Legislature faces 26.8% budget cut

Members of the Senate and the House of Representatives may take a hefty 26.8 percent reduction from the budget allocated for the second quarter of the fiscal year, nearly double the average cut given to various departments and agencies.

The Department of Finance has informed legislators the cutback — which it has pegged at 18.3 percent — is in line with the decline in actual revenue collections in the last three months initially projected at 13.4 percent.

But the department has set aside an amount equivalent to just 90 percent of the allotted budget, according Rep. Karl T. Reyes, chair of the powerful House Ways and Means Committee.

He said his committee, which in the past would normally receive $36,250 for its second quarter allotment, is expecting $26,529 for January until March, lower by $9,721 or 26.8 percent.

A so-called “leadership account” handled by the office of House Speaker Diego T. Benavente for several committees in the lower chamber will also get similar decrease as it is budgeted with $73,184 for the period, instead of the usual appropriation of $100,000.

While finance officials have assured reduction of only 18.3 percent, Reyes said he would seek clarification from the Office of Management and Budget whether the legislature is chalking up bigger cut than the two other branches of the government.

“We are actually dealing with more budget cut back as each committee is receiving less than what we anticipated,” the representative told in an interview.

Because of the lower spending level, committee operations will have to make do with limited funds and cut down on ongoing programs to meet the budget shortfall, Reyes said.

“I have to consult with other House members whether we can survive with this reduced money,” he explained. “If we can, then it’s okay.”

Last week, Gov. Pedro P. Tenorio’s administration implemented the uniform cut in the second quarter allotment to departments and agencies, except the Public School System which would pick up a nine percent reduction to its budget.

The move has been made to reflect the revised revenue estimates for FY 1999 which fall short by 13.4 percent from the initial projection due to the worsening economic crisis confronting the Northern Marianas.

The island is reeling from the fallout of the economic upheaval in Asia, NMI’s main source of tourism income and investments, which has substantially pulled down government revenues.

Due to the financial crisis, Tenorio last November slashed the budget package for 1999 by $32.5 million to $210 million to prevent huge shortfall by the end of the fiscal year.