February 6, 2014 Pohnpei, FSM -Members of the 18th FSM Congress and President Mori have been trying to resolve a conflict that has had the FSM Legislative and Executive branches at loggerheads for some weeks now. The controversy seems to be rooted in both branches' interpretations of the laws regarding allotments, appropriations, and public projects and social programs bills.
A press release by President Mori's Public Information Office that came out this evening may not do much to resolve the conflict. It discloses that President Mori "froze action" on appropriations "pending the improvement of the process involved in formulating public projects, and the strengthening of the Project Control Document (PCD)-the document that should control the implementation of project(s) based on the law itself."
From the Congress point of view, it is precisely the presidential "freezing" of action on the Congress' appropriation bill that is at the core of the controversy between the Executive and Legislative Branches. From press releases and from the President's transmittal letters to Congress the President has a long list of problems with the process of public projects legislation.
While President Mori's Public Information Office has been publishing press releases (http://myfsm.blogspot.com) subtly lambasting Congress for its public projects bills, Congress has not issued any press releases of its own in order to explain its position.
"We need to move this government forward and move on to more important priorities," said Speaker Dohsis Halbert who made space in his schedule for an interview when we stopped by unannounced. He said that he wants to handle things the Micronesian way by talking them out after tempers have cooled.
He implored us not to sensationalize the problems between the branches. Through his Public Information Office, President Mori said that he is willing to talk with us but that the pressures of the office precluded the possibility of an interview before deadline time.
Congress and the President had two closed door meetings to try to work out their differences and to move forward. Speaker Halbert said that the President was disappointed that Congress had not passed a bill to provide the Executive Branch with a large "set aside" fund that his branch could use to fund projects. He said that Congress decided against the requested "set aside" fund and opted for the public programs bill that they passed. He said that during the first meeting the two branches discussed that state of affairs and that President Mori agreed to "let the $4.9 million projects bill" go. A few days later he vetoed it. Speaker Halbert said that the second meeting was held in order to discuss problems with Project Control Documents on the implementation ofprojects, and the President's problems with the lack of committee reports and transparency in the selection of projects. He said that when the designated Senators arrived at the meeting, the President was highly agitated that Congress had decided not to send any staff members to the meeting saying that nothing official could be accomplished without staff members present to record agreements. The President's press release later said Congress had made no concessions on the matter.
On January 31, the President sent a memorandum of understanding (MOU) to the Speaker for his signature. The document Halbert was asked to sign listed the Congressional role in bettering the public projects process as:
The MOU said that the Executive would streamline the PCD process and make it more understandable to the agency and personnel responsible for it preparation, and would simplify the PCD for itself so that people involved in the projects would not get confused as to the intent of the project or program funded by Congress.
Speaker Halbert said that he could not obligate the entire Congress to the MOU and had sent a copy to each of the members for discussion.
Meanwhile, the President announced in this evening's press release that he would release the public projects money but future projects would "become subject to an improved, modified, and more transparent and comprehensive process currently being drafted by the Executive branch".
By Speaker Halbert's reckoning, the first signs of conflict arose shortly after President Mori line item vetoed $895,000 of a $1.13 million public projects bill that Congress had designated to pay the principle on delinquent Social Security payments for some unspecified Pohnpei employers. The conflict did not stem from the line item veto itself and Congress did not override it. However, the executive branch allotted the money to Pohnpei State anyway based on what President Mori said was an erroneous reading by SBOC budget office of a legal opinion issued by the Secretary of Justice.
In a letter to Senator Peter Christian dated January 16, President Mori wrote that bad decision making and failure to follow proper procedure were behind the erroneously disbursed funds. "The responsible individual has been formally counseled and disciplined in response to this unfortunate breach of proper process, and lack of judgment," he wrote. He also said that immediately following the discovery of the error he directed his staff to begin the process of de-allotment of the funds and that by the date of the letter that process had been completed.
Lt. Governor Marcelo Peterson said that before the Executive Branch decided to de-allot the funds Pohnpei had already received over $600 thousand from SBOC. He said that so far none of that money has been spent but the uses for the money had already been decided. He said that as he was aware the national government had not asked for that money back.
Lt. Governor Peterson was unaware of an amendment to the special projects bill (CA 18-42) that was just sent to the President for consideration. The amendment, if it passes Presidential scrutiny re-appropriates $1 million dollars to be used for Pohnpei State roads improvement, provided that the money will "not be allotted until Congress is officially advised that funds improperly disbursed as a result of the line item veto…are collected."
The President is free to line item veto any item on an appropriations bill and could exercise that power on the projects bill that has been engrossed for transmission to his office.
The Director of SBOC was suspended without pay over the incident but was called back to work before serving the entire suspension period.
The Department of Justice legal opinion of October 8 concluded "that the item veto on Public Law No. 18-11 does not reduce the overall apportionment of fund appropriated for Pohnpei State. The effect of the item veto is to disallow the appropriated funds to be used to cover the principal amount owed by Pohnpei employers to Social Security." Secretary Skilling explained that the "appropriation is complete because the purpose of the appropriation was clear in the bill, ('to assist the States of Pohnpei and Yap in retiring debts and covering budget shortfalls'). Viewed in that light, the veto does not affect the overall apportionment of funds as stated in the appropriations," it says.
SBOC's Director said that DOJ has since explained that though the legal opinion appeared to be saying that the remaining $895,000 should be allotted to Pohnpei State to retire debts and cover budget shortfalls that wasn't exactly what it meant. She said that the explanation was very complex but that she understood it and is moving on.
The Presidents public information office did not issue any press releases about the erroneous disbursement of funds to Pohnpei State.
Speaker Halbert read a statement on the Rule of Law into the Congressional Journal during the third regular session. He said that trust is necessary and respect for intentions rather than the invention of "ingenious loopholes and technicalities".
"In implementing a piece of legislation, especially a line-item vetoed legislation, that respect is even more necessary. A veto should be in the nature of a respectful disagreement. It should not be used as a license to completely ignore the Congress. To do so is entering very dangerous grounds which lead to breakdown of trust. I hope for all our sake that we do not go very far along that path," the Speaker said.
As to the conflict regarding public projects, on January 3, the President sent Congressional Act 18-34, a $4.9 million dollar public projects and social programs bill back to Congress. In his explanation of his veto of the bill he said that while he supports public projects because they "do contribute to basic services and economic growth, which are the essential function of government", the current system is "defective and deficient because the process lacks transparency."
He also pointed out that there are no public hearings on the proposed projects and programs. "Furthermore, failure to clearly identify the needs of the public without public input leads to repetitive changes, sometimes resulting in as many as 10 to 11 amendments."
He also said that he felt that problems with the format of Project Control Documents (PCDs) make it difficult for the Executive Branch to properly implement public projects and programs.
Lastly he said that he had vetoed the bill because he felt that Congress had been increasing appropriations for public projects and programs in a way that would not be sustainable after 2023 when the financial provisions of the Compact of Free Association as amended come to an end.
Congress overrode the President's veto during the third regular session. The President signed the bill and sent it back to Congress as Public Law 18-35. His transmittal letter that accompanied the new appropriations law brought up what Speaker Halbert said was a new objection to the public projects law-the Udot ruling.
Halbert said during our interview that the President had not mentioned the Udot case as one of his reasons for vetoing the bill and that it seemed disingenuous to have done so after Congress overturned the veto.
In fact, the President did mention the Udot ruling in his transmittal letter that accompanied the vetoed public projects bill but it was in a different context. His veto letter says that he wrote a formal letter to the Speaker under separate cover to further explain his thinking in regards to Udot. The Speaker did not provide a copy of that letter to us.
Under the Udot ruling, a legislator's role in public programs is strictly that of a lawmaker. A lawmaker is barred under the law from any involvement in the implementation of a public project. That role belongs to the allottee. In the case of Congressional public projects the allottee is the President.
Speaker Halbert said that under the FSM Constitution, the role of Congress is to legislate and the role of the President is to enforce the law. He intimated that there is no provision in the Constitution that requires the President to like the law that he is charged to enforce.