No holds for Zion paychecks assures ASG's Treasurer
The American Samoa Government has reserve funds at the two local commercial banks to ensure no hold is placed on payroll paper checks for ASG employees when the Zions Bank starts issuing paper payroll checks.
In a Jan. 16 memo to ASG departments and agencies, ASG Treasurer Dr. Falema’o ‘Phil’ Pili announced that effective immediately, all Automated Clearing House (ACH) and direct deposits shall be provided by the government’s banking institute, Zions Bank.
He said paper checks will also be issued by Zions Bank and honored by the respective local banks. “We have been in negotiations with both Bank of Hawai’i and ANZ bank representatives and they have agreed to provide immediate cash and immediate credit on the deposit,” he pointed out.
(This means there will be no hold placed by either bank on checks issued by an off-island bank — in this case Zions Bank — as is the current policy for both banks.)
“All ASG checks will be honored in this manner in accordance to agreements” and the target date for this initiative is pay period #4, ending Feb. 15, and all vendor checks thereafter, the memo said.
The memo surfaced in the Senate last week, during a Budget and Appropriations Committee hearing where the Treasurer said that direct deposit is “an option” and the government will still issue paper checks.
However, the memo explained that after Apr. 15, 2014, ASG will no longer process paper checks for payroll, which will be distributed through ACH.
During the hearing, senators voiced concerns that because Zions Bank does not have a local branch, there will be problems for ASG employees, whose payroll checks will be placed on hold for a certain period of time.
Pili said there are agreements in place with the two local banks, with $1 million in reserve in each bank to ensure there is no hold placed on any ASG payroll check.
The committee also pointed out that there are times when fees are imposed by either bank for cashing checks which do not belong to them, and this is especially true when the employee does not have a bank account with either bank.
Pili said part of the agreement with both banks calls for the government to be responsible for any fees, adding that no employee will be responsible for any fees and the two local banks will be able to cash their paper checks without problems.
“Any fees will be between the bank and ASG,” he assured senators.
Responding to committee questions, Pili said there are currently 300 government employees in Manu’a and every pay period a team from his office travels to Manu’a to help cash payroll checks for the employees there.
The team covers both Ofu and Ta’u islands and Treasury will continue to provide this service because there is no bank nor any ATMs in Manu’a, he said.