The $131.9 million debt is for accrued compensated absences, bonds and notes payable as well as claims and judgment payables.
“At year end, the CNMI had $131.9 million in long-term debt outstanding, which represents a net increase of $1.08 million or 0.8 percent net increase from the prior year, which includes a $100 million partial advanced refunding,” Deloitte & Touche said in its audited CNMI financial statement for fiscal year 2007.
Much of the amount covers bond payments at over $100 million and claims and judgment payables — over $16.5 million.
The CNMI government floated different bonds between 1999 and 2003.
The $15.7 million bond floated in 1999 to finance the local matching funds required for Public School System’s capital improvement projects is due to mature this October.
As of Sept. 30, 2007, the CNMI government still had an outstanding payable of $3.17 million to settle this debt.
In 2000, the Commonwealth Development Authority floated $60 million to finance various CIPs.
This debt must be paid through 2030.
In 2003, the government floated $40 million in bond principally to pay private landowners whose lands were taken for various public projects.
At least $11 million of the money also went to the new prison facility in Susupe.
According to the Deloitte & Touche report, this bond must be paid by 2033.
Last year, the CNMI opted to refinance some of the bonds at lower interest rates which resulted in cash flow savings of close to $8 million.
“In April 2007, the CNMI issued $100,490,000 of Series 2007A and Series 2007B General Obligation bonds to primarily refund the outstanding debt obligations of the Series 200A and Series 2003A General Obligation bonds, and to pay certain expenses related to the issuance of the bonds,” the report said.
The Office of the Public Auditor, which commissioned the report, said the revenue collections of the CNMI government dropped by 17 percent to $159.9 million for FY 2007.
Expenditures also decreased by 7.6 percent.
However, financial experts said more austerity and economic recovery measures must be implemented to ensure that the CNMI fully meet its financial obligations.
