Carlson: ‘CARES Act money all spoken for’ and GovGuam needs more

Office of the Governor at Adelup (PNC file photo)

GovGuam is staring down a looming December 30th deadline to use up all of the federal CARES Act funding.

So far, the Government looks to be rounding the bend on spending nearly $20 million in quarantining and isolation facilities, in addition to some $18 million in hazard for government employees.

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The Department of Administration just issued their latest fiscal update related to the nearly $118 million Guam received in federal CARES Act money.

Copy of Fund 677 as of 10-31-2020 2
 Of that total, some $71 million has already been spent (about 65% of it), $5 million is encumbered, meaning the procurement of whatever good or service is in process, and $41 million dollars are labeled as “available.” But Lester Carlson, the director of BBMR, says the money has actually all been spoken for.

“We will not return a penny. There are just too many needs that are out there…and these funds, while they’re much appreciated, the needs are just way greater than the fund source,” Carlson said.

He added: “Everything has to have a COVID link. We cannot use any of this money for revenue shortfalls, you can’t use it for anything that doesn’t have a direct link to COVID response or COVID prevention.”

This budget was put together as a working document in May of this year and Carlson, in his in-depth interview with PNC News, says it was always meant to be a living document, changing as the needs arose around the island.

Notable figures

While the 2-page update details the line-by-line of department and agency allotments and spending as of October 31st, there are some notable figures that stand out.

GMH was allocated around $2 million for doctor contracts and about $1 million has been spent so far.

Carlson says GovGuam needed to augment the medical professionals at the hospital, bringing in traveling staff, like nurses, which are very costly.

“You look at the litany of healthcare professionals and our historical inability to fill all of these positions because we train them so well on Guam through the University that as soon as they get out, they’re just a hot commodity anywhere else,” Carlson said.

The Governor’s office was given around $300,000 for PSAs, informational videos and other media campaigns. Carlson says none of the money has so far been expended but that he expects that the amount will be used up.

Eating up a pretty significant portion of the budget is quarantining and isolating, which is paid for through the Office of Homeland Security.

There’s $14.3 million actually budgeted and already $15.3 million spent, so a million over budget with another $1.2 million encumbered, meaning that needs to be paid out too.

“I’m probably going to have to transfer more money into that because the burn rate is pretty high. You know, we’ve used the Wyndham, we’ve used the Santa Fe, right now we’re at the Outrigger/Dusit, we’ve used Days Inn, we’ve used Pacific Star…we’ve used a whole bunch of local hotels,” Carlson said.

He added that they’re looking to shift around any available money to continue funneling into the QFAC and ISO facilities.

“We do believe that the quarantine facilities and specifically the isolation facilities have played a big role in addressing COVID, because if you have a substandard home or just so many people in your home…and you were COVID-positive, it wasn’t appropriate for you to stay at your home. So, we needed to properly house you, until you got better,” he said.

Carlson says it’s his belief that the occupied facilities not only support the COVID response but also have a trickle-down economic effect.

“You’re talking about, right now, two hotels that employ God knows how many people and the food is good. So, there is an economic benefit and we have spread the benefit around to several of the hotels and if you continue to use the quarantine facility, then that facility uses locally supplied products in order to keep the rooms clean, to keep the water and power on…to provide the food that’s served,” Carlson said.

Related Public Health Expenses

Under the headline – “Related Public Health Expenses” – various GovGuam departments and agencies were allotted smaller amounts to get their spaces set up for COVID precautions, including plexiglass barriers, additional protective gear, and more.

The GVB however was first budgeted around $23,000 initially for PPEs and retro-fitting, but they actually spent about $110,000 more than 4 times the amount.

Carlson says that money also covers extra initiatives like the “Give Us a Moment” campaign.

“We’ve engaged with GVB on a couple of initiatives, IT-related, and they’re doing something in collaboration with Customs, to try to get a mobile app for the customs form…again, to reduce paperwork and people transmitting things [from one hand to another],” Carlson said.

As for hazard pay — that 10%, 15% and 25% differential the Governor instituted for GovGuam workers who are exposed to the virus through their work — that’s running a total of about $18-some million, $13 million of which have already been spent.

Carlson says the remaining $5 million in hazard pay will be doled out with no problems before the December deadline.

“That includes the EMTs, the Fire Department, the Police Department, and the hospital staff…and a lot of people at Public Health,” Carlson said.

There are 6 other agencies which were allotted their own hazard pay budgets, totalling around $7 million, although there’s a chance not all will be used, according to Carlson, allowing for some reallocation of dollars to support overages in other areas.

Big dollars for DOC 

A curious funding allocation was some $2 million dollars for the Department of Corrections under the title of “Improve Telework Capabilities of Public Employees” but Carlson says that money was actually used for other needs at DOC.

“That encompasses many many items within the Department of Correction. There was a food service contract, because of the increased feeding, that all got lumped into that category. They did establish a facility…to teleconference with the courts. That’s so we can minimize detainee transport to and from the courts and people can still have their hearings,” Carlson said.

So far, none of the $2 million has been spent or encumbered by DOC, but Carlson says he’s already working with the department’s director for additional needs.

“You’ve got areas down at the Agana lock-up that actually need some attention. And somebody might exhibit symptoms that require the EMTs to come over and transport to the hospital. So there needs to be a full circle addressing all of those requirements and not just in Mangilao,” Carlson said.

Under Section 5 of the fiscal update, DOA is allotted $9.5 million of which, around $3.5 million has so far been spent to cover residents’ credit card fees when they pay online for GovGuam services like vehicle registration, utility bills, and taxes.

“In order to encourage people staying at home, in order to encourage more online banking and bill paying, we are absorbing that fee,” Carlson said.

GEDA rent program

Some programs are not yet reflected in the budget update since it’s dated October 31st, including the GEDA rent program, which was just launched Tuesday.

Melanie Mendiola, the administrator of GEDA, had originally said the program would be around $5 million to help 500 businesses with 2 months of rent or $20,000, whichever was lesser.

However, with Adelup only handing over $3 million to the program, Mendiola told PNC News they’ll have to lower the threshold to $15,000 or two months rent, whichever is lesser, and likely only be able to help 300 to 400 business, instead of the 500 they were originally targeting.

“If there are available funds, it’s a slight possibility that we could add some money to that,” Carlson said.

As for whether any more possible stimulus or resident support programs are coming, Carlson says that’s not in the cards, repeating again the uneven supply and demand scale with the money available.

So far, Carlson says $1 million has gone to the Ayuda I Mangafa program for families, although in reality only a total of $248,500 has been paid out as of November 12, according to Dafne Shimizu, the DRT Director. She told PNC News Tuesday that amounts to 428 payments. She says they plan to process more payments this week.

The Ayuda program allocation is also not yet reflected in the fiscal plans since it was posted after October 31; the actual legislation allows for up to $10 million for the program but Carlson says DRT requested smaller allocations as they get through batches of applications.

With the number of applications thus far, it doesn’t appear the program will be coming near that $10 million allowed for in the law.

Carlson says in addition, $18 million dollars was budgetted for the Salappe program, which put $300 directly in the hands of low income residents early on in the pandemic. And, an additional $1.2 million (so far) for the bereavement fund, to help the families of those who’ve died due to COVID-related complication with a $10-thousand dollar payment.

Carlson says that amounts to some $20 million budgetted to support residents, in addition to other federal direct support like the EIP, FPUC and PUA payouts.

“I really hope people recognize we’re doing our best, we’re doing everything to get money out to them…” said Carlson.

GEDA has already doled out nearly $17 million dollars in small business assistance, plus the incoming $3 million for rent relief. So, a total of $20 million for the business community.

There’s also a $2 million dollar program for Tier 2 and 3 clinics on Island to apply for funding from GEDA; Carlson says that application is in play now and he expects the money will go out by the December 30th deadline.

The BBMR director says he’s put a call out to every department and agency to finalize their requests, as the purse-string holder goes through line by line to figure out what money will and will not be, realistically, spent in time for the federal deadline.

Carlson consistently emphasized that although $41 million looks to be “available”, in reality the money is all spoken for and the Island desperately needs more.

He says they’re hoping more federal money gets approved to support states and territories.

“It’s not just us…this is nation wide. If more money doesn’t come it’s going to be difficult for governments across the nation…from Connecticut to Guam,” said Carlson.