(Updated)
The cash-strapped CNMI government will implement a 72-hour workweek schedule beginning June 23 pending recovery from economic wreckage caused by a series of typhoons last year, Gov. Ralph Torres announced Thursday.
“This is a very difficult decision, but it is necessary in order to protect our government employees from other more drastic options that would have more severe impacts and to ensure that our government obligations and services remain stable,” Torres said. “This is the most prudent option in order to protect our employees and safeguard public services from more drastic alternatives.”
Under the Governor’s directive, business hours for departments and agencies under the Executive Branch will be closed during every “payday” Friday “until further notice.”
“Financial recovery remains at the top of our efforts, so that we can eventually revert back to a normal 80-hour work schedule,” Torres said.
“Lt. Governor Palacios and I appreciate all our government employees for their patience during these financial challenges and for their continued commitment to serve the people of the Marianas.”
The CNMI government has slashed its 2019 budget by $29.9 million, leaving the spending level at $141.5 million from $258 million originally approved for the current fiscal year.
Torres said the workweek hours cut will help avoid payless paydays, allow the government to continue fulfilling its obligations to the Settlement Fund for retirees, to bond payments, and vendors.
Saipan was hammered by Typhoon Yutu on Oct. 25, 2018.
The Office of Personnel Management has been directed to work with all departments and agencies to ensure that all civil, excepted and exempted service employees are properly notified and advised of the modified work schedule,” according to a press release from the CNMI governor’s office.
Torres said the reduced workweek applies to all locally and federally funded government employees. Critical government functions such as law enforcement, first responders and treasury cashiers, will adopt a modified 72-hour work schedule to meet certain needs and requirements without disrupting efficient services.
Besides the workweek cut, additional cost-cutting measures include a moratorium on hiring for locally funded positions, accrual and payment of overtime and compensatory time hours.
Press Secretary Kevin Bautista said about $3 million is needed to fund a single pay period in the CNMI government. "Given the state of revenue collections, if we maintained the 80-hour work schedule, we would have run out of money to fund government payroll by the middle of August," he said in an email to the Pacific Island Times. "About $9.7 million was needed to maintain an 80-hour work schedule from August through the remainder of the fiscal year.
The adjusted work schedule of 72 hours with no overtime would allow the government to fund payroll at $2.548 million on each pay period to avoid payless paydays, Bautista said. Restricting the payment of overtime would net savings of about $2.04 million to cover any gaps in funding, he added.
“While revenue collections continue to be challenging following the impact of Super Typhoon Yutu, it is clear that revenue at the current levels will not be sufficient to fund government payroll on an 80-hour work schedule,” Lt. Gov. Arnold I. Palacios said. “In order to minimize the impact on people’s lives, we have decided to go with a 72-hour work schedule which would give us the means and resources to take us through the remainder of FY 2019.”
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Executive and legislative leaders met on Thursday to assess the government’s fiscal conditions and look into long-term solutions to improve its finances.
The administration and the Legislature’s leadership fully understand the effects Super Typhoon Yutu had on government revenues, and we agreed to continue to work hard for our people to ensure the full recovery of our economy and our community,” Torres said.
Typhoon Yutu, the largest storm that hit the United States since 1935 that brought winds and gusts up to 200 miles per hour, plowed through Saipan and Tinian, displacing hundreds of residents and bringing the economy to a standstill for about two months.
Damage assessments found that 532 homes were destroyed and 430 homes suffered major damage. 832 residents were placed into shelters across the three islands.
During the recovery phase, the Federal Emergency Management Agency that has brought in more $800 million in estimated disaster assistance.