Lawmakers assure teachers refunds of their Fund contributions

Members of the Legislature assured public school teachers and employees that they could soon refund their employee contributions from the NMI Retirement Fund once a compromised bill is enacted into law in the next months.

House and Senate members announced this during Friday’s legislative leadership summit conducted by the Public School System and the Board of Education where discussions centered on funding public education in the CNMI.

Sen. Jovita Taimanao (Ind-Rota), chairwoman of the Senate committee on fiscal affairs, and House vice speaker Felicidad Ogumoro (Cov-Saipan) announced that members of the bicameral conference committee have agreed to assist active members of the Fund to allow refunds of their employee contributions of up to 50 percent while the remaining 50 percent will be rolled over to the defined contribution plan with the condition that they don’t need to resign from their posts. The lawmakers are referring to House Bill 17-226 which is pending at the Legislature.

They revealed that an agreement was reached to help members of the Fund and to be able to prolong the government pension agency’s lifespan. Latest figures from Fund indicated that there are over 6,000 active and retirees in the plan. If enacted into law, this will be applicable to all active members in the plan.

Participants in Friday’s event have expressed relief and described the announcement as “good news.” Education Commissioner Dr. Rita A. Sablan said PSS was very pleased upon hearing the support, pledges, and commitment made by the legislators in order to assist the system’s employees and the students.

“That’s a relief for us and we’re very happy because we will be seeing a substantial savings in our personnel cost,” she told Saipan Tribune, adding that PSS stands to generate $3 million savings, or $150,000 per payroll, from the measure.

PSS has recently conducted an employment renewal survey among its employees where it gauged that half of its employees under the DB plan have the desire to take out their contribution from the Fund.

In the survey, 737 or two-thirds of the entire PSS staff responded participated in the survey of which 91 percent indicated interest in renewing their contracts.

Saipan Tribune learned that 37 percent of the respondents are under the DB plan, and 50 percent of them indicated they want to withdraw their retirement contributions.

Under existing law, active members of the plan could only refund their contributions once they are separated from government service. They could only come back in the government sector only after six months of formal separation. This means, that most of PSS employees surveyed have the intention to resign or depart from the service-both certified and non-certified. Their planned departure is determined to bring adverse impact to the school staffing pattern.

According to Sixto K. Igisomar, former Fund chairman and among the guests in the summit, the compromised legislation will bring both positives and negatives. However, he said what’s important is that this underwent proper debates, discussions, and consultations among parties.

“What’s important here is everybody understands the goal of doing this,” he told Saipan Tribune. In allowing withdrawals of contributions, he said this will lessen the liability of the Fund. However, Igisomar also noted the negative social impact it could bring to community members’ future.