Settlement Fund has no position to maintain in PSS lawsuit, says lawyer

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THE Public School System, through attorney Tiberius Mocanu, reiterated that it is not after the Settlement Fund money.

“PSS in its use of the word ‘unconstitutional’ in its lawsuit against Gov. Ralph DLG Torres and Finance Secretary David Atalig only means [that] PSS believes that the calculation of its constitutional share in the government’s annual budget was in error,” Mocanu stated in his reply to the Settlement Fund or SF opposition to the PSS motion for summary judgment.

To oppose the PSS summary judgment motion, as the SF has, would imply that it has a horse in this race, Mocanu said, adding: “It does not.”

He said the SF itself has stated that it has no position on whether the “funds appropriated to it can or should be included in calculating PSS’ 25% share pursuant to Article XV, Section 1(e) of the CNMI Constitution.”

The SF, Mocanu added, has no position to maintain.

He said the PSS draft first amended complaint was presented to the Settlement Fund, which was given full right to edit it as it saw fit.

Mocanu said PSS adopted all of the edits and comments made by the SF because PSS believed that if the complaint was edited to the SF satisfaction, it would no longer have an interest in this case and would withdraw.

Mocanu added that PSS had no interest in amending its complaint if the SF remained in the case.

He said the whole discussion on the SF motion to intervene revolved around its reading of the complaint, which triggered an interest that it needed to protect by intervening.

Thus, he added, a reasonable solution would be to amend the syntax of the complaint so that the interest the SF imputed to the complaint was no longer there.

Mocanu said the SF literally edited itself out of an interest in this case, but then refused to withdraw due to its “dogmatic misunderstanding of this case.”

He reiterated that PSS does not argue that the Legislature may not make appropriations or earmarks for the SF. “PSS only argues that the revenue contained therein is special revenue and thus should be included in the calculation of the amount available for appropriation and subject to PSS’ constitutional share,” he said.

According to the PSS lawsuit, Public Law 21-8, which set the Commonwealth government budget for fiscal year 2020, appropriated $37,718,904 to PSS, which PSS said is only about 16% of the budget.

Under the CNMI Constitution, PSS is guaranteed an annual budget of not less than 25% of the general revenues of the Commonwealth government.

The Office of the Attorney General, which represents the government, stated that PSS was allotted 25.3% of the total local revenue and resources available for appropriation for Commonwealth government activities in FY 2020.

For its part, the Settlement Fund said the PSS actions in seeking payment from amounts appropriated to the Settlement Fund violates the Settlement Agreement.

In 2009, retiree Betty Johnson sued the CNMI government for its failure to pay the amounts that it was required by law to pay to the Retirement Fund since 2005.

In Sept. 2013, the parties agreed to settle the lawsuit and the U.S. court approved a $779 million consent judgment in case the CNMI government does not meet its obligations to the Settlement Fund.

The Settlement Fund was created by the federal court as part of the settlement between the CNMI government and the retiree.

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