Retirees speak out about debt reimbursement
Guam - COLA retirees attended a public hearing today in support of legislation that would mandate the Guam Waterworks Authority reimburse the island's public sector for paying some of the water agency's previous debts. "This was money that was made available to GWA and the debt was being paid for by the General Fund," said Senator Ben Pangelinan.
When GWA was able to stand on its own, it was authorized by the Legislature to secure a bond with the caveat that the General Fund be reimbursed, with the senator adding, "GWA then filed a petition with the PUC to begin the expenditure of those bonds funds which did not require the reimbursement as required by law."
According to Pangelinan, he took issue with the PUC, which in turn an administrative law judge recommended that GWA keep with the law and pay the estimated $10 million reimbursement. And that's where Bill 156 comes in. It would mandate the $10 million go to pay the interest owed for the COLA class settlement and tax refunds.
GWA and the CCU testified in opposition of the legislation and are prepared to go before the Public Utilities Commission to argue their case as to why the judge's decision should not be adopted. Said Pangelinan, "We believe at this time the money will be made available pursuant to authorizations required under the PUC the recommendation of the administrative law judge is followed by the PUC."
CCU member Joey Duenas added, "I guess there's a difference of opinion between the bond counsel, and the financial advisor and this administrative law judge." Pangelinan said, "There is that's right," with Duenas, "And he may be wrong." Pangelinan noted, "I fully understand that he has a different opinion."
The Consolidated Commission on Utilities and the Guam Waterworks Authority said that the bond proceeds have all been obligated for capital improvement projects to comply with its federal stipulated order, and any deviation from that could violate their bond covenants and later down the road put at risk future borrowing efforts. Duenas, a former PUC chairman, stated that GWA can still go to the bond market and settle the issue of reimbursement but separating the reimbursement issue from the capital improvement projects was the best route to take for now."
He said, "We thought it cleaner to address the CIP needs, which are very clean and straightforward, and that's what we did bond counsel agreed with us and gave us that guidance and so did our financial advisors and that's really the proper way to do that."
Senator Pangelinan, however, disagreed, saying their high priced consultants should have advised them to follow the law. "Somewhere along the line they failed in their duty as your financial experts and the Government of Guam experts to structure it this way that impacts you in this manner," he said.
The CCU, however, stood by their decisions. Member and former PUC member Eloy Hara noted, "I very much sympathize with the COLA and tax recipient, we'd like to take care but again of our hands are tied because of the court order."