CPA unveils $17.8 million budget for operations

The Commonwealth Ports Authority Board has approved a $17.8 million budget for the operations of the airport and seaport divisions for fiscal year 2001.

However, the CPA Board is still studying the $1.68 million total budget for Capital Improvement Projects for both the airport and the seaport for next fiscal year.

Total projected revenue from the airport is approximately $12.8 million but a big chunk of the money or 86 percent will be used to operate and maintain all the three airport facilities within the CNMI.

This is a 6.68 percent increase over FY 2000 budget, which was previously reduced as a result of the cost-cutting measures implemented on personnel and administrative costs.

The ports authority reduced the two-week work period from 80 to 72 hours and eliminated overtime except those services directly affecting safety. CPA’s share in the employee’s health insurance premium was also cut.

As a result of the adjustment in passenger departure and aircraft landing fees, installation of paid public parking, grant of incentives to airlines for new routes and increase activity, privatization of airport tower, the airport division realized cost savings and additional revenues amounting to $3 million in FY 2000 alone.

Next fiscal year, salaries and wages at the airport are projected to slightly jump by 4.97 percent, which is still reasonable considering the austerity measures carried out by the ports authority.

Staff training in fire, rescue and other technical areas, which were drastically reduced during the financial crisis, will be restored in FY 2001.

Debt service for the $22 million airport bond amounts to $1.48 million.

The ports authority plans to appropriate $3.7 million for capital improvements at the airport to be financed from the reimbursement fund and operation’s money. CPA’s projection for the first six months of FY 2001 shows a 6 percent increase in the total number of passengers.

On the other hand, total seaport revenue is projected to reach $5 million but a huge amount or $3.4 million will be used to service its $33 million seaport bond debt.

The ports authority plans to appropriate $800,000 for Capital Improvement Projects next fiscal year.

Over the past years, CPA’s biggest concern is the expected pullout of the garment industry from the CNMI due to effects of international trade agreements plus the threat of a federal takeover.

These threats have resulted to a cumulative reduction of seaport activities, or a total of 16 percent, from a high total annual gross revenue tonnage of about .85 million in 1996 to about .7 million in 1999.

Aside from the cost-cutting measures, the seaport has implemented a rate hike in July of FY 1999 and recently installed automated public parking in an effort to raise $1 million in additional revenues.