Fund: Only $400K received from govt in past 12 months

In the last 12 months, the NMI Retirement Fund only received about $400,000 in employer contributions for government employees-an amount that Fund administrator Richard Villagomez described as “way lower” than the amount needed by the pension program to pay its annual obligations to retirees.

Speaking at Thursday night’s meeting with over 100 retirees, Villagomez said there is not enough money coming in to support the $63 million that’s being paid out to members each year.

“We don’t want to reduce your benefits, but the reality is we are hardly getting any financial support by way of contribution from the government. To give you an idea, in just the past 12 months, we have received only about $400,000 in employer contribution for local employees,” he said.

Pursuant to a court judgment in 2009, the government owes the Fund over $231 million in unpaid employer contributions and the amount just keeps on growing.

Because of this delinquency, the agency has been forced to withdraw from its investments to cover its yearly expenses, amounting to $50 million to $75 million.

Villagomez also revealed that the Fund, which administers the pension program for retirees, recorded total contributions to its portfolio at only $147 million compared to the drawdown it has incurred-about $200 million.

He discounted claims that the government, pursuant to the court judgment, has been consistently remitting contributions to the Fund. Villagomez said that what the government has been regularly remitting was mostly the contribution for federally funded employees and not for local employees.

As of last week, the Fund’s investment portfolio was down to $266 million. Because of the court set-aside amount of $100 million, the Fund has only about $166 million it can use to invest and pay for the pensions of members.

Villagomez appealed to the Commonwealth Retirees Association to organize itself and create a strong voice to save the pension system.

“Because you represent a large portion of the population, you have a strong voice and there’s strength in numbers,” he told retirees.

Fund officials and retirees described the program’s current situation as an “emergency” and if no solution is identified soon, it will only result in more chaos.

Meantime, retirees are split whether to remove the Fund’s lawsuit from Associate Judge Kenneth Govendo’s sala to the federal court. While many favor the idea, others are hesitant due to “new adjustments” and a “new timeframe” that will involved in the processing of a new case.

Based on the Fund’s audit report, the Fund paid a total of $560.7 million in benefits payments covering fiscal years 2001 through 2010. The Fund also showed an increase in the number of members from 1,461 in 2001 to now 2,996 active members.