A presentation made Tuesday on an independent audit conducted by Bert Smith & Co. has confirmed millions of dollars in losses by the Government Employees’ Retirement System.
According to George Willie, a partner in the company, benefits paid out by GERS during 2011 jumped by $10 million while employer and employee contributions into the system only increased by $6 million ($123.8 million in 2011 compared to $117.1 million in 2010). That, coupled with the depreciation of the system’s portfolio left GERS with a net decrease of $78 million in 2011, Willie said at a meeting of GERS’ Board of Trustees on St. Thomas.
Willie said the numbers, which are still preliminary, do not factor in recent government layoffs.
The 2012 and year-to-date figures for 2013 paint much of the same bleak financial picture. For December 2012, GERS’ collections amounted to $11.9 million – but $19.1 million was paid out in annuities, while $23.6 million was paid in disbursements overall leaving the system with an $11.6 million deficit.
And so far for fiscal year 2013, which began on Oct. 1, 2012, the system has amassed a $37.7 million deficit, with $34.3 million in collections and $72.1 million in total disbursements ($57.7 million of which was paid out in annuities.)
On a positive note, board members were told that the value of the system’s portfolio was at approximately $990 million – but $20 million would still need to be withdrawn in order for GERS to cover expenses.
In other action, board members also:
-elected Vincent Liger as chairman of the board and Wilbur Callender as vice-chairman. Participating via teleconference Tuesday, St. Croix resident Mary Moorhead – as a part of a new initiative by GERS intended to take suggestions from its members – suggested that trustees whose terms are up should not take a position on the board. Four trustees currently on the board are working under expired terms but said Tuesday that they must continue to serve until the governor re-nominates them or nominates someone else to take their place;
-approved the board’s official calendar and moved up their annual retreat to June 12-14, because a previously selected date conflicted with Carnival;
-ratified a poll vote that allowed for the replacement of an elevator, costing approximately $135,000, and the repair the air-conditioning on the second floor of GERS’ headquarters on St. Thomas, which would cost $16,000. Board members also voted to increase the system’s capital by $151,000 to accommodate the additional costs.
Board members attending Tuesday’s meeting included Leona Smith, Edgar Ross, Raymond James, Liger, Callender, Desmond Maynard and Carol Callwood.
