Pacific Daily News

HAGÅTÑA, Guam (Jan. 24) - During fiscal 2003, the Department of Education failed to pay retirement contributions for its employees to the Retirement Fund, which resulted in a debt of about $17 million. Until that debt is cleared, according to a policy of the Retirement Fund's board, DOE employees can't retire.

So what happened? The problem, according to Nerissa Bretania-Shafer, who served as superintendent during part of fiscal 2003, was that the education department didn't get its full allotment on a monthly basis, and DOE chose not to pay retirement contributions.

When the money finally did come, it wasn't applied to Retirement Fund debt, despite the fact that the department actually received more than it was budgeted in fiscal 2003. According to Public Auditor Doris Brooks, DOE's budget in fiscal 2003 was $140 million. It received $144 million, but spent $149 million.

DOE spent $5 million over its budget while also not paying the $17 million it owed the Retirement Fund. And because of this action, there are employees who want and deserve to retire who can't, at least not until this mess is straightened out.

The education department needs to ensure that not only is this situation rectified now, but that nothing like it ever happens again. To that end, it must hire a chief financial officer, as recommended by the public auditor since 2003.

The problem, according to DOE, is that it can't simply hire a chief financial officer; the position has to be created by the Guam Legislature. And, thus far, lawmakers have yet to take action to get this done.

In a private organization, all this bureaucratic hoop jumping wouldn't be necessary. If there were a need to hire a financial expert, one would be hired. That may be the best solution to the entire problem - eliminating the financial work by the education department. Instead, outsource the job to a private company specializing in financial matters.

This would free the administration to focus more on education. It would put the finances into the hands of experts who would also ensure that all protocols and procedures are properly followed, because a private company won't risk the consequences of violating the law by choosing not to pay retirement contributions.

January 25, 2005

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