THE CNMI government under the administration of then-Gov. Ralph DLG Torres allocated $138 million in American Rescue Plan Act funds in fiscal year 2021 but spent only $6.53 million according to the FY 2021 ARPA expenditure report of the new administration.
The report, which has been submitted to the U.S. Department of the Treasury, pertains to the allocations and expenditures in FY 2021 of the $481.87 million in ARPA funds that the CNMI received from the federal government.
Earlier this year, Gov. Arnold I. Palacios said that the CNMI had overspent and overcommitted its ARPA monies.
Intended allocations
According to the report, the CNMI government allocated a total of $138 million for Covid-19 pandemic recovery in FY 2021.
The Torres administration intended to use $40 million of the funds to respond to the public health emergency and to its negative economic impact, including assistance to households, small businesses, non-profits, impacted industries such as tourism, travel and hospitality.
Of the $40 million allocated in FY 2021 for public health emergency and Covid-19 economic impact, $12.4 million was supposed to go to households, $4 million to small businesses, $4 million to non-profits and $19.6 million to tourism, travel and hospitality.
In FY 2021, the report said, the CNMI government allocated $6 million of Section 602 funds for premium pays to eligible workers performing essential work, and providing grants to eligible employers who have eligible workers doing essential work. Of this amount, $5.1 million was intended for premium pay for first responders and $900,000 was grants for private sector companies that responded to the public health emergency in partnership with the CNMI government.
In addition, the CNMI government allocated $75 million “for the provision of government services to the extent of the reduction in revenue of the CNMI due to Covid-19 public health emergency relative to revenues collected in FY 2019.” The amount was intended for the following use:
1) $14.62 million to restore reduction of hours and reinstate furloughs affected by the loss of government revenues due to the public health emergency beginning March 2021 through Sept. 30, 2022.
2) $15.61 million for the provision of government services, its operations and activities affected by the loss of revenue due to the public health emergency from March 2021 through September 30, 2022.
3) $990,000 for the operations and activities of the judicial branch of government affected by the loss of government revenue due to the public health emergency from March 2021 through September 30, 2022.
4) $2.29 million for the operations and activities of the legislative branch of government affected by the loss of government revenues due to the public health emergency from March 2021 through September 30, 2022.
5) $6 million for the payment of government utilities in arrears from March 2021 through September 30, 2022.
6) $4.5 million for educational institutions across the Commonwealth from March 2021 through September 30, 2022.
7) $12.6 million for the Medicaid match requirement from March 2021 through September 30, 2022.
8) $7.5 million for the payment of the government’s arrears to patient providers seeking medical care abroad.
9) $4.5 million to create an e-commerce system for the CNMI government whose services to the community were hampered because of Covid-19 safety protocols, which limited government services to the general public and prevented the government from collecting fees and fines.
The last amount on the list of FY2021 ARPA allocations was $17.2 million, “to make necessary investments in water, sewer, or broadband infrastructure.” Of this amount, $1 million was allocated for the upgrade of communications infrastructure; $2 million to fund repairs of the water distribution system; $200,000 for the water catchments on Pagan, Alamagan and Agrihan; $2 million for a cyber-security system; $5 million for the construction of sewer systems; and $7 million for land compensation for the expansion of the water and wastewater systems.
Actual expenditures
But according to the new administration’s report, of the $40 million allocated for the public health emergency response in FY 2021, the CNMI government spent only a total of $632,080.
Of this amount, $100,000 went to the Road 80 vaccine campaign incentive program; $77,322 went to non-profit organizations impacted by Covid-19; and $454,758 went to tourism industry groups impacted by the pandemic.
Of the $6 million supposedly for the premium pay of eligible workers performing essential work, the CNMI government spent $2 million for the Commonwealth Healthcare Corp.’s premium pay.
Of the $75 million allocated to address the reduction in revenue, the CNMI government spent $3.9 million “to continue government services.”
The report added that the CNMI government, in FY 2021 did not spend the $17.2 million that was supposed to be invested in water, sewer, or broadband infrastructure.
Variety was told on Monday that the Palacios administration was still reviewing the FY 2022 ARPA spending report, which may undergo revision.
During the budget hearing conducted by the Senate Fiscal Affairs Committee on Friday, Finance Secretary Tracy Norita told the senators that as of May 31, 2023, the CNMI’s available ARPA funds amounted to $24.46 million. She also said that the federally funded single audit of the CNMI government for FYs 2021 and 2022 will cover ARPA fund spending.
