SAIPAN — Sen. Jude U. Hofschneider is asking the Governor and Attorney General to take the retirees’ side against pension overpayment clawbacks, introducing a Senate resolution that requests they petition the U.S. District Court for the Northern Mariana Islands to reconsider the recovery of alleged overpayments and seek waivers for affected retirees.
Senate Resolution 24-18, introduced July 20 in the Legislature’s sixth special session, responds to notices the NMI Settlement Fund issued to hundreds of retirees regarding alleged overpayments of retirement benefits following a benefits audit. The resolution says repayment demands range from several thousand dollars to hundreds of thousands, and that many retirees received the same benefits for 10 years or longer and reasonably relied on their accuracy.
The alleged overpayments resulted from benefit calculations made by the former Northern Mariana Islands Retirement Fund through no fault, misrepresentation or misconduct of the retirees, the resolution says. Many affected retirees rely solely on their pensions and cannot afford to repay the amounts or hire counsel to defend against recovery actions.
The resolution leans on CNMI case law. It cites the CNMI Supreme Court’s decision in Ada v. NMIRF, which held the 3 percent retirement bonus unconstitutional but void prospectively only, allowing members who received it in good faith to keep it, with the court finding that recouping funds retirees had likely spent and relied on for their livelihood would be unreasonable and unfair. It also cites Cody v. NMIRF and the 2023 hearing officer decision in the Rosa A. Camacho administrative appeal, which declined to recoup overpaid benefits and ordered only a prospective correction.
Based on those decisions, the resolution says claims involving recovery of retirement benefit overpayments would likely be decided in favor of retirees under the doctrine of fairness, and that the Settlement Fund should not spend retirees’ funds pursuing recovery through the courts.
The resolution requests the Governor and Attorney General advocate for equitable relief, including waiver or compromise of recovery where permitted by law, and asks that benefits be prospectively adjusted where necessary while protecting retirees from repayment obligations arising solely from administrative miscalculations.
Certified copies are to be transmitted to Governor David M. Apatang, Attorney General Edward Manibusan, Settlement Fund Trustee Joyce Tang, Designated Judge Frances M. Tydingco-Gatewood of the U.S. District Court for the NMI and House Speaker Edmund S. Villagomez.
