Major changes to the Retirement Fund law introduced in the Fono
Pago Pago, AMERICAN SAMOA — Three faipule have proposed major changes to the ASG Employees’ Retirement Fund law, which include having three members elected by Retirement Fund members and mandating an annual board meeting to be held in American Samoa.
Sponsored by Reps. Larry Sanitoa, Andra Samoa, and Vesiai Poyer Samuelu and introduced in the House on Tuesday this week, the bill seeks to revert back to 10% the percentage of the fund money to be invested locally.
More than a year ago, the Fono approved an Administration bill increasing the number of ASGRF Board of Trustee members from 5 to 7, but the bill now before the House amends it to reflect 5 board members.
The bill makes additional changes in which there will be only “two” members appointed by the governor, while the other three are “elected” members, who shall be elected at large by the members of the Fund, in an election that shall be conducted according to rules adopted by the Board.
It also sets the terms of office for the elected trustees, and other requirements.
Samoa News notes that the proposed amendment would address a long standing complaint from Fund members that their interests are not represented on the Board. They have suggested to elect members to sit on the board, especially because the government keeps tapping into the Retirement Fund for loans.
ANNUAL MEMBERSHIP MEETING
Another proposed amendment, is having the Board hold its meeting — held every two years in Hawaii — in the territory.
The amendment states that the Board of Trustees “shall hold an annual membership meeting open to all members of the Fund in American Samoa”. And notice including the agenda of such a meeting, is made public through the local media.
At the meeting, the Board “must present” an annual report of the state of the Fund, and allow an opportunity for members to comment on any presentation or forum presented during the annual membership meeting.
The Board, according to the bill, may hold other general membership meetings exclusive of the annual membership meeting.
The bill also makes clear that all potential fund investments must be presented to the members, either at the Annual Membership Meeting or another general membership meeting for approval.
Furthermore, compensation arrangements for the Board of Trustees and the Retirement Office executive director will be voted on and approved at the Annual Meeting.
Current law outlines the duties and responsibilities of the executive director, whose salary is decided by the Board; but the bill seeks to set the salary of that individual at $80,000 annually.
Another amendment in the bill would return the local investment rate to 10% from the current 17.5% — which had become a major issue of contention last year between Attorney General Talauega Eleasalo Ale and several senators.
Sen. Magalei Logovi’i had argued during a committee hearing last September that Public Law 30-29 enacted Oct. 29, 2008 contains a sunset provision requiring that the Retirement Fund’s investment cap return to 10% after the $20 million ASG loan is paid off.
However, Talauega responded in a separate letter to the Senate that the changes later made to a provision of that same law eliminated the sunset clause, which was meant to roll back local investment from 17.5% to 10% after the loan was paid off. (See Samoa News Sept. 10, 2018 edition for details.)