Cohen: Enough safeguards on 702 funding

The newly signed Section 702 CIP Funding Agreement between the U.S. and the CNMI governments contain enough safeguards to ensure that federal funds provided in the agreement would be spent properly. If the CNMI government fails to meet the requirements set in the agreement, there is a strong possibility of funding losses or even reimbursement by the CNMI to the federal government.

This was how Deputy Assistant Secretary of the Interior David B. Cohen explained to members of the House of Representatives why the U.S. Congress approved sole responsibility over the disbursement of the CIP fund to the CNMI executive branch.

Cohen, who met with House members Wednesday afternoon, said the new agreement has new provisions reinforcing accountability and on-call audit reviews. This is why the CNMI Legislature is no longer involved in the appropriation of CIP and Compact-Impact funding assistance, he added.

The federal official pointed out that his concern is focused on how the money is disbursed, controlled and accounted for based on the standards and protection clauses placed on the signed 702 funding agreement.

Cohen said, though, that even if the executive branch has the sole authority to disburse the money, he hopes it will still continue to work closely with the Legislature so that proper CIP projects are undertaken, based on the proposal submitted by the CNMI government.

House Speaker Benigno R. Fitial had told Cohen that the Legislature wants to be part of the disbursement of federal funding to ensure checks and balances.

In a separate interview, Senate President Joaquin Adriano said he is not worried about the current setup in the disbursement of 702 CIP funds since proper mechanisms are in place to protect the monies allotted by the U.S. government to finance infrastructure projects.

“There is no reason for the CNMI to screw up. If they do that, the U.S. Congress would be there to conduct an immediate audit and the Attorney General’s Office would be on hand to conduct investigation and possible charges for wrongdoings,” said Adriano in an interview.

He said Congress protects the agreement and it can always summon the CNMI for audit and inquiry. “They are answerable to Congress and the AG here can be asked to testify on that,” Adriano added.

Cohen and Lt. Gov. Diego T. Benavente officially signed the CIP Funding Agreement during a brief ceremony at the Governor’s Office last week, providing for $12.4 million fiscal year 2005 CIP Funds.