Veto of HB 17-226 ‘very much likely’

House Speaker Eli Cabrera (R-Saipan) dropped the ball on Gov. Benigno R. Fitial when he cancelled yesterday’s session that was originally intended to recall his contentious House Bill 17-226. This didn’t sit well with the governor who will “very much likely” veto the measure before it automatically becomes law on Friday.

Affected employees, however, are pushing the governor to sign it into law.

HB 17-226 allows non-retired members of the NMI Retirement Fund’s defined benefit plan to withdraw up to 50 percent of their contributions regardless of years of service and without penalty or the need for them to quit their job.

Under the bill, the rest of the employee contributions to the Fund will be rolled over to the defined contribution plan.

Fitial and Lt. Gov. Eloy S. Inos asked Cabrera and the rest of the House members on Friday to recall or withdraw HB 17-226 because it does not help the government’s plan to return to the U.S. Social Security system. The cash-strapped Retirement Fund sought bankruptcy protection on April 17.

Cabrera initially agreed to withdraw his bill but had a change of heart after further consideration.

Joe Pangelinan, one of the strong proponents of HB 17-226, said he was a bit disappointed when he heard Friday that the speaker will recall his own bill “after too much work and compromise has been put to it.”

“After much consideration, the speaker said he will not withdraw it or recall it. He leaves it up to the governor to decide what to do with the bill,” Pangelinan told Saipan Tribune.

Pangelinan said he submitted to the governor’s office on Tuesday the original petition with over 800 signatures asking for the passage and signing of HB 17-226.

“This bill will give DB members an option to withdraw [a] portion of their contribution without penalty. Our group has long wanted to meet with the governor on this but we’re never given a chance,” he added.

Press secretary Angel Demapan, when asked for comment, said, “The Fitial administration is disappointed to find out that the House has decided against recalling HB 17-226.”

As of yesterday, the bill remains pending before the governor, Demapan said.

“Given that the administration has taken steps to engage SSA officials on the proposed transfer of active government employees out of the DB plan and into the social security program, a veto of the bill is very much likely, but not determined at this time,” he told Saipan Tribune.

The press secretary said HB 17-226 was discussed at length on Friday when the governor and lieutenant governor met with House members.

He said the administration made it very clear that it would be best if the bill is recalled so that amendments can be made to it in order for the intent of the bill to be conducive to the ongoing negotiations between the administration and the Social Security Administration on the matter of having active government employees opt back into the social security program.

At that meeting, he said, House members indicated willingness to recall the bill based on the information provided them by Fitial and Inos.

“It is quite baffling to learn that their position has since changed,” Demapan added.

Demapan also said the Fitial administration recognizes that some lawmakers are concerned because the Social Security negotiations are still ongoing.

“Having said such, this is exactly why the administration hoped that the House would have gone the route of recalling the bill, and if the negotiations don’t come to fruition, then the bill can be introduced again and any outstanding concerns can be addressed before passage,” he said.

Inos, meanwhile, is set to meet this morning with the Commonwealth Retirees Association and lawmakers on the Social Security issue.