High court clarifies what constitutes govt revenue

Posted on Jan 15 2020

The CNMI Supreme Court has responded to three certified questions that Gov. Ralph DLG. Torres and Board of Education chair Marylou S. Ada submitted to the court about what constitutes government “revenue” and the constitutionally-mandated share of the Public School System.

Specifically, the two officials asked the high court’s opinion about their duties and responsibilities under Article XV, Section 1(e) of the Constitution of the Northern Mariana Islands: “The public elementary and secondary education system shall be guaranteed an annual budget of not less than twenty-five percent of the general revenues of the Commonwealth through an annual appropriation. The budgetary appropriation may not be reprogrammed for other purposes, and any unencumbered fund balance at the end of a fiscal year shall be available by reappropriation.”

Answering the first question on what revenues comprise “general revenues” within the meaning of Article XV, Section 1(e), the Supreme Court held that “general revenue” is a subset of the Commonwealth’s revenue, distinct from special revenue. To qualify as special revenue, there must be a relationship between the revenue’s source and the revenue’s purpose. If there is no relationship, those revenues are general revenues, of which PSS is entitled to a percentage.

On the second question concerning the Legislature’s authority to suspend earmarks in appropriations bills, the BOE and the governor concede the Legislature does have the authority to suspend earmarks, transforming those revenues into general revenue, which are subject to PSS’s guarantee.

Finally, the Supreme Court also held that PSS is entitled to a portion of supplemental budgets passed when the CNMI experiences a revenue surplus. That is, PSS’ guarantee is not restricted to a single annual appropriations bill. However, when there is a revenue shortfall, the Legislature may proportionately reduce PSS’ share, so long as PSS’ 25% share is preserved.

The Supreme Court’s full opinion is available at http://cnmilaw.org/supreme20.html
The NMI Constitution permits elected and/or public officials to request the Supreme Court to answer legal questions touching upon the exercise of their respective responsibilities. (PR)

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