$12M in added revenue for FY 2013

Priorities will be 80-hour restoration, Medicaid, medical referral, Fund
Lt. Gov. Eloy S. Inos said yesterday that preliminary figures indicate $12 million in additional projected revenue for fiscal year 2013 despite the termination of Saipan Air’s operations which could have brought in $5 million to $7 million more in direct and indirect tax revenues for the government.

Lawmakers welcomed the news, with most of them hoping for the restoration of 80 work hours biweekly and pumping more money to the NMI Retirement Fund and Medicaid, among other priorities.

“That is awesome news. But initially it should go back to workers to restore 80 hours. It will start a cycle of new, more money to go around,” House floor leader George Camacho (Ind-Saipan) told Saipan Tribune. He was referring to increased government collection from taxes and fees once businesses earn more.

Gov. Benigno R. Fitial is expected to soon submit a revised budget to the Legislature to reflect the additional projected revenue, Inos said.

Fitial’s original fiscal year 2013 budget submission on March 30 was $102 million. This could be raised to $114 million.

“There will be a revision. Vicky [Villagomez of the Office of Management and Budget] is still finalizing it. I believe there’s an increase of about $12 million,” Inos said in a chance interview yesterday afternoon on his way to attend the funeral Mass for the three Nekaifes brothers who died in a vehicular accident on Isa Drive.

Inos said the administration worked on the numbers and has projected some increases in tourist arrivals in fiscal year 2013 from Japan, Korea and China, among other markets, as well as “aggressive collections on big accounts.”

Fiscal year 2013 runs from Oct. 1, 2012, to Sept. 30, 2013.

“That takes into account the fact that Saipan Air is out of the equation,” Inos, a former Finance secretary, said.

Press secretary Angel Demapan separately said the budget revision packet “is still undergoing final review by the Office of Management and Budget before it is transmitted to the governor for approval.” That was as of the end of government hours yesterday.

The projected figures could still go up or down.


Inos said the additional projected revenue will be used primarily to restore 80 work hours biweekly, and pump more money into Medicaid, the medical referral program, and the NMI Retirement Fund.

Senate Fiscal Affairs Committee chair Jovita Taimanao (Ind-Rota) proposes to direct the additional revenue toward restoring 80 hours and helping the Fund.

The government owes the Fund some $320 million in unpaid employer contribution plus interest. Fitial placed the Fund under a state of emergency, and intends to place it under the Department of Finance.

Some government employees who have been getting 16-hour cuts on their biweekly paychecks for almost two years expressed relief upon hearing the news.

“The 64 hours is not enough because the economy is bad. I’d rather work on Fridays and get paid rather than not work on Fridays and not earn complete 80 hours,” a 53-year-old government employee said. The father of three hopes this will indeed happen in fiscal year 2013.

While government payroll has been cut by 16 hours, the payroll has been on time the past months for all employees.

House Committee on Commerce and Tourism chair Rep. Edmund Villagomez (Cov-Saipan) also hopes more money will go to the Fund, as well as to pay the government’s obligations.

PHI Pharmacy, Marianas Medical Center, and Saipan Health Clinic and other private clinics have temporarily stopped honoring Medicaid starting this week because of the government’s non-payment of reimbursement.

Rep. Stanley Torres (Ind-Saipan), for his part, said if the Saipan casino question is placed on the ballot in the Nov. 6 elections, the additional projected revenue in fiscal year 2013 would be “more.”

Proponents of legalizing casino gaming on Saipan, including Torres, retiree Dr. Jack Angello, acting Vice Speaker Felicidad Ogumoro (Cov-Saipan), Rep. Ray Basa (Cov-Saipan) and former speaker Pedro “Paduna” Deleon Guerrero, are currently collecting signatures to place the casino question on the ballot. They need 2,590 signatures to put the casino question on the ballot.

House Ways and Means Committee chair Ray Basa (Cov-Saipan) is also poised to pre-file the fiscal year 2013 budget bill, but he said their submission is almost similar to the governor’s original budget proposal and did not include Saipan Air’s impact.

Saipan Air, which is supposed to be the CNMI-based international carrier, decided to cease operations after its partner firm, Swift Air, defaulted on its contract agreement a week before Saipan Air’s scheduled launch on July 1. Swift Air later filed for bankruptcy.

Haidee V. Eugenio | Reporter
Haidee V. Eugenio has covered politics, immigration, business and a host of other news beats as a longtime journalist in the CNMI, and is a recipient of professional awards and commendations, including the U.S. Environmental Protection Agency’s environmental achievement award for her environmental reporting. She is a graduate of the University of the Philippines Diliman.

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