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Fono's final budget cuts $40 Million from original proposal

fili@samoanews.com

The American Samoa Government’s final budget for fiscal year 2013, which is now going through final approval by the Fono, stands at $454.86 million — a reduction of more than $40 million from the original budget proposal submitted by the Togiola Administration.

The House on Thursday afternoon approved in third and final reading its version of the amended budget and sent it to the Senate, where it went through first reading last Friday. It was also on Friday that the Senate approved its amended version of the budget, which is identical to the House version.

Lawmakers are now going through the process of endorsing each other’s versions before the final amended bill is sent to the governor for review and approval. A separate $6.8 million supplemental appropriation for FY 2013 is being moved through the House.

The original budget submission for ASG in the new year, which begins Oct. 1, 2012, was $497,295,500 (or $497.29 million) but the Fono reduced it down by $42.43 million and the major change to the budget involves reduction to the American Samoa Power Authority (ASPA) budget.

ASPA BUDGET CHANGES

ASPA, whose management continues to maintain that it's the power authority’s board of directors who give the final approval of its annual budget, had proposed $115.45 in FY 2013 but the Fono approved, only $78.82 million (or $78,824,003).

A footnote in the budget bill states that for ASPA’s FY 2013, the “House/Senate Budget and Appropriations Committees unanimously approved a four month budget or 34% of fiscal year 2012’s funding level.”

Samoa News understands the FY 2012 funding level was the one approved by the Fono at last year’s budget review. At the time, the budget ceiling for ASPA set by the Fono was $90.78 million that was the budget ceiling for FY 2011. The Fono last year approved only a four-month budget- or 34% of the FY 2012 - but ASPA instead, arguing its board’s authority, used the budget of $118.47 million, which was its initial FY 2012 budget submission.

Although the footnote says the Fono joint committees approved only four months in FY 2013 for ASPA, Samoa News should point out that, according to the amended budget bill, the Fono didn’t make changes to the original total for the electric division of $58.57 million.

The amended budget bill also states the Fono approved only $4.93 million for the water division; $1.41 million for the wastewater division, $2.42 million for solid waste division and $11.47 million for fuel marketing division.

ASPA’s original budget proposal calls for $34.41 million for fuel marketing division, $10.02 million for water division, $7.69 million for wastewater division, and $4.74 million for solid waste division.

ASPA officials are expected to be called back before the new Legislature next January to work out the final figures to cover the rest of FY 2013 — but that remains to be seen. The governor, who sided with ASPA management that the board has the final approval, rejected a similar move by the Fono in January this year, to appropriate additional money for ASPA for the rest of FY 2012.

$6.8 MILLION CHANGES

The next big cut is $6.8 million under local revenue and this is amount in the so-called unpledged interest for American Samoa from the national Tobacco Master Settlement Agreement.

Due to conflicting testimony from ASG witnesses as to whether or not this money will actually be received in FY 2013, the Fono decided during joint budget hearings to take $6.8 million from the budget and re-submit it through a supplemental appropriation, which is now moving through the House.

During last Friday’s House session some lawmakers questioned the existence of this settlement money, after the governor last week vetoed two court judgments to be funded with “unbudgeted FY 2012 revenues from the Tobacco Settlement Agreement,” calling it a “fiction”.  (See separate story on the governor’s veto of the judgment bills)

However, House Speaker Savali Talavou Ale says his interpretation of the governor’s veto letter is that this tobacco settlement money is not available in the current fiscal year FY 2012, but is available for FY 2013 and therefore the funding source for the supplemental is appropriate. 

The supplemental appropriation of $6.8 million was approved in second reading in the House and goes through third and final reading today before being sent to the Senate for approval.

Departments, agencies, offices and programs affected by cuts from the $6.8 million and resubmitted as a supplemental were previously published in the Sept. 20 edition of Samoa News.

According to the amended budget bill, the Department of Information Technology, with a budget of $296,500 and the ASG stimulus office with a budget of $459,500, are not stand- alones, but have been incorporated into the Governor’s Office budget.

These two agencies and their funding are included in the supplemental appropriations.

MISCELLANEOUS

Another major change to the budget is that the Fono cut $1 million from ASG’s $5 million subsidy to LBJ Medical Center and reallocated the $1 million to other services.  Beneficiaries of the $1 million reduction in the subsidy, as well as the reason for the $1 Million cut, were also reported in the Sept. 20 edition of Samoa News.



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