Molly Morris
In the special session called by Gov. Charles W. Turnbull Friday, the 23rd Legislature unanimously approved a bill to appropriate $2.9 million in interest earned on bond proceeds for the Judges Pension Fund and the Governors and Lieutenant Governors Retirement Fund.
The interest from last year's $300 bond issue will replenish the funds which, the administration discovered, are depleted..
While the vote was quick and unanimous, the session was anything but, as, one after another, discrepancies between the Finance Department and the Government Employees Retirement System were brought to light. And then came the bombshell – revelation that the pensions owed by law to retired judges and former governors and lieutenant governors had not been paid since April, for lack of money.
Then, under questioning by Sen. Lorraine Berry, it was learned that the would-be recipients had not even been notified of the situation.
Testifying were Finance Commissioner Bernice Turnbull, GERS acting director Willis C. Todman and GERS legal counsel Alphonse Nibbs.
Those affected by the pension cut-offs are former governors Juan Luis, Alexander Farrelly and Roy Schneider; former lieutenant governors Derek Hodge and Kenneth Mapp; and former Territorial Court judges Eileen Petersen, Henry Feuerzeig and Verne Hodge.
Turnbull said the Governors and Lieutenant Governors Retirement Fund has a $1.3 million deficit and the Judges Pension Fund is a little over $800,000 in the red. Payments mandated through this fiscal year will total at least $2,417,178, she said, but the administration asked for $2,920,000. This excess half-million did not sit well with the senators, who expressed concern as to what would be done with it.
In fact, very little sat well with the lawmakers as the testifiers bandied back and forth who was responsible for which fund. Todman stated that GERS no longer functions as a constructive trustee to pay over contributions received from the Finance commissioner. He charged that contributions to GERS, "in contravention of statutory directives," have been commingled with general membership contributions. "Through error or omission, or by administrative fiat, the statutory directive was never complied with," he said.
Todman and Turnbull both said their offices were in the process of reconciling accounts. Under questioning from Sens. Berry, Vargrave Richards and Almando "Rocky" Liburd, the Finance commissioner admitted she personally cut off the retirement payments in April after the shortfalls were discovered..
Liburd asked, "How could you stop any pension payments? What authority do you have?" Turnbull cited Attorney General Iver Stridiron as having said that "no certifying officer can issue payments out of a negative balance."
Berry asked Turnbull if the recipients had been notified of the halt in payments, which are direct-deposited to payees' accounts. No, Turnbull said. Berry continued, "Don't you think that would have been the decent thing to do?" Turnbull replied, "Yes, that would have been decent."
Berry also asked Turnbull about the 9 percent interest the pension funds are supposed to accumulate. Turnbull said the funds were not interest bearing, referring, as she did throughout the session, to her relatively brief tenure of a year and a half as commissioner and commenting, "I have no control over what transpired before."
Turnbull said she would take the interest suggestion under advisement, to which Berry replied, "It's the law – it's not a suggestion."
Berry asked the commissioner if she was aware that "with the checks being stopped, health insurance is automatically stopped, as it is deducted from the checks?" Turnbull replied, "That's true."
Liburd addressed Turnbull: "God forbid any of them should have gotten sick with no insurance. You showed no compassion at all about not notifying them."
The commissioner replied, "I spoke to many of them." "But no letter," Liburd retorted.
Turnbull countered, "I invite you to run this department. It seems that's what you want to do, and you have your spies."
Liburd told her, "People come to the Legislature complaining about the treatment they get from you."
To a question from Liburd as to whether former Gov. Roy L. Schneider's checks had been stopped before April, Turnbull replied, "I won't discuss that."
Senators lamented throughout the session their need to be there dealing with the pension situation. Richards said that, regardless of party affiliations, "we have a moral, legal and ethical responsibility to those who have served this territory with a high level of responsibility." He said he hoped payment would be immediate after the bill passed.
Turnbull said if the bill was passed Friday, the checks would be sent out the following Thursday, June 29. She said the first ones to go out would make up the missed payments and bring the accounts current.
In the opinion he issued on the bill, post auditor Campbell Malone stated that it appeared there had been no recent Senate appropriations to either fund. "However, officials continue over the years to certify and make payments, obviously in flagrant violation of the law, to the tune of a deficit . . . in excess of $2.2 million," he said, adding, "Incredible, but . . . business as usual."
Voting on the measure were Sens. Berry, Richards, Liburd, Donald "Ducks" Cole, Roosevelt David, Adlah "Foncie" Donastorg, George Goodwin, Norman Jn Baptiste, Allie-Allison Petrus, Gregory Bennerson and David Jones. Sens. Judy Gomez, Adelbert Bryan and Alicia "Chucky" Hansen were absent from the session, and Golden was absent for the vote.
