{"id":61651,"date":"2018-03-22T09:53:04","date_gmt":"2018-03-22T09:53:04","guid":{"rendered":"https:\/\/viconsortium.com\/?p=61651"},"modified":"2018-03-22T10:42:17","modified_gmt":"2018-03-22T10:42:17","slug":"government-and-gers-submit-plans-to-district-court","status":"publish","type":"post","link":"http:\/\/wp.viconsortium.com\/?p=61651","title":{"rendered":"GERS, GVI, Submit Plans To District Court For Gov’t To Come Current On Payments"},"content":{"rendered":"

ST. THOMAS — The Government of the Virgin Islands and the Government Employees’ Retirement System were ordered by District Court Judge Curtis Gomez a week ago<\/span><\/a> to submit either a joint or separate plans\u00a0to assure payment by the government to the pension system for employee and employer contributions, along with a plan of avoidance to ascertain that the government does not renege on its statutorily obligated duty in the future.<\/p>\n

Emphasizing the continued disagreements between G.E.R.S and the government, on Tuesday, the two entities submitted separate plans on how the government should come current, according to court documents. (During last week’s case, G.E.R.S. said the government owed it $41 million for employer and employee contributions, as well as loan deduction payments. The government’s number, however, was a bit lower, with\u00a0Grace Fahie-Lindo, director of payroll at the Department of Finance for 9 years, stating that the amount was roughly $30 million.)<\/p>\n

While the government’s proposal to come current remained the same with what was discussed during the court hearing on March 13 and introduced to G.E.R.S. in a meeting preceding the hearing, G.E.R.S.’s plan came with two options.<\/p>\n

The government’s plan sees the Mapp administration making one delinquent payment and one current payment every payday until July 19, 2018, at which point the government would become current with its employee, employer and loan deduction payments to G.E.R.S. The payments would also include interest payments to the pension system.<\/p>\n

The first option of G.E.R.S.’s plan sees the government setting aside some funds provided by the federal government for emergency response, to come current with its\u00a0statutorily obligated duty to pay the system through March 19. This includes employee, employer and loan deduction payments — along with interests. The first plan also includes a special account to be controlled by G.E.R.S. that would include four months worth of employee, employer and loan deduction payments to G.E.R.S., as a security peradventure the government misses its payments. The funds for this account would be secured from federal emergency funding, according to court documents.<\/p>\n

The second G.E.R.S. plan is selfsame with the first, only that the government would seek any other funding source if it can’t procure federal dollars.<\/p>\n

It’s hard to see how the District Court approves G.E.R.S.’s first plan that seeks payment through federal dollars, because it remains an open question as to whether those funds could be used to pay the pension system. That being said, the federal government in December approved some $85 million in community disaster loan funds to the local government. It was not clear whether the $85 million was already expended, or only now being released. If the latter is true, some of those dollars could possibly be used to fund G.E.R.S.<\/p>\n

Yet even when the court determines how and when G.E.R.S. should be paid, the bigger issue, by far, remains the pension system’s unfunded liability of over $4 billion.<\/p>\n

G.E.R.S.\u2019s goal on March 13 was to proceed on multiple fronts, including the government\u2019s decades-long negligence of its actuarially determined employer contribution (ADEC), currently standing at $1.2 billion, which G.E.R.S. says the government has not paid since 1991. The argument being that the system\u2019s life is at stake and that all the components to its survival deriving from the government\u2019s dereliction should be considered. Judge Gomez, however, said a determination of whether the consent judgement\u2019s breadth covered the ADEC would be determined at another time. The next court hearing has been set for May 28.<\/p>\n

GERS By the Numbers<\/strong><\/p>\n

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