A report by the Legislative Financial Officer to the Fono leaders is forecasting a $4.9 million shortfall in ASG revenue collections for Fiscal Year 2018.
The report, which is based on financial data from the Program Planning and Budget Office surmises that if the pace of collections for the first quarter of FY2018 is how the rest of the year will pan out, then ASG will not meet its projected local revenues of $96.8 million.
As of December 31, 2017 total local revenues was $22,009,971.
If that rate of collection is annualized, the LFO predicts that ASG will only be able to collect $91.8 million in local revenues, leaving a shortfall fo $4.9 million.
According to the ASG First Quarter Financial Report for FY2018, spending was 5% better than norm with the Executive Branch spending 23% of their annual budget, Judiciary at 17 %, the Fono at 26% and Special Programs at 9%.
The percentages are based on the quarterly apportionment requirements of the Approrpriation Act to serve as a control mechanism for department heads to ensure expenditures will not exceed the approved budget at the end of the fiscal year.
The report takes note of the action taken by the governor after Cyclone Gita via an executive order that freezes government spending of local funds with the exception of payroll, essential services to health and welfare, and costs directly related to Tropical Cyclone Gita recovery efforts.
Citing public law, Legislative Financial Officer Talalemotu Mauga has recommended to the Fono leaders two options to address the shortfall in revenues.
The law states that if the government’s financial and budget officers determine that actual revenues will fall short of the projections by greater than two percent for the fiscal year, the governor shall immediately notify the Fono.
He shall then submit proposed agency program plan changes, reprogramming legislation or supplemental appropriation to adjust the deficit.
Proposed changes or reprogramming shall detail the reduction in expenditures required to assure that actual revenues equal actual expenditures.
Mauga recommended that the Fono raise with Governor Lolo the issue of either modifying or withholding ASG planned expenditures provided in the budget act for FY2018 or issue cost containment measures with specific mandate for all agencies to reinstitute “financial discipline” throughout the whole government, including the Fono and Judiciary.