Legislature says finance may have erred in 20% budget cut

The CNMI Legislature is asking finance officials to correct what is apparently a miscalculation in their budget allotment for the second quarter which resulted to more than 20 percent cut way above the recent slash implemented by the Tenorio administration.

Some members of the House of Representative met the other day with Gov. Pedro P. Tenorio and Mike Sablan, special advisor for budget and finance, to raise the issue which they said may impact on their operations and ongoing programs.

They reminded the administration an existing law provides that they have to inform the legislature of the cut prior to handing them an amount much lower what they had anticipated even with the 13.4 percent “across-the-board” reduction.

“In the absence of such particular procedure… some of the members are saying that we should not get the cut,” said House Ways and Means Committee chair Karl T. Reyes.

He said the 20 percent cut could probably be a “mistake” and they have urged Sablan to look into the problem. “The legislature will definitely participate in the budget cuts,” Reyes added.

The Department of Finance earlier had informed legislators the cut back — 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, prompting them to seek clarification with the governor.

For instance, each House committee, which in the past would normally receive $36,250 for its second quarter allotment, is expecting $26,529 for January until March, less by $9,721 or 26.8 percent.

Legislators, however, are split on the budget cuts as some are saying that they are willing to forsake the shortchange as part of the efforts to help the administration deal with the deepening financial crisis.

“We ought to share in the austerity measures. We should be in the forefront and lead by example,” said Rep. Manuel A. Tenorio, chair of the Natural Resources Committee. “I have no problem with the cuts.”

Although he agreed that they need to confront the budget crunch, Commerce and Tourism Committee chair Rep. Oscar Babauta called on the administration to apply the cuts equally among the three branches of the government.

“We are going to comply with the 13.4 percent cut,” he explained. “We are just concerned that there is inequity in the percentage. I believe that this is a technical error.”

Senate Vice President Thomas P. Villagomez said they would “look into it” when records from the finance department are released, decline to comment whether the huge cut is affecting its operations.

More than $7 million was set aside to both the House and the Senate under the FY 1999 budget which was revised last November by Tenorio due to continuos drop in revenue estimates.

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.