Chairman of the House Retirement Committee, Vailoata Eteuati Amituana’i is proposing legislation that would increase the minimum monthly retirement payment to $100 and increase certain death benefits for beneficiaries of Retirement Fund members who die prior to actual retirement to $3,000. The proposed measure that was introduced in the House last week, says that this increase will not apply to retirees who retired on or prior to October 1, 2012.

It’s unclear when Vailoata will have a hearing on this bill but he told Samoa News that the increased cost of living prompted the move to submit the bill. “I was thinking why not start to look for ways in the fund to maybe increase the monthly checks for those who are making under $100.”

He pointed out that while it’s true how much the retiree receives in benefits is based on how much he or she earned while they were working, however after all these years of working, he said, “at least let an old man or old lady see his or her monthly check for at least $100.” The Faga’alu lawmaker further stated that he’s talked to the Retirement Office regarding the proposal and asked if a death benefit raised from  $1,500 to $3,000 would affect the fund.

According to Vailoata, he was looking at two options; either $100 monthly and $3,000 for a death benefit or  $200 monthly and a $3,000 death benefit. “But I think I’ll just start with $100 first because not a lot of retirees receive checks under $100 monthly.”

He also pointed out that an active employee gets $10,000 as a death benefit while a retiree gets $1,500. He said a funeral is expensive and this increase will assist the families tremendously.

Larry Sanitoa, who is among the lawmakers co-sponsoring the bill initially thanked Representative Vailoata for bringing the issue to the attention of the Fono and stated that he would always support opportunities that help the most vulnerable residents — seniors and low-income families.

“That said, initially there were concerns raised on how this bill will impact the fund given the recent actuarial valuation, which is now showing a loss of $28 million from 2014 to 2015. However, our initial research of the bill shows that there will be no significant impact to the fund as there will be a small percentage of the retirees affected.”

Sanitoa concluded that the fact remains, that before the Fono passes any legislation affecting the Retirement Fund “reports from Actuary and Board of Trustees are necessary to move any bill forward.”

The bill is co-sponsor by Vice Speaker, Fetu Fetui Jr and lawmakers, Larry Sanitoa, Vaetasi Saena Moliga, Mauagaoali’i Leapai Sipa Anoa’i, Timusa Tini Lam Yuen, Vaiaitu Mulinu’u Maluia, Manumaua Wayne Wilson and Vesi Talalelei Fautanu Jr.

BACKGROUND

ASCA, Title 7, Chapter 14, sec. 7.1405 (c,d) specifically states: Before the final vote is taken in either the Senate or House on any such legislation, the retirement fund committee of that body must submit to the voting members a written report from both the actuary and the Board of Trustees regarding the proposed legislation. The actuary’s report shall indicate the financial impact of the legislation on the future solvency of the fund-and future benefit payments.

The report of the Board of Trustees shall contain its recommendations concerning the legislation: whether the Board supports or opposes it, any recommended changes, and the board’s detailed reason (d) Any legislation, which is passed but which does not follow the procedures set forth in this section is null and void.

In the ASGERF latest Comprehensive Annual Financial Report, the ASGERF net assets in trust for pension benefits decreased by $28million or 13% between 2015 and 2014 primarily due to poor domestic and international equity market conditions, resulting in the fair value of the funds investments for the year ended September 30, 2015.

This is according to an independent audit report by the accounting firm of Moss Adams LLP, which states that the net assets for ASGERF at the close of fiscal year 2015 are $185.60 million and all of the net assets — which are held in trust for the pension benefits — are available to meet ASGERF’s ongoing obligations to plan members and their beneficiaries. ASGERF’s funding objective is to meet long-term benefit obligations through contributions and investment income.

“As of October 1, 2014 the ratio of the fund’s fiduciary net position as a percentage of total pension liability as 46.75%. In general, tis indicates that as of September 30, 2015 for every dollar of benefits due we had approximately $0.47 of assets to cover it.”