Ads by Google Ads by Google

Senate throws first salvo over the tobacco settlement funds

After amending the funding source, the Senate approved yesterday in third and final reading two administration bills totaling more than $200,000 to pay separate High Court judgements against the American Samoa Government, with the unpledged interest from the tobacco settlement.

The Senate amended the funding source as well as reducing the amount of one judgement, followed a recommendation by Senate Budget and Appropriation Committee chairman Sen. Lemanu Peleti Mauga during Monday’s session when the bill went through second reading.

Lemanu said as far as he is concerned, the $6.8 million was received by ASG in the current fiscal year 2012 and in accordance with local statute, this money should have been sent to the Fono in FY 2012 for appropriation.

The first court judgement sent to the Fono in July last year appropriates $32,500 to settle a High Court judgment handed down in 2009 over a 2001 accident where a student was injured by a government vehicle around the Pago Pago Elementary School area.

The second judgement calls for $321,757 to settle a judgment against ASG for breach of contract by failing to pay for construction services provided by Pacific International Engineering, Ltd. (PIE).

Funding sources for the two bills are higher business license fees and the new corporate franchise tax, as well as an increase in import tax on beer, tobacco and alcohol. The bills remain tabled in committee since they were first submitted early last year, and as far as senators are concerned, they have been rejected.

A Senate budget committee hearing last month revealed that ASG has a windfall of $6.8 million in the unpledged interest from the tobacco settlement, but Budget and Planning Office director Malemo Tausaga says this money is being used to fund the FY 2013 budget.

At Monday’s second reading, Lemanu moved to amend the funding source of the two bills to reflect the tobacco settlement interest as the new funding source.

For the PIE judgement, the total has been reduced by $25,000 which is the amount of money the High Court ordered the government to pay — as part of the judgement — for funeral expenses for company owner, Warren Fisher, who passed away recently.

The two judgement bills now go to the House for review and consideration, but it's unclear whether or not they will endorse the two bills given the change in the funding source, an item that some lawmakers planned to raised next week during the start of the FY 2013 budget hearings.