Vice-Speaker Cruz Introduces Bill to “Straighten Crooked Salary Schemes” & He Urges A.G. to Investigate and OPA to Audit

332

Vice-Speaker B.J. Cruz has introduced a bill to close the loophole that allowed the Governor to give retro pay to GovGuam staffers and he’s asked both the A.G. and the OPA to look into the matter. 

Guam – Vice-Speaker B.J. Cruz has introduced a bill that he says will “straighten crooked salary schemes”, he’s also asking the Attorney General to appoint a special attorney to review the matter and he’s calling on the public auditor to audit the retro pay the Governor gave to his staffers.

 

 “So that was the intent of the bill was to try to close the loophole that somebody discovered just this last week to be able to do this,” said Cruz. The Vice-Speaker is referring to bill 222 that he introduced to prevent the manipulation of salary settings for unclassified GovGuam employees. The Governor currently has the authority to set the salaries for his unclassified employees. This is what has allowed him to pay out large lump sum payments which appear to be some form of bonus pay or retro pay to his unclassified staffers for two consecutive years. Vice-Speaker Cruz’s bill would essentially prevent this by requiring that these payments be spread out over the course of the year.

 Cruz is also calling upon the A.G. to appoint a special attorney to investigate these bonuses and prosecute this case if necessary. “She is in a predicament in that she represents the government and the Governor and she also has to take care of the electorate the citizens of Guam and that’s really hard to do. Which client do you take care of?” said the Vice-Speaker

 The Vice-Speaker has also written to the Public Auditor asking her to conduct a full blown audit of the entire bonus payout process. “I wanted her to go back in and check whether or not the Governor and Lt Governor’s office were the only ones to have this special pay,” said Cruz. The Vice-Speaker says he’s seen some indication that other departments may have also received bonuses.

 He also wants the Public Auditor to look into both the bonuses and the method the Governor’s office came up with to help the employees pay their bonuses back. The Governors’ office will be cutting checks for the amounts of the bonuses to the employees who will then sign the checks back over to the Government of Guam. “Also I’ve asked her too look at the tax ramification. Did that increase everybody’s salaries for 2016? What’s that going to do to their salary in 2015 when their W-2 form comes out?” asked Cruz.

 

 The Vice-Speaker says he hopes that both the AG and Public Auditor will be able to conduct thorough investigations and audits on behalf of the taxpayers who are in the end footing the bill for these salary adjustment bonuses.

Read First Press Release Below:

Cruz Bill to Straighten Crooked Salary Schemes
 
(Hagåtña – December 16, 2015) Manipulation of salary settings relative to unclassified government employees—akin to implementation of the much-publicized Adelup retro pay raises—is barred through legislation introduced by appropriations chair Vice Speaker Benjamin J. F. Cruz this morning.
 
“Adelup has called these payments incentive pay, performance bonuses, and one-time, lump-sum salary adjustments; but the old adage is still true: you can put lipstick on a pig, but it’s still a pig,” said Cruz, referring to the various terms the administration has used to characterize the pay raises it issued its unclassified gubernatorial staff. “For two consecutive years, unclassified employees at Adelup received large lump-sum payments the law never intended to allow; this bill says that has to stop.”
 
Bill No. 222-33 (COR) arrives on the heels of Governor Calvo’s decision to use taxpayer funds to compensate for the retroactive pay raises illegally issued to 107 unclassified Adelup employees. Subsequent to the Attorney General’s opinion calling for the repayment of retroactive raises, Governor Calvo’s repayment plan to distribute new checks to unclassified employed staff at Adelup has incited an immediate response from the Vice Speaker.
 
“Illegal payments were made with taxpayer funds and the way the Governor proposes to fix it is to pay taxpayers back with their own money,” said Cruz. “This is wrong and the only people who believe otherwise work for the Governor of Guam.”
 
Aimed to prevent strategic corruption and manipulation of salaries of unclassified government employees, Bill No. 222-33 (COR) prevents further unlawful salary adjustment by amending sections that authorize the regulation of gubernatorial staff salaries. While the law currently allows the Governor and Lieutenant Governor to set salaries for positions in their respective offices, Bill No. 222-33 (COR) would ensure that those salaries are paid in 26 equal installments from the authorized salary date, preventing any scheme to pay a year’s salary in one pay period.
 
“Bill No. 222-33 (COR) isn’t perfect but it’s a strong start,” said Cruz. “This bill sends a clear message: pay adjustments can’t be manipulated to give a special class of people thousands of dollars in lump-sum pay just because an elected official says so.”
 
The measure also adds new language that would prohibit unclassified staff of the offices of the Governor and Lieutenant Governor from receiving bonus pay, defined as payment “separate and apart from” base pay; and requires that other increases to an unclassified employee’s base pay be made in 26 equal installments from the authorized adjustment date. If such salaries are then reduced within two pay periods from the authorized date, the employee must return the increased compensation before the next pay period.
 
The three amendments work in tandem to prohibit lump-sum payments during one pay period, preventing future manipulation of the processing for pay adjustments.
 
“With his army of highly-paid lawyers, the Governor had a clear choice: make it legal or make it right,” said Cruz. “His actions clearly show that despite all the legal expertise at his disposal, he has no one to tell him what is right.”

###
 
 
Read Second Release Below:
 
Cruz to AG: Appoint Special Counsel to Review Illegal Retro Pay
 
(Hagåtña – December 16, 2015) Appropriations chair Vice Speaker Benjamin J. F. Cruz has called on the Attorney General of Guam (AG) to appoint a special prosecutor to independently investigate and, if necessary, prosecute responsible parties in the illegal issuance of retroactive payments to Adelup employees in December of last year. In a letter to Attorney General Elizabeth Barrett-Anderson transmitted this morning, Cruz advocated for the appointment of a special prosecutor nominated by the Guam Bar Association Committee on Professional Ethics and Unauthorized Practice of Law.
 
“As I have said to you in the past, I do not believe that one person can serve two masters; the same adage applies to your office’s ability to independently investigate and, if need be, prosecute this matter while simultaneously representing the Governor of Guam in several ongoing concerns,” said Cruz in the letter, noting that the AG had stated to the media that she was open to the recruitment of special counsel to review the retro pay fiasco given her clear conflict in her duties in representing the government of Guam.
 
In a December 15 Pacific Daily News article, Barrett-Anderson was quoted to have said, “Because of my role of representing the government and the governor and the agencies, yes, … If is it prudent for the attorney general to recruit a special prosecutor, a special review, yes, I agree with that.”
 
“At the heart of this issue is a simple question: Can the People of Guam trust that the justice system will work as fairly for the powerful as it does for the powerless?” Cruz posits in his letter to the AG, asserting that the appointment of an independent prosecutor or conflict counsel “will ensure that an independent third party reviews the facts and, if necessary, prosecutes those who broke the law, without fear of personal or political reprisal.”
 
Cruz further states that the Governor’s reimbursement scheme—specifically, authorizing a new set of “pay adjustments” to Adelup employees to cover the repayment of the illegal retroactive compensation from January to December of 2014 —further compounds the need for independent legal review. Since the AG issued her December 10 opinion on the legality of the “bonuses” retroactively granted in December 2014, the administration has acted swiftly. The Governor’s legal counsel has admitted, and AS400 data appears to indicate, that Adelup employees have been recently granted a one-time, lump-sum salary adjustment, to be made effective this month, that would serve in place for repayment of the illegally issued retro pay.
 
The request for the appointment of special counsel to investigate Adelup’s retro pay scheme is part of Cruz’s approach in addressing the administration’s dogged efforts to give bonuses to, as described in the AG’s December 10 opinion, “107 rank and file individuals in [the gubernatorial] Offices who were possibly the only category of unclassified government employees in the Executive Branch whose salaries were not addressed by the Competitive Wage Act (CWA) or legislation, presumptively based on [the Governor and the Lieutenant Governor’s] Section 6207 authority [to set salaries for staff].”
 
“Our people need to know that the justice system can be just as fair to the powerful as it is to the powerless; this is why I am recommending a simple three-point approach: appoint an independent prosecutor recommended by the Guam Bar Association’s ethics committee, have the Public Auditor conduct a full audit of the Governor’s actions, and pass a bill to prevent this type of scheming from ever happening again,” said Cruz. “When the Governor of Guam is so focused on protecting his people that he isn’t protecting The People, the Public Auditor, Attorney General and Legislature must act clearly and decisively.”
 
###
 
Read Release Below:
 
Cruz to OPA: Audit Adelup Retro Pay Raises 
 
(Hagåtña – December 16, 2015) A performance audit of the illegal retroactive pay raises in December 2014 and the recently authorized new set of salary adjustments to be used as repayment of the former, has been requested by appropriations chair Vice Speaker Benjamin J. F. Cruz in a letter to the Public Auditor this morning.
 
The vice speaker has also transmitted a letter to the Attorney General of Guam calling for the appointment of special counsel to investigate the implementation of the Adelup pay raises and, if necessary, prosecute responsible parties.
 
“While the Attorney General deals with legal issues on the matter, it is imperative that our independent and objective Office of Public Accountability (OPA) ensures that the public is made aware of the cost details of both the illegal adjustments made in December of 2014 and the process for their repayment,” said Cruz in the letter to Public Auditor Doris Flores Brooks, referring to the administration’s decision to issue checks to currently employed recipients in the same amount that was paid in the previous year. Said checks will then be given back to GovGuam as repayment for the illegal retroactive adjustment made last December.
Cruz proposes that the audit should, in addition to other objectives, provide information relative to both pay adjustments to include the total cost of the raises, an all-inclusive list of executive branch agencies whose employees received either pay adjustments, the eligibility criteria and specific formula used to calculate amounts of individual pay raises, total withholding taxes paid, total amount of retirement contribution paid for each of the raises, the effects of the pay adjustments on the calculation of retirement annuities for recipients enrolled in the Defined Benefit Retirement Plan, the total amount of “repayment” to the General Fund.

The OPA has also been requested to determine the limitations of the accounting software or “technical glitches”, which the administration purports had made the December 2014 pay adjustments appear to be retroactive.

The request for a performance audit is part of Cruz’s approach in response to the administration’s dogged efforts to give bonuses to its unclassified employees whose salaries were not addressed by the Competitive Wage Act. In addition to calling for the appointment of an independent prosecutor recommended by the Guam Bar Association’s ethics committee, the vice speaker has also introduced legislation, Bill No. 222-33 (COR) to prohibit lump-sum payments during one pay period, preventing future manipulation of the processing for pay adjustments. 

“By fully auditing each of these payments, calling for a thorough investigation by an independent prosecutor and passing Bill No. 222-33 (COR), I hope we can prove to people that the law can be used protect taxpayers instead of swindle them,” said Cruz.

###
 

1 COMMENT

  1. First let me state that I am a loyal Republican. I have supported Governor Eddie Calvo since he decided to run in 2010 and was ecstatic when he and Ray won the that election. I once again voted for Eddie & Ray in 2014 in which they beat the opposition in ever village. This issue of granting bonuses has raised my concern because it was something I would never have suspected from this administration. Senator B.J. Cruz ((whom I’ve never voted for) was able to bring these bonuses to light and I commend him for that. We the people have a right to know how our tax money is being spent. Please hear me out Governor Calvo. As a supporter of yours for years, I feel let down. You need to have your employees pay back these bonuses even if it takes a year to do so. Your idea of returning this money into GovGuam’s coffers is an insult to every hardworking individual on this island. What you ultimately decide to do will not only determine what the history books say about your tenure as governor but also your lt. governor’s plans on running for the island’s top post in 2018. I have faith that you will do the right thing.

Comments are closed.