Teno disapproves FY 2000 budget

Despite last-minute negotiations with lawmakers, Gov. Pedro P. Tenorio yesterday disapproved the FY 2000 budget, citing potential deficit spending by departments and agencies as well as layoffs of government employees to be hit by proposed cuts barely four months into the next fiscal year.

The veto came on the day of expiration of his authority to act on the budget bill before it becomes law without his signature. There is no immediate reaction from the Legislature on his decision which could face override by both chambers.

Mr. Tenorio expressed concerns over several provisions of the spending proposal which lawmakers passed when three-quarters of the $207 million estimated revenues for the current fiscal year have already been allotted.

He said implementing an entirely new budgetary scheme for the last three months of FY 2000 would only result to two major problems — deficit spending by departments and agencies with lower appropriation level than what they have actually received so far and termination of personnel to accommodate reallocation of resources.

“Although the bill does not increase overall expenditures of the government, it shifts approximately $8 million away from agencies and programs which have been operating at those levels under continuing appropriations and reallocates them to new priorities,” the chief executive said in his veto message.

“To maintain the current level of public services, the government would be forced into unnecessary deficit spending,” he added.

Assistance

Instead of pressing this year’s budget, Mr. Tenorio asked lawmakers to begin review of the FY 2001 proposed package amounting to $220 million to reconsider the priorities and concerns under this bill.

“My staff and I are ready to work cooperatively with you on [next year’s] budget,” he told Senate President Paul A. Manglona and House Speaker Benigno R. Fitial in the letter.

The government has been running under the FY 99 revised spending level of $210 million since October 1 last year following failure by the 11th Legislature to pass the budget on time, which is before the previous fiscal year ends.

When the present batch of lawmakers took office last January, they pledged to prioritize the budget. Its passage had been derailed after the House and the Senate shifted funds from the executive department and independent programs to increase share of the Legislature, Public School System, Departments of Public Health and Public Safety, as well as medical and referral programs.

They took $4 million out of government utilities payment to maintain the approved FY 99 spending level of Rota and Tinian municipalities at $15 million each. They also appropriated $700,000 for CNMI’s lobbying efforts in Washington.

Several factors

While he attempted in the past few days to reach an agreement with the House on the budget in order to address his concerns, Mr. Tenorio noted that there were numerous considerations that led to his veto.

Aside from the potential deficit and layoff of employees, he said delivery of public services would suffer since most executive offices would shoulder most of the burden of the proposed cuts, in terms of services, jobs and resources.

He also cited as another factor a provision that would have allowed tax offset by companies that have been trying to collect payment for services rendered to the government.

This could create an unbalanced budget, impair tax collection at a considerable cost to the government, as well as authorize use of general fund revenues to offset liabilities incurred by autonomous agencies.

Public lands revenues could also be diverted into the general funds which would violate constitutional provisions regarding use of these money, according to Mr. Tenorio.

Some $1.6 million in projected income from public lands lease have not been appropriated by the Legislature to the Division of Public Lands as required under the Constitution, he said.

At the same time, illegal commingling could also occur since general funds would be used to offset debts owed by the government to landowners whose property has been acquired for public use, added the governor.

This is the first time he rejected the budget approved by the Legislature. In September 1997, lawmakers thumbed down the budget proposed by then Gov. Froilan C. Tenorio, forcing him to run under continuing resolution that spilled into Teno’s administration.