The Senate Committee on Government Services and Housing met Monday on St. Thomas and discussed three pending bills, forwarding one for consideration by the Rules and Judiciary Committee and holding the other two for further discussion.
Two of the bills involved the government workers and retirees but didn’t address ways to bolster the financially struggling Government Employees Retirement System or lower health insurance premiums.
Legislation sponsored by Sen. Sammuel Sanes, Bill 30-0370, allowing retirees the option of receiving paper checks and check stubs or direct deposit was passed despite testimony from Austin Nibbs, GERS executive director, who said it could cost up to $200,000 a year, in addition to the system’s $14 million budget. New software would be needed as well as paper and postage, he said.
Nibbs said that, according to recent research, fewer than 10 percent of the 8,397 annuity recipients requested paper copies of deposits in the last eight months. About 718 retirees requested paper at the GERS offices. Other paper checks include 455 that are mailed to retirees outside of the territory, Nibbs said.
Retirees who come into the office are given computer assistance, if necessary, and print their check stubs. Nibbs said approving the bill will “open the floodgates” with requests.
Direct deposit for annuity payments was approved in July 2011 and is a “safe and cost effective” payment method, he said. Paper is a step backwards, he added.
Sen. Donald Cole said that considering the GERS $14 million budget, an additional $100,000 to $200,000 means that retirees “have a choice.”
Other senators, including Sen. Craig Barshinger, suggested charging postage and/or a fee to process paper deposit receipts.
Sen. Terrance “Positive” Nelson agreed and said he would vote against the measure because retirees already had the option.
Sens. Diane Capehart, Alicia “Chucky” Hansen, Clarence Payne and Cole voted in favor of the bill, and Nelson and Sen. Judi Buckley voted against.
During a brief discussion, Graham and Nibbs agreed that interest could be saved and earned by changing paydays to the first and 15th of the month instead of the 16th and 30th. Nibbs pointed out that even more could be saved by paying retirees once a month.
The other government employees related proposal, Bill 30-0087, would change the composition of the Government Employees Service Commission board. Currently the board comprises five governor appointees, two elected active members and two retirees. No more than six members have ever served on the board.
The proposed change would add the director of personnel and provide that two members are appointed by the governor, two by the Senate, and there would be two elected active employees.
Discussion revolved around the director of personnel, Kenneth Hermon, and whether he would “be wearing four hats,” according to Beverly Joseph, Government Employees Service Commission representative. Hermon would be a nonvoting member, but Joseph asked if he would administer the program and advocate for participants at the same time.
The discussion then turned to health insurance for government employees and why a $675, 000 late charge has been incurred annually since 2007 or 2008.
“We have never been able to come current on our health insurance payments,” Hermon said. “I am always trying to pay a premium that is 30 days late.”
Late payments by the central government were blamed for the late payment to CIGNA, the government’s insurance provider. Cole pointed out that employees are paying their premiums timely and shouldn’t have to cover for the government’s lack of funds.
Payne argued passionately in favor of self-insurance for government workers. He said that although 9,000 government workers are under the V.I. health insurance plan, 40,000 residents are paying taxes for the government’s late payments and can’t get health insurance themselves.
Andre Dorsey, GESC vice president, said, “You met it broken, but you have had eight years to fix the system. Catching up payments doesn’t fix it.
The model we have now is a broken model,” Dorsey said. “It is not a matter of bringing the personnel director on the board.”
Joseph disagreed and said the board was not broken; it was a matter of getting insurance payments made on time.
“We really need to resolve this insurance issue with the government,” Sen. Clifford Graham, the bill’s sponsor, said in support of holding the bill.
Buckley said, “It’s very clear there’s no support for the bill as it’s written,” and Hansen eventually moved to hold the bill in committee.
The third bill on the agenda, Bill 30-0330, allowing the Housing Finance Authority to issue agriculture leases for up to 25 years, was also held in committee without discussion. Payne, the bill’s sponsor, said the agriculture commissioner and HFA director support the measure.