mpc requests price increases

By LG

In April of this year, MPC contacted the office of the Speaker to arrange for a meeting with the Legislature. The purpose of the meeting was to seek Legislative approval of MPC’s request to raise fuel prices. Section 7.1313 of the Kosrae State Code requires that the Governor and the Legislature must be consulted prior to any fuel price increases that would affect the local market. Under that same Section 7.1313, MPC has the authority to raise its selling rate for non-domestic use, i.e. aviation/jet fuel and off-shore markets.

MPC’s request would have added approximately 10-15 cents to the cost of a gallon of gasoline or diesel for a private citizen of Kosrae. In addition, MPC wanted to raise the price it charged the State Government by 50 cents a gallon.

The Legislature asked MPC for detailed information justifying the requested price increases and a meeting was held with members of the Legislature on April 17, 2000. According to MPC, crude oil prices have steadily gone up, starting in the summer of 1999 and peaking in March of this year. Although, the cost of fuel had gone up, MPC’s domestic selling prices have remained unchanged during the whole time, contributing to its already negative financial stature.

After hearing the reasons underlying the proposed increases in fuel prices, the Legislature agreed to allow MPC to raise its selling prices, but only for State Government purchases. The Legislature refused to approve any price increases for Kosrae’s private customers.

Board Appointments

By AN

On Tuesday, June 13^th, the Seventh Kosrae State Legislature convened its Seventh Special Session called by Speaker Hiteo Shrew. The intent of the special session was to enable the Legislature to act on nominees submitted by the Governor for various state boards whose membership was affected by the recent enactment of State Law 7-72.

Before State Law 7-72 took effect, a board member held office after his term expired until a successor takes office. Earlier this year, Senator Lyndon Jackson introduced Legislative Bill No. 7-148 to amend Kosrae State Code Title 7, Section 7.112 to limit the hold-over period of all board members of agency governing bodies and state-appointed members of government financed enterprises. Through recommendation of the Judiciary and Governmental Operations (J&GO) Committee on the bill, the hold-over period now ends after three (3) months. According to the J&GO committee, the three months “is ample time for replacement process . . .” The old law permitted board members to avoid the Legislative confirmation process simply by holding over in office indefinitely.

Enactment of State Law 7-72 had a dramatic effect on certain State boards composed mostly or entirely of holdover members. Several boards no longer had a quorum of members necessary to take lawful action. In response, the Legislature acted immediately on the nominations to fill the board vacancies created by the enactment of State Law 7-72. The nominations submitted to the Legislature by the Governor were for the Broadcast Authority Board, Election Commission, Parole Board, Sports Council, Kosrae Visitors Bureau and Port Authority.

The four-day special session resulted in the following recommendations by the Legislature: the approval of all nominations for both the Broadcast Authority Board and the Election Commission; the approval of four (4) and defeat of one (1) nomination for the Parole Board; and the approval of three (3) and defeat of two (2) nominations for the Sports Council. The Legislature ended its Seventh Special Session hoping that its recommendations will now enable the boards to function properly and within the law.

FY 2001 Budget received

By CT

Now that the proposed FY 2001 operations budget for Kosrae State is at its final stage, we can look back at how the budget got to the Legislature. The process starts every year when the Governor’s Office issues the Budget Call. Each Budget Call mandates a February 1^st deadline, as required by Section 10.301 of the Kosrae State Code.

The Budget Call is the Governor’s notice to every office, department, agency, and each government branch to send in their budget proposals. This means that before February 1^st, each branch, department, or office of the Kosrae State Government should have already prepared and submitted a proposed budget for the upcoming fiscal year to the Governor’s Office.

Between February 1^st to May 31^st, each of the proposed budgets is at the mercy of the Budget Review Committee (Review Committee). The Review Committee is composed of the Lt. Governor Gerson Jackson, Budget Officer Tiser Reynolds, Personnel Administrator Salpasr Tilfas, and Kosrae’s Chief Planner, Mr. Likiak Wesley.

When the departments and offices submitted their proposed budgets, the Review Committee sets a schedule for each to appear and justify its proposed budget. The hearings with the departments and offices are when the Review Committee does its grilling and takes out all the fat, mostly from the equipment and travel categories.

By June 1^st of each year, a proposed State Government Budget has to be on the Speaker’s Desk.

If this deadline is not met, the Legislature asks a good many questions about why the budget was late and it usually sours the mood for the LLegislature’s budget review.

The proposed FY 2001 budget was submitted on time, so things proceeded smoothly. The proposed budget is not much different from the last one. Not many questions were asked regarding the budget figures, as the Review Committee stayed true to its purpose and took out most of what could be taken. They even followed through to sit in on the Legislative review and spoke up when a department complained about things taken out of its proposed budget.

Not all government entities were subject to the Budget Committee’s review, however. By law, the Review Committee can not alter the budget proposals of the Legislature, the Kosrae State Court, and all other offices not under the control of a Department Director. Adjustments to these budget proposals can be made only in the Legislative review.

On Tuesday, June 27, 2000, the Committee of the Whole met to make its recommendation on the proposed State Government Budget. It decided to stay with the proposed budget as submitted, except for necessary adjustments to personnel, with the understanding that essential additions that were expressed during the hearings would be submitted by supplemental request through the same process as the main budget. Final action on the budget is expected to be taken during the next Legislative session.

seventh special session highlights

By JL

The Seventh Special Session convened on Tuesday, June 13^th in the KSL Chamber. During this four-day special session, 8 bills and 25 resolutions were introduced. The bills introduced are as follows:

L.B. No. 7-195 Amending State Law No. 7-41, to provide an additional $5,000 to supplement personnel operation of the Kosrae State Legislature.

Introduced by Sen. Jackson. Assigned to the Committee on Judiciary and Governmental Operations.

L.B. No. 7-196 Reappropriating $421,449 to fund certain US Federal funded programs in the State.

Introduced by Vice-Speaker Benjamin by request. Assigned to the Committee of Whole. Passed final Reading on June 16^th.

L.B. No. 7-197 Appropriating $5,370,925 from the US Grant Fund; $1,362,360 from the Revenue Fund; $1,593,053 from the Foreign Assistance Fund; $144,143 from the Airport Trust Fund; for the operation of the Executive, the Legislature, the State Court and certain agencies, and other governmental programs for fiscal year ending September 30, 2001.

Introduced by Vice-Speaker Benjamin by request. Assigned to the Committee Of the Whole. The Legislature is reviewing the budget.

L.B. No. 7-198 Appropriating $2,935,000 from the Compact Capitol Account for implementation of the Public Sector Investment Program.

Introduced by Vice-Speaker Benjamin by request. Assigned to the Committee of the Whole.

L.B. No. 7-199 Appropriating $3,400 from the Compact Current Account to fund Kosrae’s participation in the 1st Micronesian Track and Field Championship to be held in Pohnpei;.

Introduced by Sen. Jackson by request. Assigned to the Committee on Health and Social Affairs.

L.B. No. 7-200 Appropriating $100,000 from the Local Revenue Fund, dedicated to Health and Education Capital Fund, to fund certain Health Services Capital Development Programs.

Introduced by Sen. Jackson. Assigned to the Committee on Health and Social Affairs.

L.B. No. 7-201 Amending Kosrae State Code, Title 2, to require regular meetings of the Branch Heads.

Introduced by Speaker Shrew. Assigned to the Committee on Judiciary and Governmental Operations.

L.B. No. 7-202 Amending Kosrae State Code, Title 8, Chapter 3, and Title 9, Chapter 5, to establish a municipal sale tax and to require a portion of the revenue from that tax to be used to collect debts due to businesses located in the municipality.

Introduced by Speaker Shrew. Assigned to the Committee on Ways and Means.

L.B. No. 7-203 Appropriating $92,000 from the Revenue Fund, dedicated to Health and Education improvement projects, to fund certain Kosrae Department of Education capital projects.

Introduced by Sen. Jackson. Assigned to the Committee on Education and Cultural Affairs. The bill passed final reading on June 19^th.

The resolutions introduced during this session are as follows:

L.R. No. 7-109 Expressing the sincerest appreciation of the Seventh Kosrae State Legislature to the Nitijela, the Speaker of the Nitijela, and the former President of the Republic of Marshall Islands for their recent actions supporting Nitijela Resolution 104 and for the warm welcome and many courtesies extended to the Kosrae delegation on their recent visit to Majuro.

Introduced by Floor Leader Welly, Sen. Abraham and Sen. Martin. Assigned to the Committee on Resources and Development.

L.R. No. 7-110 Consenting to the nomination of Mr. Salpasr Tilfas as a member of the Parole Board.

Introduced by Sen. Martin. Assigned to the Committee on Judiciary and Governmental Operations. The resolution was defeated.

L.R. No. 7-111 Consenting to the nomination of Mr. Nena M. Tolenoa as a member of the Parole Board.