PALIKIR, Pohnpei (FSMIS) — Federated States of Micronesia President Leo A. Falcam led a delegation to Chuuk to continue discussions on the state’s ongoing financial problems and to develop joint national and state actions to accelerate financial recovery.
The president’s delegation met with Gov. Ansito Walter and a cross-section of the state’s leadership on June 7-8. The mutual agreements of the two governments were memorialized in the form of a memorandum of understanding signed on June 10. Implementation of the elements of this MOU will begin to put the state’s finances back on a stable path.
In expressing the determination of the FSM national government to provide support to the state as it attempts to repay outstanding debts, fulfill obligations and restore financial stability, the president indicated his resolve in three specific areas.
First, to ensure that all public funds be administered according to national and state laws and consistent with treaty obligations with the U.S.
Second, to ensure to the greatest extent possible that bi-weekly gross wages of Chuuk State employees are fully paid without delay.
And third, to ensure that the interests of Chuuk State’s municipal governments are protected with respect to their remaining balances of capital improvement project funds received as Compact economic assistance from the U.S.
Walter acknowledged that the state was suffering from financial problems that resulted from over-projection of revenues and subsequent over-appropriation of the state’s budget.
He also committed his administration to ensuring that the upcoming fiscal year budget would not repeat the same mistakes.
The governor also pledged his full support for certain financial austerity measures that, by reducing operating expenses and reducing new CIP commitments, will free resources to begin addressing the state’s urgent debts and land purchase requirements.
