GPA: $12M will have to come from taxpayers - KUAM.com-KUAM News: On Air. Online. On Demand.

GPA: $12M will have to come from taxpayers

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by Mindy Aguon

Guam - The Government of Guam may want $12 million from the Guam Power Authority, but that money will have to come from ratepayers. The Department of Administration recently submitted invoices to GPA, the power authority and the airport as they seek to compensation under a law that hasn't been implemented since 1997.

GPA officials recently met with the Calvo Administration, expressing concerns about whether there is a statute of limitations for the government going back and billing autonomous agencies for the money in lieu of taxes. While the law previously prohibited the agencies from raising rates to make the payments, CCU chair Simon Sanchez says that provision violated bond covenants and the law was amended.

He told KUAM News, "You can't stop the utilities from recovering costs and if the government wants to impose a cost on the utilities, then the utilities must be able to raise the rates to pay for that and the government agreed to that when they approved all the other bonds that the utilizes have borrowed. Because the lenders of the utilities don't want GovGuam imposing unfunded mandates that there can be no rate recovery."

The bottom line, Sanchez says, is that if the government wants the money it's going to be charged to ratepayers not just for the $12 million that's owed, but for the $800,000 a year going forward.

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