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Law allows flexible use of lapsed funds
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Posted on Aug 13 2005
Gov. Juan N. Babauta has approved a bill that seeks to make flexible the use of lapsed local funds.
Babauta signed House Bill 14-326, authored by Reps. Oscar M. Babauta and Jesus T. Attao, which aims to amend 1 CMC section 7708 of the Planning and Budgeting Act.
Babauta, in his Aug. 10 transmittal letter to the Legislature, said the measure will allow the Department of Finance “to have increased flexibility in managing the use of all monies deposited in the Commonwealth general fund.”
Further, he said that the law as amended contains a new subsection (d) to clarify that all funds appropriated from local revenues which “lapse” at the end of a fiscal year must revert to the original source rather than to the general fund.
Babauta said the administration and Finance have been doing this pursuant to the previous recommendation of the Attorney General’s Office.
“The changes to the Act as set forth in this measure, however, will ensure that these procedures continue to be implemented in a consistent manner,” he said.
H.B. 14-326 becomes Public Law 14-83.
Some agencies, including the Saipan Higher Education Financial Assistance Board, earlier called on the Legislature to help them keep “lapsed” funds.
In particular, SHEFA said it has not used about $1 million, which lapsed in fiscal year 2004. SHEFA, which began operations last year under the Saipan Mayor’s Office, was initially appropriated $1.2 million. The money was eventually released following an action by the Saipan and Northern Island Legislative Delegation.
Finance Secretary Fermin M. Atalig earlier said that, although the remaining money had been set aside for the program, it could not be spent in the absence of a law authorizing such a particular move. (Liberty Dones)
