23 Feb 2007

American Samoa administration seeks to borrow 20 million dollars from retirement fund

10:24 am on 23 February 2007

American Samoa's Governor, Togiola Tulafono, is seeking legislative approval for a direct loan from the ASG Employees Retirement Fund to pay for infrastructure projects which were initially proposed in a $20 million bond bill.

The governor says a direct loan from the fund is a much simpler vehicle for funding the proposed projects.

In a letter to Fono leaders, the Governor says the logistics involved with bond issues are various and complex.

He says the requirements of insurance, underwriters fees, administrative costs and ratings agencies will be avoided by pursuing a direct loan from the Retirement Fund.

A new bill is being introduced to authorize the government to borrow $20 million from the fund at 7.5% interest.

The projects to be funded with the loan include the harbor dredging, the purchase of a tug boat, funding for the Pacific Arts Festival, an airport hangar, seawalls , a youth centre and various buildings.