CNMI to adopt austerity measures due to decline in tourists

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CNMI Governor Ralph Torres (file photo)

The CNMI government will have to implement austerity measures that may be more severe than those of last year.

Gov. Ralph DLG Torres met with the House leadership on Wednesday morning and presented several budget-cut options which, according to lawmakers, include across-the-board work-hour cuts and suspending 25 percent of government retirees benefit payments unprotected by the Settlement Agreement.

The settlement agreement mandates the payment of 75 percent of a retiree’s benefits.

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The governor told legislators that he will indicate in an official communication which of these options is the most reasonable in adjusting the fiscal year 2020 budget.

He said the budget amount will be 25.3 percent less due to the drastic and sudden decline in tourist arrivals following the novel coronavirus outbreak in China.

In his remarks during the Saipan Chamber of Commerce general membership meeting at Kanoa Resort on Wednesday, Torres said early projections show that “we are set to lose at least $40 million in revenue and, as a government, my administration is working with the Legislature to adapt and make adjustments now.”

He added, “I understand that there have been discussions around the community about us returning to austerity. I can tell you all right now that all options are on the table.”

Torres said the government is reinforcing its cost-containment measures. “We are looking at our current tax structure to seek ways in which we can generate revenue to keep essential public services going. And yes, we are looking at a reduction in work hours,” he said.

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