RECENTLY, comments in the media have suggested that the idea of using American Rescue Plan Act or ARPA funds to pay retiree premiums came from me. It is totally false. While I’m 100% for the retiree bonus, we need to fund the bonus in the right way, in the way that ensures that the CNMI Attorney General’s office won’t sue retirees and that the CNMI won’t put jeopardize federal funding by spending ARPA illegally.
We have seen what happens when the Secretary of Finance inappropriately disburses money. There are cases of overtime pay and exceeding the salary cap. Maybe not immediately, but eventually the Attorney General’s Office takes action for recovery. We have seen what happens when the CNMI Pension Fund makes miscalculations and issues overpayments. Pensioners, through no fault of their own, have been forced to repay years of overpayments at incredibly short notice. This must stop. As legislators, we cannot ignore the law. Retirees shouldn’t have to worry about being sued for improperly paid bonuses.
I supported legislation to fund the initial $500 bonuses using money that was earmarked for budget items vetoed by the governor. The House legislation not only created a business unit, but also funded it and identified the accounts that would be operated. When we doubled the bounties from $500 to $1,000, the Chamber identified the Mariana Visitors Authority because it was adequately funded both locally and federally. MVA even had the resources to provide $500 in “travel money” to tourists.
In December 2021, Governor Torres sent a letter to the Legislative Assembly in which he stated that he intended to fund the bonus with money from local operations and that he would fill this shortfall with the funds. of the ARPA. Finance Secretary David Atalig repeated this message on February 15, 2022, during a meeting before the House Ways and Means Committee. Referring to the plan to use money from local operations and then use ARPA to fill the temporary shortfall, Secretary Atalig used the term “filling” repeatedly.
More recently, in a Saipan Tribune article published on April 5, 2022, Senate President Hofschneider said that the idea of indirectly funding the retiree bonus by using it to top up our local funds “is not in accordance with the rules federal funds as there are certain restrictions on the use of ARPA funds.
Significantly, however, this same article asserts:[i]It was Vice House Speaker Blas Jonathan T. Attao (R-Saipan) who said earlier that the $850,000 they proposed to take out of the MVA for the $1,000 bonuses for retirees from the government would be replaced or returned to the MVA with ARPA funding. It is totally false.
Senator Hofschneider noted that the Senate passed Joint Senate Resolution 22-05 (“SJR 22-05”) on December 15, 2021. SJR 22-05 states: “ARPA, however, prohibits the use of funds from ARPA to pay retirement benefits. ” (Page 1, lines 13-17). Significantly, however, despite recognizing this prohibition, SJR 22-05 also states:
“WHEREAS the Governor and the Secretary of Finance plan to reprogram the total amount of $1.3 million for the sole purpose of retiree bonuses and have assured the Legislature that the programs of the general fund will not be interfered with in any way as these funds will be back-filled using ARPA funds under the government’s revenue loss provisions, which are subject to state law.” (Page 2, lines 16-20).
Senator Hofschneider also noted that the Senate passed Joint Senate Resolution 22-09 on March 10, 2022 (“SJR 22-09”). SJR 22-09 also states that: “ARPA, however, prohibits the use of ARPA funds to pay state retirement benefits, including any CNMI retiree bonus.” (Page 1, lines 16-217). Like the previous Joint Senate Resolution, SJR 22-09 also states that:
“WHEREAS the Governor and the Secretary of Finance plan to reprogram the total amount of $2.6 million from the Executive for the sole purpose of retiree bonuses and have assured the Legislature that the programs within the Executive will not be fettered in any way as these funds will be met using ARPA funds under the government’s Loss of Earnings Provisions, which are subject to state law. (Page 3, lines 9-13).
It was never my intention to use ARPA funds to directly or indirectly fund the bonus. I have always maintained that this could violate the terms of ARPA and jeopardize $500 million in federal aid. The President of the Senate says he and the Senate are “committed to finding the source of the funds without jeopardizing an industry known to CNMI for 40 years, and to ensure that retirees receive their bonus quickly”.
If that were true, he should have agreed to meet the House in a conference committee. If that were true, then why leave the decision to fund the retiree bonus to the Governor alone? The legislature, not the governor, should decide where the money should come from. The Senate legislation relied on the Governor and his reprogramming power, but without the House allocating funds to a new business unit, that reprogramming power is not enough. Moreover, after all the deficit spending we have seen from his administration, what is the abdication of our “wallet power” responsible for? That’s why the House passed two bills to fund the retiree bonus using $2.6 million in local funds that we did identify. That’s why the House says we should meet and talk.
The Governor takes credit for many things. This ARPA idea is his and he knows it. Secretary Atalig has been repeating this since February. The Senate passed not one but two joint Senate resolutions where there is express language that cautions against the use of ARPA and then clearly attributes the plan to use ARPA illegally to the Governor and the Secretary . Despite this, in an article published in Marianas Variety on April 6, 2022, MVA Board Chairwoman Viola Alepuyo said she asked Finance Secretary Atalig “if it is true that the budget of MVA can be “filled” with federal funds from ARPA. The article also provides:
“’The secretary said he didn’t know where the House of Representatives got this information from,’ Alepuyo said. “Most importantly, the finance secretary has made it clear that he does not know where this information came from.
– it doesn’t come from him. He didn’t think Finance was legally allowed to “fill” MVA’s budget if Bill 22-95 were approved. ”
Is Secretary Atalig indicating that if this was a joint resolution of the Senate doing the “filling” it is legally permitted, but if it is a House bill , This is not the case? If not MVA, what account does he intend to use?
In closing, I just wanted to set the record straight and remind everyone of the “filling” that Governor Torres and Secretary Atalig were planning to do and their promise last December. They may have forgotten that the letters, testimonials and resolutions prove that the “backfill” was their idea, and they may have forgotten their promise to retirees. But when it comes to political games like this, people won’t forget.
Blas Jonathan T. Attao is the Deputy Speaker of the House of Representatives.