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Public hearing on supplemental budget

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by Sabrina Salas Matanane

Guam - The balancing act officially got underway today as back to back hearings and testimony filled the Legislature's Public Hearing Room on the government's financial nightmare. Up first: the Administration's $36 million supplemental budget request. During today's hearing the GovGuam Retirement Fund testified in opposition and threatened a lawsuit if it's tapped to kick-in $15 million to help with the government's current fiscal year shortfall.

Senator Ben Pangelinan started today's public hearing by making it clear he's known all long, as has the Calvo Administration, there would be a shortfall this fiscal year, but unlike the Administration's reasons, Pangelinan contends its because of GovGuam's health insurance contract that was negotiated and signed last year, and an order by a District Court judge to make payments to comply with an amended permanent injunction involving the Department of Mental Health.

Senator Ben Pangelinan said, "These two shortfalls created after the budget passed was communicated to the governor since day one."

But BBMR Director and Acting Department of Administration Director Benita Manglona said it was only on Day One and after unrestricted access to GovGuam's financials did they confirm just how bad a shape the government was in. Manglona, "In those first few pay periods we were just dollars away from not having enough to pay government employees."

Bill 184 is a supplemental budget request to keep GovGuam floating through the end of this fiscal year. More specifically, the Administration maintains it needs a total of $36 million to pay bills and keep certain government agencies and programs running past June. Included in the bill potential revenues sources to fund the shortfall, a major chunk: a $15 million provision involving the Retirement Fund, which the Administration believes based on the findings of an audit conducted by the Office of Public Accountability was an overpayment from the general fund to the Retirement Fund. The Administration would like to use the overpayment to go toward crediting what's owed by the Guam Memorial Hospital.

"We're not asking the Retirement Fund to take that money back," Manglona said. "We're just asking them to keep it in the Retirement Fund; it's money that was overpaid."

Although the Administration accepts the OPA's findings, the Retirement Fund refuted the report, defending there was never an overpayment and should this provision in Bill 184 be enacted there will be a legal challenge and other consequences. Retirement Fund board chair Joe T. San Agustin said, "If Bill 184 is enacted, the Fund will decline to process retirement application on wide-scale basis. That means its not just GMH we're talking about - the entire Government of Guam."

Manglona, however, defended there was no reason why the OPA's report should be doubted. She said, "Senators, what you're saying is you don't believe the OPA report?"

Vice Speaker B.J. Cruz replied, "I have a long history of not agreeing with reports from the Public Auditor and her [Doris Flores Brooks] believing she's an attorney or whatever, in what she's going to move forward on, so yes. Between the OPA and Joe T., I would take Joe T. before I would take the OPA's word."

Senator Judi Guthertz asked Manglona if the Retirement Fund provision was removed did she have a Plan B, the BBMR director said she would get back to her hopefully by Monday. As for the Public Auditor, she is currently off-island and was not present to defend her audit findings.

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