Prior Service Trust Fund
Prior Service Trust Fund (PSTF)
The 237 Marshallese and hundreds of Micronesians currently receiving benefits from the Prior Service Trust Fund (PSTF) are assured of continuous benefits until end of 2009 as $500,000 additional funding was approved by the Office of the Insular Affairs, US Department of Interior.
This piece of good news was brought to the attention of PSTF’s Board of Directors (comprised of the Administrators and Board Chairmen of the former members of the Trust Territory) during their meeting in Guam in February 2009.
The additional funding will be divided on a pro-rata basis among the four former members of the Trust Territory – the Commonwealth of the Northern Mariana Islands, Republic of Palau, Federated States of Micronesia and the Republic of the Marshall Islands.
The PSTF is a US funded program that provides benefits to Micronesians with five or more years of service with the Naval Administration or Trust Territory Government prior to 1968.
When the PSTF was decentralized in April 2006, the administration of the fund was transferred to the respective social security system of each of the four former members of the Trust Territory.
In November 2007, the fund was depleted to almost zero which forced MISSA to put on hold its benefit payments. It was resumed in January 2008 when additional funding of $108,112 was received. Another $7,784 was received in July 2008.
The fund run out again in September 2008 and consequently, payments for September and October 2008 were put on hold until another $61,088 was received by MISSA in late 2008. This enabled the Administration to continue paying its beneficiaries up to February 2009.
Early this month, MISSA received $7,400, just enough to pay-off the benefits for the month of March 2009. The Administration expects to receive soon he balance of its share in the $500,000 additional funding for PSTF.
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Published 5 December 2008
MISSA gets additional PSTF funding
The Prior Service Trust Fund (PSTF) is a U.S. funded program that provides benefits to Micronesians with five or more years of service with the Naval Administration or Trust Territory Government prior to 1968. This program is controlled by a Trust Agreement between the U.S. Department of Interior and the four Trust Territory governments of the Commonwealth of the Northern Mariana Islands, Republic of Palau, Federated States of Micronesia and the Marshall Islands.
The trust agreement became effective in 1987 and to date more than $16 million of benefits have already been paid.
In April 2004, John M. Niedenthal, MISSA’s Board Chairman, started his term as Chairman of the PSTF. This was the result of a previous agreement that each PSTF Board Member shall act as the Chairman on a rotation basis per year.
In September 2004, PSTF officials met in Washington D.C. with U.S. Deputy Assistant Secretary Cohen and the Office of ther Insular Affairs. The meeting was a success as a grant for $1.6 million was awarded to the PSTF which was used to bring the beneficiary payments up to date.
A portion of the fund amounting to $100,000 was granted as assistance fund for the decentralization of the PSTF effective October 1, 2005, which would cause the administration of the fund to be transferred to the social security system of each of the four former members of the Trust Territory.
The fund was subsequently decentralized in April 2006 and MISSA started administering the distribution of $105,000 leftover share it received.
As of September 30, 2007, MISSA had only $31,141 in reserve for PSTF which was inadequate to cover the 20% administrative fees due to MISSA estimated at almost $37,000 and another $60,000 receivables that have accumulated prior to its decentralization. In 2006.
On September 2007, MISSA made its decision to put on hold all PSTF benefit checks pending receipt of additional funding from the U.S. Government.
In November 2008, MISSA received $61,088 additional PSTF funding which enabled the Administration to release its September and October 2008 benefit checks which were put on hold earlier for lack of funds. This is the third funding received in 2008.
In early 2008 (January and July), the Administration received a total of $115,896 for the almost 250 current Marshallese beneficiaries. This enabled the Administration to continue paying the monthly PSTF benefits until August 2008, after which the fund was depleted again (for the second time). MISSA was forced to put on hold its PSTF benefit payments in November 2007 for lack of funds. Payments were then resumed in January 2008 when additional funding was received.
At present, the Administration needs at least $11,100 to meet its monthly PSTF benefit payments, including the 20% administrative fee that MISSA is entitled to. Unless additional funding is received, the current PSTF fund will only last until January 2009.