Senator Laolagi Vaeao has moved to erase from the government’s books a loan facility agreement which requires LBJ Hospital to repay a $5 million loan that it received from the American Samoa Government more than ten years ago.
Based on the agreement the current and immediate past ASG treasurer claim that the LBJ Hospital owes millions to ASG and Treasury is withholding monthly subsidies, the 2% wage tax, and Medicaid/Medicare payments due the LBJ Hospital to offset this debt.
The $5 million came from Hurricane Val insurance monies.
At a hearing into LBJ finances last month, senators pointed out that the $5 million should not be called a loan, because this was government money from the Val insurance settlement.
Plus the Fono never had any intention for the hospital to pay back the $5 million.
Deputy ASG Treasurer Tina Vaa testified that the $5 million is still on ASG’s books and auditors have advised that it can only be written off if the Fono approved a bill to that effect.
Senator Laolagi stated at that time he intended to sponsor such a bill.
Yesterday he delivered on his promise, introducing Senate Bill 34-19, which forgives by repealing the $5 million debt created in the American Samoa Government Credit Facility Agreements for the American Samoa Medical Center that was entered into in 2003.
The legislation states that the government has long desired to forgive and write off a loan it provided to the hospital in 2003 of $5 million.
So that both ASG and the hospital can provide more accurate accounting and reporting of their finances, the bill goes into effect the day it is approved by the Legislature and signed by the governor.
