GOVERNOR Arnold I. Palacios on Tuesday signed the revised fiscal year 2023 budget which includes austerity measures due to depleted American Rescue Plan Act funding.
House Bill 23-31, which revises Public Law 22-22, is now P.L. 23-4.
The governor said he had to line-item veto some of the administrative provisions of the bill “that would have presented constitutional issue or lacked clarity to enforce.”
These included Section 604 which would require Legislative approval of the ARPA spending plan prior to submission to the U.S. Treasury.
The governor said any measure that is intended to have the force and effect of law must be originally introduced as a bill in the Legislature, which upon passage must be presented to the governor for approval.
He said Section 604 “sidesteps the constitutional lawmaking process and would require only legislative approval through a joint resolution and reduce my office’s role to that of a consultant.”
The governor also vetoed the provisions that would suspend the proportionate reduction of funds of the legislative and judicial branches.
He said all three branches of government receive funding from the same Commonwealth revenues, and thus all three branches share the burden through proportionate reduction of their respective budget under the Planning and Budget Act should there be a decrease in revenue resources during a fiscal year.
Palacios said “proportionate reduction ensures fairness in allocating the budget cuts across all three branches.”
Although the revised budget increases the fiscal year budget projection to $116.1 million from $109.7 million, it also reduces executive branch working hours to 72 from 80. However, law enforcement agencies are exempted.
In his transmittal letter to the Legislature, the governor reiterated that the ARPA funds and Community Disaster Loan were overspent and overcommitted.
Had the CNMI government continued on the original budget, the Commonwealth would have ended
“in a fiscal disaster with a substantial operating deficit,” Palacios said.
“My administration had no choice but to tighten the fiscal reins, cancel contracts, and reduce bi-weekly standard work hours to 72 hours and to request that the Legislature revise the budget plan,” the governor said.
He said the Department of Finance continues its review of ARPA funding to determine the extent of any transfer of funds that are not in compliance with ARPA regulations and law.
Before he signed the budget bill, he noted that some of the administrative provisions he vetoed are “templates” of legislative desires in the past, and that he himself had expressed those desires.
“Sitting down in a different capacity, I see the other side of the picture,” said the governor who is a former House speaker and Senate president.
“But I’m very happy to sign this revised budget. As you know, we have to do it. This is part of the cost-containment, setting aside resources to priorities that we all have come to agree on,” he added.
He thanked the lawmakers for finalizing the budget measure “fairly expeditiously.”
He said he has instructed the Office of Management and Budget to finalize a budget proposal for FY 2024 by Friday.
He intends to submit the next fiscal year’s budget proposal to the Legislature by May 1.
The governor signed the revised FY 2023 budget in the presence of Lt. Gov. David M. Apatang, Special Assistant for Management and Budget Vicky Villagomez, Senate President Edith Deleon Guerrero and Speaker Edmund S. Villagomez.
Also present were Senate Vice President Donald M. Manglona who chairs the Senate Fiscal Affairs Committee, Rep. Ralph N. Yumul, the author of H.B. 23-31 and chair of the House Ways and Means Committee, and other lawmakers.
Gov. Arnold I. Palacios signs the revised fiscal year 2023 budget bill into law while Lt. Gov. David M. Apatang looks on Tuesday.
