Feds respond positively to Palacios’ funding requests for unemployment benefits, ending Austerity Mondays, and infrastructure money

Governor Arnold Palacios speaks with Carmen Cantor, assistant secretary of the Interior, during last week’s plenary session of the Interagency Group of Insular Areas. Photo courtesy of the governor’s office.

While CNMI tourism officials blow public funds on dead-end junkets and associated businessmen push a dead-end Chinese investment policy, Arnold Palacios reportedly is making promised inroads to securing more federal cash for the ailing Commonwealth government and economy. And according to his senior policy advisor, Tina Sablan, federal officials responded to the governor with a willingness to help the CNMI because of his efforts.

The governor last week delivered an address to the Interior Department-coordinated Interagency Group on Insular Areas annual meeting in Washington, D.C. that focused on the reforms he stayed true to making as a segue way to his pitch for federal resources.

“At the start of my administration, I announced a pivot away from over-reliance on China to focus on strengthening ties with federal partners and regional allies,” told the assembled federal officials. “Upon entering office last year, my administration inherited a financial crisis, a struggling economy, and critical infrastructure in disrepair. These destabilizing conditions, as they have done in the past, make us vulnerable to external threats, including malicious influence from the Chinese Communist Party (CCP). I emphasized then, as I do today, that our fiscal, economic, and social stability is directly tied to national security and a free and open Indo-Pacific.”

Mr. Palacios made good on his first-year promise to federal officials, which military officials all the way up to the commander of U.S. Indo-Pacific Command can attest to. His commitment to the so-called China pivot has been met in Saipan with incessant pushback from some in the business community and even from the media.

And while his support for the American agenda has thus far been unwavering, he made his expectations at this IGIA clear that advocacy is a two-way street, and there is much the country can do to help the CNMI to ward off Chinese influence.

He began by explaining local efforts to economic and fiscal recovery from the devastation wrought upon the Commonwealth by his predecessor, Ralph Torres.

“To stabilize the government’s financial condition, we have implemented cost containment measures and launched a tax collection task force to raise revenues and bring delinquent taxpayers into compliance,” he said. “We have also sought help from federal partners to audit expenditures of federal tax dollars and build local capacity in tax administration and financial investigation.”

The governor made the following requests for the IGIA to coordinate federal agency support:

  • Extension of the Pandemic Unemployment Assistance program to allow the CNMI government to complete issuance of unemployment (PUA) benefits.
  • Use of the unused balance of PUA funds in order to restore working hours to public employees affected by the so-called Austerity Mondays.
  • A larger pot of federal funds “to enhance both infrastructure and government operations.”
  • Money to improve areas of Saipan, Tinian, and Rota for “destination enhancement,” or improvements designed to attract more tourists to the CNMI.
  • Release of Economic Development Authority money for “crucial economic development and destination enhancement projects.”
  • The designation of the CNMI as an Essential Air Service community in the hopes of reducing the cost of airfare between and to and from the islands of the Northern Marianas.

“Our economic recovery has been promising but slow, and the pressure to return to the China market persists,” the governor began his conclusion to the speech. “A quicker recovery will enhance our resilience against external threats, and strengthen our nation’s position in the region. I look forward to tangible commitments from federal partners in securing a prosperous and sustainable Marianas, America’s gateway to the Indo-Pacific.”

“The governor’s testimony at the IGIA was well-received, and several federal officials expressed appreciation for his candor and clarity,” Ms. Sablan told Kandit. “Subsequent meetings with key federal agencies were positive and fruitful, and focused particularly on the Governor’s requests for support in technical and programmatic assistance as well as critical infrastructure projects for the Commonwealth.”

Kandit: Did any signal support for any of the governor’s requests? Any invitation to continue these asks and discussions with their agencies?

Ms. Sablan: Yes, this was the case with all the agencies.

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