Fund bites at crumbs

The Legislature’s approved $2.4 million payment for government employees’ retirement and health insurance contribution is acutely inadequate but it is better than nothing, according to Fund administrator Karl T. Reyes.

“That figure is very small. We’re owed $70 million in employer’s contribution alone by the government,” said Reyes in an interview. “But we’ll accept any amount. It’s better than nothing at all.”

The proposed payment of $2.4 million, which also includes some portion for Medicare, is contained in House Bill 14-304, which passed both the Senate and the House of Representatives recently.

Last week, though, House members voted against transmitting the bill yet to the Governor’s Office. Both the House leadership and the minority bloc said the bill should be recalled due to “language problem.”

The House original version of the bill called for a $10.9 million appropriation for FY 2005, mainly to settle the government employees’ within-grade increase and retroactive pay.

The bill, authored by Rep. Jesus Attao, said the funds would be sourced from the additional revenues identified by the Babauta administration for FY 2005.

The Senate amended the bill to increase the amount to $20 million, and instead of tapping government revenue, the Senate moved to authorize the Commonwealth Development Authority to borrow the money.

The amended bill now contains a $9 million reimbursement for the Saipan and Northern Island Legislative delegation’s local funds, which were used to pay off the retroactive salaries of Saipan government employees.

Meantime, NMIRF’s Reyes pointed out that the central government has not presented any other plans to pay off its debt with the Fund any sooner.

The continuing resolution allocates 2 percent of the total annual appropriation for deficit reduction.

“It’s the government’s job to find ways on how to settle this huge financial liability. So far, we’ve received no suggestion as to how they can effectively manage the debt,” said Reyes.

To date, the CNMI government’s liabilities total $113.3 million, including $79.1 million for Retirement Fund payments. The $79 million is an accumulated amount over 10 years, said the Department of Finance.

Other debts as of April 2005 include $12.6 million for Retirement Fund quarterly allotments, $13.3 million in utility bills for the Commonwealth Utilities Corp., $1.7 million for the Marianas Visitors Authority, and $6.8 million for vendors.