State of the Territory report offers insights into ASG’s audits and performances

Pago Pago, AMERICAN SAMOA — In the State of the Territory Comprehensive Report 2024, the financial outlook for American Samoa highlights the collective work the Lemanu-Talauega Administration has done “to support the government and people of our Territory,” it states.

In review, at times the work has involved repayment of the US Treasury for ineligible expenditures of federal funds, as well as testing its own performances using both federal and local funds.

US TREASURY OFFICE OF THE INSPECTOR GENERAL AUDIT

For the U.S Treasury Office of the Inspector General Audit, the 2024 TCR points out that 2023 marked the ongoing audit of over three (3) and a half years, since July 2020, which is required submissions to the US Treasury Office of the Inspector General as part of the $35 Mil Coronavirus Relief Fund (CRF). One of the 4 reports is completed with 3 additional reports to be done  by Sept. 2025.

The audit has so far let to questions of costs of over $9.3 Mil, which includes access roads, MV Pago Pago vessel purchase, school improvements, DPS vehicles, TBAS, Visitors Bureau and others. Currently, additional documentation and justification has been provided for $3.9 Mil of the $9.3 Mil.

The first report of the 4 reports, known as Interim Report #1, identified the MV Pago Pago vessel as an ineligible purchase. Samoa News points out the final repayment of the vessel to the US Treasury was made in Sept. 2023, and was part of the kerfuffle the Administration has with the Fono over money spent without Fono approval in 2023. Funds used are said to be from local “surplus” revenue that under law must be approved by the Fono before being spent.

According to the 2024 TCR, “To date, the 2020 COVID-19 Fono stipends, Leapaga lease payments and the purchase of the MV Pago Pago are ineligible costs and ASG has reimbursed U.S. Treasury these costs of over $2.5 million.”

The Lemanu-Talauega Administration was notified of the ineligibility of the 2020 COVID-19 Fono stipends in July 2020, by Richard Delmar, Deputy Inspector General of the US Department of Treasury in a July 14 letter to ASG Treasurer Ueligitone Tonumaipe’a, four days after the Fono stipend checks were distributed.

“Since Fono members were already in telework capacity prior to COVID-19 due to the ongoing constriction of the legislative building, we believe the stipend payments of $20,000 and $10,000 respectively, are unrelated to the COVID-19 health emergency,” the letter stated.

The direct payments were issued to members of the Fono from Coronavirus Relief Fund proceeds to support members tele working from their homes, according to Delmar, as confirmed during a meeting with Tonumaipe’a.

(Of note, Tonumaipe’a remained in government service dealing with finances as the out-going Lolo Administration transitioned the helm of the government to the new administration of Lemanu-Talauega, prior to the current Treasurer taking full control of the helm.)

Delmar requested that the payments issued to Fono members be returned in order for ASG to address future related COVID-19 needs. It is unknown at this time if any or all of the stipends were returned, as ASG did not make public any information on the issue. It is assumed since ‘repayment’ was made that some, if not all the checks were not returned.

The Leapaga lease payments related to the road project that runs from the Fagaima/ Ottoville road four-corners, through the Fonoti and Leapaga family lands up to to the main road in Malaiemi. It involves an advanced payment of the lease. Samoa News should point out that at the time the Lolo Administration announced the lease prepayment, CARES Act funds were not mentioned as being used. It also should be noted that federal funding policies do not allow for ‘prepayments’.

“The territory is awaiting the decision of the most recent submission if additional questions and ineligible costs must be reimbursed to the U.S. Treasury,” the TCR 2024 stated.

GOVERNMENT ACCOUNTABILITY OFFICE (GAO)

The Government Accountability Office (GAO), according to the 2024 TCR does audits, reviews and engagements which are facilitated through requests of congressional committees or subcommittees or are statutorily required by public laws or committee reports. It lists the five (5) engagements the territory has undergone during 2025.

“Completed are the Territorial Debt and COVID-19 with issued GAO reports.”

For the Territorial Debt it states that of Sept. 30, 2021, its total debt outstanding was about 23% of GDP. “This reflects recent borrowing to invest in its infrastructure,” it states.

It continues that “the government’s pension plan is underfunded and the government is increasing contributions to extend solvency.

(In 2022, amendments increasing contributions was passed as follows: the contributions of Fund members go up yearly October 1st, until 2024. In 2022, members were paying 4% and effective Oct. 1, 2023, their contribution increase to 5% and for Oct. 1, 2024, they will be paying 6%. For ASG, as the employer, it was paying 10% from Oct 1, 2022, 12% for FY 2023, and it will increase to 14% effective Oct. 1, 2024.)

“American Samoa’s economy is stable but continues to depend almost entirely on activity generated by the StarKist Samoa Company tuna cannery and government employment.

“Prospects for economic growth outside of these areas face challenges.”

For COVID-19 Relief funding as mandated by the CARES Act, ASG pointed to 4 focus areas all which contributed to a successful approach to the COVID-19 efforts and deployment of safety measures to keep the territory and its citizens safe from the deadly effects of the virus.

The four areas of focus were: 1) leveraging pre-existing programs, 2) technical Assistance, 3) funding flexibilities, and 4) immediate available funding.

TERRITORIAL AUDIT OFFICE (TAO)

For the Territorial Audit Office (TAO), in 2023, it “prioritized performance audits, investigations, and surprise cash counts to enhance government operations' effectiveness, efficiency, and economy, while also preventing fraud, waste, and abuse.” It hired three new staff and a Chief Auditor (the first in more than 10 years). The 2024 TCR lists what performance audits it completed including surprise cash counts, and what other reports are pending.

Of note, TAO secured a grant “earmarked for covering rent for the next three years and acquiring office equipment like video conferencing machines and computers,” as well as utilizing a Technical Assistance Program Grant to fund its three staff position for the current fiscal year. It has also been developing a new audit manual that will be finalized by the end of the calendar year.

“In accordance with its mandate, TAO has developed its annual work plan for the 2023-24 Fiscal Year.”

Samoa News will report on the American Rescue Plan Act (ARPA) Oversight Office, which lists its projects, developments and results as of 2023 in the 2024 TCR. The office is headed by executive director Keith Gebauer.