After weeks of holding budget review hearings for fiscal year 2024, the 35th Legislature Committee on Budget, Appropriations, and Finance heard from two semi-autonomous agencies.
The lead testifiers for the Government Employees’ Retirement System and the Magens Bay Authority said they came to present overviews of their operations. Both Interim GERS Administrator Angel Dawson and Magens Bay Authority Interim General Manager MemorieAnne Brown-Callender both pointed out that their agencies are not funded through the executive budget.
Committee Chairwoman Donna Frett-Gregory said the third agency scheduled to appear on Tuesday — the Virgin Islands Next Generation Network — did not appear but will be rescheduled.
For the next five-and-a-half hours, agency teams spoke about their accomplishments from the current spending year and answered questions about the challenges they face.
Dawson reminded committee members that a few years ago, pension officials predicted GERS’ insolvency by 2024. Much of that changed when the Legislature and Gov. Albert Bryan Jr. came up with a financing plan using rum cover-over funds.
The measure was approved and signed into law in 2022.
“Fortunately, with the Funding Note referenced earlier, instead of Oct. 1, 2024, representing the beginning of the GERS final year of existence as we know it, we can look forward to the GERS remaining viable throughout at least 2052,” Dawson said.
But the administrator said the system still faces setbacks. Government employees’ withdrawal of pension contributions as they resign or move on is one of them, he said. There is also the possibility that the system could lapse into temporary insolvency in 2038 unless there are adjustments to the current financing scheme.
“We expect this trend to decrease due to additional funding that will be infused into the system in future years,” Dawson said.
He also updated the committee on the system’s payments to retirees. There were membership and annuity payouts to 8,776 retirees in FY 2021, according to unaudited reports.
Overall, the administrator expressed guarded optimism for the retirement system’s future.
In the round of questions posed by committee members, Sen. Novelle Francis Jr. asked about future revenues. Specifically, Francis asked if GERS had plans to develop some of the real estate they owned on St. Croix.
Dawson said there may be further discussions about that at an upcoming Senate hearing.
The presentation by officials at the Magens Bay Authority was brief compared to the questions posed to GERS by Frett-Gregory and the two rounds of questions from committee members.
Frett-Gregory questioned Brown-Callender about revenues and expenses for the current year, about payroll processing and pension liability.
Committee member Carla Joseph asked Brown-Callender to furnish information about the authority’s savings and investment accounts. The new director said she did not come prepared to answer those questions, but she would supply the requested documents by day’s end.
The chairwoman said she was pleased to hold talks with agencies like the Magens Bay Authority, even though they did not come to defend their spending plan.
“I’m happy that you are not one of those individuals who says, ‘But we don’t get any money from you,'” she said.
“But you do, because every single dime, every entity that is created by the institution of the Legislature, we have an oversight responsibility. Whether or not you collect those dollars or not, and you are self-sustaining, these are considered taxpayer dollars,” the chairwoman said.
Sens. Donna A. Frett-Gregory, Ray Fonseca, Marvin A. Blyden, Dwayne M. DeGraff, Novelle E. Francis Jr., Milton E. Potter, Carla J. Joseph, and Samuel Carrión were in attendance at Tuesday’s hearing.
