Ninth circuit hears dispute over COLA for CNMI retirees

The U.S. Court of Appeals for the Ninth Circuit in Hawaii heard the case of Rosa A. Camacho v. NMI Settlement Fund on Tuesday over a dispute regarding Cost of Living Adjustment between the CNMI government and retirees.

“She acquired an interest in COLA. It is protected by the Commonwealth Consitution. She should be paid and her pension should be adjusted accordingly to that,” said Jeanne Rayphand, Attorney for Rosa Camacho.

Rayphand explained that Camacho retired in 1991. She turned 55 in 2006 and received a Cost of Living Adjustment from 2007 through 2010. However, it ended after a Senate bill was signed into law in 2011 eliminating the cost of living increases.

“I am just trying to figure out how she can be entitled to any COLA benefit about greater than what she was statutorily permitted in 1991 at the time of her retirement,” said Chief Judge Mary Murguia.

“The statute says that her membership continues. She continues to be a member after she retires and an accrued benefit accrues during her membership…she was entitled to the benefit after she retired also,” said Rayphand. 

The NMI Settlement Fund presented its case and responded to questions.

“The constitution prohibits benefits from being diminished or impaired. IT does not prohibit parties from contractually agreeing to alster, which is what the settlement agreement does…COLA payments are subject to appropriation. They are only due if there is an appropriation,” said NMI Settlement Fund Attorney Patrick Civille.