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Budget Update: Fono holds up ASTCA budget hearing until financial info received

American Samoa TeleCommunication Authority’s fiscal year 2016 budget review has been postponed to a new date, as yet unscheduled, while the Fono joint budget committee sought financial reports pertaining to ASTCA as well as minutes of the American Samoa Visitors Bureau board meeting, which should verify confirmed salary and other benefits for Visitors Bureau executive director David Vaeafe.

 

The joint committee’s decision to postpone the review was reached Thursday even before lawmakers started reviewing the budget for ASTCA, which was represented by acting chief executive officer Alex Sene Jr., who is also one of the only two existing members of the Visitors Bureau board. The other Visitor’s board member is Roy J.D. Hall Jr.

 

ASTCA FINANCES

 

During the budget hearing, Sen. Magalei Logovi’i said the ASTCA budget proposal is missing a profit and loss statement dealing with revenue versus expenditures. (The Fono had requested of the ASG Budget Office that all entities under the Enterprise Fund — such as the authorities — provide a profit and loss statement prior to the hearings.)

 

Magalei says the profit and loss statement as well as ASTCA’s latest audit report are needed as part of the budget review. He also noted that Sen. Tuaolo Manaia Fruean raised a point earlier in the day, during the Senate session, that ASTCA had been making payments for one of the two government loans from the ASG Retirement Fund. He says this information should also be provided by ASTCA for the committee.

 

Another request from the committee is a complete updated report on the status of the $91 million federally funded Broadband Linking the American Samoa Territory (BLAST) project.

 

At the Senate session Thursday, Tuaolo requested a hearing to obtain more information on the bonds issued by the American Samoa Economic Development Authority (ASEDA). Among the matters Tuaolo wanted to know was how the bond was going to be repaid — since he was not in the Senate when the Fono approved issuance of the bonds; and regarding the bond purchase by the ASG Employees Retirement Fund board — if the purchase has paid off the two ASG loans from the Retirement Fund.

 

Tuaolo said ASTCA was making payments for one of the two loans, and wondered if ASTCA will still be required to make the repayment if the Retirement bond purchase has been finalized with ASEDA. He says the Senate has an obligation to look at the impact of the bond issue on the Retirement Fund.

 

Senate Budget and Appropriations Committee chairman Sen. Laolagi F.S. Vaeao put through a request — via the Senate President Office — for a status of the bond sale, update on the bond purchase deal with Retirement Fund and other bond issues. He asked that the report be submitted to the Senate for review prior to scheduling a hearing with the ASEDA board.

 

Laolagi says the hearing will be scheduled as soon as it’s known when the current FY 2016 budget hearings are completed. Laolagi’s hearing is also expected to cover other issues raised recently by other senators pertaining to the bond purchase deal between Retirement Fund and ASEDA. A list of witnesses for the hearing is not known at this time.

 

ASEDA announced late last month the refinancing deal of the two loans totaling $11.7 million.

 

In 2006, the Fono approved and the governor signed into law, legislation allowing the government to loan $10 million to the LBJ Medical Center and the loan money was used to pay off the hospital’s outstanding debts at the time to local and off island vendors. ASTCA was responsible for repaying this loan.

 

Then the following year in 2007, a $20 million loan bill went into effect and the loan proceeds were to fund local capital improvement projects and amended the following year to add more local projects such as the 10th Festival of Pacific Arts and the undersea fiber optic cable project. Loan repayment is made through revenues ASG received on a certain percentage collected from taxes and fees.

 

VISITORS BUREAU

 

At Thursday’s budget hearings, Tuaolo inquired with Sene Jr. if he was a member of the Visitors Bureau board, based on testimony last week by Vaeafe, who also told the committee that it was the board who set up his salary package as well as other benefits.

 

Sene explained that he is a board member, but his term has since expired and is awaiting new appointment (by the governor). He said he has remained on to help with matters pertaining to the board and the Visitors Bureau.

 

Tuaolo raised several questions including whether or not Sene had attended the meeting in which Vaeafe’s salary and benefit package was approved, and when had that occurred. Sene couldn’t recalled the actual dates, but suggested to the committee that it can obtain details in minutes of the board meetings.

 

Tuaolo says Vaeafe is getting a salary of $85,000; medical benefits at $15,000 and $17,000 to cover his housing or rental place of residency. He pointed out that this is a lot of money.

 

The committee then officially requested minutes of the meetings dealing with Vaeafe’s salary and benefit package.

 

Under questioning by the committee last Thursday during the Visitors Bureau budget hearing, Vaeafe told lawmakers that his salary — including increments — medical benefits and housing allowance are all part of his employment contract approved by the board.