Bill 332 has dramatic impacts on retirees

by Clynt Ridgell, KUAM News
Tuesday, October 31, 2006


During Monday's legislative session members of the 28th Guam Legislature discussed, amended and ultimately passed Bill 332, Governor Felix Camacho's bond-borrowing bill. The bill contains some intriguing items with dramatic impacts on retirees of Guam's public sector. With a vote of 13 to 1, the bill heads to the Governor's desk for his signature.

The legislation provides the chief executive to borrow up to $300 million on the bond market. It also contains an amendment submitted by the Camacho Administration that would allow the Governor to use the bond money and specific special fund accounts to pay for cost of living allowances.

Senator Eddie Baza Calvo (R) says the final version of the bill was a mixture of different ideas from all parties involved in the COLA case. He told KUAM News, "The language in this particular bill incorporated some bills that have been introduced by members of the Legislature both in the majority and the minority. It also entailed some language by the Governor in regards to access to specific cash accounts, as well as language incorporated by the plaintiff's attorney, Mike Phillips, in regards to a structured settlement."

The bill would allow Guam's governor to tap four Executive Branch accounts to pay COLA. These four accounts are the GTA Privatization Fund, the Interim Transition Office Account, the Territorial Highway Construction Fund, and the Tourist Attraction Construction Fund. If tapped, these funds must be reimbursed promptly as cash becomes available. The bill also included Senator Frank Aguon Jr.'s (D) amendment that would make COLA awardees eligible for tax rebates on their COLA settlements.

The bill would additionally authorize the governor to enter into a structured settlement with COLA recipients at 7% interest per annum, allowing him to pledge up to $10 million per year from Section 30 monies as collateral for the settlement. This would allow retirees to get the total COLA owed to them up front from lending institutions who would then collect the COLA from the public sector at a later date.

Governor Camacho says he will sign the bill into law as soon as he receives it, adding he is awaiting the court's final decision on the total amount that the government will owe. "Then of course, it would be nice if we could pay at least a thousand to each of the retirees that are due this," Camacho told KUAM News. "If they're due that amount at least up front that's the separate 'Lola Cola', as we call it," he joked.

On top of this Lola Cola (is in reference to the thirteen-year-cola case) the Governor says he hopes to pay the regular COLA due to retirees for this fiscal year by sometime in November or December.

Review the amended Bill 332 on BobsOffice.org


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