DEPARTMENT of Finance Secretary David DLG Atalig, the guest speaker at the Saipan Chamber of Commerce general membership meeting on Wednesday, discussed the American Rescue Plan Act funds that the CNMI will receive as well as the administration’s funding priorities.
He said from 2019 to 2021, his goals have been to look to the future, rethink processes, change operations, and make a difference, placing an emphasis on staffing, technology, and services.
The American Rescue Plan Act will help fund these improvements to the Department of Finance operations, Secretary Atalig said as he explained the breakdown of these federal funds.
Under Subtitle M, a portion of the ARPA that addresses coronavirus state and local fiscal recovery, the CNMI is due to receive $507 million in total.
Of this $507 million, $483 million will go towards state local recovery, $5 million to local fiscal recovery or non-entitlement units of the local government, $10 million to local fiscal recovery or to the counties, and $9 million to the capital projects fund.
State fiscal recovery
Allocations per U.S. territory under Section 602 of Subtitle M of the ARPA are partially dependent upon population.
Of the $4.5 billion available for the U.S. territories for state fiscal recovery, half is split evenly between American Samoa, Guam, the CNMI, Puerto Rico, and the U.S. Virgin Islands.
The remaining half will be allocated by population.
Because the CNMI has a population of 51,851 people, or 1.4547% of the total population of the U.S. territories, it will receive $32,730,250 of the remaining half allocated by population.
In all, the CNMI will receive roughly $483 million under Subtitle M.
Of this funding, $141,546,050 will be allocated for Fiscal Year 2021, while the remaining $341,184,200 will be for Fiscal Year 2022.
The funding will specifically be used for four main purposes:
• 19.72%, or $100 million, will go towards responding to the Covid-19 public health emergency or its negative impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries, such as tourism, travel, and hospitality.
• 6%, or $30 million, will go towards providing premium pay to eligible workers that are performing essential work, or by providing grants to eligible employers that have eligible workers who perform essential work;
• 49.3%, or $250 million, will be for the provision of government services to the extent of the reduction in revenue due to the Covid-19 public health emergency relative to revenues collected in the most recent full fiscal year;
• 20.26%, or $102,730,250, will go towards making necessary investments in water, sewer, or broadband infrastructure.
For FY 2021, $40 million will go towards the negative impacts of the global Covid-19; $6 million for essential workers; $75 million to government services; and $20,546,050 to water, sewer, and broadband.
For FY 2022, $60 million will go towards the negative impacts of the global Covid-19; $24 million for essential workers; $175 million to government services; and $82,184,200 to water, sewer, and broadband.
Local fiscal recovery and capital projects
Among the U.S. territories though, the CNMI is estimated to receive a little over $13 million of the $84.63 billion pot for the U.S. states and territories for coronavirus local fiscal recovery funds provided under Section 603 of Subtitle M of the ARPA.
Similar to Section 602, half of the CNMI funding under Section 603 will be distributed equally among the four municipalities of Saipan, Tinian, Rota, and the Northern Islands, while the remaining half will be allocated proportionately by population.
These funds will also be for the same purposes as Section 602 funds, but will be focused on the municipalities.
As for funding under Section 604 for critical capital projects directly enabling work, education, and health monitoring — including remote options, in response to the Covid-19 public health emergency, the CNMI is estimated to receive $8,987,065 of the $100 million pot for U.S. territories and Freely Associated States.
Seventy-five percent of the Section 604 funds for the CNMI will be allocated to Saipan and the Northern Islands, and 12.5% each to Rota and Tinian.
Secretary Atalig emphasized that allocations are contingent upon certification of the U.S. secretary of the Treasury that these calculations are accurate for the CNMI in accordance with the guidance provided for Subtitle M.
Upon receipt of such certification, funds will be allocated within the CNMI as calculated.