‘NMI govt pays $24.5M of required $25M minimum annual payment’

• Govt made timely quarterly payments

• Fund investments gains from 2 quarters reach $3.8M

To date, the CNMI government has paid $24.5 million of the $25 million minimum annual payment due under the settlement agreement in Betty Johnson’s class action. The government has also made timely quarterly payments.

In her combined second and third quarter report for fiscal year 2014 filed in the U.S. District Court for the NMI on Sunday, NMI Settlement Fund trustee Joyce C.H. Tang also disclosed, among other things, that gains from the Fund’s investments from these two quarters were $3.8 million and that as of Aug. 31, 2014, the value of the investments was about $98.5 million.

On the government payments, Tang said there is a balance of $500,000 due for fiscal year 2014, which will be paid before Sept. 30, 2014.

“The Settlement Fund members have received their pensions in a timely manner,” she noted.

In addition to the 75 percent pension payments, Tang said the passage of the casino law enabled the government to obtain funding to pay the 25-percent that was cut under the Johnson’s settlement agreement.

The casino law made available to the government $30 million from an exclusive license fee to pay the 25-percent payment to Settlement Fund members, and interest due under Public Laws 17-82 and 18-02.

Tang said the central government and the autonomous agencies are required to submit employer contributions to the Settlement Fund.

She said all autonomous agencies are current through Aug. 9, 2014, except for the Public School System, the Commonwealth Healthcare Corp., and Northern Marianas College.

Tang said PSS and CHC are cooperating and working with the Settlement Fund to catch up.

NMC, on the other hand, has not paid the full amount of the employer taxes required in a provision in the settlement agreement, Tang said.

In fact, Tang said that NMC has refused to comply with the settlement agreement provision that states that “the CNMI and autonomous agencies shall make supplemental payments to the Settlement Fund in the amount of the employer contributions for these Settlement Class members at the same contribution rates they were paying as of June 26, 2013.”

“NMC was notified of this requirement and still refused to pay the delinquent balance,” she said.

On investment strategy, Tang said the investment return as of Aug. 31, 2014, is 4.35 percent, and is on track with the Settlement Fund’s investment policy.

The value of the Settlement Fund’s investment assets at the beginning of the second quarter was $105 million.

While there were draws during the second and third quarter of about $6 million, Tang said the gains from investments of $3.8 million from these two quarters helped offset the draws.