“Our message to the vendors is that we are working on getting these debts resolved. The government recognizes that it needs to pay for its bills. The government wants to make sure that it is stabilized and addressed accordingly. We collect taxes and we expect everybody to pay promptly and the expectation should be that we should pay our debts promptly ” Muna told the Journal in an exclusive interview.
He said there is no timeframe set to pay all debts but said the government is working on it. “We really can’t commit to a timeline right now. But it is something that we are working on at this point. We are trying to come up with a good long-term plan that would address this not only in terms of getting us current with the payments now but as well in terms of making sure that there’s a system or something that we can implement to make sure payments stay current and are moving forward ” he said.
Muna said the signing of the $193.5 million fiscal 2007 budget by on Sept. 18 should send a strong signal to the contractors that the government is serious about getting its financial house in order.
It was the first time in four years that a budget law was signed. The government was operating on a continuing resolution which means that each budget for the current year was based on the previous year even if revenue projections for the current year are less than the previous one.
“From a financial standpoint we have budget resources that have been identified for 2007 as opposed to going into a continuing resolution. If we were to go to a continuing resolution it would be $198 million for which the resources identified for FY 2007 was $193.5 million ” Muna said.
Operating through a continuing resolution he said was how the government ran deeper into a deficit the accumulated total of which he said has gone “well over $150 million.”
This Muna added is also among reasons why the government fell behind in cutting checks for contractors and vendors. He said that vendor payments were delayed as a result of the debts of previous years “just catching up.”
“The government has basically expended more money over the past few years so that the gap has accumulated to over $150 million. What’s happening here is that even though we have identified as much resources as we have we are using the current dollar that we are collecting to pay for the prior period expenditures that were not paid ” Muna said.
Paying all past-due accounts with vendors is part of the whole approach aimed at addressing the government’s financial problems Muna said.
“We are coming up with. a developing process. We recognize that we need to make sure that vendor payments are moving forward and paid for properly and that starts with making sure that prior period or past due accounts are addressed and that of course making sure that we are moving forward and remain current on that account ” Muna said. He said some past-due accounts date back to 2004.
There are approximately 50 companies who have rendered services to the government for contracts ranging from architectural and engineering designs of various projects to road repairs and building maintenance. MBJ
