Sunday, August 28, 2011

Democrats defend budget bill, $180M bond


SPEAKER Judi Won Pat said it’s unfortunate Governor Eddie Baza Calvo would say she and her Democratic colleagues are not paying attention to the “working poor,’ since the budget the Legislature passed includes a $180 million bond, of which $120 million will be used to pay out 2010 and prior-year tax refunds to “our residents who are suffering daily.”

The $180 million bond borrowing does not allow the governor to borrow to pay for corporate taxes.

Last week, after the Legislature passed the budget bill in a narrow 8 to 7 vote, Calvo said he would likely veto an “incomplete and disastrous budget.”

“I’d like the governor to explain exactly what he means by ‘disastrous and incomplete,’” said Won Pat, stressing the Legislature passed a fiscally responsible budget that would weather any unpredictable outcome the U.S. Congress might enact that would affect Guam in terms of federal funding for the island.

“The budget that passed was reasonable. We didn’t raise the debt ceiling, so there is a $45 million cushion that we can borrow if anything unpredictable comes out of Congress. We’re seeing what’s happening in the U.S. In January, we’ll know how we’re tracking. If the governor passes this budget, there is the opportunity for him to borrow another $160 million,” said Won Pat.

Calvo said he was concerned about the lawsuit filed against the government for unpaid tax refunds.

“Senator Pangelinan has said time and again what measure the government is making to show good faith efforts that we’re paying out the tax refunds. We as lawmakers understand our role and we will remain firm in moving this government forward with fiscal responsibility,” said Won Pat.

“There is uncertainty over what cuts the U.S. Congress will make and how it will affect us. We need to prepare for this. Cautious optimism prevailed during our budget session and I hope the governor rethinks his immediate reaction to veto this budget.”

She said Congress’ intentions for Guam will be clearer in January, and the budget bill wasn’t just about the borrowing of the bond, but a durable bill with clauses that would displease the governor.

One such provision is the $8 million insurance rebate Calvo’s SelectCare would have to pay back to the government and GovGuam employees. “By signing the bill, he is agreeing that a rebate is owed. That’s one reason why I think he’s going to veto it,” said Won Pat.


Won Pat said if a budget fails to pass, a shutdown in government services is possible. In reaction to those lawmakers who voted against the budget bill, Won Pat asked: “Do they want to shut down this government?”

Senator Ben Pangelinan said he didn’t know why the governor would not sign the bill into law since it includes the authority to borrow the money to pay prior-year tax refunds to individuals.

Last week, the governor targeted Won Pat, Vice Speaker Benjamin J.F. Cruz, Senator Rory Respicio and Pangelinan, saying they were keeping tax refunds from the people.

“The Legislature, led by Speaker Won Pat, Vice Speaker Cruz, Majority Leader Respicio and Budget Chairman Pangelinan, unfortunately passed a budget that will leave Guam further in debt, and keep hundreds of millions of dollars of your money away from you,” said Calvo’s press secretary, Troy Torres.

Torres said the governor will continue fighting for all the tax refunds for every person owed a refund.

“We cannot believe Sens. Won Pat, Cruz, Respicio and Pangelinan can just ignore people who are suffering, struggling and begging for their own money. The most disturbing part about this is the government has not been able to pay tax refunds because of the budget deficits the past three years these senators created. Yet, when they had a chance to right this wrong, they just shut people out and threw the cries and pleas of the working poor to the side,” said Torres.

“The $120 million bond would pay only 30 percent of the tax refunds owed. What about everyone else,” according to Torres.

Won Pat said the $120 million from the bond borrowing plus the $105 million in the budget bill, both for tax refunds, is enough to pay 2010 and prior-year tax refunds to Guam’s working families.

Sen. Dennis Rodriguez Jr. was the only Democrat who voted against substituted Bill 145, along with the six Republican lawmakers: Senators Tony Ada, Frank Blas Jr., Chris Duenas, Sam Mabini, Mana Silva Taijeron and Aline Yamashita.
“The governor cannot, in good conscience, enact a law that will leave people behind. He will likely veto this disastrous budget proposal,” said Torres.

The Chinese Chamber of Commerce last week joined Guam’s mayors and vice mayors in endorsing Calvo’s plan to borrow $344 million.

The Chamber’s executive board members are expected to formally sign an endorsement at their board meeting this week, according to a press release from the Governor’s Office.

The budget bill was engrossed last Friday and will be transmitted to the governor.

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