SOME Guam media have belatedly discovered that last year the Legislature increased survivors' benefit from 50 percent to 60 percent. This increase was passed, without a public hearing, via a floor amendment to the 2012 Budget Bill, P.L. 31-77, on Aug. 25, 2011. This increase will cost the Retirement Fund $3.8 million a year, and increased the unfunded liability by $64.2 million.

The timing of this belated discovery is suspicious. It follows shortly on the heels of the introduction of Gov. Eddie “Pepsi” Calvo’s Spending Cuts Bill, aka the Omnibus Budget Reform Act of 2012, aka Bill 507-31, which will ALSO increase the unfunded liability in two ways – by allowing 500 employees to retire early and by extending the unfunded liability amortization period by 10 years.

According to Pepsi’s spokesman, Troy Torres, Pepsi’s proposed raids on the Fund are justifiable since the board of directors of the Fund connived in the increase in survivors' benefits. How can the board object to the governor’s proposed raids on the Fund, Troy Torres says, when the GGRF board did not object to (or even covertly support) the increase in survivors' benefits?

Pepsi appears to have quietly decided that the Retirement Fund is a goner, and that the current administration might as well LOOT something that will bite the dust eventually anyway. I also suspect that the latter conclusion has also been reached by those advancing the interests of a cohort of current retirees with a certain life expectancy. I am referring to a group of current retirees, and their survivors and children, who have benefited by recent actions of the GGRF board of trustees – actions such as acceding to the Health Insurance Bailout of 2011 and the recent increase in survivors' benefits from 50 percent to 60 percent.

This in spite of the fact that on Feb. 18, 2003, in Odilia Bautista v. Gerald S.A. Perez CV 1848-01, Judge Lamorena ORDERED the board of directors of the Fund to challenge in court any legislative increase in benefit levels. The board has yet to initiate action in court seeking to invalidate this increase in survivors' benefits.

A motion is now pending before Judge Lamorena to compel the board to challenge in court the organicity of this increase in survivors' benefit levels. The motion is awaiting assignment of a hearing date.

Retirees and future retirees need to be on full alert. Pepsi AND the board of directors of the GGRF are screwing with your retirement.

Joe Guthrie,
Guam and the Philippines