Retiree Groups Sue Government Over Missing Payments

Groups representing retired Virgin Islands government workers on Tuesday filed a petition in Superior Court seeking a writ of mandamus ordering the territorial government to pay at least $21 million it owes the retirement fund.

The petition was filed by Debra A. Christopher, president of St. Croix Government Retirees Inc., and Phyllis M. Nehlsen, chairwoman of the St. Croix Government Retirees Advisory Committee. A copy was sent to V.I. media Tuesday evening.

The petition asks the court to order the Government of the Virgin Islands to pay GERS the $7 million annually from the rum cover-over revenues, as V.I. law mandated beginning with fiscal year 2013. The law was part of a broad emergency economic stabilization bill. Despite the legal requirement, the government has made only one of the payments, in 2016.

The petition notes the law states, “‘Notwithstanding any law or provision to the contrary, there is hereby appropriated in the fiscal year ending September 30, 2013, and all subsequent fiscal years the sum of $7 million from the Internal Revenue Matching Fund to the GERS as a direct contribution.’ Act 7261 does not provide that the Commissioner of Finance as the representative of the Department of Finance can amend, modify or refuse the direct contribution … every fiscal year.”

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The petition asks the court to order Gov. Kenneth E. Mapp and the commissioner of Finance to make the retroactive payments immediately. The government, which has been dealing with a $62 million deficit in the current budget, has been struggling to make payroll in recent months.

The $7 million annual payments are only one small piece of a fiscal problem that is threatening to bankrupt GERS by the year 2020.

The total pension liability for retired workers is $4.23 billion, according to the petition, and contributions by employees and the government do not cover the amount of money going out in pension payments. The GERS pension fund is expected to be spent and unable to pay full pensions in less than a decade, possibly as early as 2020 and almost certainly not later than 2025.

GERS officials and financial advisors have testified the reforms would help over time, but without at least a $600 million to $1 billion infusion of cash to invest, the plan will go broke.

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