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GMH loan to be presented on Thursday

by Jolene Toves

Guam - The challenges faced by the Guam Memorial Hospital may not be new but hopefully by the New Year it can finally get a better handle on its finances.

It has been months since legislation to allow GMH to borrow up to $25 million to assist in making vendor payments and pay off other operational costs was signed into law.

While $12 million will go to refinancing a previous loan the remaining $14 million is supposed to be used to pay off vendors that GMH has the highest debts with. "We are actually going back and forth on some details and finally negotiated the terms of the loan which recently was ratified by the bank it has come down to us now we are going to present the loan to our board for approval on this Thursday the 5th," noted Hospital Administrator Joseph Verga. He says if approved by the board it will go back to the Guam Economic Development Authority for ratification and then to the Bank of Guam at which time he hopes the funds will be available shortly thereafter.

He added, "Both the GEDA board which included members of the GMH administration negotiated with the Bank of Guam who was the major responder to the RFP for the loan trying to negotiate the best terms for the best rate."

And while committee chair on health Senator Dennis Rodriguez, Jr. has been told that once the debt is paid down these funds, in addition to the funds received from gaming taxes, will put GMH in the clear and ensure the large accumulation of debt does not happen again, Verga however is not so quick to say the same. "$14 million will not wipe out the entire loan but that will wipe out several large vendors like Perry Point that in fact threatened our Medicare money and continues to be threatened unless we pay that off," he said.

"There are a few debts that for example GMH owes Rev & Tax for the GovGuam and we are working with the legislature to work out a deal whereby those debts are forgiven and wiped out as well."

Verga says GMH is focusing on paying off vendors they owe the most to. As for the revenues received from the gaming tax he reminds that 40% goes toward operations and only 60% toward urgent care. "We've only received one check right now and supposed to be receiving another one how much we will actually be receiving we still don't know at this point," he said.

GMH will be receiving their second check generated from the gaming revenues this month at which time he says they will have a better picture of what to expect monthly, but overall the funds from both the loan and the gaming tax will help reestablish GMH's ability to maintain supplies for months rather than weeks.

Meanwhile Senator Rodriguez says the Legislature needs to ensure they work with hospital management and stay on top of them to ensure they are doing their part. 

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