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Governor informs retirees: Government can no longer afford 25% benefit payments because of BOE lawsuit

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GOVERNOR Ralph DLG Torres on Sunday wrote the following open letter to the retirees of the Commonwealth government, surviving spouses and minor children beneficiaries:


“I am saddened to inform you that starting with the next scheduled payment on April 15, 2020, the CNMI government will be unable to obtain the necessary funding to provide for the 25% cover payments to government retirees, surviving spouses and minor children. I have agonized over this decision and have exhausted as much avenues as possible. Unfortunately, under the circumstances before us, these efforts were simply not enough.


“Last month, under the direction of Board of Education members Phillip Mendiola-Long, Marylou Ada and Andrew Orsini, the Public School System filed a Complaint for Declaratory and Injunctive Relief demanding 25% of general funds. This lawsuit singlehandedly restricted our government funds at a time when students are not in session, schools are not operated and while our community is deeply entrenched in our fight against the Coronavirus Disease (Covid-19).


“Prior to filing their lawsuit, I, together with Lt. Governor Arnold I. Palacios, the Attorney General, the Secretary of Finance, and members of the Legislature’s leadership invited PSS and the Board of Education to discuss our current financial status, the dire situation of our economy and pleaded with them to help in maximizing what little resources we have available. We met on two different occasions and each time, I thought that we were all willing to work amicably together for the greater good — that of our community as a whole. I specifically informed the Board of Education and PSS that an injunction would cause a 25% cut to retirees’ pension. Unfortunately, Board of Education members Mendiola-Long, Ada and Orsini demanded immediate access to funds and proceeded to order the lawsuit against the advice of Chairwoman Janice Tenorio and Vice Chairman Herman Atalig.


“Because of the lawsuit, my hands are tied and any ability I had to guarantee you your funds have now been stripped away. You have seen this government’s efforts to keep our promise to you. Since the judgment was issued in Johnson v. Inos, Case No. CV-09-0023 in 2013, this government has paid you 100% of your benefits, retroactively paid you for the time you started receiving 75% and provided bonuses for 3 consecutive years in 2016, 2017 and 2018.


“Collectively, this government has paid a total of $328,708,089.08 for your benefits. Of that amount, $225,523,657.57 was paid to the Settlement Fund as our obligation under the settlement agreement while $103,184,431.51 was paid to retirees to cover the 25% difference in pension benefits. This government has managed to keep our promise through some of the most trying times faced by the CNMI. Through the damages of Typhoons Soudelor and Mangkhut, continuing to provide the full benefits our retirees have earned was a top priority. Even through the devastation of Super Typhoon Yutu, I made sure that retirees received 100% of their pension benefits. And when the lingering economic recession caused by Super Typhoon Yutu forced the Government to take austerity measures in 2019, this government still paid you 100% of benefits.

“Thus, you know first-hand this government’s commitment to give you 100% of your benefits. I am sorry that certain members of the Board of Education’s only commitment is to selfishly guard its interest at the expense of our community. I am sorry that these acts of self-interest have led to this difficult decision.

“The timing of these actions is unfortunate. Covid-19 still stalks our islands and lurks in the corners of our streets. We must persevere and now, more than ever, we must fight against self-interest and work toward bringing forward a community that puts the needs of others before their own.”

November 2020 pssnewsletter

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