Torres blames Yutu anew for tattered CNMI govt finances

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Posted on Jun 27 2019

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Responding to a mounting clamor in the community for more transparency in the CNMI government’s finances, Gov. Ralph DLG Torres led several local and federal officials in a public outreach yesterday that sought to do just that.

Torres was joined by Lt. Gov. Arnold I. Palacios, Finance Secretary David Atalig, Office of Management and Budget director Virginia Villagomez, and Federal Emergency Management Agency representative Bill Roach in yesterday’s public outreach at the Pedro P. Tenorio Multi-Purpose Center in Susupe.

Other officials present were Marianas Visitors Authority managing director Priscilla Iakopo, Office of Planning and Development director Kodep Ogumoro, and Public Assistance officer Patrick Guerrero.

In his opening statement, Torres again blamed Super Typhoon Yutu as the main cause of the CNMI’s current economic and financial situation, which almost zeroed out the government’s budget. He detailed the gravity of the disaster that hit the islands of Saipan and Tinian in the last week of October in 2019, when Yutu struck. With winds of 177 miles per hour, Yutu was considered the strongest typhoon ever recorded to hit the CNMI.

The Commonwealth government paid the upfront cost of recovery efforts and will be reimbursed by FEMA later. Debris removal, power restoration, food, fuel for generators of critical agencies, and labor were some of the initial cost that the government shouldered.

At a cost of $62.5 million, power restoration got the biggest chunk of the government’s expenses after Yutu. Another $9.1 million went to labor costs and $8.2 million was spent to transport food and fuel to get people around. A total of $7.9 million was spent on debris removal.

To date, FEMA has already awarded a total of $72.7 million in reimbursements to the CNMI while $15 million more is expected to be remitted soon.

Torres said that Yutu damaged lots of homes, business establishments, and other infrastructure, including power and water distribution, and closed the Francisco C. Ada/Saipan International Airport that prevented commercial planes from landing on Saipan.

Yutu greatly impacted the tourism industry—the CNMI’s main source of revenue through the hotel occupancy tax and other taxes collected from visitors.

Roach said it is FEMA’s responsibility to have all resources at their disposal be readily available when needed after every disaster. However, they have a process in providing assistance, such as reimbursements.

“There’s a process that needs to be followed. Our responsibility…is to help local governments and, at the same time, [make them] understand our programs. Reimbursements will get done; just be patient,” said Roach.

In her presentation, Iakopo said the CNMI lost about $19 million in revenue from the business gross revenue taxes, hotel occupancy taxes, and other expenses made by visitors to other business establishments. That amounted to about 21 percent lower revenue than initially projected.

Jon Perez | Reporter
Jon Perez began his writing career as a sports reporter in the Philippines where he has covered local and international events. He became a news writer when he joined media network ABS-CBN. He joined the weekly DAWN, University of the East’s student newspaper, while in college.

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