Gov reports ASG’s revenue shortfall, but offers no details of the changes that “need to be made”

Pago Pago, AMERICAN SAMOA — Amid ongoing complaints by many vendors in the territory’s private sector, a concerning financial development was officially communicated in a letter from Governor Pulaalii N. Pula, addressed to Senate President Tuaolo Manaia Fruean, dated August 12, 2025. The letter explains that during the initial three quarters of the fiscal year, the American Samoa Government (ASG) experienced a significant revenue shortfall amounting to $26.24 million.

“As required by the 2025 budget Public Law No 38-20, I am writing to inform you that ASG’s revenue collection has come under two percent of the budget forecast,” the Governor wrote.

A preliminary and unaudited report attached to the letter from the Treasury provided an overview of the revenue expectations for the fiscal year. It detailed that revenues were projected to reach $124,430,250 by the conclusion of the third quarter.

However, after reviewing the financials, it was found that the actual revenues collected during the first three quarters of Fiscal Year 2025 amounted to only $98,184,036. This resulted in a significant shortfall of $26,246,214, highlighting the discrepancy between the anticipated and actual revenue outcomes and raising concerns about budgetary management and potential impacts on funding for essential programs and services.

However, in his letter, the Governor expressed optimism for the future.

“I am optimistic that we can work together to address this issue and other matters pertaining to the budget when you reconvene in September. We all know that changes need to be made,” he said. 

Pulaalii, in his letter, does not offer details of the changes that “need to be made”.

In January of this year, the Governor ordered a 10% reduction in spending across the board for ASG departments and agencies, and placed restrictions on hiring, overtime, and travel.

In a memo issued in January, the Governor stated that research conducted by his transition team and staff indicates that the ASG had significantly fallen behind in meeting its financial obligations. He emphasized that the situation was worsening with each payroll period.

As a result, he stated that he would be implementing a series of cost containment measures until a thorough analysis of government finances was completed. 

Key measures included:

1. All hiring of employees funded by the General Fund will require the Governor’s approval.

2. All departments and agencies must immediately reduce spending from the General Fund by 10% of the ASG Budget for Fiscal Year 2025. These spending reductions were take effect immediately, and revised budget proposals must be submitted to the Governor by January 31st.

3. All overtime must be pre-approved by the department director or equivalent leadership, and work schedules should be optimized to prevent employees from exceeding 40 hours per week.

4. The Governor ordered departments to implement energy conservation measures, noting that the ASG currently owes a significant power bill to ASPA. Energy usage would be monitored, and departments that failed to show a reduction in energy consumption would face further budget reductions or other consequences.

5. The Governor also directed that no payments would be issued unless a properly approved purchase order or contract is on record for services or merchandise.

6. Travel using the General Fund must be approved by the Governor or his designee until further notice. Non-essential travel that has already been arranged should be canceled or rescheduled, unless specifically approved by the Governor.

Semi-autonomous agencies and authorities were exempt from this general memorandum. 

The Governor concluded, “As we obtain a clearer picture of the government’s financial status, we will adjust these cost containment measures.”

BACKGROUND

ASG’s current payroll (FY 2025) is said to be $5Mil+ bi-weekly.

Samoa News notes that the government’s projected payroll or personnel costs for its 2026 projected budget runs at 69.3% of projected revenues, while at the same time it forecasts a 3% decrease in its workforce. Its FY 2026 budget projection also shows an 11% increase.