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Fund, AGO yet to finalize regs for 2003 law
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Posted on Apr 23 2005
Regulations for the new retirement law, which was enacted nearly two years ago, have yet to be finalized and published.
Fund administrator Karl T. Reyes said Friday that the Attorney General’s Office and Fund staff would meet on Tuesday to finish the final draft of the regulations.
Reyes said the process took long largely because the AGO “wants to be clear on every section of it.”
“The AGO wants to make sure that we understand every section of it because this law [Public Law 13-60] addresses so many previous retirement laws. Most likely, we’ll finish everything by Tuesday. It will be then published and we’ll wait for the 30-day comment period,” he said.
The Retirement Integrity Assurance Act, which was signed into law in December 2003, aims to remove unfunded liabilities in the government’s retirement program and, in the process, enhance the financial solvency and viability of the local Retirement Fund.
The law, among others, merges Class I and Class II retirement categories; discourages early withdrawal of contributions; and adopts the U.S. Social Security System’s cost of living allowance model.
In hopes to maintain financial integrity, the law repealed the 3-percent bonus for certain elected officials, benefits for boards and commission members, vesting credits for education service, military service, compensatory time, and used sick leave, and prior service vesting credit.
The law imposes penalties on early withdrawal of contributions and restricts reemployment for a period of six months unless the contributions are returned to the Fund.
Further, the law calls for the restructuring of the early retirement provision for Class I members to encourage them to retire before reaching 62 years.
Authorities believe that these changes would reduce government payroll costs and free up additional funds for remittance as employer contribution to the Retirement Fund.
The government is now $79 million behind in its employer contribution to the Fund.
The law also expands the authority of the Fund board to include reviewing other retirement plans and determining whether such pension plans would be feasible alternatives or supplemental plans that would be in the best interest of the government.
