More than two months after Gov. David M. Apatang asked the Legislature to pass a revised budget based on additional government resources, the Senate and the House of Representatives approved House Bill 24-80, House Substitute 1, last Dec. 22, with one dissenting vote.
HB 24-80, HS 1 allows the expenditure of roughly $157 million for fiscal year 2026 and implements revised revenue assumptions by reauthorizing appropriations and budget authority for government agencies, instrumentalities, and programs. The measure incorporates austerity measures while prioritizing legally mandated expenses such as debt service and pension-related obligations.
Together, the measure reflects the Apatang administration’s revised budget framework, which is supported by a $29-million pension loan from the Marianas Public Land Trust intended to help meet minimum Settlement Fund requirements and maintain government operations in FY 2026.
In the Senate, HB 24-80, HS 1 passed with seven affirmative votes and a lone “no” vote from Sen. Celina R. Babauta. Sen. Paul A. Manglona was absent.
Nearly two hours earlier, the House approved HB 24-80, HS 1 by a 16-0 vote, with Reps. Thomas John D. Manglona, Raymond U. Palacios, Ralph N. Yumul, and Patrick H. San Nicolas excused.
In explaining her vote, Babauta said it should not be construed as opposition to passing a budget to fund the Government Health and Life Insurance program and other programs currently at risk.
The Saipan and Northern Islands lawmaker specifically took aim at granting the municipality of Tinian three new full-time positions and providing back pay to commissioners of the mothballed Commonwealth Casino Commission.
“That sends the wrong message to our workforce and to the public. It is completely irresponsible. We cannot, with a straight face, continue to ask government employees to tighten their belts while expanding government payroll elsewhere. We cannot continue to govern with fantasy budgets—budgets built on wish lists instead of what we can actually afford. The CNMI must learn to live within a real budget, and if necessary, to make the hard choices that come with a realistic budget,” she said.
Babauta also said she took offense to the $210,000 appropriated under Section 615, entitled “Commonwealth Casino Members.”
“Despite the Attorney General’s clear determination that this payment is illegal. It is apparent that the Attorney General’s determination has fallen on deaf ears with the Legislature. The House of Representatives just finished voting unanimously to approve this budget bill before us now, on first and final reading. Not a single vote in opposition to this illegal section of this Act. Casino commissioners are not government employees. The issue is simple: using public funds to compensate non-government employees violates the law.”
She said these two actions are precisely why the CNMI’s credibility with the Office of Insular Affairs continues to erode.
“I place no blame on our federal partners who are trying to help our struggling government due to the most blatant, reckless, and wasteful spending perpetrated under former governor Ralph [DLG] Torres’ administration. Federal partners have made it crystal clear that the additional financial assistance is contingent upon good faith fiscal discipline. When we pass budgets built on fantasies and wish lists instead of reality, we signal that we are unwilling to live within our means, and it should come as no surprise when federal oversight tightens, and trust and financial assistance are withheld,” she said.
In the House, floor leader Rep. Marissa Flores made known her reservations despite voting in the affirmative to pass the revised budget measure.
“While the Department of Finance and the secretary herself have provided public updates, key financial documents and supporting schedules remain pending and have not been fully transmitted to the Legislature, placing risk on this process and limiting full validation.”
She added that the risk is compounded by the fact that the CNMI remains behind on its required audits, creating future harm through weakened transparency, federal compliance risk, and potential funding delays. However, she said the Commonwealth’s legal obligations do not pause.
“We are bound by court judgment orders requiring funding of settlement obligations. We are bound by statute to make 25% of the Public School System. We carry longstanding obligations for land compensation through MPLT and the Department of Public Lands.”
Flores added that the Commonwealth also remains responsible for employee, vendor, and unresolved federal program liabilities, including COVID-19-era CARES Act and BOOST funds. She said failure to pass a consolidated budget would immediately endanger pensions, public schools, employee insurance coverage, and vendor payments, while increasing audit and compliance risks for the government.
“Voting yes does not mean all concerns are resolved. It means recognizing our fiduciary duty to prevent greater harm when the law leaves no alternative. Allowing this budget to fail would not fix past deficiencies,” she said.
The Senate and the House passed the $157.1-million FY 2026 appropriations bill—excluding the CNMI’s debt service obligations—in back-to-back sessions after the Department of Finance added close to $7 million in additional funds last Nov. 19 and about $3.7 million last Oct. 14.
The Nov. 19 additions included $4.9 million from the Public School System’s FY 2022 year-end fund balance for appropriation and $1 million from Marianas Public Land Trust remittance interest to the general fund. The Oct. 14 additions came from FY 2025 lapse funds for appropriation.
Aside from passing HB 24-80, the House and the Senate also approved House Concurrent Resolution 24-3 as part of the Commonwealth’s revised FY 2026 budget process amid declining revenues.
HCR 24-3 approves the government’s identified revenues and resources for FY 2026, totaling about $184.6 million, including DPL funds, but limits the amount available for appropriation to roughly $157.1 million after accounting for special revenue earmarks and debt service obligations.
Before passing HB 24-80, HS 1, the Senate also approved HB 24-15, which authorizes the continued payment of employer premiums for the GHLI Program.
All eight members present voted “yes” to the bill, with Sen. Paul Manglona excused.
With passage of the funding measure, the Legislature—pending Apatang’s signature—authorizes the use of $3.75 million in previously identified FY 2026 revenues. The measure responds to a warning from the Apatang administration that the GHLI retiree program faced imminent termination due to lack of funding, with an estimated $7.2 million needed to prevent cancellation of retiree health coverage.
Under the bill, $936,896.25—representing the constitutionally required 25% share of general revenues—would be allocated to the Public School System. The remaining $2.81 million would be directed to the GHLI retiree business unit to cover employer premium payments and avoid disruption of coverage.
The legislation specifies that the funds are already included within FY 2026 available resources, meaning the authorization does not create a new appropriation or increase the existing budget ceiling.
When the Senate approved the revised budget bill at nearly 7pm, it ended marathon sessions by lawmakers that squeezed in an equally protracted meeting with Apatang and Finance Secretary Tracy Norita.
The House and Senate actually had scheduled sessions at 10am and 1:30pm, respectively, but both had to go in recess for hours to convene with the Apatang administration to finally hammer out a general government funding measure agreeable to all parties.
HB 24-80 and HB 24-15 now go to Apatang’s desk for his approval.
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