Guam Lawmakers Pass Annual Budget Bill

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Governor: Current version of bill will ‘create funding shortfalls’

By Shawn Raymundo

HAGÅTÑA, Guam (Pacific Daily News, Aug. 25, 2015) – After deliberating and debating the Fiscal 2016 budget act for nearly a week, lawmakers Monday passed the annual measure in a 13-1 vote.

Sen. Tony Ada, R-Sinajana, voted against the fiscal budget act while Sen. Brant McCreadie, R-Agana Heights, was off-island. Ada didn’t want to comment on his vote.

When the Legislature completed discussing Bill 37-33 late Friday afternoon, Gov. Eddie Calvo wrote a letter to Vice Speaker Benjamin Cruz, concerning cuts in the budget.

The current version of the budget bill, Calvo said, would create funding shortfalls to various government projects and payroll including cuts to 19 vacant positions at the Department of Corrections.

"This could be a problem as DOC is currently under federal scrutiny," Calvo said, referring to a federal court order signed in January that requires the prison to make substantial improvements to the facility’s healthcare functions.

"These are vacancies that we are working to fill because they are required to ensure efficient and safe operations," Calvo said. "Anything that interferes with that could jeopardize the work with the agency under federal scrutiny.

At the onset of session last week, Cruz explained why his appropriations committee introduced a substitute version to Calvo’s original budget request.

"Clearly, governor, your fiscal team’s prediction of the imminent layoffs with our proposed FY 2016 budget is not only incorrect but also glaringly illogical," he wrote to Calvo on Sunday.

Needing to cut spending as a result of the government’s recently announced deficit of about $60 million in the General Fund, Cruz said they found about 400 vacant positions worth $24 million that Calvo had planned to hire for.

Cruz criticized the governor for coming in at the "11th hour … to inject his baseless claims" to protect the roughly 400 new hires.

The alternative measure also reduced appropriations by more than $37 million while still giving the governor a 15-percent transfer authority to manage government resources. It also "provides reasonable increases for almost all departments and agencies," Cruz wrote.

Cruz continually noted that the budget relied on conservative revenue estimates, which were accepted and agreed upon with bi-partisan support, as the two parties across the aisle worked together to finalize the budget.

"Substitute Bill 37-33 has enjoyed bipartisan support," Cruz wrote. "This is because revenue estimates are conservative, spending priorities are broadly shared, and each side of the aisle has been committed to constructive compromise."

Calvo had asked Cruz to place an amendment in the bill that would have replaced the "conservative" projected revenues with the revenues in the initial Executive budget request as long as monthly revenue tracking reports at the end of the second quarter of the fiscal year projects revenues to "reach or exceed" the governor’s original revenue levels.

The governor’s amendment also called on giving him "100 percent spending and transfer authority, and allotment release for all of the identified agencies with shortfalls."

"If these requested amendments became law, they would be the equivalent of a blank check, permitting you to unilaterally adjust revenue levels based on reports only your advisers produce and proportionately increase spending wherever you see fit without sanction of the Legislature," Cruz responded.

Cruz did not include the amendment into the bill prior to a legislative vote.

In a release from his office, Calvo said he’ll make the fiscal 2016 budget work, as he’s done with previous fiscal budgets the Legislature has passed. Acknowledging Sen. Ada’s opposition to the budget act, Calvo was concerned most of the other senators didn’t think about their vote all the way through.

"The best case scenario is that our revenue projections come true again and the Legislature will pass a supplemental budget halfway through the year that looks a lot like the one I gave them," Calvo said in the release. "In the meantime, some of the agencies are going to have to make some tough decisions."

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