The Public School System has filed a lawsuit against Gov. Ralph DLG Torres, the Legislature, and the CNMI government to settle the issue of what constitutes the mandated 25-percent funding that PSS should get from general revenues.
PSS, through interim commissioner Glenn Muña, e-filed the lawsuit last Thursday in Superior Court. The court’s clerk received the suit yesterday.
PSS, through counsel Tiberius D. Mocanu, asked the court to declare that the “general revenues of the Commonwealth” be defined as the total budgetary resources identified by the governor.
Mocanu requested the court to rule that PSS is entitled to an unfettered 25 percent of that amount, before earmarks or debt service payments.
Mocanu asked the court to declare that PSS is entitled to 25 percent of the revenue in any special account, separate and apart from the general fund, but which contains general revenue.
The lawyer said PSS should be reimbursed for any deficiency in payments made to it since fiscal year 2017 up to the present.
He said PSS’ constitutionally mandated budget of 25 percent of the “general revenues” of the Commonwealth must come from the total gross amount of budgetary resources of the Commonwealth and all other funds from budgetary sources before initial allocations are made.
“In other words, PSS’ 25 percent must be measured against the overall total budgetary resources,” Mocanu pointed out.
He cited that in 2017, PSS’ budget should have been 25 percent of $212,649,298, which is approximately $53,162,324.
The lawyer said the CNMI government, however, “earmarked” funding by setting it aside as unavailable for appropriation, and then designated the remaining funds as part of the “general fund.”
“Because PSS’ budget is a constitutional mandate, the CNMI government must treat PSS’ appropriation as an initial earmark before all statutory earmarks,” he said.
Mocanu noted that in 2017, it was only after all statutory earmarks had been deduced from the total identified budgetary resources that PSS was allocated 25 percent of the remaining funds.
He said Public Law 19-68 excludes from the general revenues of the Commonwealth funding for 14 earmarks, which amount to $34,163,698.
He said Public Law 19-68 also excludes from the general revenues of the Commonwealth funding for three items: two refunding bond payments and one debt service to the Retirement Fund Settlement Agreement.
Mocanu said these amount to $41,460,375.
He said these debt service payments and payment to the retirement fund are general obligations of the Commonwealth and are paid from the general revenues of the Commonwealth.
Mocanu said money from the Casino Gross Revenue Tax collections are part of the “general revenue” of the Commonwealth and should be available for appropriation.
The lawyer asserted that because collected CGRT is accounted for in determining the sum for the total budgetary resources available for the fiscal year, CGRT collections must be available for appropriation when determining PSS’ 25 percent budget and should not be excluded because it is stored in a separate account.