The Senate has merged a bill that coverts ASG’s debt to the American Samoa Government Employees Retirement Fund to a $31 million loan to be paid by the American Samoa Telecommunications Authority and an administration bill that reduces ASG’s contribution to the Retirement Fund.
Senators had earlier decided to table the administration bill until an actuary report on the impact of the changes proposed in the bill was provided. They had also voted to delay the Senate bill sponsored by Senate President Tuaolo Manaia Fruean for the $31 million loan and request a special session of the Fono to review and vote on the bill, together with any items proposed by the Governor. But with just a few days remaining in the current Fono session and uncertainty if a special session would be called, the merger of the two bills was believed to be the best chance for the two bills to pass.
Senators made changes to the effective dates of the reduced employer rates proposed in the administration bill. Under the amended dates, the rate that ASG pays to the Retirement Fund is reduced from 14% to 8% effective Oct 1, 2026 through to September 30, 2028.
Then it increases to 10% from Oct 1, 2028 to September 30, 2030.
From October 1, 2030 to September 30, 2032 it increases to 12 percent. Thereafter the government’s contribution rate shall be based on a formula that’s provided in the law.
For the $31 million loan, Senators have inserted language for Debt Service Payments. This states that ASTCA shall transfer and remit debt service payments to the Fund on ASG’s behalf in accordance with the repayment schedules. debt service requirements. reserve requirements and other covenants set forth in the promissory note and related loan documents executed pursuant to this Act. Any payment made by ASTCA shall be credited to ASG’s repayment obligations under the loan.
ASTCA shall make monthly deposits into any Debt Service Account established pursuant to the loan documents, prior to the use of available revenues for discretionary expenditures. Such deposits shall be determined in accordance with the repayment schedule and funding requirements established in the promissory note and related loan documents and shall be sufficient to provide for the timely payment of all scheduled debt service obligations.
Amounts deposited into a Debt Service Account shall be used solely for payment of obligations arising under the loan authorized by this Act unless otherwise permitted by the loan documents.
Senators approved the merged bill by unanimous vote in third reading yesterday. It’s expected to be introduced in the House of Representatives today.
Senators also passed in final reading yesterday a House bill that establishes the American Samoa Telecommunications Authority by law. This was another bill that Senators had decided last week to table however it was reported to the floor for third reading yesterday and was passed by unanimous vote.
The bill will now be enrolled and sent to the Governor for his review.
