Guam Hospital Tax Breaks Could Be Decided In September

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GEDA reviewing application made by Regional Medical City

By Gaynor Dumat-ol Daleno

HAGÅTÑA, Guam (Pacific Daily News, July 25, 2013) – The Guam Economic Development Authority's (GEDA) decision whether Guam's first private hospital project will receive all, some or none of its requested tax breaks -- may be made in September.

GEDA Business Development Manager Christina Garcia said the agency has completed the initial review, showing that the Guam Regional Medical City has met the requirements to apply for tax relief under the qualifying certificate program. The pre-qualification process included determining whether the applicant will create new jobs, brings new money into Guam, has the financial means to make the project a reality and fills a community need, Garcia said.

Review committee

But while the underwriting part of the review process is complete, GEDA still has an internal review committee that will further look at the financial aspects of the project.

The underwriting report is an internal working document that cannot be released to the public, but once the internal review committee completes its work and GEDA's administrative side has a written recommendation for the board's vote, that document becomes public, Garcia said.

GEDA held a public hearing on the $219 million hospital project's application for tax breaks in May in a crowded conference room from which the attendees spilled over into a hallway.

The public hearing and a comment period lasting through June 12 led to the submission of 61 oral and written comments, mostly in support of the tax breaks the new hospital is seeking, Garcia said.

Garcia said the agency normally receives a few comments when a qualifying certificate application comes up.

20 years of breaks

The qualifying certificate program, established in 1965 under Guam law to attract investors, allows businesses to apply for rebates or abatement of certain taxes for up to 20 years.

The private hospital developer's qualifying certificate shows it is asking for:

After the GEDA board of directors votes on whether, or to what extent, tax breaks will be granted, the final say will be with the governor, who signs the qualifying certificate.

Calvo says he's for it

Gov. Eddie Calvo said to the Pacific Daily News in May he will approve a tax break or tax breaks for the private hospital developer, but without the details, he remains undecided on how much to grant the investor.

Part of the final stretch of the GEDA review is weighing the costs and benefits to the island economy if tax breaks are granted to the private hospital's investment group. GEDA now has a chief economist, Henry Cruz, who is part of the internal GEDA review.

In the PDN interview with the governor in May, Calvo said he feels for island residents' hardships when family members need off-island medical care.

The project's developer has indicated to GEDA that the project is on track to open next June, Garcia said.

The project is being built in Dededo and its structural work has moved on to the third and fourth floors of what will be a six-story hospital.

The hospital will be operated by The Medical City, a Joint Commission-accredited Philippine health care organization, its website states.

The Medical City's network includes one flagship health care complex, three provincial hospitals and 20 ambulatory clinics serving about 50,000 inpatients and 1.2 million outpatients annually with a medical staff of 1,500 physicians, states the developer's website, www.themedicalcity-grmc.com/

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