Government of the Federated States of Micronesia

Pohnpei Governor Pangelinan Delivers State of State Message

PALIKIR, Pohnpei (FSM Information Service): February 3, 1997 - Pohnpei Governor Del Pangelinan delivered his State of the State Message in an approximate two-hour Special Session of the Pohnpei State Legislature held at the Pwohmaria Resort Restaurant in Dekehtik on January 31, 1997.

Pangelinan highlighted, among other issues, the decrease in financial resources available to the State due to Compact Funding step-down which commenced on October 1, 1996, the beginning of Fiscal Year 1997 and ending September 30, 1997. He added that the Pohnpei state government budget for Fiscal Year 1997 of $21,305,429 will decline in Fiscal Year 1998 to $18,209,368, a shortfall of nearly $3 million.

Pangelinan has recommended reduction of salaries and shorter working hours of government employees, and privatizing certain functions of government as ways to deal with the budgetary problem. While Pangelinan submitted proposed legislation to implement his proposals for the Legislature's consideration, Pangelinan has implemented a regulation that eliminated standby differentials for medical and dental doctors who were on-call after normal working hours.

Pangelinan urged approval of the proposed amendment to the FSM Constitution, which will return to each state 80 percent of national taxes collected in each state. Stating that the return of an additional 30 percent to the current 50 percent will help Pohnpei with its financial problems. Pangelinan contends that the remaining 20 percent of national tax revenues and fees collected from fishing permits, plus other money and grants are adequate to meet the operational expenses of the FSM National Government.

Section 5 of Article 9 of the FSM Constitution states: "National taxes shall be imposed uniformly. Not less than 50 percent of the revenues shall be paid into the treasury of the state where collected."

Pangelinan reiterated his government's goal of developing fisheries, tourism and agriculture. Stating that Pohnpei State plans to use the $600,000 aid from the Government of the People's Republic of China (PRC) for development of a demonstration farm on which to grow a variety of vegetables for domestic consumption and for export.

To help small businesses, $1.5 million has been appropriated to guarantee loans for small businesses, Pangelinan announced. Education and health care were listed as top priorities, no specific steps to be followed were stated.

For further information on this release, please contact:

FSM Office of the President
Public Information: Press, Radio, Video
P.O Box 34
Palikir Station, Pohnpei, FM 96941
Tel.: (691) 320-2548/2092
Fax.: (691) 320-4356