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Fund awaiting talks on Compact money loan
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Posted on Dec 28 2004
The NMI Retirement Fund is just awaiting the Executive Branch to initiate talks on its proposed $20 million loan with the agency for the Public School System.
“We’ve been approached about that but there’s no formal discussion. We have yet to see their presentation,” said Fund administrator Karl T. Reyes on Monday.
The Governor’s Office earlier said it plans to borrow $20 million from the Fund for PSS projects and use the money it expects to get as Compact Impact payments as leverage to pay the loan off.
This developed after Gov. Juan N. Babauta announced Friday that he would commit the entire Compact Impact funding totaling $5.1 million a year in the next four years to PSS.
The administration said it favors lump sum spending to ensure greater efficiency in implementing PSS capital improvement projects.
Governor senior policy advisor Bob Schwalbach has said that based on initial consultation, the Fund is open to the proposal. Such arrangement, he said, would call for an agreement signing between the Fund and the Department of the Interior on the payment terms.
The DOI releases the annual Compact Impact grants annually to all U.S. jurisdictions to help them cope with the impact of migration of citizens from other Pacific Islands: Federated State of Micronesia, Palau, and Marshall Islands, collectively called the Freely Associated States.
The CNMI receives $5.1 million a year out of the $30 million federal appropriation to compensate territories on FAS migration-related costs. The $30 million grant are to be divided each year for the next 20 years among the CNMI, Guam, Hawaii, and American Samoa
The sharing is based on the number of people in each jurisdiction who migrated from FAS after 1986, when the original Compacts went into effect.
