CNMI faces new budget reduction

The House of Representatives yesterday made a gesture that it might reduce the budget for fiscal year 2005 to approximately $212.65 million—down from this fiscal year’s over $213 million budget by more than a million dollars—eliminating revenue-generating measures in the Babauta administration’s integrated fiscal plan that has yet to be adopted.

Without the revenue-generating measures outlined in the integrated fiscal plan to meet the governor’s proposed $226 million budget for FY 2005, the identified budgetary resources for the next fiscal year amount to only $212,651,911.

The House capped funding available for the CNMI government’s operations to only $210,525,392, since over $2 million of the identified budget resources for the next fiscal year would be allotted to slice the budget deficit by one-percent.

Of the over $210 million available for governmental operations in the next fiscal year, $1.387 million shall be allocated for medical referral, bone marrow and heart transplants.

The lower chamber yesterday passed House Concurrent Resolution 14-1, which approved and identified budgetary resources for the next fiscal year.

The resolution deducted over $13.69 million from the governor’s proposed $226 million budget, the bulk of which was targeted by the administration’s integrated fiscal plan.

The plan aimed to raise an additional $10 million for the next fiscal year by increasing nonresident worker fee, which was projected to add $3.1 million to the revenue; driver’s license and vehicle fee, $1.09 million; and hotel occupancy tax, $598,692. The proposed plan to reduce income tax rebate by 10 percent is projected to raise an additional revenue of $3.42 million to the government.

It also deducted over $2.11 million in Tobacco Fund and some $746,273 representing the Tobacco Settlement Fund from the governor’s proposed $226-million budget.

The identified budgetary resources indicated that the House might approve a new fiscal budget that is lower than the current fiscal year’s over $213 million.

The House, however, could also approve a piecemeal budget, according to Board of Education chair Roman C. Benavente, who earlier said that the lower chamber’s leadership already assured that the Public School System would be appropriated $42 million for the fiscal year.

House Speaker Benigno Fitial and other members of the leadership, including House Education Committee chair Justo Quitugua, reportedly met with BOE and PSS officials Friday to discuss budget concerns.

Benavente earlier said the meeting with the lawmakers covered a wide range of issues, including classroom and supply needs and salary increases. He claimed that the House leadership did not recommend any reduction in the proposed PSS budget, saying that it was realistic and necessary.

The $42-million budget level was the negotiated amount submitted by the Executive Branch to the Legislature, according to Benavente. He said, though, that the PSS originally proposed $48 million for its new fiscal year budget.