Previous Story
‘PSS exemption bill bad for NMIRF’
|
Posted on Sep 09 2005
Saipan lawmaker Ramon Tebuteb warns of adverse impact on the NMI Retirement Fund of the Legislature-approved bill exempting the Public School System from the increased rate in retirement contributions.
He said that other agencies would eventually ask for the same privilege as PSS.
“If we can extend this exemption to PSS, nothing prevents us from giving the same to other agencies. If this happens, the Retirement Fund would be in trouble. So this is worrisome,” said Tebuteb in an interview yesterday.
The lawmaker said he was the only congressman who did not vote for House Bill 14-369, which seeks to grant PSS a five-year reprieve from paying the rate increase from 24 percent to 36.7 percent effective Oct. 1, 2005. The bill, authored by Rep. David Apatang, has now passed both houses of the Legislature.
At the Senate, senators Diego M. Songao and Luis Crisostimo had abstained from voting.
The NMI Retirement Fund had opposed the passage of the bill, saying that the rate increase is necessary to ensure the survival and growth of the Fund.
The Fund first notified government agencies of the rate increase in May this year pursuant to a 2003 actuarial study.
Other agencies have began complying with it but most of them, including PSS and the central government, asked to delay the increase, at least until fiscal year 2006, citing the lack of funding under the continuing resolution.
The Fund had agreed to the postponement of the implementation.
Later, however, PSS asked the Fund to exempt it from the rate increase altogether, citing that it has been paying its dues on time and should not be penalized by additional rates.
Further, PSS also said that the increased rate would adversely impact some of its local and federal programs.
