her part, expressed that Finance and Agulto stand ready to answer questions and provide all requested documents without a subpoena.

Previously, Senate President Edith DeLeon Guerrero (D-Saipan) made an Open Government Act request to the Department of Finance regarding any information about the trust account that was opened by the previous administration using ARPA funds in the amount of $225 million.

The Senate president said it was important to know which funds are still available to provide necessary services to the people.

Last April, Norita said the ARPA funds were deposited in the Bank of Guam in 2021 but were depleted in 2022.

Sen. Karl King-Nabors (R-Tinian), who chairs the special committee dedicated to this matter, said the Senate president wrote Norita a letter on April 19, seeking her cooperation by providing a written authorization for the bank to release requested documents. However, he said, “no response has been received” from the Finance secretary.

Since the special committee was created, King-Nabors said they have reviewed all the documents provided by Finance.

according to CNMI Treasurer Asuncion Agulto.

Last Tuesday, Department of Finance Secretary Tracy Norita and CNMI Treasurer Asuncion “Connie” S. Agulto appeared before the Senate special committee on the Bank of Guam investment account ($225 million) and American Rescue Plan Act spending plans for the CNMI to answer questions regarding ARPA funds and how they were handled under the previous administration.

Agulto told the special committee that the $225 million in ARPA funds in question that were placed in a BOG investment account during the previous administration accrued interest of $728,000.

Senate floor leader Sen. Corina Magofna (D-Saipan), during her line of questioning, asked Asuncion if it is common practice to place federal funds in investment accounts.

“I believe the intent of ARPA funds was to pay for the spending plan, do you know if part of the spending plan was to take a sum of the money and put it into an investment account? Is it allowed to take federal funds and put them in an investment account to generate income. Did you find that concerning that it was put into an investment account,” asked Magofna.

To which, Agulto shared that it is not, but previous Finance secretaries did take local funds (totalling $50 million) and placed them into investment accounts.

“Prior to ARPA, I’ve never seen federal grants placed into investment accounts. Former secretaries [have] placed local funds in investment accounts. It’s not a common practice anymore but it has happened. Around $50 million,” she said.

In addition, Agulto shared that the previous administration’s ARPA expenditures were all over the place and now, over a year since taking on the daunting task to properly record and recoup ARPA funds, DOF is still in the process of reconciliation.

However, as for the $225 million, Agulto adds that to this day what the $225 million that was discovered in an investment account was used for remains undetermined.

“The team has done a lot to right the wrongs, record them, you will see those in the report. As far as what the $225 million was used for, we cannot really determine that just that it went back to ARPA therefore that’s available for spending,” she said.

Previously, the Senate special committee on the Bank of Guam investment account ($225 million) and ARPA spending plans for the CNMI voted in favor of issuing a subpoena against Agulto to answer questions regarding a trust account opened by the previous administration using ARPA funds in the amount of $225 million.

DOF secretary, for her part, expressed that Finance and Agulto stand ready to answer questions and provide all requested documents without a subpoena.

Previously, Senate President Edith DeLeon Guerrero (D-Saipan) made an Open Government Act request to the Department of Finance regarding any information about the trust account that was opened by the previous administration using ARPA funds in the amount of $225 million.

The Senate president said it was important to know which funds are still available to provide necessary services to the people.

Last April, Norita said the ARPA funds were deposited in the Bank of Guam in 2021 but were depleted in 2022.

Sen. Karl King-Nabors (R-Tinian), who chairs the special committee dedicated to this matter, said the Senate president wrote Norita a letter on April 19, seeking her cooperation by providing a written authorization for the bank to release requested documents. However, he said, “no response has been received” from the Finance secretary.

Since the special committee was created, King-Nabors said they have reviewed all the documents provided by Finance.

Asuncion S. Agulto