KOROR, Palau — The Palau national government avoided a shutdown with the signing of the FY 2025 Unified Budget Act on September 30, 2024, just hours before the end of the fiscal year. The budget allocates $134 million in total authorizations, with $131.8 million appropriated for the general operations, special revenues, and debt service for the fiscal year ending September 30, 2025.

The Executive Branch will receive $58.8 million, while the Legislative Branch is allocated $8.3 million. The Judicial Branch is authorized $4.5 million, with $4 million appropriated. Additional allocations include $1.9 million for Boards and Commissions, $13.1 million in State Block Grants, and $5.6 million for other agencies. Education support includes $7 million for Palau Community College, private schools, and the National Scholarship Fund.

To address national debt obligations, $9.5 million has been set aside, covering loans from the Asian Development Bank (ADB), Industrial and Commercial Bank of China (ICBC), housing development loans, and the Palau Housing ICBC loan. Of this amount, $7 million will come from the 2023 Compact Review Agreement, with the remainder sourced from local revenues.

The budget also includes $2.9 million to subsidize services provided by the Palau Public Utilities Corporation, such as the Automatic Fuel Price Adjustment Clause, water and wastewater services, and the Lifeline Subsidy Program.

Continuing its commitment to social support, the government has allocated $2 million to fund the Supplemental Social Security Administration (SSA) benefit payments.

A new item in the budget is a $3 million allocation for the purchase of a medical house in Hawaii, as an alternative use of funds initially intended for the Civil Service Pension Plan. The government anticipates a $20 million grant from the U.S. to support the Pension Plan.

Additionally, the FY 2025 budget provides $1.4 million for the Pacific Mini Games, set to take place in Palau from June to July 2025, and another $1.4 million for continued social assistance payments of $480 to retired and disabled citizens.

New appropriations include $100,000 for the inauguration of the new government in 2025.

The budget bill also includes non-budget-related amendments, notably the revision of 34 PNC Section 3106, which now defines fentanyl and other opiate derivatives as controlled substances and establishes stricter penalties for their misuse.