Hybrid retirement system still in discussion
Lawmakers and the GovGuam Retirement Fund continued discussion to create a new hybrid retirement system.
October 17, 2014Updated: October 17, 2014
By KUAM News
By KUAM News by Ken Quintanilla
Guam - The bill is considered years in the making and long overdue - and today lawmakers together with the Government of Guam Retirement Fund continued discussion on legislation to create a new hybrid retirement system.
A day after session began, lawmakers continued discussion on Bill 394 - this time in the Committee of the Whole with members from the Government of Guam Retirement Fund on hand. Board chairman and former speaker Joe T. San Agustin said, "So far, I'm glad they were able to come into the Committee of the Whole because yesterday was kind of little disappointing because they were all in the dark somehow they got their numbers confused and they've been so misguided by some people that proposed themselves to be expert on Retirement Fund."
Session was called at the request of Vice Speaker BJ Cruz following two lengthy public hearings last month on his Bill 394. The measure would create a new hybrid retirement system that includes both a defined "floor" of benefits and a deferred compensation program as the Defined Contribution component.
Senator Chris Duenas today says it would be a disservice to pass Bill 394 without properly understanding what exactly it entails especially for the GovGuam employees and taxpayers who he says may possibly have to foot a portion of the bill. "One thing that's been happening is a lot of conversations with government employees that are currently under the defined contribution plan 0023 and the thought process is this is the savior plan and it's a Lexus and it is a Lexus, but you're paying for a Lexus," he said.
According to bill 394, the hybrid retirement system would be available to all GovGuam employees and mandated for new hires on or after January 1, 2015. Senator Michael San Nicolas however introduced an amendment extending the rollout of the plan to begin in 2016, saying, "We want to give social security a chance to work its way through the congress, the second reason is that right now we budgeted for the current retirement plan but not for a hybrid plan, so we need to make sure we budget for that appropriately and the third reason is we want o give more time for the employees to be able to be fully aware of what this hybrid plan might entail."
Following the passage of his Resolution 379 in June, Congresswoman Madeleine Bordallo introduced a bill in the US Congress to allow GovGuam and the federal government to enter into a voluntary agreement allowing GovGuam employees into the social security system. "Well, good luck for him on that, we've been trying to get social security to come back to Guam since 1989 and good luck senator. I'm just asking now, when is Madeleine Bordallo going to have that resolution, have a public hearing, I'll bet you 10 to 1, it's one of those introduced then just forgotten," San Agustin said.
In the meantime, San Agustin says this hybrid retirement system is long overdue adding the responsibility is not on the GGRF but the Legislature to pass it. "If they have the guts pass it now, why wait two years from now and hoping that something else is going to happen in the meantime, 7,000 people are on a dangling right there I think that's irresponsible to continue to have 7,000 people on a string and give them no hope at all," he added.
Session resumes in the Committee of the Whole next week Tuesday morning.
Guam - The bill is considered years in the making and long overdue - and today lawmakers together with the Government of Guam Retirement Fund continued discussion on legislation to create a new hybrid retirement system.
A day after session began, lawmakers continued discussion on Bill 394 - this time in the Committee of the Whole with members from the Government of Guam Retirement Fund on hand. Board chairman and former speaker Joe T. San Agustin said, "So far, I'm glad they were able to come into the Committee of the Whole because yesterday was kind of little disappointing because they were all in the dark somehow they got their numbers confused and they've been so misguided by some people that proposed themselves to be expert on Retirement Fund."
Session was called at the request of Vice Speaker BJ Cruz following two lengthy public hearings last month on his Bill 394. The measure would create a new hybrid retirement system that includes both a defined "floor" of benefits and a deferred compensation program as the Defined Contribution component.
Senator Chris Duenas today says it would be a disservice to pass Bill 394 without properly understanding what exactly it entails especially for the GovGuam employees and taxpayers who he says may possibly have to foot a portion of the bill. "One thing that's been happening is a lot of conversations with government employees that are currently under the defined contribution plan 0023 and the thought process is this is the savior plan and it's a Lexus and it is a Lexus, but you're paying for a Lexus," he said.
According to bill 394, the hybrid retirement system would be available to all GovGuam employees and mandated for new hires on or after January 1, 2015. Senator Michael San Nicolas however introduced an amendment extending the rollout of the plan to begin in 2016, saying, "We want to give social security a chance to work its way through the congress, the second reason is that right now we budgeted for the current retirement plan but not for a hybrid plan, so we need to make sure we budget for that appropriately and the third reason is we want o give more time for the employees to be able to be fully aware of what this hybrid plan might entail."
Following the passage of his Resolution 379 in June, Congresswoman Madeleine Bordallo introduced a bill in the US Congress to allow GovGuam and the federal government to enter into a voluntary agreement allowing GovGuam employees into the social security system. "Well, good luck for him on that, we've been trying to get social security to come back to Guam since 1989 and good luck senator. I'm just asking now, when is Madeleine Bordallo going to have that resolution, have a public hearing, I'll bet you 10 to 1, it's one of those introduced then just forgotten," San Agustin said.
In the meantime, San Agustin says this hybrid retirement system is long overdue adding the responsibility is not on the GGRF but the Legislature to pass it. "If they have the guts pass it now, why wait two years from now and hoping that something else is going to happen in the meantime, 7,000 people are on a dangling right there I think that's irresponsible to continue to have 7,000 people on a string and give them no hope at all," he added.
Session resumes in the Committee of the Whole next week Tuesday morning.