OFFICE OF THE GOVERNOR
PRESS RELEASE
(for immediate release – April 23, 2007)
Contact: email the newsroom
(684) 633-4116 - Fax: (684) 633-2269

Governor Togiola asks Fono
for $1.7 million for LBJ Hospital

(UTULEI) - Governor Togiola Tulafono today submitted in the Fono’s special session proposed legislation that will authorize the American Samoa Medical Center Authority (ASMCA) to borrow $1.7 million of the funds that were authorized under the LBJ Loan Bill.

In a letter to the Fono leadership, Governor Togiola said “As a result of the High Court’s decision in Senate vs Governor regarding the LBJ Loan Bill, the $1.7 million that was originally part of the bill is arguably available for reauthorization.

The newly proposed measure will provide for urgently needed money for ASMCA’s Medicaid and State Children's Health Insurance Program (SCHIP) matching fund requirements and also to purchase much-needed healthcare equipment in the current fiscal year.

The specific purpose for use of the $1.7 million is to fund the local contribution of Medicaid / SCHIP and for diagnostic imaging instruments and related-equipment, which totals $1.2 million. The remaining $500,000 of the borrowed funds will go into the ASMCA Fiscal Year 2008 budget.

Governor Togiola says this legislation will greatly assist ASMCA in meeting its financial obligations at LBJ Hospital.

“We continue to make significant gains in offering quality health care for our patients. The reauthorized funds will help ASMCA to purchase critically needed medical and diagnostic equipment, thereby ensuring more efforts of providing better health service for American Samoa,” said Governor Togiola. “It is my sincere hope that the Fono will offer ASMCA its full support.”

BELOW Proposed bill in its entirety

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___.B. NO. 30-___                                                             PUBLIC LAW NO.30-____

THE THIRTIETH LEGISLATURE OF AMERICAN SAMOA

FIRST SPECIAL SESSION

Begun and held at Fagatogo, Tutuila, American Samoa
on Monday, the twenty-third day of April
two thousand and seven

AN ACT AUTHORIZING THE AMERICAN SAMOA MEDICAL CENTER AUTHORITY (ASMCA) TO BORROW $1.7 MILLION PURSUANT TO PUBLIC LAW 29-21 BY AMENDING SECTION 7.1444.4 ASCA AND PROVIDING FOR AN EARLY EFFECTIVE DATE.

Preamble:

Due to the urgent need to provide funding for ASMCA’s Medicaid and SCHIP match requirements and to purchase much needed healthcare equipment in the current fiscal year, this law shall become effective immediately upon passage by the Legislature and signing by the Governor.

BE IT ENACTED BY THE LEGISLATURE OF AMERICAN SAMOA:

Section 1.            Section 7.1444.4 is amended to read:

“7.1444.4 Credit facility authorization - Assistance - American Samoa Medical Center Authority.

(a) In accordance with the provisions of section 7.1444.4(g)(3), which limits any investment in obligations or other instruments issued or guaranteed by the government to no more than ten percent of fund assets at cost, the Governor, on behalf of the American Samoa Government (ASG), and the Board of Directors of the American Samoa Government Employees Retirement Fund (ASGERF) are authorized to enter into a credit facility whereby the ASGERF will lend and ASG will borrow an amount of $10,000,000.

(b) The Governor, the Treasurer and the Chief Financial Officer for the American Samoa Medical Center are authorized to negotiate the terms of the credit, including an interest rate, repayment terms and such other terms and conditions as may be required to obtain the credit facility, except that the interest rate must be tied to the current actuarial rate of return and the interest rate shall not be less than 8% per annum. The Governor, the Treasurer and the Chief Financial Officer for the American Samoa Medical Center and the ASGERF Board are further authorized to execute all instruments and documents necessary to conclude the transaction, including promissory notes which evidence indebtedness of ASG. The Governor is authorized to pledge the full faith and credit of ASG as well as to provide collateral as required by the ASGERF Board to secure the loan.

(c) The loan proceeds shall be placed in an earmarked fund and used exclusively for the following purposes and in the following priority:

(1) debts, obligations and payable accumulated and owing to appropriate American Samoa Medical Center Authority (ASMCA) vendors, amounts not to exceed:

(A) Contingent - Liabilities

(B) Contingent - Liabilities Penalty & Interest
Total $1,800,000

(C) Vendor - Liabilities:

Total Liabilities                                                                                     $5,000,000
Total expenditures                                                                               $6,800,000
            (2)             Continuing Operation of ASMCA                                          $1,700,000
            (3)             Matching funds                                                                        $1,500,000
Total                                                                                                   $10,000,000

(d) $1,700,000 to pay for the continued operations of ASMCA is contingent upon ASMCA reinstating the hospital fees and costs rates prior to November 1, 2005 and there shall be no future increases of the rates for fees and costs thereafter. If hospital fees and costs are not reinstated to before November 1, 2005 rates, the $1,700,000 will return to the Legislature for reappropriation. shall be used by ASMCA for the following specific purposes:

(1)            Medicaid/SCHIP Local Match and Medical and Diagnotic Equipment:
(A)           Beds; Ultrasound (Cardiology); Incubator; Pulse Oximeters; Gurney; Patient Monitors; Examination Table; Operating Microscope; Tracoustics exam room; Electric exam table; Exam treatment chair; Floor unit; Slit lamp Zeiss; Visual field analyzer; Patient monitoring system; Chemistry analyzer; Birthing beds; Infant warmer system; Surgical Table; Infusion pump; Autopsy table, sink and space; Blood pump; ABG machine; Neonatal monitor; C-arm extenstion; Torniquet, single, double; Infusion pump, dual; Cautery machine; Cysto table; Shea drill; Stretcher, patient transport; Heater probe; Scope, Gastroscopy; Steris system; Instrument washer; Portable cauterize; Procedure tables; Aud. Exam table; Hand held Doppler; Crib baby; Ultrasound, electrical simulation; Whirlpool, large; Analyzer, blood gas; Pasteumatic compact; Electrosurgery.
Total Expenditures                                                                               $1,200,000

(2)           ASMCA Fiscal Year 2008 Budget                                            $   500,000

Total                                                                                                   $1,700,000

            (e) The Governor, the Treasurer and the Chief Financial Officer for the American Samoa Medical Center shall be authorized to expend proceeds of the loan to satisfy only the debts, obligations and payables accumulated and owing to ASMCA vendors as provided for in 7.1444.4(c)(1)(A)-(C) above and any surplus or remaining funds shall be utilized for the following specific purposes, in descending order of priority:

(1) purchasing diagnostic equipment;

(2) purchasing treatment equipment;

(3) paying for capital improvement projects, excluding housing projects;
and equipment and continuing operation of ASMCA shall be provided directly to ASMCA and a full accounting of the said expenditures shall be made by ASMCA to Governor and the Legislature with full supporting documentation. The ASMCA shall enter into a fiscal and operations reform plan with ASG, which shall be approved by the Governor, whereby ASMCA will implement procedures to increase its revenues, reduce its expenditures, achieve a balanced budget and improve the operations of ASMCA ("ASMCA Fiscal and Operations Reform Plan"). The Plan shall be submitted within six (6) months of the date of the loan.

Section 2.             Effective date.

Due to the urgent need to provide funding for ASMCA’s Medicaid and SCHIP match requirements and to purchase much needed healthcare equipment in the current fiscal year, this law shall become effective immediately upon passage by the Legislature and signing by the Governor.