FY 2013 Budget Call: New revenue source on tap?
The government’s budget call letter for fiscal year 2013 — which begins on Oct. 1, 2012 — says “additional new source of revenue is anticipated” in the new fiscal year, but didn’t provide specific details of the new revenue source.
The three-page June 13 budget call letter came from Malemo Tausaga, director of the ASG Office of Program Planning and Budget with the approval of Gov. Togiola Tulafono.
“As global economic challenges and uncertainty persistently linger, the current pulse for growth in our local economy is projected to be rather weak to modest,” the letter says. “While drawn out economic woes may weaken our local revenue collections pool; [an] additional new source of revenue is anticipated and projected to inject a much needed boost for FY 2013 proposed budget.”
“Although cautiously optimistic; as always, I strongly encourage each department and agency to be prudent in the expending of our limited pool of financial resources to insure its consumptions are fully optimized,” wrote Malemo.
The letter didn’t identify where the new revenue source is coming from but this issue will be clarified by ASG officials when the FY 2013 is presented to the Fono for review next month. Malemo is currently off-island and Samoa News could not confirm with any other ASG finance official as to any new source of revenue.
The only tax approved this year by the Fono bringing in new revenue is the 2% wage tax, which funds the repayment of the $3 million loan from the ASG Workmen’s Compensation Account for LBJ Medical Center. After the loan is paid off, any revenues collected thereafter will go to LBJ.
In his letter, Malemo reminded all departments that ASG must be in compliance with the federal Labor Fair Standards Act, and each department is to allocate sufficient funding to cover the minimum wage rate increase of $4.91 — for government employees — effective Sept. 30 this year. (Federal legislation is pending in the U.S. Congress to again delay the next wage hike, or halt it).
“Furthermore, additional funding must be obligated to absorb the separation compensation payouts for outgoing directors,” said Malemo.
As ASG moves “forward and beyond”, Malemo said adequate financial resources and bold sacrifices are needed to further improve government operations and basic services in the best interest of our people.
He said Executive budget allocations have been prioritized and implemented for departments and agencies given the anticipated increase in revenues for FY 2013 budget.
According to Malemo, final budget submission is due at 4 p.m. on June 29 at his office.
The FY 2013 budget will be the top priority item for Fono review, debate and approval when lawmakers convene next month for the fourth and final session of the 32nd Legislature.
The budget law signed last year by the governor for FY 2012 totaled $383.2 million.
LOCAL BASIC OPERATION
Each department and agency has been given a revised budget ceiling for FY 2013 because of the anticipated additional new revenues, according to the letter, which also requested the support of each director “to thoroughly review and scrutinize” their budgetary requests in “an effort to assist the government in streamlining your operational costs.”
Directors and heads of agencies were also informed that there will be no new positions allowed in the FY 2013 budget and all vacant positions need to be omitted from the budget request.
“Additionally, all step increments should be pro-rated,” said Malemo. “Any extraordinary requests over and above the ceiling allotment will need to be withheld for fiscal year 2013 as funding allowance does not permit this.”
Departments and agencies funded with federal grants have been requested to prepare their budgets according to the most recently approved federal grant award. Additionally, any budget over the authorized amount of the grant award will not be accepted.
“There is absolutely ‘no’ local funds to cover any additional costs or supplement your grants,” said Malemo, who requested agencies to provide a copy of the latest grant award or the proposed grant request.
ASG offices and semi autonomous agencies whose budgets are considered “Enterprise Funds” are asked to prepare their budget requests based on actual revenue collections from the current fiscal year 2012. These entities are also required to submit a profit and loss statement. This would include ASPA, ASTCA and LBJ Medical Center, among others.