Govt fighting for stimulus money

Local government officials are scrambling so the CNMI can have a shot at receiving a slice of the $787 billion stimulus package.

With President Obama expected to sign the American Recovery and Reinvestment Act today in Denver, Colorado, the CNMI has a chance to receive as much as $96 million for projects. But because the insular areas were unsuccessful in their attempt to allow the Interior Department to distribute their portion, the CNMI must apply and compete against other local governments for any money it receives.

Gov. Benigno Fitial has named Commerce Secretary Michael Ada as the point person within the Executive Branch for the application process.

Ada is asking department heads to identify possible projects that are “shovel ready,” identify what the federal funding source is and begin the application process. By Friday, he said he hopes to have the application process started, although he will not be writing the applications for each department.

“The Governor has made it clear that this is a priority, and this needs to happen, like, now,” Ada said.

‘Time is of the essence’

As with other areas, the CNMI will have its work cut out for it.

Time is of the essence, Ada said. Many of the projects have strict timeframes because the money is supposed to be used quickly.

For example, Ada said, under normal federal grant guidelines a local agency must go through a local point of contact such as a governor. The grant application is released to the public for comment and once finalized the governor can sign off on it, but that can take many days.

Also, if the projects require local matching funds, that will be difficult for the cash-strapped CNMI, Ada said.

Another issue is the expenditure portion, the secretary said.

“The stimulus package is meant to get money into the economy as fast as possible. Local agencies will put [the money] out in the community in the form of contracts, but the problem is the timeframe is very limited. If we get the money, there is a procurement period, [and] that timeframe for bidding may bite into the timeframe to spend money. If somebody protests the bidding, that takes another 30 days.”

In most federal grants, he added, money is not deemed expended until it is in the account of the vendor, which is sometimes a problem for the CNMI. People refer to millions of dollars in unused Capital Improvement Plan funding, but the CNMI is not sitting on it, Ada said. It just can’t be taken off the books until it’s in the vendor’s account.

“The drawdown of the funds becomes an issue,” he said.

Some states have created commissions or hired specialists to oversee the stimulus money, but that’s not something the Commonwealth can do, Ada said.

“You’ve got to remember we’re an insular area. To get someone in here who understands the needs on why this project is so critical is hard,” Ada said. “The whole thing is a bunch of paperwork. Other governments can afford to do that. Our government is trying to leverage its resources,” he said, adding that department heads should be knowledgeable on how to obtain the necessary resources.

Difficult

The CNMI has the ability to compete for the money like any other jurisdiction, but it will be difficult, delegate Gregorio “Kilili” Sablan said. He has urged the administration to work quickly and wisely in obtaining the funding.

House Speaker Arnold Palacios said he and other members of the Legislature are concerned about the government’s ability to compete for the grants.

“I hope, I said this a month ago, when the stimulus package was still in a proposal form, I hope the Commonwealth government, particularly the Executive Branch, is ready to execute this particular package. Otherwise we’re going to get left behind again,” he said, citing the millions of dollars in CIP funds.

The agencies need to ask themselves if they are on the ball and ready to deliver, he said.

“At the end of the day we don’t want to be standing, looking at each other, and pointing fingers at each other,” he said. “That’s going to be unacceptable. Now is the time. We’ve been given this opportunity. We need to make the best of it.”

The Puerto Rico dump and the Cross Island Road are two projects Palacios said he would like to see receive funding because he believes they are shovel-ready.

“Remember, lose it or use it,” the speaker said. “Those states or territories that don’t use it will lose it. The last thing we want to do in these dire days of economic challenges is to not be able to execute. I think every state, every city that has this opportunity is looking to get going. Whether or not philosophically you agree with all the press, the national press, whether this is a good thing or a bad thing, the fact of the matter is it’s in our lap. Let’s make the best of it and get some positive results.”