By Emmanuel T. Erediano
[email protected]
Variety News Staff
GOVERNOR David M. Apatang, in his fiscal year 2027 budget submission, warned of a deeper reduction in available financial resources due to the impact of Super Typhoon Sinlaku on the islands’ electricity and power supplies, which has disrupted business operations.
In his proposal dated May 1, 2026, the governor told Speaker Edmund S. Villagomez and Senate President Karl King-Nabors that the total FY2027 budget is $101,887,467, which is $32.5 million lower than the FY2026 budget of $134.4 million.
The Governor’s Revenue Council, in its report, said it based the FY2027 revenue forecast on actual FY2025 collections of $172 million, “which served as the baseline before applying several key adjustments.”
“One-time revenues totaling $3.6 million, such as casino GRT and reimbursements, were removed to avoid overstating recurring collections. Given anticipated declines in visitor arrivals, hotel occupancy tax revenues were projected at 50 percent below the baseline, reflecting continued weakness in the tourism sector,” the report said.
The forecast, the council added, “also incorporates a $2.3 million reduction tied to business closures in FY2025. To account for broader economic uncertainty and potential volatility in collections, a 5% across-the-board reduction was applied, resulting in an additional $7.7 million decrease.”
In his budget submission, the governor said the FY2027 proposal “does not yet reflect the fiscal impact of Super Typhoon Sinlaku, which is expected to strain government operations and revenues. Damage to critical infrastructure and disruptions to economic activity will increase expenditures while suppressing revenue collections, further narrowing our fiscal margin.”
The administration, he said, had to make difficult but necessary decisions. With available financial resources sufficient only to support a 20-hour work week for government employees, the FY2027 budget proposal reflects reduced personnel costs and constrained operations across all branches of government.
“To preserve essential services, it will be necessary to implement furloughs and responsibly resize government operations to align with current fiscal capacity. These actions are not taken lightly but are essential to maintaining core government functions and restoring fiscal stability,” the governor said.
The $101.9 million FY2027 budget proposal, he noted, includes allocations for critical obligations such as retiree benefits, education, healthcare support, and essential government services, while temporarily suspending certain statutory earmarks to prioritize immediate needs. He said 39% of the budget is for personnel expenses, 58% is for operational expenses, and 3% is for utilities.
The governor urged members of the Legislature to give the proposal careful consideration and to act on measures that will support economic recovery and long-term fiscal sustainability. He said continued collaboration between the Legislature and the executive branch will be critical in navigating the challenges ahead.
He added that he is aware there is an opportunity to make changes to the budget proposal 90 days before the end of the fiscal year and said he will continue to monitor fiscal conditions closely and may submit amendments as necessary.
