‘13 opt-outs unintentionally paid 100 percent of pension’

Thirteen opt-outs from the Settlement Fund were unintentionally paid a full 100 percent of their pension benefits, according to Finance Secretary Larrisa Larson.

The unintentional payment of 100 percent to opt-outs was among the issues discussed during Friday’s emergency hearing in federal court.

U.S. District Court for the NMI designated Judge Frances Tydingco-Gatewood, however, agreed with the government that such disparity treatment of retirees was unintentional.

Attorney Margery Bronster, counsel in the class action filed by Betty Johnson, pointed out that the settlement agreement requires that if anyone gets 100 percent payment, all other retirees should get 100 percent.

In an interview, Larson said she’s been sick for a couple of days and when she came in, Finance already released checks for the opt-outs or for those who opted out from the Settlement Fund agreement.

“So the opt-outs were paid a full 100 percent. So there is a need to rectify and pay the rest of the settlement class, the remaining 25 percent payment,” Larson said.

Larson said that’s the urgency of Friday’s hearing because the government needs to treat everybody equally.

Larson said what they have been doing in the past is they always treat the opt outs equally to the settlement class.

The secretary said had she been informed that the Settlement Fund was not going to pay the 25 percent, then they would have withheld the payment for the 25 percent to opt-outs as well.

“But the news came to Finance late,” Larson said.

The Settlement Fund received from Finance $632,052.71 last Wednesday to pay the 25 percent pension payment due Feb. 12, 2016.

Settlement Fund Trustee Joyce C. H. Tang informed Gov. Ralph DLG. Torres that same day that the Settlement Fund cannot continue to accommodate the government in distributing the 25 percent pension payments unless the government identifies a source income that can be used for this purpose or obtains a court order.

On Friday, Tang returned to Finance the $632,052.71, saying it comes from an unauthorized source.

In the interview, Larson pointed out that because of a clause in the settlement agreement that says that everyone should be treated equally, it is really critical that this payment for 100 percent go out.

“So it is top priority for the administration that we address the matter,” she said.

Larson said it doesn’t matter if 13 or one received 100 percent because the government should treat everybody equally.

Larson said for the 75 percent, it is in the budget so there is no question about that.

She said the 25 percent is for the government to find the funding, “which the government does.”

Larson said right now the government and the Settlement Fund Trustee have a disagreement on the interpretation of the law.

Larson said they are going to discuss their different interpretations and come to a compromise.

She said when they come back to the next hearing they will show that they compromise or they don’t agree, then the judge is going to make a decision for them.

On the issue that the there is no money available for the casino law fees paid by Best Sunshine International, Ltd. with which to pay the 25 percent pension payments for Fiscal Year 2016, Larson said that doesn’t mean that the government is not going to get anymore. “We get the money every year from the casino. And we have alternative sources of funding. And that’s what we have been doing. We are using alternative source of funding,” she said.

In the budget law, Larson said, the governor is allowed to reprogram from other sources as he feels it necessary.

“And that’s why there is a disagreement. They say we shouldn’t and we say we can. We still of the opinion that we follow the law,” she pointed out.

Larson said every 15 days they pay approximately $630,000 to $640,000 or $1.2 million to $1.3 milion a month just for the 25 percent. She said the 75 percent is always in the budget.

“Even before we set the limits for the government, we set aside for retirement first and the bond. And after, that what tells us what’s left for the agencies,” she said.

Larson said they always pay the 75 percent and that they never missed the deadline.

She said the Settlement Fund trustee and Johnson’s counsel worry that the government is not going to make the obligation to pay the 75 percent.

“But we always meet our obligation. This is our priority,” she added.