The Torres administration is set to submit to the Legislature this week its proposed budget for the operations of the CNMI government in fiscal year 2020, which begins on Oct. 1 this year.
The Department of Finance is expected to submit a revised report on the estimated budgetary resources after the second quarter of fiscal year 2019 ended last Sunday.
Press secretary Kevin Bautista told Saipan Tribune that the administration has until May 1 to submit the proposed budget to the Legislature since this is a new administration.
“However, Gov. Ralph DLG Torres and Lt. Gov. Arnold I. Palacios will submit it within the next two days,” he added.
House Speaker Blas Jonathan T. Attao (R-Saipan) and Rep. Ivan A. Blanco (R-Saipan), in separate messages to Saipan Tribune, supported the administration’s statement.
“They [administration] have until May 1 to submit the proposed budget but I’ve heard it should be ready sooner,” said Attao.
“They have the option to submit the budget proposal no later than May 1, but I was advised that it could be submitted before then,” added Blanco.
Torres, in a letter to Attao and Senate President Victor B. Hocog (R-Rota), informed the Legislature of a proportionate reduction of 15 percent in the allotment authority of all three branches of government per quarter.
Torres added that he explained in a separate letter that revenue forecasts for fiscal year 2019 was lower than they had originally projected, a reduction of 4.7 percent, largely due to Super Typhoon Yutu that crippled the CNMI tourism industry for almost three months.
“However, steeper across-the-board reduction of allotment authority is necessary to take into account the [CNMI’s] fixed annual obligation to its bondholders and the minimum annual payment of $44 million to the Northern Mariana Islands Settlement Fund,” Torres said.
“If the Executive Branch were to bear the brunt of the reduction of revenue collection in fiscal year 2019, the operation of entire programs, if not agencies, will likely be suspended until the revenue forecast improves.”
He added that the across-the-board reduction is an effective fiscal tool as provided under the Planning and Budgeting Act that would ensure the government would not incur an operating deficit by the end of fiscal year 2019.
“As stated, Lt. Gov. [Arnold I.] Palacios and I remain optimistic that, as the year progresses, our revenues will rebound. Until such time, based on the numbers we have provided you and the assessment of acting Finance secretary [David Atalig], we are duty-bound to adhere to our legal obligation to maintain fiscal discipline and responsibility,” Torres said.