President Surangel Whipps Jr. has submitted a supplemental budget bill to the Olbiil Era Kelulau (OEK), requesting nearly $1.2 million in new funding and seeking appropriation of funds previously authorized—but not appropriated—under the Fiscal Year 2025 Unified Budget.
The proposal, submitted April 4 and now under review by the Senate Ways and Means Committee, coincides with the start of the third quarter of the fiscal year.
Mini-Games Funding Urgent
With fewer than 80 days remaining until the Pacific Mini-Games, the bill seeks the full appropriation of $1.4 million that was previously authorized for the event. Whipps emphasized the urgency of accessing these funds as preparations intensify.
Utility Subsidies Restored and Adjusted
The measure also restores power, water, and wastewater subsidies for residential customers. The Palau Public Utilities Corporation (PPUC) announced last month that these subsidies would end April 1 due to exhausted funds.
Under the new proposal, the Lifeline Subsidy Program—targeting low-income households—will increase from $250,000 to $750,000. The broader residential electricity subsidy, which covers diesel fuel costs, will be reduced from $1.2 million to $850,000. The per-kilowatt-hour subsidy will be cut from 10 cents to 5 cents for the first 500 kWh.
Social Assistance, Pension, and Membership Fees
Also included in the supplemental budget is $1.4 million for social assistance payments to retired and disabled citizens. Like the Mini-Games funds, this amount was authorized but not appropriated in the original FY 2025 budget.
New line items in the proposal include:
- $350,000 to upgrade the Civil Service Pension Plan Fund’s database system, hardware, and servers
$75,000 for the annual Mechesil Belau Conference
$75,000 for the Palau Red Cross
$500,000 for the Pacific Islands Forum (PIF) annual membership fee
$54,000 for the World Bank annual membership fee
Education and Debt Funding Sources ShiftedSignificant changes are also proposed for funding sources related to education assistance and debt service.
Of the $6.96 million allocated for education assistance, $6 million would come from the Compact Trust Fund instead of local revenues. The remaining amount will still be funded locally.
For debt service, of the $7.63 million obligation, $2.7 million would be paid from local revenue, with the balance covered under the Compact Review Agreement’s Debt Consolidation Fund.
Most Agencies Within Budget
A first-quarter government expenditure report shows that agencies largely remained within their allocated quarterly budgets. Most funding requests in the supplemental bill are for programs not included in the original FY 2025 budget, while some are intended to supplement existing allocations—such as operational support for the Guam and Hawaii Consulate Offices and administrative costs tied to Palau’s participation in the FSM Arrangement.