by Jolene Toves

Guam - Many residents have been wondering how or if the fiscal cliff will affect Guam, and if so, to what extent?

The Guam Housing and Urban Renewal Authority is watching closely what will happen over the next several weeks in Washington. According to GHURA executive director Michael Duenas, the threat of sequestration is real for his agency, saying, "We are looking at and 8.5% cut for our programs, that is basically 8.5% from March forward."

Leaving only six months left in the fiscal year to absorb the potential cut. According to Duenas, GHURA's operating budget is a subsidiary fund from HUD to cover daily expenses and can be sequestered come March 1. GHURA has not received much guidance from the federal agency at this point on what is happening with the fiscal cliff, which means GHURA must look at how to adjust. "The instructions that I have given to the managers at this point is to focus on expenditures that allow us to get units renovated and families moved in," he stated.

Duenas says there is no freeze at this point, noting, "All expenditures should be focused specifically on what will get the houses leased out, the vouchers issued and achieve the objective and goals of the grants." He adds that he has asked that any expenditures that can be postponed until next year be postponed.

Another option is to tap into the cash reserve program, of which Duenas says, "It will allow us some breathing room and may allow us to avoid any drastic cuts over the remaining six months of the year." According to a report issued by GHURA, for the 1st quarter expenses the agency has already spent over $368,000, leaving about $6.5 million in their cash reserve program.

Duenas adds that the cash reserve funds are divided between the 9 to 11 pots of funding within GHURA. "Although the money sounds like a lot, we don't have the flexibility to move funds around between the different programs," he said.

These funds are intended for unexpected expenses throughout the remainder of the year, not to cover the daily expenses. For now, Duenas will just have to wait and see, but his fingers are crossed that Congress acts.