Pago Pago, AMERICAN SAMOA — In a Budget and Appropriations Committee hearing held on Monday, February 3, 2025 that lasted almost two hours, Deputy Director of Treasury Levi Reese disclosed that the government has been in the process of paying what it owes to the government employee retirement fund.

Gov. Pulaaliʻi Nikolao Pula during his State of the Territory address delivered during the opening of the 39th Legislature revealed that nearly $9 Mil was owed by ASG to the fund.

The House Committee, chaired by Faipule Vailoaata Amituanaʻi, had called Reese, along with the Deputy Director of the Budget Department and the Director of the American Rescue Plan Act (ARPA) to testify about funding reports, the current financial status of the Territory, and updates on allocations for ARPA funds.

Faipule Trude Ledoux-Sunia probed Reese about the status of the American Samoa Government Employee Retirement Fund (ASGERF), which had been revealed by the governor in his State of the Territory address to have been behind six months. The total amount that ASG owed to the fund was nearly $9 million, according to Pula.

So far, Reese said, over one million has been paid as of last week.

The Deputy Director went on to provide some background information about the Retirement Fund and its incremental increases throughout the past years.

In 2022, a law was passed increasing the government’s and members’ contributions to the ASGERF in an effort to address a serious deficit in money that goes into the fund versus what is paid out monthly.

The new law increased the combined contributions of ASG and employees from 11% to 14%, effective October 1st with ASG contributing 10%, up from 8% and members contributing 4%, up from 3%. There were incremental increases each year thereafter up to 2024, with members paying 5% in 2023 and 6% as of Oct. 1st, 2024, while ASG’s contribution rose to 12% in 2023 and 14% in 2024.

Reese stated there are issues with the high percentage now in effect — which is 20% in total.

“The difficult part about things like that is if we continue to raise the contribution, there has to be a revenue source to balance out this new deduction.”

“I donʻt recall any new revenue sources and it is very difficult for us to support a 20 percent contribution to the retirement fund.”

Reese stated that in order to address this issue, the government has started to pay both the employer and employee portion of contributions, which currently totals almost $900,000: over $600,000 of the employer and over $200,000 for the employee portion.

When Samoa News asked Reese after the hearing whether there was a timeline for full repayment of the money not paid into the retirement fund, Reese postulated that it would be subject to the confirmation of the Acting Director of Treasury.

Acting Director of the Treasury Donald Kruse is on island and his House confirmation hearing is tentatively scheduled for Tuesday, February 11th, at 11am.

(Samoa News should point out that the ASG contribution of 14% is where the problem lies — having no revenue source. The 6% contribution from employees is a direct deduction from their gross salary and in this sense their revenue source is their ‘pay check’.)