Senate President Edith Deleon Guerrero speaks during a Senate session.
THE claim of Finance Secretary Tracy B. Norita that the $93 million in American Rescue Plan Act funds was a budget item and not cash is misleading, according to Senate President Edith Deleon Guerrero.
In an interview on Thursday, Deleon Guerrero said ARPA money “is actual fiat currency and the ARPA sheet provided is an ARPA fund balance, not a budgetary balance nor is it projected revenue.”
She said this means that the $93 million should “reconcile” with the cash in the bank as of May 31, 2023 based on the ARPA fund balance sheet.
Deleon Guerrero said the $24 million that the Finance secretary mentioned is the ARPA cash book balance.
“At this point, because it is actual fiat currency from the U.S. Treasury, the difference between $93 million and $24 million is $69 million,” Deleon Guerrero said. “Theoretically, the $69 million should still be in cash in the bank to reconcile with the ARPA fund balance sheet…of $93 million.”
Deleon Guerrero said she supported the motion to override Gov. Arnold I. Palacios’ line-item veto on the ARPA spending plan because the administration, upon taking office, did not object to the participation of the Legislature.
She said there is also no supporting ARPA financial statement that can give the Legislature a true picture of the ARPA bank and fund balance.
“Due to [the] Covid-19 pandemic the entire world stopped spinning and no revenue, no tourist, nothing was coming in hence the ARPA funds from the U.S. government were made available to state governments to stay afloat. ARPA is hard cash, not projected revenue for budgetary purposes,” Deleon Guerrero said, adding that ARPA funding “is neither a formula, discretionary, or a technical grant, it is fiat currency, not a car.”
She also noted that ARPA recipients must obligate the funds by Dec. 31, 2024, and spend them by Dec. 31, 2026.
Good intent
Deleon Guerrero said the federal government allows state governments to draw down from its Payment Management System.
The states submitted their ARPA spending plan for approval by the U.S. Treasury and upon approval, “the money rolled in hard cash, again because the world economy had plunged to a screeching halt.”
“Do we really think that the U.S. government will go on a reimbursement basis with state governments knowing that all flights had stopped, people were on lockdown, the entire world was on a lockdown and so as a result through electronic means the ARPA money was transferred to state governments so they could start spending hard cash,” Deleon Guerrero said.
She said the CNMI government received $481 million in ARPA funds in May 2021.
“I come with good intent and I deeply honor transparency, honesty, and accountability for the CNMI and its people. The election is over and being politically correct has no place after the inauguration. This government belongs to the people. We preached rebuilding trust, transparency, and accountability. The override [attempt] was not an exercise in futility,” Deleon Guerrero said.
“Since the beginning when we all took office I recommended to the administration to leverage the CNMI’s client relations with its financial deposit institution for a line of credit on an as needed basis, and recently at an informal meeting with the Marianas Public Land Trust, myself, Governor Palacios, Speaker Edmund Villagomez, and House legal counsel Joe Taijeron, I specifically asked MPLT to consider restructuring the interest rate of 7.5% of the CNMI’s outstanding note of $10 million of the original $15 million borrowed to pay Yutu vendors,” she said.
There is also a long list of financial reports that her office has requested from the administration, she said.
She added that she gave the Finance secretary a hard copy of the pending reports list during their meeting with the Senate special committee on FEMA Community Disaster Loan “as a kind reminder that we are still waiting for them.”
“We [have been] patiently waiting for…six months,” she added.
She said the governor’s line-item veto has “put us in total darkness.”
She was referring to a budget provision that would have allowed the Legislature to have access to the central government’s Munis Financial Management Information System “for budget purposes.”
In vetoing the provision, the governor cited the separation of powers between the executive and legislative branches, and the confidentiality of taxpayer information. He also said that it would be counter-productive to provide direct access to Department of Finance data in the Munis system.
Deleon Guerrero said access “was granted back in January 2023.”
If granted access again, maybe “we might find the $93 million checking account — the governor is wondering about its whereabouts,” the Senate president added.
