New Earmark Rules Have Lobbyists Scrambling
By ERIC LICHTBLAU
New York Times
Published: March 11, 2010
WASHINGTON — Jolted by a sudden tightening of the rules, lobbyists and military contractors who have long relied on lucrative earmarks from Congress were scrambling Thursday to find new ways to keep the federal money flowing.
“The playing field has changed dramatically,” said Michael H. Herson, a lobbyist in Washington whose firm, American Defense International, represents numerous defense industry contractors who have already put in their requests this year for earmark money.
Those clients, who along with hundreds of other businesses got $1.7 billion last year through the controversial practice of awarding earmarks, will now be barred from receiving money under a new policy adopted Wednesday by Democrats on the House Appropriations Committee.
House Republicans, seeking to outdo the Democrats in ethics reform, went even further Thursday by agreeing to swear off all earmarks, for both nonprofit and commercial organizations, for the next year.
“This is the best day we’ve had in a while,” said Representative Jeff Flake, an Arizona Republican who has been a fierce opponent of earmarks — no-bid contracts directed by lawmakers — but had found little support among Republican colleagues before this week. “In terms of us getting this moratorium, the stars were aligned. What the Democrats did certainly motivated the Republicans.”
Senate leaders, however, have not rushed to follow the House, a situation that would set up a clash when the two chambers try to reconcile their spending bills.
No one was willing to predict on Thursday how that confrontation might play out. Meanwhile, defense contractors and the “K Street” lobbyists in Washington who often represent them were planning new ways of packaging their financing requests — and trying to keep the revenue coming in.
Some firms talked of partnering with hospitals, universities and other nonprofit organizations in seeking federal money, an idea that Congressional officials said might not be allowed under the new rules. Others said they planned to become more aggressive about applying directly to the Pentagon and other federal departments and agencies, and not Congress, for grant money. Still others are warning their clients to diversify their financing sources and become less reliant on Washington.
“For firms that have made their living on getting earmarks for their clients, this is a sea change,” said Joseph M. Donovan, managing partner at Nelson Mullins Public Strategies Group, a Boston lobbying firm that represents about 50 private and public clients. “It fundamentally changes their business model.”
Mr. Donovan said his company had anticipated a sharp cutback in earmarks because of the political mood in Washington and began taking steps to help clients navigate the new landscape. That includes hiring an in-house writer to help them apply for federal grants directly from executive branch agencies instead of Congress.
Because that grant money is usually awarded based on competitive bids, he said it would be harder for smaller companies with promising research-and-development ideas. Contractors will have to be “more strategic” in their thinking, he said, “because I don’t want to be in the position of telling them that things are being done through a wink and nod and you’re just going to get a million dollars.”
In the Senate, some lawmakers have defended earmarks as a necessary tool for Congress to exercise the power of the purse and influence federal spending. Supporters say that for every “Bridge to Nowhere,” the Alaska earmark project that became infamous five years ago, there are worthy projects that get less attention.
As one example, supporters pointed to the earmarking of tens of millions of dollars in the 1990s to General Atomics and other military contractors for early development of what became the Predator program, the unmanned drones now used frequently in airstrikes in Afghanistan. Senator Daniel K. Inouye, the Hawaii Democrat who leads the Senate Appropriations Committee, said that if the House ban on commercial earmarks had been in effect then, “we would not have the Predator today.”
Limiting earmarks to nonprofit recipients is not necessarily a cure-all. For example, Representative John P. Murtha, the Pennsylvania Democrat famous for his earmarking largess, set up the Concurrent Technologies Corporation in his district in the 1980s as a nonprofit research center for metalworking, and he helped guide more than $1 billion in defense earmarks to it before he died last month.
Executives at Concurrent contributed frequently to Mr. Murtha’s campaigns. The group has come under scrutiny by F.B.I. investigators looking into pay-to-play allegations against the now-defunct lobbying firm P.M.A., which represented Concurrent and other clients that got earmarks.
Whether earmark money will dry up complete
Showing posts with label Salape. Show all posts
Showing posts with label Salape. Show all posts
Friday, March 12, 2010
Wednesday, August 12, 2009
Bordallo: Funding Mechanisms for Buildup Already in Place
Bordallo: Funding Mechanisms Already In Place For Guam Buildup
News Analysis
Written by Jeff Marchesseault
Wednesday, 12 August 2009 21:29
By Jeff Marchesseault
GUAM - "‘The buildup is going to happen. We just have to do it right,'" Congresswoman Madeleine Bordallo told Guam News Factor after a speech by the House Armed Services Chairman at the University of Guam this morning.
Bordallo, who chairs the Insular Affairs, Oceans and Wildlife Subcommittee under Natural Resources Chairman Nick Rahall in the U.S. House of Representatives, was actually quoting Rahall's familiar refrain about the massive military expansion already in its planning and contracting phases on Guam. When asked whether her subcommittee would recommend the omnibus funding legislation now being called for by Guam Senator Judi Guthertz to help ensure adequate funding for a long list of projects related to the civilian-side of the buildup, Bordallo said she preferred piecemeal legislation. And she expressed confidence that all necessary funding would be identified and committed in due course.
Guam Shouldn't Have To Compete
Yesterday, Guthertz, who chairs the local Committee on the Guam Buildup, "told the CODEL that piecemeal legislation will not answer the needs that will appear immediately during the course of the buildup." That, according to a news release she sent after attending a welcome luncheon for the visiting Members of Congress.
In fact, yesterday Guthertz also provided the media with a laundry list of unaddressed issues related to the buildup, including infrastructure and utility upgrades and expansion, capital improvements, transportation funding, economic development, and regular meetings to track buildup progress and ensure fair and equitable treatment of the civilian community. She calls it the "Agenda of Priority Concerns for the Guam Military Buildup".
Referring to her comprehensive outline, Guthertz reasoned, "It is also not just or sufficient to require Guam to compete with the 50 states and the other territories for grants and loans for the above listed projects as if they are not absolutely necessary for a successful buildup."
In fact, in her Agenda, Guthertz goes as far as to suggest, "An OMNIBUS APPROPRIATION BILL MAY BE APPROPRIATE for the civilian community of Guam's needs."
Omnibus Appropriation ‘Unrealistic'
But a CODEL news conference at the Hyatt today told a different story. Several members of the Congressional Delegation said that it would be unrealistic for the Government of Guam to expect one broad piece of legislation to cover realignment needs on Guam - inside or outside the fence.
Referring to the many bodies that will be involved in determining Guam's buildup needs, Bordallo told reporters, "There are so many different committees involved with this buildup...to expect one all-encompassing piece of legislation is not realistic in my opinion."
House Delegate Donna Christensen said, "What the people of Guam and the Legislature can be assured of is that we understand the challenges, given (prevailing) economic conditions." But she added that "given our budgetary constraints, it would be very difficult" to pass omnibus legislation for Guam's buildup needs alone.
"We've had omnibus legislation before but when you're talking about a $16 billion buildup, you're talking about seven different committees," said House Delegate Eni Faleomavaega of American Samoa.
Offering perspective on the complexities and resourcefulness of the perennial Congressional money-hunt, Rahall told those gathered at the news conference that some funding "might not be from appropriation, but money that already exists."
That 'Bordallo Swagger'
As a longtime politician who grew up on Guam in the first few years after World War II; who cut her teeth in the current-affairs world of broadcasting; who spent many years in local politics filling roles as First Lady, Senator and gubernatorial contender; and who now represents her island in Congress, Bordallo seems to have the veteran stateswoman's sixth sense and calm resolve that all necessary funding, forms and functions of the military buildup will fall into place as needs arise. And that while it may be the job of some to press for comprehensive lists of necessary changes, it is her fiduciary duty to navigate the competitive realities of the Hill, to negotiate and compromise with the powers that be to help ensure that Guam gets what it needs, when it needs it, without hurting the needs of constituents in the countless jurisdictions outside of Guam.
An example of ‘other needs' was represented right there at the news conference today. Congressman Henry Brown said, "I'm from Charleston, South Carolina where 30,000 people lost their jobs (when a naval facility shut down there after a Base Realignment And Closure assessment)."
New Hope From Hawaii
All neediness aside, Bordallo and the Members of Congress traveling with her are encouraged by a change of command at the White House that has brought renewed focus on Guam and the Pacific. It is evidenced in everything from Hawaii-born Senator Barack Obama opening a presidential-election campaign office on Guam and committing himself to Guam causes such as the fight for war reparations -- to President Obama writing a letter of commendation to patriotic Guam for proudly celebrating its 65th Anniversary Liberation Day and appointing Agat native Tony Babauta as his choice for Assistant Secretary of the Interior for Insular Affairs.
Furthermore, as President, Obama has insisted that Congress must re-include its $211 million 'reduction' in Navy construction on Guam if lawmakers still want his signature on the 2010 Defense Authorization Act. Tossing the construction funding back into the hat will show Japan that the U.S. is serious about honoring its agreement to reduce forces in Okinawa and that America appreciates the $336 million that Japan has already spent on realigning forces to Guam. To do less, in Obama's mind, would be to further jeopardize the $6.09 billion in financing that Japan has previously agreed to in writing.
"In the last few months there's been a real change. Now that you see the new administration, you see a lot more commitment (to Guam and the region going) in a better direction," said Bordallo at today's news conference.
Faleomavaega couldn't have agreed more. "This administration has given a much better structure in dealing with the buildup," he said.
Been There, Done That
Bordallo's parting comments to reporters offered further perspective and steely resolve that could only knowingly come from one as familiar with Guam politics as she. Someone who grew up in post-war Guam with an intermingled sense of a borderless Guam that was then, through military settlement, every bit as American as it was Chamorro.
Referring to a population that is expected to swell to nearly a quarter of a million by the time the buildup is completed over the course of the next decade, to the rapid construction of installations, to the 21st century 'boat loads' of dollars that will be spent on the whole affair, and to the countless hours devoted to planning the best possible outcome for all stakeholders, Bordallo put it to us straight.
"I've been involved in this buildup for a long time. Guam has had numbers like these before. This buildup will occur throughout the island ... and I will be your eyes and ears in Washington to make sure we get what we need."
News Analysis
Written by Jeff Marchesseault
Wednesday, 12 August 2009 21:29
By Jeff Marchesseault
GUAM - "‘The buildup is going to happen. We just have to do it right,'" Congresswoman Madeleine Bordallo told Guam News Factor after a speech by the House Armed Services Chairman at the University of Guam this morning.
Bordallo, who chairs the Insular Affairs, Oceans and Wildlife Subcommittee under Natural Resources Chairman Nick Rahall in the U.S. House of Representatives, was actually quoting Rahall's familiar refrain about the massive military expansion already in its planning and contracting phases on Guam. When asked whether her subcommittee would recommend the omnibus funding legislation now being called for by Guam Senator Judi Guthertz to help ensure adequate funding for a long list of projects related to the civilian-side of the buildup, Bordallo said she preferred piecemeal legislation. And she expressed confidence that all necessary funding would be identified and committed in due course.
Guam Shouldn't Have To Compete
Yesterday, Guthertz, who chairs the local Committee on the Guam Buildup, "told the CODEL that piecemeal legislation will not answer the needs that will appear immediately during the course of the buildup." That, according to a news release she sent after attending a welcome luncheon for the visiting Members of Congress.
In fact, yesterday Guthertz also provided the media with a laundry list of unaddressed issues related to the buildup, including infrastructure and utility upgrades and expansion, capital improvements, transportation funding, economic development, and regular meetings to track buildup progress and ensure fair and equitable treatment of the civilian community. She calls it the "Agenda of Priority Concerns for the Guam Military Buildup".
Referring to her comprehensive outline, Guthertz reasoned, "It is also not just or sufficient to require Guam to compete with the 50 states and the other territories for grants and loans for the above listed projects as if they are not absolutely necessary for a successful buildup."
In fact, in her Agenda, Guthertz goes as far as to suggest, "An OMNIBUS APPROPRIATION BILL MAY BE APPROPRIATE for the civilian community of Guam's needs."
Omnibus Appropriation ‘Unrealistic'
But a CODEL news conference at the Hyatt today told a different story. Several members of the Congressional Delegation said that it would be unrealistic for the Government of Guam to expect one broad piece of legislation to cover realignment needs on Guam - inside or outside the fence.
Referring to the many bodies that will be involved in determining Guam's buildup needs, Bordallo told reporters, "There are so many different committees involved with this buildup...to expect one all-encompassing piece of legislation is not realistic in my opinion."
House Delegate Donna Christensen said, "What the people of Guam and the Legislature can be assured of is that we understand the challenges, given (prevailing) economic conditions." But she added that "given our budgetary constraints, it would be very difficult" to pass omnibus legislation for Guam's buildup needs alone.
"We've had omnibus legislation before but when you're talking about a $16 billion buildup, you're talking about seven different committees," said House Delegate Eni Faleomavaega of American Samoa.
Offering perspective on the complexities and resourcefulness of the perennial Congressional money-hunt, Rahall told those gathered at the news conference that some funding "might not be from appropriation, but money that already exists."
That 'Bordallo Swagger'
As a longtime politician who grew up on Guam in the first few years after World War II; who cut her teeth in the current-affairs world of broadcasting; who spent many years in local politics filling roles as First Lady, Senator and gubernatorial contender; and who now represents her island in Congress, Bordallo seems to have the veteran stateswoman's sixth sense and calm resolve that all necessary funding, forms and functions of the military buildup will fall into place as needs arise. And that while it may be the job of some to press for comprehensive lists of necessary changes, it is her fiduciary duty to navigate the competitive realities of the Hill, to negotiate and compromise with the powers that be to help ensure that Guam gets what it needs, when it needs it, without hurting the needs of constituents in the countless jurisdictions outside of Guam.
An example of ‘other needs' was represented right there at the news conference today. Congressman Henry Brown said, "I'm from Charleston, South Carolina where 30,000 people lost their jobs (when a naval facility shut down there after a Base Realignment And Closure assessment)."
New Hope From Hawaii
All neediness aside, Bordallo and the Members of Congress traveling with her are encouraged by a change of command at the White House that has brought renewed focus on Guam and the Pacific. It is evidenced in everything from Hawaii-born Senator Barack Obama opening a presidential-election campaign office on Guam and committing himself to Guam causes such as the fight for war reparations -- to President Obama writing a letter of commendation to patriotic Guam for proudly celebrating its 65th Anniversary Liberation Day and appointing Agat native Tony Babauta as his choice for Assistant Secretary of the Interior for Insular Affairs.
Furthermore, as President, Obama has insisted that Congress must re-include its $211 million 'reduction' in Navy construction on Guam if lawmakers still want his signature on the 2010 Defense Authorization Act. Tossing the construction funding back into the hat will show Japan that the U.S. is serious about honoring its agreement to reduce forces in Okinawa and that America appreciates the $336 million that Japan has already spent on realigning forces to Guam. To do less, in Obama's mind, would be to further jeopardize the $6.09 billion in financing that Japan has previously agreed to in writing.
"In the last few months there's been a real change. Now that you see the new administration, you see a lot more commitment (to Guam and the region going) in a better direction," said Bordallo at today's news conference.
Faleomavaega couldn't have agreed more. "This administration has given a much better structure in dealing with the buildup," he said.
Been There, Done That
Bordallo's parting comments to reporters offered further perspective and steely resolve that could only knowingly come from one as familiar with Guam politics as she. Someone who grew up in post-war Guam with an intermingled sense of a borderless Guam that was then, through military settlement, every bit as American as it was Chamorro.
Referring to a population that is expected to swell to nearly a quarter of a million by the time the buildup is completed over the course of the next decade, to the rapid construction of installations, to the 21st century 'boat loads' of dollars that will be spent on the whole affair, and to the countless hours devoted to planning the best possible outcome for all stakeholders, Bordallo put it to us straight.
"I've been involved in this buildup for a long time. Guam has had numbers like these before. This buildup will occur throughout the island ... and I will be your eyes and ears in Washington to make sure we get what we need."
Tuesday, July 14, 2009
The Guam Military Buildup by Congressman Neil Abercrombie
By Neil Abercrombie
July 11, 2009
Some in Guam have expressed strong opposition to provisions in the 2010 National Defense Authorization Act, passed overwhelmingly this week by the U.S. House, concerning military construction in Guam.
The measure authorizes a multi-year, multi-billion dollar building program to construct a new home for the 3rd Marine Expeditionary Forces and elements of other units stationed on the island of Okinawa and in mainland Japan for many years. This means building permanent military facilities to accommodate about 8,000 military personnel and as many as 9,000 family members. The move is the result of a lengthy and detailed agreement between the United States and Japan, under which the U.S. will pay about 40% of the cost.
When Members of the House Armed Services Committee considered the matter, we had two aims: 1.) to assure our men and women in uniform and their families high quality, comfortable and durable buildings and facilities in a secure environment in which they can work, train and live, and 2.) create stable, well-paid jobs for skilled American building and construction workers to replace some of the thousands of jobs lost in this economic recession,.
This five-year project will require 15,000 or more construction workers. Thousands will have to be recruited to relocate to supplement the local workforce. The legislation reserves 70% of those jobs for American workers.
My ideal for the quality of housing and facilities we want on Guam are the military construction projects in Hawaii and across the country through public-private joint ventures, in which companies win multi-year contracts to build, maintain, repair and manage family housing and other structures on a base. The company builds out the project and makes its money from the Basic Allowance for Housing paid by the military families who live in the housing. In Hawaii, we negotiated 50-year agreements with our construction companies at Schofield Barracks, Hickam Air Force Base, Pearl Harbor Naval Station and Marine Base Kaneohe. The product and the process have been widely praised by military families and military leaders.
Wages should be commensurate with the experience and skills of the building trades workers who can provide the quality construction our military personnel deserve. The legislation established wages at the level for similar projects in Hawaii, the closest U.S. labor market. Guam’s prevailing wage is significantly less than most U.S. labor markets; its tax base is limited; and its workforce has only a fraction of the trained and skilled people needed for this job.
The alternative is to outsource to Japanese companies that will bring in foreign workers, for which the Guam government collects a bounty of $1000 per head. This will open the door to profiteering and continued wage bondage, and be a slap in the face of every qualified, unemployed American worker.
Relocating thousands of military personnel and their families is a massive undertaking, and will dramatically alter Guam’s future. Building a new military base from scratch will take several years and billions of dollars. The project will offer thousands of local jobs, thousands more from outside, create opportunities for local small businesses and transform the economy of the island. It is also a singular opportunity to put Americans to work, in an American territory, building America’s future in the Pacific region. Economic security and national security go hand in hand.
July 11, 2009
Some in Guam have expressed strong opposition to provisions in the 2010 National Defense Authorization Act, passed overwhelmingly this week by the U.S. House, concerning military construction in Guam.
The measure authorizes a multi-year, multi-billion dollar building program to construct a new home for the 3rd Marine Expeditionary Forces and elements of other units stationed on the island of Okinawa and in mainland Japan for many years. This means building permanent military facilities to accommodate about 8,000 military personnel and as many as 9,000 family members. The move is the result of a lengthy and detailed agreement between the United States and Japan, under which the U.S. will pay about 40% of the cost.
When Members of the House Armed Services Committee considered the matter, we had two aims: 1.) to assure our men and women in uniform and their families high quality, comfortable and durable buildings and facilities in a secure environment in which they can work, train and live, and 2.) create stable, well-paid jobs for skilled American building and construction workers to replace some of the thousands of jobs lost in this economic recession,.
This five-year project will require 15,000 or more construction workers. Thousands will have to be recruited to relocate to supplement the local workforce. The legislation reserves 70% of those jobs for American workers.
My ideal for the quality of housing and facilities we want on Guam are the military construction projects in Hawaii and across the country through public-private joint ventures, in which companies win multi-year contracts to build, maintain, repair and manage family housing and other structures on a base. The company builds out the project and makes its money from the Basic Allowance for Housing paid by the military families who live in the housing. In Hawaii, we negotiated 50-year agreements with our construction companies at Schofield Barracks, Hickam Air Force Base, Pearl Harbor Naval Station and Marine Base Kaneohe. The product and the process have been widely praised by military families and military leaders.
Wages should be commensurate with the experience and skills of the building trades workers who can provide the quality construction our military personnel deserve. The legislation established wages at the level for similar projects in Hawaii, the closest U.S. labor market. Guam’s prevailing wage is significantly less than most U.S. labor markets; its tax base is limited; and its workforce has only a fraction of the trained and skilled people needed for this job.
The alternative is to outsource to Japanese companies that will bring in foreign workers, for which the Guam government collects a bounty of $1000 per head. This will open the door to profiteering and continued wage bondage, and be a slap in the face of every qualified, unemployed American worker.
Relocating thousands of military personnel and their families is a massive undertaking, and will dramatically alter Guam’s future. Building a new military base from scratch will take several years and billions of dollars. The project will offer thousands of local jobs, thousands more from outside, create opportunities for local small businesses and transform the economy of the island. It is also a singular opportunity to put Americans to work, in an American territory, building America’s future in the Pacific region. Economic security and national security go hand in hand.
Sunday, July 12, 2009
What's Behind Abercrombie's Ammendment?
What’s behind the Abercrombie amendment?
Sunday, 12 July 2009 23:49 by Jayne Flores
The Marianas Variety
It’s a trade off: the long-awaited payment of war reparations to our dwindling number of survivors of the Japanese occupation, for a Hawaii-based wage rate for the buildup.
That seems to be the most logical reason behind Hawaii Rep. Neil Abercrombie’s two additional amendments to the National Defense Authorization Act for Fiscal Year 2010.
Abercrombie is running for governor, and if he can boost his state’s struggling economy by giving construction workers jobs on Guam that pay just as much as if they were working in Hawaii, it would be a large feather in his political cap. It’s a cap that, according to a candidate watchdog web site, has been paid for with contributions from the likes of Lockheed Martin, BAE Systems, and 21st Century Systems, all military contractor heavyweights.
On the other side, we’re getting to the point that if we don’t settle this war claims issue soon, there won’t be any WWII survivors left to receive the money.
Abercrombie’s first amendment requires that Hawaii construction wage rates, which are approximately double what construction workers on Guam are paid, will apply to all build-up related projects funded with money specifically earmarked for the build-up.
The second amendments says that not more than 30 percent of the total hours worked per month on a buildup construction project may be performed by foreign workers, or workers holding temporary work visas.
So we’ve now got requirements that the Defense Department has to pay everyone who works on a buildup project those high Hawaii wage rates, and on each of the jobs, 70 percent of the work hours have to be worked by U.S. workers.
Obviously, Abercrombie is trying to prevent jobs going to foreign workers while construction workers in his state and other states are out of work. His amendment makes perfect sense if you’re a senator watching unemployment rates skyrocket in your state, or watching your state hand out vouchers for payment because it is broke.
This amendment seems to strike fear in the hearts of contractors on Guam and the overall Guam business community. They’ve been collectively saying that doubling wage rates for these projects might kill the buildup, or cause a domino effect and increase the cost of living on the island. But would it?
The large contractors that will be paying these higher rates already pay similar rates in many states. According to www.payscale.com, journeyman electricians make an average of $25.44 an hour in the states. Carpenters make from $22.33 to $32.43, depending on where they work. So these contractors’ bids will reflect the Hawaii-based wage rates accordingly. It’s the Department of Defense that will have to fork out the big bucks.
Local contractors are not getting these jobs – that’s the word through the grapevine. They may get subcontracts, but they can work the higher wages into their subcontract bids. So the local contractors won’t actually have to pay these rates, because Abercrombie’s amendment is specific to the buildup, not to the prevailing wage rate on Guam.
What will happen, though, is that the buildup will create two classes of H-2 workers and local workers, those who work on federal projects and are paid the higher wages, and those who work on local projects and are paid Guam’s prevailing construction wage rates. This could cause some animosity among workers within a company, especially among foreign workers who might fight over who gets to work the 30 percent hours on federal projects.
The higher wage rate might actually work in Guam’s favor. Although stateside workers will probably send home a significant portion of their paychecks if they don’t move their families out here, rest assured, they’ll frequent local restaurants and other establishments, and spend more of their money here than would foreign workers, who as a general rule send home most of their paychecks.
The defense budget bill, including the war claims and Abercrombie amendments, is now in the U.S. Senate. What senators are going to have to decide is whether they want to increase the cost of the buildup in order to put more Americans back to work, or scratch the whole bill and start over. Or, they could take out Abercrombie’s amendments, or the war claims amendment, or both.
At this point, anything can happen. But having to deal with the higher buildup wages won’t be as devastating as will having the war claims legislation slip through our fingers once again.
If this is the deal – we should take it.
Sunday, 12 July 2009 23:49 by Jayne Flores
The Marianas Variety
It’s a trade off: the long-awaited payment of war reparations to our dwindling number of survivors of the Japanese occupation, for a Hawaii-based wage rate for the buildup.
That seems to be the most logical reason behind Hawaii Rep. Neil Abercrombie’s two additional amendments to the National Defense Authorization Act for Fiscal Year 2010.
Abercrombie is running for governor, and if he can boost his state’s struggling economy by giving construction workers jobs on Guam that pay just as much as if they were working in Hawaii, it would be a large feather in his political cap. It’s a cap that, according to a candidate watchdog web site, has been paid for with contributions from the likes of Lockheed Martin, BAE Systems, and 21st Century Systems, all military contractor heavyweights.
On the other side, we’re getting to the point that if we don’t settle this war claims issue soon, there won’t be any WWII survivors left to receive the money.
Abercrombie’s first amendment requires that Hawaii construction wage rates, which are approximately double what construction workers on Guam are paid, will apply to all build-up related projects funded with money specifically earmarked for the build-up.
The second amendments says that not more than 30 percent of the total hours worked per month on a buildup construction project may be performed by foreign workers, or workers holding temporary work visas.
So we’ve now got requirements that the Defense Department has to pay everyone who works on a buildup project those high Hawaii wage rates, and on each of the jobs, 70 percent of the work hours have to be worked by U.S. workers.
Obviously, Abercrombie is trying to prevent jobs going to foreign workers while construction workers in his state and other states are out of work. His amendment makes perfect sense if you’re a senator watching unemployment rates skyrocket in your state, or watching your state hand out vouchers for payment because it is broke.
This amendment seems to strike fear in the hearts of contractors on Guam and the overall Guam business community. They’ve been collectively saying that doubling wage rates for these projects might kill the buildup, or cause a domino effect and increase the cost of living on the island. But would it?
The large contractors that will be paying these higher rates already pay similar rates in many states. According to www.payscale.com, journeyman electricians make an average of $25.44 an hour in the states. Carpenters make from $22.33 to $32.43, depending on where they work. So these contractors’ bids will reflect the Hawaii-based wage rates accordingly. It’s the Department of Defense that will have to fork out the big bucks.
Local contractors are not getting these jobs – that’s the word through the grapevine. They may get subcontracts, but they can work the higher wages into their subcontract bids. So the local contractors won’t actually have to pay these rates, because Abercrombie’s amendment is specific to the buildup, not to the prevailing wage rate on Guam.
What will happen, though, is that the buildup will create two classes of H-2 workers and local workers, those who work on federal projects and are paid the higher wages, and those who work on local projects and are paid Guam’s prevailing construction wage rates. This could cause some animosity among workers within a company, especially among foreign workers who might fight over who gets to work the 30 percent hours on federal projects.
The higher wage rate might actually work in Guam’s favor. Although stateside workers will probably send home a significant portion of their paychecks if they don’t move their families out here, rest assured, they’ll frequent local restaurants and other establishments, and spend more of their money here than would foreign workers, who as a general rule send home most of their paychecks.
The defense budget bill, including the war claims and Abercrombie amendments, is now in the U.S. Senate. What senators are going to have to decide is whether they want to increase the cost of the buildup in order to put more Americans back to work, or scratch the whole bill and start over. Or, they could take out Abercrombie’s amendments, or the war claims amendment, or both.
At this point, anything can happen. But having to deal with the higher buildup wages won’t be as devastating as will having the war claims legislation slip through our fingers once again.
If this is the deal – we should take it.
Friday, May 08, 2009
Pentagon Reconsiders Pricey Guam Move
Pentagon reconsiders pricey Guam move
By Otto Kreisher
CongressDaily May 7, 2009
The Marine Corps commandant told House appropriators on Wednesday that the initial $4 billion estimated U.S. cost for relocating thousands of Marines from Japan to Guam is "way short" of what the service will likely spend.
"It will be far more than that," Gen. James Conway told the House Military Construction Appropriations Subcommittee.
Conway said the decision to move more than 8,000 Marines from Okinawa and some bases in mainland Japan would be reconsidered as part of the global basing study during the upcoming Quadrennial Defense Review. The Defense Department will have to come up with a prioritized list of projects and determine Guam's ability to support the additional forces, the commandant said.
Rep. Norman Dicks, D-Wash., opened the issue, saying he was concerned that Guam does not have the infrastructure to support all the Marines and additional sailors that are planned to be based there.
Conway agreed and noted that plans call for $3 billion a year in construction over a considerable period, and the territory of Guam could support only half of that. He also expressed concern about the ability to provide training facilities for those Marines.
Japan has committed to financing most of the cost of moving the Marines out of the bases on Okinawa, which are impacted by the growing population. But the Japanese government is struggling to provide the funds for that effort and the relocation on the island of a Marine air base.
Military Construction Appropriations Subcommittee Chairman Chet Edwards, D-Texas, asked if additional funds were provided in the fiscal 2010 budget to reflect the higher cost for the Guam move. Conway noted that he could not provide details until the budget is released on Thursday, but said "X amount of dollars" were in the budget.
Most of the big expenses, he added, were in future years, subject to decisions made in the QDR.
Rep. Ander Crenshaw, R-Fla., noted that the Navy's plan to relocate a nuclear-powered aircraft carrier from Norfolk, Va., to Mayport, Fla., also would be reviewed in the QDR. But Crenshaw asked Adm. Gary Roughead, the chief of naval operations who also attended the hearing, if he still supported that move.
Roughead said he did, because he considered the concentration of all five of the Atlantic Fleet's carriers in Norfolk a security risk. He noted that the six Pacific Fleet carriers are in three locations.
The Virginia delegation has protested the move, arguing that the Navy could not afford what could be as much as $1 billion to prepare Mayport to host a nuclear carrier. The base had been home to the conventionally powered carrier John F. Kennedy, which has been retired.
By Otto Kreisher
CongressDaily May 7, 2009
The Marine Corps commandant told House appropriators on Wednesday that the initial $4 billion estimated U.S. cost for relocating thousands of Marines from Japan to Guam is "way short" of what the service will likely spend.
"It will be far more than that," Gen. James Conway told the House Military Construction Appropriations Subcommittee.
Conway said the decision to move more than 8,000 Marines from Okinawa and some bases in mainland Japan would be reconsidered as part of the global basing study during the upcoming Quadrennial Defense Review. The Defense Department will have to come up with a prioritized list of projects and determine Guam's ability to support the additional forces, the commandant said.
Rep. Norman Dicks, D-Wash., opened the issue, saying he was concerned that Guam does not have the infrastructure to support all the Marines and additional sailors that are planned to be based there.
Conway agreed and noted that plans call for $3 billion a year in construction over a considerable period, and the territory of Guam could support only half of that. He also expressed concern about the ability to provide training facilities for those Marines.
Japan has committed to financing most of the cost of moving the Marines out of the bases on Okinawa, which are impacted by the growing population. But the Japanese government is struggling to provide the funds for that effort and the relocation on the island of a Marine air base.
Military Construction Appropriations Subcommittee Chairman Chet Edwards, D-Texas, asked if additional funds were provided in the fiscal 2010 budget to reflect the higher cost for the Guam move. Conway noted that he could not provide details until the budget is released on Thursday, but said "X amount of dollars" were in the budget.
Most of the big expenses, he added, were in future years, subject to decisions made in the QDR.
Rep. Ander Crenshaw, R-Fla., noted that the Navy's plan to relocate a nuclear-powered aircraft carrier from Norfolk, Va., to Mayport, Fla., also would be reviewed in the QDR. But Crenshaw asked Adm. Gary Roughead, the chief of naval operations who also attended the hearing, if he still supported that move.
Roughead said he did, because he considered the concentration of all five of the Atlantic Fleet's carriers in Norfolk a security risk. He noted that the six Pacific Fleet carriers are in three locations.
The Virginia delegation has protested the move, arguing that the Navy could not afford what could be as much as $1 billion to prepare Mayport to host a nuclear carrier. The base had been home to the conventionally powered carrier John F. Kennedy, which has been retired.
Friday, January 16, 2009
Senators Hit $1 Million Payout Plan
Senators hit $1M payout plan
Thursday, 15 January 2009
by Therese Hart
Marianas Variety News Staff
In a remarkable show of bipartisan unity, senators from both parties yesterday condemned the $1 million weekly payout plan for the landfill being proposed by the federal receiver.
Gershman, Brickner & Bratton informed the U.S. District Court last Wednesday that it wants GovGuam to pay out $1 million a week in cash beginning March 1 to finance various landfill-related projects.
The recommendation was made by GBB special principal associate David Manning during the landfill quarterly status hearing in District Court.
Sen. Eddie Calvo, responding to the proposal, said the payout plan is simply too heavy a burden for GovGuam to bear.
"That amounts to approximately $4 million a month, averaging 10 percent of what is taken in on a monthly basis which is about $30 to $50 million a month. If that were to occur, there would have to be a substantial realignment of expenditures within the government. That would have a very detrimental impact on the critical services the government provides," the senator said.
Calvo added that critical areas such as education, health and public safety will be adversely affected.
Sen. Frank Aguon Jr. chimed in, saying that although he respects any decision that Judge Frances Tydingco-Gatewood may make on the matter, all the parties really need to sit down and recognize that the government of Guam is not a cash cow.
"We need to work out financial arrangements that would be acceptable to all parties and recognize that the residents need a government to run, inclusive of addressing education, public safety and healthcare requirements," said Aguon.
Sen. Judi Guthertz has also criticized the payout plan, saying: "I don't think it's achievable, given the cash flow problems of the government. I think it's unconscionable that the federal government is mandating this on this territory and not considering its fair share for the closure of the Ordot Dump and the construction of the new landfill."
Destroy
Last Wednesday, Gov. Felix Camacho said one million dollars out of the government's operating fund will destroy GovGuam's ability to provide services.
In light of this latest demand from GBB, Camacho said the legislature should now give him policy approval to proceed with the revenue bond, although he told the court that given the current global financial crisis, it would be difficult for the government to secure a bond at this point in time.
The governor said that even if the government were to secure financing in the bond market, because of the high rates, it's simply not affordable.
"It's going to be very difficult to receive that right now and this will only exacerbate our already growing deficit," Camacho said.
Defended
Manning had defended the $1 million weekly payout plan, saying that the continuous replenishment of the funds on a weekly basis in which $20 million has been deposited into a bank account is necessary because it provides a "clear reassurance to the contractors employed to do the Consent Decree project work that they will be paid in a timely way." Without such assurance, Manning said it is unlikely that quality contractors will be willing to undertake the work needed to bring Guam into compliance with the Consent Decree.
Manning added that given the weak cash position of the government, a fixed weekly cash contribution may be more manageable than monthly cash amounts.
Thursday, 15 January 2009
by Therese Hart
Marianas Variety News Staff
In a remarkable show of bipartisan unity, senators from both parties yesterday condemned the $1 million weekly payout plan for the landfill being proposed by the federal receiver.
Gershman, Brickner & Bratton informed the U.S. District Court last Wednesday that it wants GovGuam to pay out $1 million a week in cash beginning March 1 to finance various landfill-related projects.
The recommendation was made by GBB special principal associate David Manning during the landfill quarterly status hearing in District Court.
Sen. Eddie Calvo, responding to the proposal, said the payout plan is simply too heavy a burden for GovGuam to bear.
"That amounts to approximately $4 million a month, averaging 10 percent of what is taken in on a monthly basis which is about $30 to $50 million a month. If that were to occur, there would have to be a substantial realignment of expenditures within the government. That would have a very detrimental impact on the critical services the government provides," the senator said.
Calvo added that critical areas such as education, health and public safety will be adversely affected.
Sen. Frank Aguon Jr. chimed in, saying that although he respects any decision that Judge Frances Tydingco-Gatewood may make on the matter, all the parties really need to sit down and recognize that the government of Guam is not a cash cow.
"We need to work out financial arrangements that would be acceptable to all parties and recognize that the residents need a government to run, inclusive of addressing education, public safety and healthcare requirements," said Aguon.
Sen. Judi Guthertz has also criticized the payout plan, saying: "I don't think it's achievable, given the cash flow problems of the government. I think it's unconscionable that the federal government is mandating this on this territory and not considering its fair share for the closure of the Ordot Dump and the construction of the new landfill."
Destroy
Last Wednesday, Gov. Felix Camacho said one million dollars out of the government's operating fund will destroy GovGuam's ability to provide services.
In light of this latest demand from GBB, Camacho said the legislature should now give him policy approval to proceed with the revenue bond, although he told the court that given the current global financial crisis, it would be difficult for the government to secure a bond at this point in time.
The governor said that even if the government were to secure financing in the bond market, because of the high rates, it's simply not affordable.
"It's going to be very difficult to receive that right now and this will only exacerbate our already growing deficit," Camacho said.
Defended
Manning had defended the $1 million weekly payout plan, saying that the continuous replenishment of the funds on a weekly basis in which $20 million has been deposited into a bank account is necessary because it provides a "clear reassurance to the contractors employed to do the Consent Decree project work that they will be paid in a timely way." Without such assurance, Manning said it is unlikely that quality contractors will be willing to undertake the work needed to bring Guam into compliance with the Consent Decree.
Manning added that given the weak cash position of the government, a fixed weekly cash contribution may be more manageable than monthly cash amounts.
Monday, December 15, 2008
Governor Optimistic About $20 Million Landfill Loan
Governor confident: Camacho upbeat on $20M landfill loan
By Dionesis Tamondong
Pacific Daily News
December 17, 2008
One local bank official said his bank is just not interested in lending the government $20 million for landfill construction. Another lender said it would consider the proposal if the repayment sources were more concrete.
With less than a week before the federal deadline for responses, the Camacho administration is sure some lending institutions will submit proposals to finance the Ordot dump closure and landfill construction projects.
"We remain confident that we will be able to secure the financing," said George Bamba, Gov. Felix Camacho's chief of staff. The government of Guam must deposit $20 million by Jan. 5, or some officials could face legal action from the federal government.
The Guam Economic Development and Commerce Authority has issued a request for proposals for financiers to lend GovGuam the money for the start-up projects.
BankPacific President Phil Flores said his bank won't respond to the financing request. "We're not interested. We're just not going to bid on this one."
While Flores didn't provide a specific reason for not responding to GovGuam's proposal, he said there's too much confusion over the dump situation.
"Is the Legislature wanting to build in Layon or to give the contract to (Guam Resource Recovery Partners)?" Flores asked. "So if you're lending money for a new landfill, there's always the concern that it's not going to be built."
Several lawmakers disagree with the local government's selection of Dandan, Inarajan, as the landfill site, arguing it is a potential freshwater source and is too remote for efficient use as a landfill. Senators passed a measure last month pushing for development of a privately operated landfill in the Guatali area of Piti and Santa Rita, on land being leased by GRRP, saying it is friendlier to the environment and less costly than floating bonds to develop the Inarajan site.
Pete Sgro Jr., co-counsel to Barclay's Capital, said his firm would be interested only if the repayment terms were solidified with Section 30 funds as collateral for the loan. Barclay's Capital is a division of Barclay's Bank, which has offices worldwide.
"We are seriously considering submitting a response, and if we do so, however, the response will contain terms that would include not continuing with a subordination of the Section 30 money," Sgro said. "Otherwise there is no value in the collateral."
Sgro said lawmakers made "damaging amendments" to the governor's original short-term borrowing bill.
The administration had pledged Section 30 money -- taxes paid by federal and military employees on Guam and remitted to GovGuam --to pay back the $20 million.
But lawmakers instead required tipping fees be used as the main repayment source, and a variety of funding sources -- including compact-impact money, Section 30 money and the General Fund -- as additional security, Sen. Ben Pangelinan said.
By doing so, Section 30 funds could continue to be used for other obligations, such as the overdue tax refunds and COLA payments.
"These payments are also ordered by the court and on par with the landfill issue," Pangelinan said.
Pangelinan said the amendments were made in consultation with the administration's fiscal policy team after lawmakers realized there wasn't enough support to pass the governor's original bill.
Sgro said lawmakers should go back and approve the original version of the governor's bill, which is in line with the intent of the federal receiver and the District Court of Guam.
"How can anyone ignore the consistent position taken by (Chief Judge Frances Tydingco-) Gatewood and create an amendment that will not accomplish the necessary financing because of the vagueness and lack of value of the collateral created by an amendment?" Sgro asked.
By Dionesis Tamondong
Pacific Daily News
December 17, 2008
One local bank official said his bank is just not interested in lending the government $20 million for landfill construction. Another lender said it would consider the proposal if the repayment sources were more concrete.
With less than a week before the federal deadline for responses, the Camacho administration is sure some lending institutions will submit proposals to finance the Ordot dump closure and landfill construction projects.
"We remain confident that we will be able to secure the financing," said George Bamba, Gov. Felix Camacho's chief of staff. The government of Guam must deposit $20 million by Jan. 5, or some officials could face legal action from the federal government.
The Guam Economic Development and Commerce Authority has issued a request for proposals for financiers to lend GovGuam the money for the start-up projects.
BankPacific President Phil Flores said his bank won't respond to the financing request. "We're not interested. We're just not going to bid on this one."
While Flores didn't provide a specific reason for not responding to GovGuam's proposal, he said there's too much confusion over the dump situation.
"Is the Legislature wanting to build in Layon or to give the contract to (Guam Resource Recovery Partners)?" Flores asked. "So if you're lending money for a new landfill, there's always the concern that it's not going to be built."
Several lawmakers disagree with the local government's selection of Dandan, Inarajan, as the landfill site, arguing it is a potential freshwater source and is too remote for efficient use as a landfill. Senators passed a measure last month pushing for development of a privately operated landfill in the Guatali area of Piti and Santa Rita, on land being leased by GRRP, saying it is friendlier to the environment and less costly than floating bonds to develop the Inarajan site.
Pete Sgro Jr., co-counsel to Barclay's Capital, said his firm would be interested only if the repayment terms were solidified with Section 30 funds as collateral for the loan. Barclay's Capital is a division of Barclay's Bank, which has offices worldwide.
"We are seriously considering submitting a response, and if we do so, however, the response will contain terms that would include not continuing with a subordination of the Section 30 money," Sgro said. "Otherwise there is no value in the collateral."
Sgro said lawmakers made "damaging amendments" to the governor's original short-term borrowing bill.
The administration had pledged Section 30 money -- taxes paid by federal and military employees on Guam and remitted to GovGuam --to pay back the $20 million.
But lawmakers instead required tipping fees be used as the main repayment source, and a variety of funding sources -- including compact-impact money, Section 30 money and the General Fund -- as additional security, Sen. Ben Pangelinan said.
By doing so, Section 30 funds could continue to be used for other obligations, such as the overdue tax refunds and COLA payments.
"These payments are also ordered by the court and on par with the landfill issue," Pangelinan said.
Pangelinan said the amendments were made in consultation with the administration's fiscal policy team after lawmakers realized there wasn't enough support to pass the governor's original bill.
Sgro said lawmakers should go back and approve the original version of the governor's bill, which is in line with the intent of the federal receiver and the District Court of Guam.
"How can anyone ignore the consistent position taken by (Chief Judge Frances Tydingco-) Gatewood and create an amendment that will not accomplish the necessary financing because of the vagueness and lack of value of the collateral created by an amendment?" Sgro asked.
Wednesday, April 02, 2008
Companies Eye the CNMI
Companies eye CNMI as staging area in Guam buildup
The Saipan Tribune
Wednesday, April 02, 2008
By Mark Rabago, Assistant Editor
Companies hoping to save costs in the upcoming military buildup in Guam are looking at the CNMI as a possible staging ground for their operations.
This was confirmed recently by Department of Commerce Deputy Secretary Michael Ada, who said that his office has received quite a number of inquiries from businesses that are interested in warehousing, labor-intensive, and other related activities on the islands.
Ada said the CNMI is a viable option for these companies because of the islands' lower minimum wage and cheaper leasing terms vis-à-vis that of Guam.
Gov. Bengino R. Fitial's press secretary Charles P. Reyes agrees with Ada's assessment and added that another lure for companies is the Commonwealth's tax incentives and qualifying certificate program.
“Many companies interested in the military buildup in Guam may operate from the CNMI or be based in the CNMI because of our attractive tax incentives, including the QC program.”
Reyes added that, although the minimum wage was raised, the CNMI may still offer lower labor costs compared to Guam, and real estate rental or lease costs may also be lower.
“Lower taxes and lower labor costs may persuade some companies capitalizing on the military build up to base operations in the CNMI.”
He said the tax incentives and QC program were two of the reasons why the government managed to bring in additional air seats in spite of the fact that Japan Airlines pulled out.
In a recent interview with Fitial himself, the islands' chief executive championed the Commonwealth's competitive advantage in getting residual investment from the impending Guam military buildup.
“Because of our tax structure, lower tax rates, and qualifying certificate we stand a better chance at attracting companies that would cater to the military buildup projects than anywhere in the world,” he said during the Covenant Day celebrations held last March 24.
The $15-billion Guam military buildup is targeted for 2010-2014 following the relocation of 8,000 U.S. Marines and about 9,000 of their dependents to the U.S. territory from Okinawa, Japan.
The Saipan Tribune
Wednesday, April 02, 2008
By Mark Rabago, Assistant Editor
Companies hoping to save costs in the upcoming military buildup in Guam are looking at the CNMI as a possible staging ground for their operations.
This was confirmed recently by Department of Commerce Deputy Secretary Michael Ada, who said that his office has received quite a number of inquiries from businesses that are interested in warehousing, labor-intensive, and other related activities on the islands.
Ada said the CNMI is a viable option for these companies because of the islands' lower minimum wage and cheaper leasing terms vis-à-vis that of Guam.
Gov. Bengino R. Fitial's press secretary Charles P. Reyes agrees with Ada's assessment and added that another lure for companies is the Commonwealth's tax incentives and qualifying certificate program.
“Many companies interested in the military buildup in Guam may operate from the CNMI or be based in the CNMI because of our attractive tax incentives, including the QC program.”
Reyes added that, although the minimum wage was raised, the CNMI may still offer lower labor costs compared to Guam, and real estate rental or lease costs may also be lower.
“Lower taxes and lower labor costs may persuade some companies capitalizing on the military build up to base operations in the CNMI.”
He said the tax incentives and QC program were two of the reasons why the government managed to bring in additional air seats in spite of the fact that Japan Airlines pulled out.
In a recent interview with Fitial himself, the islands' chief executive championed the Commonwealth's competitive advantage in getting residual investment from the impending Guam military buildup.
“Because of our tax structure, lower tax rates, and qualifying certificate we stand a better chance at attracting companies that would cater to the military buildup projects than anywhere in the world,” he said during the Covenant Day celebrations held last March 24.
The $15-billion Guam military buildup is targeted for 2010-2014 following the relocation of 8,000 U.S. Marines and about 9,000 of their dependents to the U.S. territory from Okinawa, Japan.
Sunday, March 23, 2008
Guam Struggles to Find $$$ for Military Buildup
Guam struggles for $$$ to fund island infrastructure upgrades
Weekly Japan Update
Date Posted: 2008-03-27
Guam needs money, plenty of it, to fund dozens of large scale construction projects needed in advance of the planned relocation of 8,000 American Marines and their families from Okinawa.
The realignment will boost Guam’s largely tourism-based economy from $3 billion to more than $4 billion as the military moves will swell the military population to 19,000, and boost the number of dependents another 19,000. There are now 6,400 American troops on Guam, along with about 7,700 family members.
Guam’s 170,000 residents are mostly in favor of the relocation, but worry about how they’ll be able to get everything built to support it. “We need private-sector participation because it’s too big a project for a small government and a small community,” says Gerald Perez, former president of the Guam Chamber of Commerce. “We feel like we’ve been told to upgrade port facilities, build roads and houses all at the same time,” a politician adds, “and it’s simply impossible.”
Moving 8,000 Okinawa Marines to Guam is estimated to cost $10.3 billion, with Japan’s government picking up the tab for more than $6.1 billion to cover infrastructure construction. Officials say that infrastructure involves building a water supply system, sewage facilities, family housing and barracks for the troops. Guam has already asked Japan to ante up another $3 billion to cover costs to the local civilian sector for upgrade projects.
Guam’s Governor figures that’s only fair, because “I would expect a good amount of the Special Project Entities would be going to Japanese companies.” Felix Camacho says the relocation effort is far beyond Guam’s local capability, noting Guam’s annual budget is only $450 million. He says there’s a lot of work to be done to support the massive building projects, because the 48-kilometer-long island has only one major road running from the Apra Port to the Andersen Air Force Base. That road winds through downtown Agana. ‘Camacho says the Apra Port capacity must be at least doubled to handle the increases in materials flowing to Guam.
Construction is supposed to begin in 2010, but the former Chamber leader predicts that number will wobble. “We suspect it may have to be drawn out over a long period of time,” he said, “unless we get help.” James Martinez, head of Guam’s Contractors’ Association, also predicts full blown construction may “be delayed further than 2010.”
Apart from Guam’s concerns about obtaining enough funding to make the project start-ups run smoothly, some worries are mounting that the delays in building a new military airfield in Okinawa may stall or hamper needed funding deals. The Japanese government is still wrangling with Okinawa officials over construction of a new airfield at Camp Schwab to replace the controversial Futenma Marine Corps Air Station located in Ginowan City.
Weekly Japan Update
Date Posted: 2008-03-27
Guam needs money, plenty of it, to fund dozens of large scale construction projects needed in advance of the planned relocation of 8,000 American Marines and their families from Okinawa.
The realignment will boost Guam’s largely tourism-based economy from $3 billion to more than $4 billion as the military moves will swell the military population to 19,000, and boost the number of dependents another 19,000. There are now 6,400 American troops on Guam, along with about 7,700 family members.
Guam’s 170,000 residents are mostly in favor of the relocation, but worry about how they’ll be able to get everything built to support it. “We need private-sector participation because it’s too big a project for a small government and a small community,” says Gerald Perez, former president of the Guam Chamber of Commerce. “We feel like we’ve been told to upgrade port facilities, build roads and houses all at the same time,” a politician adds, “and it’s simply impossible.”
Moving 8,000 Okinawa Marines to Guam is estimated to cost $10.3 billion, with Japan’s government picking up the tab for more than $6.1 billion to cover infrastructure construction. Officials say that infrastructure involves building a water supply system, sewage facilities, family housing and barracks for the troops. Guam has already asked Japan to ante up another $3 billion to cover costs to the local civilian sector for upgrade projects.
Guam’s Governor figures that’s only fair, because “I would expect a good amount of the Special Project Entities would be going to Japanese companies.” Felix Camacho says the relocation effort is far beyond Guam’s local capability, noting Guam’s annual budget is only $450 million. He says there’s a lot of work to be done to support the massive building projects, because the 48-kilometer-long island has only one major road running from the Apra Port to the Andersen Air Force Base. That road winds through downtown Agana. ‘Camacho says the Apra Port capacity must be at least doubled to handle the increases in materials flowing to Guam.
Construction is supposed to begin in 2010, but the former Chamber leader predicts that number will wobble. “We suspect it may have to be drawn out over a long period of time,” he said, “unless we get help.” James Martinez, head of Guam’s Contractors’ Association, also predicts full blown construction may “be delayed further than 2010.”
Apart from Guam’s concerns about obtaining enough funding to make the project start-ups run smoothly, some worries are mounting that the delays in building a new military airfield in Okinawa may stall or hamper needed funding deals. The Japanese government is still wrangling with Okinawa officials over construction of a new airfield at Camp Schwab to replace the controversial Futenma Marine Corps Air Station located in Ginowan City.
Saturday, January 26, 2008
Task Force Outlook on Troop Expansion
Civilian/Military Task Force presents outlook on troop expansion
by Clynt Ridgell, KUAM News
Friday, January 25, 2008
During the Civilian/Military Task Force's briefing for the 29th Guam Legislature today two major points were made clear: first that Guam needs money for the buildup of troops locally, and secondly that the island simply needs more information on the Pentagon's plans. It was made evident during the presentation that Guam must do its best to obtain the financial assistance necessary to prepare for the dramatic increase in population that will result from the military buildup.
Governor Felix Camacho says this is something he's been working on and something he will continue to push for. "We as a territory need to make our case," the chief executive announced. "We've already missed the opportunity for appropriations for Fiscal Year 2009, we need to target Fiscal Year 2010 if we're going to get any types of appropriations."
To help Guam get the money it needs the Task Force has been working on a needs assessment to be presented to the General Accountability Office (the investigative arm of Congress) that will be her by the 31st of the month. However, to properly produce an accurate needs assessment the Government of Guam needs to know more details about the military's plans, like how many people will end up here, where will they be housed at, and what kind of infrastructure the military will need to support them and their increased facilities.
J. Peter Roberto is the chairman of the Subcommittee on Health and Social Services and stated, "One of the things we've worked with the Joint Guam Program Office is we've tried to get information of their statistics of military personnel coming in, so we can factor that in."
And such was a recurring theme of today's presentations overall. More information is needed from the military so that Guam can properly asses its needs and can start making plans of its own. This need for more information was even reflected in a report written by the GAO on Guam's military buildup. All the subcommittees gave basic reports with limited information; one of the most detailed subcommittee reports was given by education chairman David Okada, in which he estimated that Guam will need 6-9 new schools. But even he admits that more information from the Department of Defense is needed.
Senator B.J. Cruz (D) was not satisfied with most of the reports, saying many of them contained more fluff than actual substance. Tony Lamorena advised lawmakers that today's presentations had to be shortened summaries because each subcommittee chair would need at least an hour to report their needs assessments.
Roberto also explained the difficulty in producing more specific presentations without more specific information, saying, "I think the subcommittee agrees...that the questions that we've asked the military for numbers so that we can do a projected plan. We are still not getting the information we want."
In the end it was clear that the CMTF has made a lot of headway in certain areas like establishing communications with various federal agencies but still have a long way to go in getting more information from the DoD.
by Clynt Ridgell, KUAM News
Friday, January 25, 2008
During the Civilian/Military Task Force's briefing for the 29th Guam Legislature today two major points were made clear: first that Guam needs money for the buildup of troops locally, and secondly that the island simply needs more information on the Pentagon's plans. It was made evident during the presentation that Guam must do its best to obtain the financial assistance necessary to prepare for the dramatic increase in population that will result from the military buildup.
Governor Felix Camacho says this is something he's been working on and something he will continue to push for. "We as a territory need to make our case," the chief executive announced. "We've already missed the opportunity for appropriations for Fiscal Year 2009, we need to target Fiscal Year 2010 if we're going to get any types of appropriations."
To help Guam get the money it needs the Task Force has been working on a needs assessment to be presented to the General Accountability Office (the investigative arm of Congress) that will be her by the 31st of the month. However, to properly produce an accurate needs assessment the Government of Guam needs to know more details about the military's plans, like how many people will end up here, where will they be housed at, and what kind of infrastructure the military will need to support them and their increased facilities.
J. Peter Roberto is the chairman of the Subcommittee on Health and Social Services and stated, "One of the things we've worked with the Joint Guam Program Office is we've tried to get information of their statistics of military personnel coming in, so we can factor that in."
And such was a recurring theme of today's presentations overall. More information is needed from the military so that Guam can properly asses its needs and can start making plans of its own. This need for more information was even reflected in a report written by the GAO on Guam's military buildup. All the subcommittees gave basic reports with limited information; one of the most detailed subcommittee reports was given by education chairman David Okada, in which he estimated that Guam will need 6-9 new schools. But even he admits that more information from the Department of Defense is needed.
Senator B.J. Cruz (D) was not satisfied with most of the reports, saying many of them contained more fluff than actual substance. Tony Lamorena advised lawmakers that today's presentations had to be shortened summaries because each subcommittee chair would need at least an hour to report their needs assessments.
Roberto also explained the difficulty in producing more specific presentations without more specific information, saying, "I think the subcommittee agrees...that the questions that we've asked the military for numbers so that we can do a projected plan. We are still not getting the information we want."
In the end it was clear that the CMTF has made a lot of headway in certain areas like establishing communications with various federal agencies but still have a long way to go in getting more information from the DoD.
Friday, November 09, 2007
Tuesday, September 18, 2007
Funding for Marine Move May Fall Short
Funding for Guam buildup may fall short
By Gerardo R. Partido
Variety News Staff
September 18, 2007
FUNDING requirements for the military buildup on Guam are not yet fully identified and may be difficult to meet given other priorities and existing funding constraints.
This was among the findings of a comprehensive study on the Guam military buildup conducted by the Government Accountability Office, or GAO, the investigative arm of the U.S. Congress.
According to the agency, various Department of Defense agencies that are to help support the influx of personnel and equipment into Guam will likely incur additional costs that are not yet included in the current DOD $13 billion cost estimate for the military buildup on Guam.
The $13 billion estimate only includes the costs to move the Marine Corps forces from Okinawa to Guam, construct a Navy pier for a transient aircraft carrier, and station an Army ballistic missile defense task force.
GAO pointed out that this cost estimate does not include the costs of other defense agencies to support the additional military personnel and their dependents on Guam.
Furthermore, GAO warned that the government of Japan’s funds will not be made available until it has agreed to specific infrastructure plans for Guam.
The Marine Corps move from Okinawa to Guam is estimated to cost about $10.3 billion. Of this amount, the government of Japan has agreed to contribute about $6.1 billion to develop facilities and infrastructure on Guam.
In addition, the GAO study warned that if the Futenma replacement facility in Okinawa is not built, the Marine Corps relocation to Guam may be delayed. The facility is intended to replace the Marine Corps Air Station Futenma and is estimated to cost $4 billion to $5 billion.
DOD officials view the success of the Futenma replacement facility as a key objective of the initiative that needs to be completed in order for other realignment actions to take place.
GAO noted that the government of Japan may encounter challenges in funding its share of the Marine Corps move, considering Japan’s other national priorities and its commitments associated with funding several other major realignments of U.S. forces in Japan under the Defense Policy Review Initiative.
At the time of the GAO study, the Japanese legislature had already approved $228 million for planning and initial construction funds for force posture realignments, including project planning in Guam, and authorized the Japan Bank for International Cooperation to invest in businesses for Guam development.
According to GAO, Department of Defense officials have also expressed concern regarding the department’s ability to obtain a continuous flow of funds adequate to pay its share of the current $13 billion cost estimate for the military buildup on Guam in light of ongoing operations and funding constraints and challenges.
These officials, whom GAO did not identify, informed the agency that obtaining funding for the military buildup on Guam at current estimated levels will be difficult because of the pressures the department faces in funding other defense priorities and activities, including the ongoing operations in Iraq and Afghanistan and procurement costs for weapons systems.
In addition, there are other costs not included in the $13 billion cost estimate associated with the Marine Corps’ move to Guam that will increase overall costs.
Historically, GAO pointed out that the government of Japan has paid a large portion of the operation and maintenance costs of the Marine Corps in Okinawa in the form of host nation support that will be borne solely by DOD after the move.
By Gerardo R. Partido
Variety News Staff
September 18, 2007
FUNDING requirements for the military buildup on Guam are not yet fully identified and may be difficult to meet given other priorities and existing funding constraints.
This was among the findings of a comprehensive study on the Guam military buildup conducted by the Government Accountability Office, or GAO, the investigative arm of the U.S. Congress.
According to the agency, various Department of Defense agencies that are to help support the influx of personnel and equipment into Guam will likely incur additional costs that are not yet included in the current DOD $13 billion cost estimate for the military buildup on Guam.
The $13 billion estimate only includes the costs to move the Marine Corps forces from Okinawa to Guam, construct a Navy pier for a transient aircraft carrier, and station an Army ballistic missile defense task force.
GAO pointed out that this cost estimate does not include the costs of other defense agencies to support the additional military personnel and their dependents on Guam.
Furthermore, GAO warned that the government of Japan’s funds will not be made available until it has agreed to specific infrastructure plans for Guam.
The Marine Corps move from Okinawa to Guam is estimated to cost about $10.3 billion. Of this amount, the government of Japan has agreed to contribute about $6.1 billion to develop facilities and infrastructure on Guam.
In addition, the GAO study warned that if the Futenma replacement facility in Okinawa is not built, the Marine Corps relocation to Guam may be delayed. The facility is intended to replace the Marine Corps Air Station Futenma and is estimated to cost $4 billion to $5 billion.
DOD officials view the success of the Futenma replacement facility as a key objective of the initiative that needs to be completed in order for other realignment actions to take place.
GAO noted that the government of Japan may encounter challenges in funding its share of the Marine Corps move, considering Japan’s other national priorities and its commitments associated with funding several other major realignments of U.S. forces in Japan under the Defense Policy Review Initiative.
At the time of the GAO study, the Japanese legislature had already approved $228 million for planning and initial construction funds for force posture realignments, including project planning in Guam, and authorized the Japan Bank for International Cooperation to invest in businesses for Guam development.
According to GAO, Department of Defense officials have also expressed concern regarding the department’s ability to obtain a continuous flow of funds adequate to pay its share of the current $13 billion cost estimate for the military buildup on Guam in light of ongoing operations and funding constraints and challenges.
These officials, whom GAO did not identify, informed the agency that obtaining funding for the military buildup on Guam at current estimated levels will be difficult because of the pressures the department faces in funding other defense priorities and activities, including the ongoing operations in Iraq and Afghanistan and procurement costs for weapons systems.
In addition, there are other costs not included in the $13 billion cost estimate associated with the Marine Corps’ move to Guam that will increase overall costs.
Historically, GAO pointed out that the government of Japan has paid a large portion of the operation and maintenance costs of the Marine Corps in Okinawa in the form of host nation support that will be borne solely by DOD after the move.
Saturday, August 25, 2007
Japan May Control Military Money
Japan may control buildup money
By Gerardo R. Partido
Variety News Staff
August 24, 2007
JAPAN may end up controlling how the bulk of the money used for the military buildup on Guam is used.
This became apparent during yesterday’s Guam Industry Forum as one of the speakers indicated that Japan’s portion of the Marine relocation funding may not be subject to U.S. regulations.
Robert Little, assistant counsel of the Naval Facilities Engineering Command, said that while the $4 billion committed by the American government will be subject to normal U.S. procurement rules, the special purpose entities that the Japanese will be forming to handle the Marine relocation may be exempted.
For instance, the bid preference for U.S. firms only applies to U.S. military construction appropriations. This means that the Japanese government could very well buy most of the materials and contract out the majority of the relocation work to Japanese companies.
Of the $10 billion price tag for the relocation of the Marines from Okinawa, the Japanese government will be shouldering 60 percent or about $6 billion.
This is unprecedented and marks the first time the Japanese government has agreed to share the costs of building and improving facilities at a U.S. base overseas.
Because of this, fears have been raised that only Japanese contractors may be tapped to handle the mammoth job of relocating the 8,000 Marines and their families to Guam.
According to Variety sources, many Japanese companies, most notably the giant Mitsubishi Heavy Industries, have already been quietly inspecting Guam and CNMI facilities.
The Guam Contractors Association has expressed concerns over the role Japanese firms may assume in the design and construction of facilities funded by the Japanese government and Japanese financial institutions.
One concern is whether Japanese standards may be substituted for U.S. standards where Japanese funds are used.
Some contractors also want to find out more details on the type of management structure expected to be put in place if Japan insists on using Japanese companies to manage the large and complex task of relocating the Marines and their families from Okinawa.
Okinawan politicians have likewise been lobbying to have displaced Okinawan workers used in the relocation of the Marines but GCA said this may not be the most cost effective source for labor.
Under the financing plan approved by the Japanese parliament, the state-run Japan Bank for International Cooperation has been designated as the bank that will give loans to contractors hired to help relocate the Marines to Guam.
JBIC is the arm of the Japanese government that undertakes lending and other operations for the promotion of Japanese economic activities overseas and it has demonstrated in the past a preference for Japanese companies, analysts say.
However, the Japanese Defense Ministry has said that JBIC will also give loans and investments to U.S. companies, with the U.S. firms paying back the money.
Local contractors interviewed by Variety also believe that while Japanese companies may get the major contracts, U.S. and Guam companies will still not lose out as they will surely be subcontracted by the Japanese.
The government of Guam likewise feels confident that the Japanese special purpose entities will tie up with U.S. and local firms to perform the many tasks connected with the Marine relocation.
During the recent House Subcommittee on Insular Affairs field oversight hearing, Gov. Felix P. Camacho pointed out that Guam already has a good relationship with the Japanese business community, noting that one of the island’s independent power producers is now run by a Japanese company.
Under the Marine relocation financing plan, Japan will provide $2.8 billion in grants, $1.5 billion in investments and another $1.79 billion in loans, with the investments and loans to be paid back.
By Gerardo R. Partido
Variety News Staff
August 24, 2007
JAPAN may end up controlling how the bulk of the money used for the military buildup on Guam is used.
This became apparent during yesterday’s Guam Industry Forum as one of the speakers indicated that Japan’s portion of the Marine relocation funding may not be subject to U.S. regulations.
Robert Little, assistant counsel of the Naval Facilities Engineering Command, said that while the $4 billion committed by the American government will be subject to normal U.S. procurement rules, the special purpose entities that the Japanese will be forming to handle the Marine relocation may be exempted.
For instance, the bid preference for U.S. firms only applies to U.S. military construction appropriations. This means that the Japanese government could very well buy most of the materials and contract out the majority of the relocation work to Japanese companies.
Of the $10 billion price tag for the relocation of the Marines from Okinawa, the Japanese government will be shouldering 60 percent or about $6 billion.
This is unprecedented and marks the first time the Japanese government has agreed to share the costs of building and improving facilities at a U.S. base overseas.
Because of this, fears have been raised that only Japanese contractors may be tapped to handle the mammoth job of relocating the 8,000 Marines and their families to Guam.
According to Variety sources, many Japanese companies, most notably the giant Mitsubishi Heavy Industries, have already been quietly inspecting Guam and CNMI facilities.
The Guam Contractors Association has expressed concerns over the role Japanese firms may assume in the design and construction of facilities funded by the Japanese government and Japanese financial institutions.
One concern is whether Japanese standards may be substituted for U.S. standards where Japanese funds are used.
Some contractors also want to find out more details on the type of management structure expected to be put in place if Japan insists on using Japanese companies to manage the large and complex task of relocating the Marines and their families from Okinawa.
Okinawan politicians have likewise been lobbying to have displaced Okinawan workers used in the relocation of the Marines but GCA said this may not be the most cost effective source for labor.
Under the financing plan approved by the Japanese parliament, the state-run Japan Bank for International Cooperation has been designated as the bank that will give loans to contractors hired to help relocate the Marines to Guam.
JBIC is the arm of the Japanese government that undertakes lending and other operations for the promotion of Japanese economic activities overseas and it has demonstrated in the past a preference for Japanese companies, analysts say.
However, the Japanese Defense Ministry has said that JBIC will also give loans and investments to U.S. companies, with the U.S. firms paying back the money.
Local contractors interviewed by Variety also believe that while Japanese companies may get the major contracts, U.S. and Guam companies will still not lose out as they will surely be subcontracted by the Japanese.
The government of Guam likewise feels confident that the Japanese special purpose entities will tie up with U.S. and local firms to perform the many tasks connected with the Marine relocation.
During the recent House Subcommittee on Insular Affairs field oversight hearing, Gov. Felix P. Camacho pointed out that Guam already has a good relationship with the Japanese business community, noting that one of the island’s independent power producers is now run by a Japanese company.
Under the Marine relocation financing plan, Japan will provide $2.8 billion in grants, $1.5 billion in investments and another $1.79 billion in loans, with the investments and loans to be paid back.
Monday, June 11, 2007
Money for Marines Move Still Not Finalized
$6B Japan financing not yet final
By Gerardo R. Partido
Variety News Staff
May 29, 2007
THE $6 billion approved by Japanese lawmakers to help fund the relocation of Marines from Okinawa to Guam is not yet final, the Consulate General of Japan in Guam announced.
In a letter, Consul General Tamio Tomino said the $6 billion that will be shouldered by the Japanese government under its agreement with the U.S. was not outlined in the bill approved last week by Japan's upper house of parliament.
"For the time being, however, this is the figure that the governments of Japan and the U.S. are looking at as Japan's share of the estimated costs for the relocation of the U.S. Marines," Tomino said.
He added that the actual timeline for the Japan Diet to take up this matter for discussion has not yet been decided "and will probably not be" until the U.S. side completes the Environmental Impact Statement, or EIS, process and other preparatory work.
So far, the Navy is far from completing a draft EIS as it only recently finished polling residents' feedback about the planned relocation of the Marines.
The input from Guam and CNMI residents will still be forwarded to Navy planners as they prepare to draft an EIS, which will analyze the impact of the Marines' relocation on the community and culture of Guam and the CNMI.
This means that further delay could still occur before the actual extent of Japan's financing could be known.
Guam Contractors Association executive director James Martinez, in an interview with Variety, said his group's members are hungry for more details in the aftermath of the Japanese parliament's approval of the Marine relocation financing.
"Of course, we're happy that the Japanese lawmakers approved the bill. But at this point, we still need to see the details. As far as we are concerned, there is still nothing concrete to go on from which we can base our plans," Martinez said.
In his letter, Tomino also dispelled initial reports that the U.S. would get the primary contracts for the construction projects needed to accommodate the Marines.
He confirmed that the state-run Japan Bank for International Cooperation has been designated as the bank that will give loans to contractors.
But Tomino said details concerning the contractors and the mode of investment and finance work of the Japan Bank for International Cooperation have yet to be finalized.
"The discussions in this regard between Japan and the U.S. are an ongoing process," the Japanese consul general said.
This leaves open the possibility that the bulk of the contracting work may still end up with Japanese companies as U.S. contractors have feared.
In Japan, opposition continues against the approval of the $6 billion financing, which many Japanese consider too high and unfair.
The approval of the $6 billion financing will mark the first time a Japanese government has agreed to share the costs of building and improving facilities at a U.S. base overseas and this has enraged Japanese nationalists.
"Certainly, it is unusual for a government to finance the building of another country's military facilities in a territory other than its own," the influential Japanese daily Asahi Shimbun said in an editorial.
By Gerardo R. Partido
Variety News Staff
May 29, 2007
THE $6 billion approved by Japanese lawmakers to help fund the relocation of Marines from Okinawa to Guam is not yet final, the Consulate General of Japan in Guam announced.
In a letter, Consul General Tamio Tomino said the $6 billion that will be shouldered by the Japanese government under its agreement with the U.S. was not outlined in the bill approved last week by Japan's upper house of parliament.
"For the time being, however, this is the figure that the governments of Japan and the U.S. are looking at as Japan's share of the estimated costs for the relocation of the U.S. Marines," Tomino said.
He added that the actual timeline for the Japan Diet to take up this matter for discussion has not yet been decided "and will probably not be" until the U.S. side completes the Environmental Impact Statement, or EIS, process and other preparatory work.
So far, the Navy is far from completing a draft EIS as it only recently finished polling residents' feedback about the planned relocation of the Marines.
The input from Guam and CNMI residents will still be forwarded to Navy planners as they prepare to draft an EIS, which will analyze the impact of the Marines' relocation on the community and culture of Guam and the CNMI.
This means that further delay could still occur before the actual extent of Japan's financing could be known.
Guam Contractors Association executive director James Martinez, in an interview with Variety, said his group's members are hungry for more details in the aftermath of the Japanese parliament's approval of the Marine relocation financing.
"Of course, we're happy that the Japanese lawmakers approved the bill. But at this point, we still need to see the details. As far as we are concerned, there is still nothing concrete to go on from which we can base our plans," Martinez said.
In his letter, Tomino also dispelled initial reports that the U.S. would get the primary contracts for the construction projects needed to accommodate the Marines.
He confirmed that the state-run Japan Bank for International Cooperation has been designated as the bank that will give loans to contractors.
But Tomino said details concerning the contractors and the mode of investment and finance work of the Japan Bank for International Cooperation have yet to be finalized.
"The discussions in this regard between Japan and the U.S. are an ongoing process," the Japanese consul general said.
This leaves open the possibility that the bulk of the contracting work may still end up with Japanese companies as U.S. contractors have feared.
In Japan, opposition continues against the approval of the $6 billion financing, which many Japanese consider too high and unfair.
The approval of the $6 billion financing will mark the first time a Japanese government has agreed to share the costs of building and improving facilities at a U.S. base overseas and this has enraged Japanese nationalists.
"Certainly, it is unusual for a government to finance the building of another country's military facilities in a territory other than its own," the influential Japanese daily Asahi Shimbun said in an editorial.
Wednesday, May 30, 2007
Guam's Billion Dollar Road
$1.25B road project detailed
Proposed highway would cut through Manengon
By Gaynor Dumat-ol Daleno
Pacific Daily News
gdumat-ol@guampdn.com
May 31, 2007
Guam's future billion-dollar highway, which is a piece of the military buildup puzzle, likely will run across largely undeveloped hills and valleys of Chalan Pago, Yona and Piti, according to a tentative map from the Navy.
If the idea evolves into an adopted plan, the highway would start near the point where Routes 10 and 4 meet in Chalan Pago, according to a Department of the Navy Guam planning document, which was still at an early stage and was labeled "notional."
The $1.25 billion highway would provide the military with an alternative access that links Andersen Air Force Base in northern Guam and the Navy base on the southern side of the island.
The Air Force and Navy bases use Marine Corps Drive for a main link, but the road has had a history of gridlock during serious accidents.
In May 2006, Air Force Lt. Gen. Daniel Leaf, deputy commander of U.S. Pacific Command, said in an interview that when the island's military population grows significantly, the highway would be needed to "move both people, supplies and equipment from north to south, south to north on the island, whether it's for training or to deploy out of the harbor."
"And we want to do that with minimal impact on the community and expeditiously. The current road structure doesn't really allow for that very well. So that's an area we believe we'll have to invest in," Leaf said.
The largest chunk of the $15 billion military buildup on Guam involves building housing, training and other facilities for the 8,352 members of the U.S. Marines and about 9,000 dependents who must relocate from Okinawa to Guam by 2014.
The Marines' move to Guam is expected to cost about $10 billion, of which $6 billion will be paid by Japan.
The 3rd Marine Expeditionary Force is moving out of Okinawa as part of the U.S.-Japan agreement aimed at beefing up security in the region and consolidating U.S. military installations in Japan to free up land for return to the Japanese.
But while Japan is helping to pay for the Marines' relocation, such as for barracks and "quality-of-life" facilities, the highway project is expected to be 100 percent funded by American taxpayers, according to an itemized list of cost sharing between Japan and the U.S.
Real property values soaring
The anticipation of local economic growth stemming from the military buildup already has sent the values of Guam homes, condominium units and land parcels soaring.
"I am amazed at how much the island has already benefited from the initial phases of the buildup," said Guam Delegate Madeleine Bordallo, in a speech to the Guam Chamber of Commerce yesterday.
She mentioned that in some cases, real property values have increased 300 percent over the past few years.
"The economic investment I see here on Guam will eclipse the boom we experienced in the '80s," she said, of the era when Guam was a magnet for Japanese investors who financed construction of many Guam hotels.
"Rising property values means equity for the residents of Guam and that translates into wealth," she said.
The congresswoman's speech did not mention the $1.25 billion highway project, but she said that even before the Marine-related construction kicks in, the military buildup has begun.
The fiscal 2008 defense spending bill includes $300 million in military construction projects for Guam. The bill has passed the House, and it will work out a version that will also be acceptable to the Senate.
Fiscal 2009 funding for military projects on Guam will hover around $500 million, and more than $1 billion a year starting in 2010, Bordallo said.
Investments
For Guam investors who are planning to buy land in areas near the future billion-dollar road project, they can do so now, but their investments might not turn profits any time soon.
While the construction project for the Marines' relocation is expected to begin three years from now, or around July 2010, the road project will start years further into the buildup, according to a military time line.
The military highway construction might start in the fifth year into the buildup, or around 2015, based on the preliminary time line.
But before any of the major buildup construction projects can begin, environmental impact assessments must be completed.
That process could take about two years, according to a military estimate
Proposed highway would cut through Manengon
By Gaynor Dumat-ol Daleno
Pacific Daily News
gdumat-ol@guampdn.com
May 31, 2007
Guam's future billion-dollar highway, which is a piece of the military buildup puzzle, likely will run across largely undeveloped hills and valleys of Chalan Pago, Yona and Piti, according to a tentative map from the Navy.
If the idea evolves into an adopted plan, the highway would start near the point where Routes 10 and 4 meet in Chalan Pago, according to a Department of the Navy Guam planning document, which was still at an early stage and was labeled "notional."
The $1.25 billion highway would provide the military with an alternative access that links Andersen Air Force Base in northern Guam and the Navy base on the southern side of the island.
The Air Force and Navy bases use Marine Corps Drive for a main link, but the road has had a history of gridlock during serious accidents.
In May 2006, Air Force Lt. Gen. Daniel Leaf, deputy commander of U.S. Pacific Command, said in an interview that when the island's military population grows significantly, the highway would be needed to "move both people, supplies and equipment from north to south, south to north on the island, whether it's for training or to deploy out of the harbor."
"And we want to do that with minimal impact on the community and expeditiously. The current road structure doesn't really allow for that very well. So that's an area we believe we'll have to invest in," Leaf said.
The largest chunk of the $15 billion military buildup on Guam involves building housing, training and other facilities for the 8,352 members of the U.S. Marines and about 9,000 dependents who must relocate from Okinawa to Guam by 2014.
The Marines' move to Guam is expected to cost about $10 billion, of which $6 billion will be paid by Japan.
The 3rd Marine Expeditionary Force is moving out of Okinawa as part of the U.S.-Japan agreement aimed at beefing up security in the region and consolidating U.S. military installations in Japan to free up land for return to the Japanese.
But while Japan is helping to pay for the Marines' relocation, such as for barracks and "quality-of-life" facilities, the highway project is expected to be 100 percent funded by American taxpayers, according to an itemized list of cost sharing between Japan and the U.S.
Real property values soaring
The anticipation of local economic growth stemming from the military buildup already has sent the values of Guam homes, condominium units and land parcels soaring.
"I am amazed at how much the island has already benefited from the initial phases of the buildup," said Guam Delegate Madeleine Bordallo, in a speech to the Guam Chamber of Commerce yesterday.
She mentioned that in some cases, real property values have increased 300 percent over the past few years.
"The economic investment I see here on Guam will eclipse the boom we experienced in the '80s," she said, of the era when Guam was a magnet for Japanese investors who financed construction of many Guam hotels.
"Rising property values means equity for the residents of Guam and that translates into wealth," she said.
The congresswoman's speech did not mention the $1.25 billion highway project, but she said that even before the Marine-related construction kicks in, the military buildup has begun.
The fiscal 2008 defense spending bill includes $300 million in military construction projects for Guam. The bill has passed the House, and it will work out a version that will also be acceptable to the Senate.
Fiscal 2009 funding for military projects on Guam will hover around $500 million, and more than $1 billion a year starting in 2010, Bordallo said.
Investments
For Guam investors who are planning to buy land in areas near the future billion-dollar road project, they can do so now, but their investments might not turn profits any time soon.
While the construction project for the Marines' relocation is expected to begin three years from now, or around July 2010, the road project will start years further into the buildup, according to a military time line.
The military highway construction might start in the fifth year into the buildup, or around 2015, based on the preliminary time line.
But before any of the major buildup construction projects can begin, environmental impact assessments must be completed.
That process could take about two years, according to a military estimate
Friday, March 16, 2007
More on the Move from Okinawa to Guam
Move to Guam could cost Marine Corps extra $465M a year
By David Allen, Stars and Stripes
Pacific edition, Friday, March 16, 2007
CAMP FOSTER, Okinawa — The move of some 8,000 Marines and their families from Okinawa to Guam by 2014 is expected to cost the Marine Corps an extra $465 million annually.
However, a recent inspector general’s report concluded that the Navy, Air Force and Marine Corps are not prepared for the increased annual costs resulting from the planned changes to the force structure in the Pacific.
The 14-page report, released Monday, is the culmination of a yearlong audit and interviews with military officials. It states the Marine Corps is the only branch so far to estimate how much it will cost yearly to move assets to Guam from Okinawa. However, the corps has not included the cost in its budget projections.
“The source of funds for the additional requirements (has) not been resolved between Headquarters, Marine Corps and the Department of the Navy,” the report states.
The Navy and Air Force also will incur additional annual costs by moving assets to Guam, but the services have not determined what they are, the report adds.
“If DOD and the Services do not include the projected increased annual funding requirements in the next Program Objective Memorandums for DFY 2009,” the report read, “the quality of life for servicemembers and their dependents and the readiness of U.S. forces in USPACOM may be adversely affected.”
The United States has reached agreements with Japan and South Korea for a major restructuring of U.S. forces in the Pacific. A reduction of some 12,500 U.S. Forces Korea personnel is expected to be complete by the end of 2008.
The United States and Japan agreed last May to replace Marine Corps Air Station Futenma with a new airfield on Camp Schwab and to close several other Marines bases on Okinawa. That would result in the move of 8,000 Marines and about 9,000 family members to Guam, with Japan picking up about $6 billion of the estimated $10.3 billion cost.
To help cover that cost, Japan officials are considering reducing host-nation support for U.S. forces remaining in Japan. Japan now pays about $3.03 billion a year to maintain U.S. forces and is expected to pay that much until 2008.
“DOD must recognize and plan for a possible substantial increase in funding requirements to support forces remaining in Japan if Japan reduces its host nation support,” the IG report states.
Besides the Marines, the Air Force plans to relocate about 3,500 servicemembers, civilian employees and their families to Guam from various locations, but has not estimated the increased budget requirements for the move, according to the report. Also, the Navy, which closed many facilities on Guam in 1993, will need an increase in funds to “refurbish and adequately maintain facilities” for the influx of Marines and airmen.
By David Allen, Stars and Stripes
Pacific edition, Friday, March 16, 2007
CAMP FOSTER, Okinawa — The move of some 8,000 Marines and their families from Okinawa to Guam by 2014 is expected to cost the Marine Corps an extra $465 million annually.
However, a recent inspector general’s report concluded that the Navy, Air Force and Marine Corps are not prepared for the increased annual costs resulting from the planned changes to the force structure in the Pacific.
The 14-page report, released Monday, is the culmination of a yearlong audit and interviews with military officials. It states the Marine Corps is the only branch so far to estimate how much it will cost yearly to move assets to Guam from Okinawa. However, the corps has not included the cost in its budget projections.
“The source of funds for the additional requirements (has) not been resolved between Headquarters, Marine Corps and the Department of the Navy,” the report states.
The Navy and Air Force also will incur additional annual costs by moving assets to Guam, but the services have not determined what they are, the report adds.
“If DOD and the Services do not include the projected increased annual funding requirements in the next Program Objective Memorandums for DFY 2009,” the report read, “the quality of life for servicemembers and their dependents and the readiness of U.S. forces in USPACOM may be adversely affected.”
The United States has reached agreements with Japan and South Korea for a major restructuring of U.S. forces in the Pacific. A reduction of some 12,500 U.S. Forces Korea personnel is expected to be complete by the end of 2008.
The United States and Japan agreed last May to replace Marine Corps Air Station Futenma with a new airfield on Camp Schwab and to close several other Marines bases on Okinawa. That would result in the move of 8,000 Marines and about 9,000 family members to Guam, with Japan picking up about $6 billion of the estimated $10.3 billion cost.
To help cover that cost, Japan officials are considering reducing host-nation support for U.S. forces remaining in Japan. Japan now pays about $3.03 billion a year to maintain U.S. forces and is expected to pay that much until 2008.
“DOD must recognize and plan for a possible substantial increase in funding requirements to support forces remaining in Japan if Japan reduces its host nation support,” the IG report states.
Besides the Marines, the Air Force plans to relocate about 3,500 servicemembers, civilian employees and their families to Guam from various locations, but has not estimated the increased budget requirements for the move, according to the report. Also, the Navy, which closed many facilities on Guam in 1993, will need an increase in funds to “refurbish and adequately maintain facilities” for the influx of Marines and airmen.
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