SENATE Committee on Fiscal Affairs chair Sen. Victor B. Hocog on Wednesday said they will likely amend the House version of the Fiscal Year 2023 budget bill.
FY 2023 starts on Oct. 1, 2022. Without a new balanced budget enacted into law on that date, there will be a partial government shutdown.
Hocog said they want to “ensure that all government employees are secured for their continuing employment [even when] the [American Rescue Plan Act] funds [are] gone,” he said.
The Senate committee, which has conducted budget hearings on Tinian, Rota and Saipan, is concerned that the House version of the bill primarily funds departments and agencies through ARPA funds, he added.
Hocog said if 80% of a department’s funds are from ARPA, once the department reaches the deadline to spend ARPA funds in the next fiscal year, and if the CNMI government fails to collect enough revenue to fund personnel costs, then that department will be in debt.
“We don’t want that to happen,” he added.
On Wednesday, the Senate panel held a budget hearing in the Senate chamber.
Joining Hocog on the panel were vice chair Senate Vice President Justo S. Quitugua, Sen. Francisco Q. Cruz, Sen. Karl King-Nabors and Senate Floor Leader Vinnie Vinson F. Sablan.
Senate President Jude U. Hofschneider was also present for a portion of the budget hearing to receive clarification from Secretary of Finance David DLG Atalig regarding certain provisions of the budget bill.
Secretary Atalig appeared before the panel virtually to answer the senators’ questions regarding the administration’s version of the budget compared with the House bill.
He said there is approximately $120 million in ARPA funds for operations, but added that it remains to be seen how much of the FY 2022 funds will carry over into the new fiscal year.
Funds also need to be reserved for various government projects, he added.
Atalig said he does not object to the inclusion of language in the budget bill to fund operations for “zeroed-out” departments and agencies, noting that the governor has publicly stated that these should be funded at least as much as what was provided by the FY 2022 budget.
He said salaries will still be intact for the upcoming fiscal year, and will include within-grade increases in certain departments and agencies.
The administration, however, is seeking more reprogramming authority for roughly $9 million in the budget bill.
Atalig said this would give the governor the flexibility to move funds around for “needed areas.”
He said he also anticipates that more revenue will be generated in the upcoming fiscal year, adding that the numbers provided in the administration’s budget proposal are “conservative estimates.”
As for reimbursements from the Federal Emergency Management Agency, Atalig said he anticipates that the CNMI will receive around $20 million before the end of this month.
The CNMI government pays for the costs of unbudgeted expenditures for unforeseen disasters, and is then reimbursed by FEMA for eligible expenditures.
Atalig hopes that in the future, there will be a reserve fund for future disasters to minimize delayed payments to vendors.
Senate Committee on Fiscal Affairs chair Sen. Victor B. Hocog presides over a budget hearing in the Senate chamber on Wednesday.
Senate President Jude U. Hofschneider sits in on the Senate Committee on Fiscal Affairs budget hearing in the Senate chamber on Wednesday afternoon.
Sen. Francisco Q. Cruz poses a question as Senate Vice President Justo S. Quitugua looks on.
Sen. Karl R. King-Nabors and Senate Floor Leader Vinnie Vinson F. Sablan review documents during the budget hearing.
