American Samoa Power Authority Executive Director Utu Abe Malae has confirmed layoffs are planned for early next year for the government’s semi autonomous agency, which he says has accumulated too much accounts payable over the years.

While the total number of employees to be laid off was not immediately clear nor the actual date of the lay off, Utu said that ASPA is planning to cut about $150,000 per month from payroll, goods and services.

“The employees themselves have suggested ways to meet the cuts: reduce hours, sell off dead stock, pre-pay fuel suppliers for steep discounts, implement progressive pay cuts, etc.,” Utu told Samoa News yesterday.

Asked to explain the reasons for the lay off, Utu said, “We have accumulated too much accounts payable over the years. Even after we catch up and become current paying our bills, we will still be short $150,000 per month.”

“The severance package that was offered to employees two years ago did not result in sufficient savings, even though the number of employees decreased,” said Utu, who became ASPA boss in 2013 and offered in 2014 early retirement to ASPA personnel with a severance package.

He said that 12 years ago, the number of employees was fewer than 300; while in 2012 it was close to 500 and now it is about 440. “Yet the sales to the canneries were higher in the past than now,” he points out.

Asked if a severance package will be offered to the to-be-laid off employees, Utu said that it is a possibility but it won't be as generous as the ones offered two years ago. He also says laid off employees will come from all ASPA divisions and will include those on contract.

Utu also highlighted want needs to happen to avoid layoffs: both canneries to operate at full bore; new industrial and large commercial customers; the new ASPA plant operating at Satala because it is more efficient than the temporary one there; catch up on all grant reimbursements from the Federal government; improve the efficiency of our workforce, especially those in accounting and grants administration; a substantial reduction in non-revenue water and improve the efficacy of project management - for example, Manu’a projects, Satala Power Plant, new ASPA Operations Building.

In conclusion, Utu declared, “We need a booming economy with tourism and fisheries at the forefront.”

In mid October, Tri Marine International announced the closure of the canning operation of its American Samoa plant, Samoa Tuna Processors Inc., effective Dec. 11. Asked about the impact of this closure to ASPA revenues, Utu told Samoa News at the time that in FY 2016, STP represented approximately 6% of ASPA's revenues.

“Depending on the extent of STP's operations after the discontinuation of canning operations, ASPA will have to make up between $1.2 to 1.8 million of annual non-fuel cash flow from revenue measures, cost reductions or combination thereof,” Utu said.