GEDA: Buildup Impacts Will Exceed Benefits

GEDA: Buildup Impacts Will Exceed Benefits

Guam - Last week the Guam Economic Development Authority released some of it's findings on the Draft Environmental Impact Statement of the military buildup.



The bottom line according to GEDA is that the economic impacts will exceed the economic benefits unless mitigation measures are identified and included in the Final EIS.

During Governor Bordallo's administration Joseph Bradley was the Chief Economist for GovGuam. Recently he's given presentations to the civilian military task force on the economic portion of the Draft Environmental impact statement. He's come to some of the same conclusions that the Guam Economic Development Agency has reached. For example concerns that the economic impacts will outweigh the economic benefits. Many in the local business community have touted the boost that servicemen and women will have on the economy. The DEIS however states that only 12% of military payroll will be spent in the local economy. Bradley says "I don't think that Tumon is exactly what a sailor on shore leave is looking for anyway." Instead Bradley believes many of the servicemen and women will be craving the forms of food and entertainment that they are used to in the states. While Tumon offers some of this Tumon was developed with the Japanese tourist in mind.

Bradley says one way to mitigate this is for local businessemen to begin creating attractions and entertainment that servicemen will want to go to. Another concern of GEDA's is that according to the DEIS after the population decreases the island of Guam will have an excess or oversupply of housing. Bradley says this could mean abandoned houses and even commercial buildings that is unless we find a way to mitigate these potential negative impacts. Bradley has some of his own ideas for example he says GovGuam could work with the federal governement to develop programs to convert excess housing into affordable or low cost governement housing.

Finally there is the recession like period that will occur according to the DEIS after the buildup ends and the population diminishes. The boom itself will be three times larger than the tourism boom of the 80's. While bradley says that the recession will still be better than Guam's current economy it's how fast and how steep the economy recedes which is what will really cause problems.

Written by :
Clynt Ridgell

Buildup's costs outweigh benefits, says GEDA

Buildup's costs outweigh benefits, says GEDA

Posted: Feb 02, 2010 2:56 PM
Updated: Feb 02, 2010 2:56 PM

by Mindy Aguon

*Letter from GEDA to Sen. Aguon
http://ftpcontent.worldnow.com/kuam/custom/news/geda_aguon_02022009.PDF

Guam - Economic impacts from the impending military buildup will exceed the anticipated economic benefits. That's what the Guam Economic Development Authority anticipates should mitigation measures not be identified and included in the final environmental impact statement.

GEDA Administrator Tony Blaz listed primary concerns with the relocation of U.S. Marines that include demands for infrastructure increasing the pressure for substantial borrowing; money not being spent in the local economy; a recession-like period after 2014; and continued increases in the cost of goods and services. Blaz says government officials must ensure that benefits from the buildup exceed the costs so residents and our economy can obtain short- and long-term benefits if the buildup occurs.

PNC :: GEDA: Buildup Comes With Some Big Negatives

PNC :: GEDA: Buildup Comes With Some Big Negatives

Friday, 29 January 2010

Guam - GEDA Administrator Tony Blaz has submitted his top concerns over the impact of the military buildup to Senator Frank Aguon Jr.'s Committee on Economic Development.

In his letter to Aguon, Blaz lists the following impacts and concerns:

*GRT, corporate income taxes and personal income taxes could be as high as $423 in 2014 and then declining to $104 million in 2017.

*There may be a time lag between when GovGuam revenues are needed and when they are available for use.

*The buildup would generate more demands on Guam for roads, ports sewer, water, power and other infrastructure and will increase the pressure for substantial borrowing.

Read GEDA's list of concerns and impacts

*Members of the military do not spend a great deal of their income in the local economy, especially if they are housed on base and buy their groceries on base. Currently only 12% of the enlisted military income is spent on Guam.

*The average annual income of military personnel is just $29-thousand dollars. 11,182 active duty personnel translates into a total annual payroll of #323 million. Just 12% will be spent in the local economy.

*Housing for the military will be provided by the military, not the Guam private market. Local shippers and wholesaler will increase sales to the military bases but when imported goods are sold on base, most of the value of those sales won't be realized and profits won't be reinvested locally.

*There will be a "recession-like" period after 2014 when business will have to lay off workers after the peak buildup period.

*Guam workers will likely see the cot of living continue to rise faster than their incomes.

*The cost of living during the construction phase could negatively affect households on fixed incomes, although other households could benefit from rising wages.

*Hotels could benefit conssiderably, but the service sector could undergo a difficult period due to loss of labor to higher paying jobs and pressure or increased wages.

Written by : Kevin Kerrigan

PNC :: Ada Says Feds Need to Pay for Infrastructure

PNC :: Ada Says Feds Need to Pay for Infrastructure

Friday, 29 January 2010

Guam - The Guam Economic Development Authority has issued a list outlining the major economic impacts to Guam as a result of the military buildup.

According to geda the potential economic impacts as outlined in the DEIS will exceed the economic benefits. GEDA does note however that these are potential impacts noted by the Department of Defense. One of the major impacts listed is the fact that Govguam can't afford to make the infrastructural upgrades needed for the military buildup.

Senator Tom Ada is the chairman of the committee on utilities. He says that after this weeks DEIS hearings the Consolidated Commission on Utilities made it clear that they will need money from the feds to make the necessary upgrades to the islands power water and wastewater systems. For example the Guam Power Authority will need at least 110 million dollars for it's upgrades while the Guam Waterworks Authority will need at least $50 million dollars. Senator Ada says that these upgrades are all achievable if the Federal Government provides the money needed to start on the projects.

Ada says that the CCU has worked with the Department of Defense to come up with solutions. Part of the solution is to identify the upgrades that are directly necessary as a result of the buildup and have the U.S. federal government pay for them. Ada says the bottom line is that the federal government will have to fund the improvements to infrastructure needed to support the buildup.

The senator also spoke about the indirect impacts to the island's utilities and how they are much harder to identify. In fact according to Ada DEIS fails to address the indirect impacts to the islands infrastructure.

The senator also wants to make it clear that the current bonds that GWA has secured are meant for upgrades that are needed without the buildup the agency still needs money to fund the upgrades necessary as a result of the buildup.

GEDA meeting mulls DEIS

GEDA meeting mulls DEIS

Posted: Jan 25, 2010 10:18 PM PST
by Janjeera Hail

Guam - The Draft Environmental Impact Statement was also the topic of discussion at today's GEDA subcommittee meeting. Bank of Guam Economic and Market Statistics Officer Joseph Bradley gave a presentation, focusing on how the buildup will affect the local workforce.

The DEIS predicts that the number of jobs will rise significantly in 2013 and 2014, but that many of those jobs will disappear once the buildup is complete. "When the project is done, there's no work for them," Bradley surmised. "It may be, there may be very good ways to do it but I don't think we can lose sight of the fact that we're really talking about the community as a whole and not just the impacts on the operations of the government."