Court orders Settlement Fund to submit status update

DISTRICT Court for the NMI designated Judge Frances M. Tydingco-Gatewood has ordered the NMI Settlement Fund trustee to present a status update.

Joyce C. H. Tang, the principal representative of the Settlement Fund trustee, was ordered to file the status report before Sept. 19.

Gov. Ralph DLG Torres and Finance Secretary David Atalig were also ordered by the judge to be present at the hearing set for Sept. 26.

According to a stipulation filed in March 2019 by the CNMI government and the Settlement Fund, the Commonwealth will use $11 million from the Federal Emergency Management Agency to pay the NMI Settlement Fund’s remaining balance and to bring Minimum Annual Payment or MAP current.

The stipulation stated that the settlement agreement requires the CNMI government to pay the second quarterly MAP in the amount of $15,130,000 in its entirety on or before March 31, 2019.

To avoid a breach of the settlement agreement and because of the exceptional circumstances brought about by Super Typhoon Yutu, the trustee and the CNMI government have agreed on a payment plan that would bring the CNMI government current on its MAP weekly payments and pay the remaining balance by April 30, 2019.

The parties agreed that the CNMI government will notify the Settlement Fund when it has received all or portions of the FEMA payment in its bank account. Upon receiving the FEMA payment, the CNMI government “shall immediately pay the following amounts to the Settlement Fund: (a) the unpaid portion of the remaining balance; and (2) the amount required to bring the weekly MAP payments current.”

In 2009, retiree Betty Johnson sued the CNMI government for its failure to pay the amounts that it was required by law to pay the NMI Retirement Fund since 2005.

She said the Fund would run out of money by June 2014 and would no longer be able to pay retirement benefits.

In Sept. 2013, the parties agreed to settle the lawsuit and the U.S. court approved a $779 million consent judgment in case the government does not meet its obligations to the Settlement Fund.

Before Typhoon Yutu, the CNMI government had been making timely payments to the Settlement Fund and was also voluntarily appropriating funds to restore the retirees’ 25 percent pension cut.