OAG: District Court should not inject itself in PSS dispute

The Office of the Attorney General has asserted that the U.S. District Court for the NMI should not inject itself into the dispute between the CNMI government and the Public School System over the annual PSS budget issue.

Deputy Attorney General Lillian A. Tenorio asked the District Court Thursday to deny the NMI Settlement Fund’s request for a declaratory ruling that PSS is not entitled to 25% of the Settlement Revolving Fund and the amounts appropriated to the 25% benefit payments under the CNMI statute.

Tenorio also asked the court to deny the Settlement Fund’s request for a ruling that PSS’ actions violate the settlement agreement in Betty Johnson’s class action.

Under the settlement agreement in Johnson’s class action against the CNMI government and the NMI Retirement Fund that was approved in 2013, the CNMI government agrees to make annual payments that will enable the settlement to fund at least 75% of class members’ benefits.

Tenorio said the Settlement Fund’s legal basis for the relief falls outside the District Court’s jurisdiction under the Johnson settlement agreement as the Commonwealth’s obligation under that agreement are unaffected by the PSS lawsuit filed in the Superior Court.

She said the issue of PSS’ budget under the NMI Constitution is presently being litigated in the Superior Court, and the Commonwealth’s payment obligations to the Settlement Fund are not in dispute.

Tenorio noted that the Johnson settlement agreement was intended to provide the Commonwealth with litigation peace, resolve pending issues, and provide a workable budget plan for paying the retirees’ pension.

She said the Settlement Fund’s motion to enforce is contrary to the intent of the settlement agreement based on the speculative possibility that the Commonwealth will not make payments to the Settlement Fund because of the PSS lawsuit.

If the court were to grant the motion, Tenorio said, it would pave the way for the Settlement Fund to file motions for a wide variety of speculative threats to their payments under the settlement agreement.

She said the Settlement Fund’s theory undercuts the settlement agreement by undermining the terms of the agreement and the litigation peace it was supposed to bring to the parties.

Under the Johnson settlement agreement, the Commonwealth and the signatory autonomous agencies, including PSS, agreed to a consent judgment of $779 million, “or the equivalent of the actuarial present value of benefits related to the Settlement Class members.”

PSS and Education Commissioner Dr. Alfred Ada are suing Gov. Ralph DLG Torres and Finance Secretary David Atalig before the Superior Court to guarantee for PSS an annual budget of not less than 25% of the Commonwealth’s general revenue.