Friday, August 23, 2013

No guaranteed pension payments for Fund settlement opt-outs in Northern Marianas

Marianas Variety

Governor Eloy S. Inos, center, is flanked by, from left, Assistant Attorney General Reena Patel, Senator Ray Yumul, Attorney General Joey Patrick San Nicolas and Senator Vic Hocog on Thursday en route to Tinian where the Administration held a town hall meeting on the settlement agreement.
RETIREES who opt out of the Settlement Class will find themselves in a bind as no guaranteed benefit payments will come their way through the CNMI government. 

Asked if the government would pay, Governor Eloy S. Inos said yesterday, “We can’t. We can’t do that. That is pushing the envelope. I think the right decision at this time is to join the settlement.”

Governor Inos has been actively leading discussions with the members of the community on the settlement agreement that provides for payment of 75 percent of benefits and refunds to active Defined Benefit Plan members.

Even with 25 percent of benefits deferred, Governor Inos earlier assured retirees that the government would set up a recovery fund to pay this deferred 25 percent in benefits as well as to pay the interest on contributions made by active members.

“If they don’t want to join the settlement, there is nothing I can do. I cannot guarantee payment even if they decide to go to Finance to demand their checks. They are not going to get a check. They can’t. They won’t,” said Governor Inos.

He said the opt-outs will have to go through the court.

Asked if the Department of Finance was not going to cut checks for them, he said, “Definitely not. Finance is not going to deal with any Retirement disbursements.”

Some retirees are saying that it is their constitutional right to receive their pension paychecks.

Variety was told that if the settlement agreement is finalized, some retirees who opt out will go to Finance and demand their constitutionally protected right to receive their pension checks

Governor Inos said, “Constitutional right is one thing. Check is another thing. For their constitutional right, they may have to go court. I am sorry. That’s the way it is.”

Governor Inos also said that as far as issuance of pension checks goes, he doesn’t want people to be misled by the assertion that it is OK to opt out and get the checks from Finance.

“My advice would be to go with the settlement. This is the best that could have happened under the circumstances. We’re offering payment of 75 percent and we’ll make up the 25 percent,” he said.

A notice on the class action settlement indicated that opt outs will neither benefit from the settlement nor be represented by the class counsel.

“You may assert your rights to try to make the CNMI pay your benefits but you will have to hire your own lawyer to represent you,” the notice stated.

The same notice assured those who remain in the Settlement Class that they are on a better footing compared to the opt outs as they are guaranteed payment of at least 75 percent of their pensions until the last member has retired from the system.

Opt outs cannot expect to get a higher pension check than those in the Settlement Class.

In an earlier interview with Variety, class counsel Margery Bronster was straightforward in cautioning those who would opt out of the settlement class.

She said, “You will not be guaranteed 75 percent of your payments. We don’t know what the Legislature will do with the opt-outs. But there is nothing that requires the government to pay the opt-outs 75 percent. In addition, they will not have class counsel representing them.”

For Bronster, as counsel for the class, “we’re watching out for the benefits of the beneficiaries.”
Bronster also said that if the government fails to pay the opt outs, they can’t use the stipulated judgment to try and collect money.

There is no Fund for opt-outs, said Bronster, adding that the assets the Retirement Fund now holds will be transferred to the Settlement Fund under the direction of the Settlement Trustee.

Retirees, inactive and active Fund members have until Sept. 20 to make this decision to opt out.

Those staying in the Settlement Class need not do anything.

But those who wish to opt out must deliver to the Fund a written notice of their intent to opt out with name, address, birth date, and signature.

Given the risks for opt outs, Governor Inos, during the first town hall meeting at the multipurpose center, asked the members to make the right decision.

“The only certainty is the settlement and the fund that will be provided under the settlement,” he said.

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