CNMI confronts fiscal emergency; Officials outline austerity path, seek federal relief
- Admin
- Sep 23
- 3 min read
By Bryan Manabat
Saipan—The Northern Marianas government is entering fiscal 2026 under a deepening financial crisis, prompting urgent calls for austerity, unified messaging and federal intervention.
“We are in a severe budget crisis,” CNMI Del. Kimberlyn King-Hinds said, urging immediate reforms and transparency to secure federal support.
At a press conference this week, King-Hinds was joined by Gov. David Apatang, Lt. Gov. Dennis James Mendiola, Finance Secretary Tracy Norita, Special Assistant for Management and Budget Vicky Villagomez and lawmakers.
What began as a routine 902 consultation in Washington, D.C. escalated into a critical discussion on emergency relief.
King-Hinds said federal officials, including the U.S. Department of the Interior and the White House, have committed to funding the CNMI’s first-quarter request, estimated at $5.7 million. But she made clear that the assistance is conditional.
“The federal government needs to see that we’re doing everything we can to help ourselves,” King-Hinds said. “There is commitment from the federal government, the Interior and the White House to assist with the first quarter ask. But that commitment comes with conditions. And the condition basically is that the CNMI government acts like the house is on fire by implementing some reforms.”
She emphasized that future quarterly requests will require legislative action and deeper structural changes, including rightsizing government, eliminating duplicative positions, and seriously considering the $29 million Marianas Public Land Trust loan.
The first-quarter funding is expected to support key areas, including Department of Finance operations, the off-island medical referral program, Department of Corrections obligations, Medicaid local match, and the 25 percent pension payments to retirees.
King-Hinds also pointed to the federally funded 2020 Fiscal Summit Report as a guiding document for reform. She urged local leaders to revisit their recommendations and present a unified strategy moving forward.
The Department of Finance confirmed a downward revision of FY2026 revenue projections by $22.9 million, lowering the estimate from $179 million to $156 million. Governor Apatang said he directed the department to reassess the budget to provide a clearer picture of the government’s financial position.
Norita attributed the revenue decline to falling tourist arrivals, reduced airline service, and slowing tax collections. She reaffirmed the administration’s commitment to working with the Legislature on both immediate and long-term reforms.
“This is a challenging moment for the Commonwealth,” Norita said. “But with decisive leadership and cooperation, we can navigate these fiscal challenges together.”
With the shortfall looming, Apatang said his administration is preparing for worst-case scenarios. “We’re now looking at how to cut government expenditures, so we are looking into austerity measures,” he said.
“Even our people understand that,” Apatang added. “We have to cut — we don’t have the money. So we just have to work together and see what we can do to come up with some additional funding somewhere, and hopefully we can get the loan from MPLT.”
Among the austerity measures under consideration are immediate reductions in work hours, furloughs, and possible reduction-in-force; a hiring freeze except for critical law enforcement positions; and a freeze on government travel, regardless of funding source.
Medium- and long-term reforms proposed by the administration include new internet sales and excise taxes, amendments to casino and construction tax laws, merging duplicative agencies, and establishing a rainy-day fund.
Apatang is expected to sign into law a revised budget before Oct. 1, the beginning of FY 2026.
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