May 5, 2008 — About halfway through the 2008 fiscal year, at least three key government departments and agencies are performing significantly under budget, but anticipate a rise in expenditures over the next few months.
The news came during testimony presented before the Senate's Finance Committee. Attempts to keep better track of how government money has been spent over the past six months spawned the creation of this week's mid-year budget updates, which started Monday morning with the government's three biggest revenue collection and money-management agencies.
As of the end of March, the Office of Management and Budget has only eaten up $683,418 of its $3.3 million fiscal year 2008 budget appropriation — which, according to one official, still "does not reflect much of OMB's major expenditures."
Out of the Indirect Cost Fund, the agency has so far spent about the same amount — $668,834 out of a little more than $3 million.
The slowdown in spending is partly due to difficulties in filling vacant positions that are not yet completely funded, according to Claudette Farrington, OMB's deputy director. Compiling the FY 2009 budget and making moves to relocate the agency's federal grants management unit to the old Public Finance Authority headquarters on St. Thomas has also been at the top of OMB's priority list, pushing back spending on other operational costs — staff training and professional development, facilities renovation, and the replacement of equipment — to the summer months, she said.
According to OMB's financial documents, the bulk of the agency's FY 2008 General Fund appropriation — about $1.6 million — is earmarked for personnel services, while nearly $404,000 is slated for corresponding fringe benefits. OMB is expected to rack up another $213,649 in supply costs, along with a little more than $1 million in "other services and charges," which includes such things as professional services, communications and travel expenses.
From the beginning of October 2007 to the end of March, OMB has only spent about $500,000 on personnel, $153,000 on fringe benefits, $11,000 on supplies and $15,984 on "other services and charges."
The Department of Finance is in a similar position, according to Valdamier Collens, the agency's executive assistant commissioner. Over the past few months, Finance has spent about 38 percent — or $3.2 million — out of its $8.5 million General Fund budget. Expenditures in the personnel services category have dropped by about 12 percent over last year, and the department currently is under budget by an average of 50 percent in most other expenditure categories, he added.
Challenges in retaining staff and filling vacant positions have resulted in some cost savings, but the department will most likely see an increase in expenditures toward the end of the fiscal year as more new initiatives come online, Collens said. Finance should still be under budget by about 10 percent by the time the fiscal year wraps at the end of September, he added.
For FY 2008, the Bureau of Internal Revenue (BIR) was appropriated about $11 million from the General Fund and an additional $12,000 from the Internal Revenue Matching Fund. So far, the agency has only been allotted approximately $5.6 million, and has currently spent about $3.7 million on personnel services and $816,568 on "other services and charges," including communication, transportation, office supplies and insurance costs.
The bureau has added six new employees over the past six months, and anticipates bringing 10 more on board, said Gizette Thomas, BIR director. Additional funds have been spent on employee training, daily cleaning services and equipment maintenance.
Present during Monday's hearing were Sens. Terrence "Positive" Nelson, Basil Ottley Jr., Usie R. Richards, Ronald E. Russell and James Weber III.
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