Acting Governor Laapui Talauega Ale has ordered cost containment measures to take effect immediately to address a projected deficit for the current fiscal year.
The measures include a freeze on hiring for new or vacant positions paid with local revenues, reclassifications and promotions, suspension of overtime funded with local money, and a ban on travel paid with local funds.
In a March 4 letter to Treasurer Malemo Tausaga and Budget Director Catherine Saelua, the Acting Governor said ASG’s first quarter performance report reveals increased spending in several sectors, including contractual, materials and supplies, travel and personnel.
“Projections for increased spending in future quarters warn of the possibility of a year end budget deficit,” he said.
KHJ News reported last week that ASG spending for the first quarter of FY2024 exceeded revenues by more than $8 million.
Actual revenues raised $36.5 million, but expenditures totaled $44.5 million.
Projected local revenues for the first quarter was $40.6 million but actual revenues collected totaled $31.3 million, a shortfall of $9.4 million.
Saying that proactive steps must be taken to avoid a projected deficit, the Acting Governor instructed Malemo and Saelua not to process any payments that do not meet certain guidelines.
Personnel actions that are now on hold:
- Pay adjustments other than annual increments
- Reclassifications and promotions
- Creation of positions with local funding sources
- Hiring for all new and vacant positions funded with local revenues including career service and contract employees
- New personnel services contracts not supported by the approved budget for the current fiscal year
No locally funded overtime will be allowed until further notice.
No locally funded travel will be allowed that exceeds the current quarterly allocation.
Also suspended is the purchase of new vehicles with local money.
The Acting Governor also instructed that no new contracts or renewals will be approved, unless the funding source is clearly identified and the availability of funds is unrestricted.
Change orders or contract amendments are prohibited until further notice.
The use of payment vouchers to pay leases, or contracts, for amounts of over $3,000 is suspended until further notice.
Acting Governor Laapui said these measures will remain in effect until amended based on the financial condition of ASG.
