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NMI faces up to $40M revenue loss in FY20

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WITH the suspension of flights from China due to the novel coronavirus outbreak, the CNMI government stands to lose $35 million to $40 million in projected revenue in the current fiscal year, the administration told lawmakers in a meeting on Wednesday morning.

Today, Thursday, the House leadership will meet at 10:30 a.m., to discuss “how we can prepare for the worst,” House Floor Leader John Paul Sablan said in an interview.

He said this “could mean a lot of things, like budget cuts, austerity measures or even furloughs.”

For his part, Rep. Roman Benavente said it’s good that there is still no confirmed case of coronavirus on island, “but everybody must brace for the impact on the economy.”

“There will be cuts,” he added.

House Minority Leader Edwin Propst said, “The health of our people comes first.”

“That is non debatable,” he added. “With regards to the economy suddenly crumbling or collapsing, let us not forget that we have run a deficit for the last three years — $8 million in FY17, $26 million in FY18 and $88 million in FY19. On top of that, the chairman of Ways and Means Committee said we have to retire the deficit, and how do we do it? There has to be cuts, unless we can bring in more money somehow.”

Propst said he doesn’t support “drastic tax hikes” which could hurt people more.

In his significant emergency declaration on Wednesday, Gov. Ralph DLG Torres said he has directed the secretary of Finance and the Office of Management and Budget “to undertake an immediate cost-impact analysis and make recommendations within 30 days for adjustments to our FY 2020 Budget consistent with the CNMI Planning and Budgeting Act. That analysis shall be furnished to the Legislature for consideration and consultation as needed.”

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