Lawmakers: Direct Compact funds to PSS

Members of the House of Representatives led by GOP congressman Joseph Deleon Guerrero has asked Gov. Juan N. Babauta to allocate $5.615 million of Compact impact funds to the Public School System.

This is contrary to the plan of the governor who favors using the funds to retire the government’s longstanding deficit totaling some $101 million.

House Joint Resolution 14-21, authored by Deleon Guerrero, said the money shall be used on key impact areas such as health, education, and other social services. It cited PSS reports that there are 516 students from FAS right now.

“PSS has shouldered annual impact costs of $5.615 million for these students,” it said, citing PSS reports that such projections include operational costs, busing, and classrooms.

“It does not include the impact costs of additional personnel for non-teaching and teaching positions required at each school site,” said the resolution.

The resolution further said the CNMI Constitution states that the educational system shall be a funding priority. “To accomplish the objectives of the Constitution, it is necessary to ensure that the children of the CNMI are provided safe facilities and buses.”

The resolution was signed by Reps. Martin B. Ada, Benjamin Seman, Clyde Norita, David Apatang, Ray Tebuteb, Norman Palacios, Arnold Palacios, Ray Yumul, and Timothy Villagomez, among others.

Babauta recently consulted with the fund grantor, the U.S. Department of the Interior, on the use of Compact money for deficit payment.

The CNMI expects to get over $5 million in Compact money this year and every year in the next 20 years.

The Compact legislation provides that $30 million will be divided each year for the next 20 years among the Northern Marianas, Guam, Hawaii and American Samoa to help these jurisdictions deal with the effects of migration from the Federated States of Micronesia, Palau and the Marshall Islands, commonly referred to as the freely associated states.

The use of the money to address the public debt is reportedly being supported by the CNMI Blue Ribbon Committee, which consists of the governor, House Speaker Benigno R. Fitial, Senate President Joaquin G. Adriano, and Retirement Fund board chairman Joseph Reyes.

The committee was earlier tasked to conduct a feasibility study on leveraging the Compact impact funding as a way to address the deficit problem.

Of the total deficit, over $77 million represents the Retirement Fund’s unfunded liabilities.

As of Sept. 30, 2003, the outstanding debt included an $8.8 million for PSS-CIP bonds and Judicial Building loan; $2.1 million in 2003 land compensation/CIP bonds; $12.8 million in unpaid utilities; and $9.2 million in reserves for future disbursements.

Further, the government expects to incur $11.7 million in unfunded liabilities in fiscal year 2005, including the $3.7-million retroactive within-grade increase; $1.4 million representing amount owed for the 5-percent bonus; $2.2 million in potential litigation liability; and $4.3 million owed to the Retirement Fund.