Questions raised on bills that seek to help the Fund

Another Senate initiative and a House bill went under the microscope on Wednesday as part of an ongoing special House review of measures that seek to help the NMI Retirement Fund-most concerns having to do with their constitutionality and practicality.

The Senate-amended House Bill 17-226, which originally allows active members to “withdraw” their contributions from the Fund without a need to resign from government and now allows the same members to instead “roll over” their contributions to the defined contribution plan, was questioned mostly for its legality and constitutionality.

Rep. Teresita Santos (Ind-Rota), chair of the House Special Committee on Retirement Fund Issues, and Rep. Tony Sablan (R-Saipan) separately said that while parties involved support the intent of the latest version of HB 17-226 to help prolong the Fund’s lifespan, the Senate’s multiple amendments that include a new revenue-generating provision may be unconstitutional.

Santos and Sablan said the Constitution requires all revenue-generating bills to originate from the House.

Retirement Fund administrator Richard Villagomez and other Fund officials support the intent of the Senate-amended HB 17-226 to help the Fund, but yielded to constitutionality concerns. The Fund supports it primarily because the Senate has put in a funding mechanism-tax rebate cuts.

Santos and Sablan said the suggestion is for the Senate-amended HB 17-226 to be introduced in its entirety as a new House bill to address constitutionality questions. Santos said the special committee will take this into consideration when preparing a report and recommendation to the full House.

Senate Legislative Initiative 17-15, meanwhile, which seeks a constitutional amendment to require the government to set aside 25 percent of its revenues to pay for the government’s employer contribution to the Fund, was also criticized mostly for its impracticality.

Sablan said in his personal view, the initiative is “impractical.”

The 25 percent is on top of what’s currently paid to the Fund in employer contribution.

Sablan cited, for example, that for a $102 million budget, $25 million-plus will be set aside for the Fund, leaving all other government programs and activities, as well as personnel spending, with only $75 million.

Santos said next week’s meeting will focus on a pending pension obligation bond measure to help the Fund.