By Jude O. Marfil
For Variety

WASHINGTON, D.C. – U.S. Deputy Assistant Interior Secretary for Insular Affairs David B. Cohen warned the CNMI about losing federal grants due to the commonwealth government’s delay in the implementation of capital improvement projects.
“I don’t want to scare anybody,” Cohen said in an interview at his office here. “But in the past, funds that have not been expended in a timely fashion have affected the pace at which we commit new funds.”
Office of Insular Affairs documents revealed that the CNMI has approximately $55 million in unspent CIP funds.
Of this figure, $54.45 million has already been assigned to a particular project.
It is unclear, however, how much of this money is still sitting in OIA accounts because the CNMI has not yet come up with the local matching funds to implement the projects.
Projects that were approved between 1997 and 2002 require that the CNMI shoulder half of the CIP cost.
But half of the projects approved in 2003 as well as those between 2004 and 2007 do not need local matching funds.
If the CNMI cannot raise the local match funding, it can reprogram funds for projects that are 100 percent federally funded.
“We’ve been working with the CNMI to try and help them move some of these CIP funds more quickly. There are a number of obstacles on their side that were identified and we’re trying to help them address those,” Cohen said.
A separate report showed that the delay in the implementation of CIPs was due to the CNMI Department of Public Works’ “failure to efficiently process contracts and change orders.”
“While change orders are fairly common with construction projects, the CNMI seems to process an extremely high number of them which adds to project costs and delays,” the report stated.
Further, DPW was remiss in tapping a person to review files, submit final drawdowns, and properly close completed CIPs. This resulted in accounts staying open for years which led to the delay in the transfer of funds to new, existing or underfunded projects.
“OIA is currently working with the CNMI to hire a contract officer for the CNMI CIP office who would review change orders and contracts to ensure that they are necessary,” the report read.
DPW was also negligent in overseeing the management of project managers, the report added.
Another factor that slowed the implementation of CIPs was the austerity holiday initiated by the Fitial administration.
The austerity measure requires government employees, including those working for federally funded projects, to skip working every other Friday.
While insisting that it was not for him to tell the CNMI how to run its government, Cohen said “the (local) economy could certainly use (CIPs) now.”
Washington Rep. Pete A. Tenorio, for his part, said: “I fear that in the next cycle, we will see a reduction in federal grants funds in the CNMI because of the reduction of salaries. If you reduce your output (with) austerity (holidays), and not do your job… (the federal government) will have to adjust (the grant) in the new grant cycle.”