FRIDAY, 01 APRIL 2011 01:56 BY JANELA BUHAIN | VARIETY NEWS STAFF
THE Port Authority of Guam on Wednesday received an unexpected bill from the Department of Administration for $12.25 million
The Port Authority of Guam on Wednesday received an unexpected bill from the Department of Administration for $12.25 million for an “autonomous agency infrastructure collections fund” as authorized by a public law dating back to 1997. Variety file photo
for an “autonomous agency infrastructure collections fund” as authorized by a public law dating back to 1997.
The amount of the bill is an annual assessment of $875,000 since 1998 that the Port has not paid, according to the bill that DOA sent to the Port Authority.
“We did receive an invoice for $12.2 million from the Department of Administration. We are currently reviewing the invoice. We will reserve comment until we have further explored this matter,” said Pedro Leon Guerrero, Jr., PAG general manager.
Leon Guerrero said he is anticipating meeting with the Department of Administration to further discuss the assessment of $12.2 million.
Public Law 24-14 states that the four autonomous agencies—The Guam International Airport Authority, the Guam Power Authority, The Port Authority of Guam and the Guam Telephone Authority—are assessed an aggregate amount of $3.5 million annually, or $875,000 per autonomous agency.
GTA is no longer an autonomous government agency as it was officially privatized in 2002.
The aggregate amount, the budget law states, is “in lieu of taxes and other charges as may normally be assessed against a private company for utility easements, gross receipts taxes, taxes on audited income, government development fees, such as water wells and monetary fees.”
But Committee on Utilities Chairperson Tom Ada is concerned that by paying the amount, the Port will face hardships that will get passed onto Guam’s consumer.
“If Department of Administration is going to go and assess $12 million out of the coffers of the Port Authority, which I’m certain is money programmed for other port-related work, if they take that away from them, the Port is going to need to make up for that loss most likely through an increase in tariffs,” said Ada on Wednesday.
This likely increase in tariffs, Ada said, would ultimately get passed down to Guam’s consumers.
“Now the cost of food commodities on the shelves are going to have to be increased to cover the additional increase in shipping costs,” he said.
The entire fund was supposed to be used “solely for the purposes relating to the health and public safety of the people of Guam and public works,” the law states.
At the time, according to the law, “senseless violence” associated with illegal drugs was adversely impacting the public safety and quality of life of island residents.
The funds are supposed to go towards the training and salaries for police and corrections officers.
But even former Gov. Carl Gutierrez at the time, in his transmittal letter to the late Speaker Antonio Unpingco, said this assessment on PAG would “severely constrict the lifeblood of our island’s economic activity, the shipment of goods.”