“It’s going to be tough. As it presently stands now, with the 2010 budget, we have already overspent more than what we have,” Rep. Ray N. Yumul told the Variety.
Yumul, a Saipan Republican, remains a member of the committee.
Over the past three years, Yumul said there has been a sharp decline in the government’s revenue collections with the demise of the Saipan garment industry and the struggles that the local tourism industry continues to face.
But Yumul said there is some “troubling” information regarding the government’s projected data that must be clarified.
He cited differences in income taxes and business gross revenue tax collections.
“It raises grave concerns to me. Now, we can’t even trust data. We have to sit down with them [administration officials] and ask how they formulated those data that they have collected,” the lawmaker said.
The Fitial administration’s proposed budget for FY 2011 totaled $132 million subject to certain austerity measures.
Rep. Ramon C. Basa, the current chairman of the House Ways and Means Committee, said the panel will begin this month the budget process.
Government agencies, led by the Department of Finance and the Office of Management and Budget, will be called in to discuss budget issues.
“Our tax collection is at the lowest point in our history,” said Basa, Covenant-Saipan.
Under the CNMI law, the administration must submit a proposed budget to the Legislature by April 1.
Basa said this deadline was met and so the ball now is with the House of Representatives where the budget bill should originate.
His committee met yesterday morning to discuss revenue enhancing measures as well as discuss budget-related issues.
“We talked about the legislation and also we talked about the budget, the entire process. We’re going to schedule different agencies to meet with us maybe in late April or early May. We will conduct hearings and hear them testify on their budget needs,” said Basa.
“Our target is to see the FY 2011 budget bill passed by early August,” he added.
The ratification of House Legislative Initiative 16-11 in the last general elections bars the government from automatically going through the continuing budget resolution process to finance its expenses.
This constitutional amendment further bars any withdrawals from the general funds except by legislative appropriations.
A Senate committee report on H.L.I. 16-11 emphasized the possibility of a government shutdown in the absence of a passed budget.
“Essentially, this will shut down the commonwealth government with the exception of critical services for which a plan for continued operation must be provided by law. This government shutdown provision will force the legislative and executive branches of government to seriously review and enact a balanced budget on time.
Additionally, according to the National Conference of State Legislatures, 23 of the U.S. states have provided for government shutdowns in the absence of an enacted budget,” it said.
The committee said the continuing budget resolution proves problematic for the cash-strapped CNMI government because it contributes to its mounting deficit every year.
“In past fiscal years where continuing resolutions have taken effect, deficits are accumulated and continue to increase when the previous fiscal year’s revenue collection is higher than the projected revenue collection of the current fiscal year. At present, this has amounted to over $170 million in deficit spending,” it said.
//
