Friday, October 09, 2009

CNMI ranks lowest in ARRA money spending

Commerce wants public to consider factors

By Haidee V. Eugenio

The CNMI is at the bottom of the list when it comes to spending federal stimulus funding, according to an updated report from the federal tracking system.

At the same time, the CNMI Department of Commerce is now soliciting requests for proposals from qualified information technology contractors to create its American Recovery and Reinvestment Act of 2009 reporting system.

As of 3pm yesterday, seven contractors have picked up copies of the RFP at the Division of Procurement and Supply in Lower Base. The deadline for submission of bids is Oct. 21.

As of Sept. 30, the CNMI has only spent $358,669 or 0.8 percent of the $44,736,824 in ARRA funding so far made available to it, data from shows.

The total amount announced for the CNMI stands at over $53 million.

The CNMI's spending level is the lowest among 50 states, five territories, and three Pacific nations receiving ARRA money.


But Commerce Secretary Michael Ada, when asked for comment yesterday, said there are several dynamics that need to be considered when it comes to ARRA money expenditure.

“The reason our percentage is now less than 1 percent is because more money has come in. As I have mentioned in previous communications to the press, there is lag time for fund draw downs simply due to systems. The other reason for our expenditures being 'behind' even among smaller jurisdictions could be the type of funds being drawn down,” Ada said.

For example, the money could have gone to things like Medicaid payments which are easier spent as the funds cover Medicaid reimbursements, than energy money, he said.

“In addition, you need to consider that the CNMI government is not the only recipient of the money, so it is unfair to blame the expenditure lag strictly on the central government,” he added.

He said the Northern Marianas College, Northern Marianas Housing Corp., Commonwealth Ports Authority, and Public School System all received direct money that didn't come through the CNMI executive branch and whose money doesn't go into the central government's Financial Management System.

For fairness' sake, he said, the same questions should be asked of autonomous agencies.

Other territories

To date, Guam has already spent $17.3 million or 17 percent of the $103.5 million made available to it.

American Samoa has so far spent $4.6 million or 9 percent of $51.9 million in available ARRA funding.

The U.S. Virgin Islands has spent $19.7 million or 19 percent of $101.7 million ARRA money, while Puerto Rico spent 28 percent or over $813 million of $2.854 billion available so far.

Even Palau, the Marshall Islands, and the Federated States of Micronesia spent more in ARRA money than the CNMI. Palau has so far spent $950,000 or 37 percent or over $2.5 million in ARRA money. FSM has so far spent over $3.6 million of $5 million in available federal stimulus funds, while the Marshall Islands, $1.8 million of over $2.9 million.

Press secretary Charles Reyes, when asked for comment yesterday, said “Michael Ada and all relevant staff are working on these issues and placing the highest possible priority on the expeditious processing of such funds.”

Delegate Gregorio Kilili C. Sablan (D-MP), in a news briefing on Tuesday, said he understands the need for strict financial control when it comes to ARRA funding.

But Sablan said it raises concerns when even Guam and American Samoa are bound by the same strict financial controls and are still able to move much faster in allocating and spending ARRA money.

“I'm pleading.we need recovery dollars in our economy as soon as possible,” he told reporters.


Ada said the procurement process also holds up a great deal of the contracting, obligation, and ultimately, expenditures of ARRA money.

Procurement regulations require a 30-day posting of RFPs, followed by the evaluation, negotiation, and subsequent contract award, and this only obligates the money, he said.

In addition, provisions such as “Buy America” have proven to be an obstacle in projects as simple as lighting retrofits.

“Another thing to note is that just because other jurisdictions have quickly spent money doesn't mean they have done so with accountability, transparency, and responsibility, but that has yet to be seen,” Ada told Saipan Tribune in an e-mail response.

The CNMI, according to Ada, also reported updates to the federal tracking system and the numbers will not be made available until Oct. 31.

“The reports are due on the 10th. We have from the 11-30th to amend, and they become public on the 31st. This is per the Recovery Accountability and Transparency Board. In addition, I am not sure what the autonomous agencies reported, so it is premature in all aspects,” Ada added.

In closing, Ada said the ARRA issue is a complex one.

“It is very hard to break down in snippets so where folks can really grasp it. I think it would help everyone have a better understanding of this and for you to provide a clearer picture to your readers,” he added.

On Sept. 18, Saipan Tribune reported that the CNMI spent only 1 percent or $332,000 of the $27.935 million in federal stimulus money that was made available as of that date.

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