GOVGUAM OWES NON-PROFITS MILLIONS

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Social services impacted by unpaid contracts

By Oyaol Ngirairikl HAGATNA, Guam (Pacific Daily News, Jan. 6, 2011) – In Guam, nonprofit agencies are owed millions by the Government and failure to pay could mean job cuts or a discontinuation of services to hundreds of elderly, patients with disabilities and runaway children.

Catholic Social Service is owed about US$1.5 million for services provided between October and December.

"We have approximately 200 employees covered by most of the government contracts, said Diana Calvo, executive director for Catholic Social Service. The numbers of clients per program varies, but in total we serve about 500 to 600 clients."

Catholic Social Service is one of the nonprofit organizations contracted by the government of Guam to provide various services for people who either can't help themselves, because of age or a disability, or because they are trying to get away from an abusive environment.

Calvo said Catholic Social Service received US$100,000 in December but nothing since.

"We've been following up every day," she said.

Thus far, the agency has been able to stave off payless paydays for employees. The Archdiocese of Agana provided some funding in December. In addition, the community helped via donations.

"I think people have a general understanding of GovGuam's financial situation, but the response that it's a cash flow issue doesn't seem right," she said.

From late November through most of December, GovGuam officials said revenue collections weren't matching operational needs and money was being divvied out between agencies as needed.

But in the last couple of weeks, officials said tax refund payments were increased significantly in the last three months of the year which is why various government agencies were unable to pay employees' health insurance premiums.

Troy Torres, the new administration's spokesman, said the financial team is collecting data from various agencies to get a better understanding of Guam's financial situation. They also have asked the Public Auditor to assess Guam's debt.

"We are not aware yet of the total picture of what the government owes nonprofits including Catholic Social Service, we are working with Department of Administration to assess the government's liabilities," Torres said.

Calvo said she's hopeful things will change soon.

"While the cost for food, gasoline and everything is going up, our contracts have not changed so we're absorbing increased costs within our total contract amount, Calvo said. We need to have GovGuam recognize that we provide services to individuals and if we choose to terminate services for nonpayment, the government would have to provide those services but also absorb all of the increased costs associated with those services."

Millie Lujan, the interim executive director for Sanctuary Inc., said her organization is owed more than US$107,000, which includes a US$60,000 claim filed in September 2009.

Lujan said Sanctuary has been providing services from October to December, to the tune of US$106,000, though contracts for those services have yet to be approved.

"They're still at the attorney general's office for review, that's according to our last conversations with the Attorney General's office," Lujan said.

Bryan Cruz, AG's spokesman, said their office had received one contract late last month and that contract is still under review. He did not say when it is expected to be completed.

Like Calvo, Lujan said Sanctuary is concerned that non-payment will have negative results on programs, employees or both.

"That is something that our board has had to really consider because we do have an ethical responsibility to the clients," she said, noting that nonprofit work runs the risk of non-payment not just on Guam but throughout the nation.

"My greatest fear is that we may not be able to continue. We've exhausted our line of credit," she said.

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