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Budget revisions spark political firestorm in the Northern Mariana Islands

by | Jul 28, 2023 | Northern Mariana Islands | 0 comments

In March, the House of Representatives of the Commonwealth of the Northern Mariana Islands (CNMI) unanimously passed legislation to revise the territory’s budget in light of projections revealing the government had less funds to work with than they had anticipated. Governor Arnold Palacios (I) signed the bill in April, but not without vetoing specific provisions that, he said, were inconsequential to the numbers but redundant or onerous.

Specifically, Palacios vetoed two sections—604 and 713—which would later prove significant. Section 604 concerned the American Rescue Plan (ARPA), an economic stimulus package signed by President Joe Biden (D) in 2021, which, among other provisions, assigned discretionary funds to states and territories. The section mandated that any future ARPA spending must be approved by the Northern Mariana -Islands’ legislature “after collaboratively consulting with the [governor’s] administration.” Governor Palacios took umbrage with this wording, calling the provision unconstitutional and arguing that all legislation must be signed by the governor, not merely consulted over. Palacios also vetoed Section 713, which would have provided select legislative offices with real-time access to the Department of Finance’s monetary information. Palacios called such a measure “counterproductive,” saying that the department would instead release such information after a delay in order to ensure the quality of the data and “explain the information… to the legislature.”

Senate President Edith Guerrero (D), a senator from Saipan, criticized Palacios’ vetoes, suggesting they were hypocritical and opaque. Regarding Section 604, Guerrero took issue with Palacios’ handling of ARPA funds broadly, suggesting the governor had laid off commonwealth employees whose salaries were initially paid by ARPA funds, even though those funds still remained. As for Section 713, Guerrero argued that Palacios’ efforts to deny the legislature real-time financial information were a move against transparency and accountability. The Senate voted on a motion to override the Governor’s veto, which failed with four ayes, two nays, and three absences.

Following the motion, Senator Celina Babauta (D) of Saipan, who voted not to override the veto, criticized the proceedings as a whole. She suggested the motion to override was performative and doomed to fail since the Senate voted on the motion only a day before the deadline to override a governor’s veto expired. Even if the Senate successfully voted to override, the House would not have been able to vote in time.

The political fight over the budget revisions has also grown to directly involve the Department of Finance. Senator Guerrero recounted that she had requested live access to financial data as early as January in order to sort out confusion regarding ARPA funding. At the time, that access had been granted but then was revoked by Governor Palacios’ veto of Section 713. Such retroactive policy, she suggested, further delegitimized the governor’s office and the Department of Finance. Senator Guerrero then directly attacked Finance Secretary Tracy Norita, calling the Department of Finance’s statements regarding ARPA funding inconsistent and borne out of a desire to appear “politically correct.” Lastly, she defended herself against Senator Babauta’s comments, insisting the Senate’s motion to override Palacios’ veto was not an “exercise in futility,” as Babauta had termed it, but a meaningful challenge to misconduct on the governor’s part.

What was initially a trivial veto of seemingly minor line-item provisions in the revised budget bill has grown into a political controversy involving the Northern Mariana Islands’ governor, Senate president, and Department of Finance. At the heart of the controversy are questions of financial transparency, constitutional separation of powers, and accountability. Whether the legislature will be granted access to the commonwealth’s financial records and whether the allegedly remaining ARPA money will be recovered remain to be seen.



Kabir Buch

Kabir Buch

Kabir Buch is a senior at the Harker School in California. He’s passionate about constitutional law and political science, and worked on a lawsuit protecting free speech rights on social media (Cool World v. Twitter). He's deeply interested in global affairs and is a captain of his school's debate team. In his free time, he loves hiking, strolling through his neighborhood, and reading fantasy novels. At Pasquines, he's the Northern Mariana Islands Affairs Intern Editor.


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