Guam – Congresswoman Madeleine Z. Bordallo proposes legislation that would have the Guam Waterworks Authority buy Navy’s water and waste water system. But Consolidated Commission on Utlilites Chair Simon Sanchez says the $200 million dollar price tag is too high for the people of Guam.
Recently the Japanese government decided to allocate close to 420 million dollars for the construction of Guam’s utilities and improvement of the infrastructure. Consolidated Commission on Utilities Chair Simon Sanchez says he doesn’t have any details yet on how or when that money will flow into Guam, but points out that Japans fiscal year starts on April 1st. He adds its a good sign that they appropriated money in their budget for Guam’s infrastructure. Right now it looks like the Japanese government is committing the first 420 million out of the promised 740 million. Sanchez anticipates any money that is committed to Guam will arrive sometime after April of 2011.
Part of the 2011 Defense authorization bill discusses combining The Navy with Guam’s water and waste water system. Sanchez says the merger between Navy and GWA might take some time to complete. According to Sanchez, it took close to a decade, from the time Guam Power Authority and the Navy agreed to merge their systems to the actual turn over.
Sanche says GPA had to meet performance standards that were established by a third party. We suspect and have suggested that GWA follow that same model that GWA and the Navy agree to performance standards for our system, show that we have met those standards and then take over the system.
Sanchez says the bigger issue right now is that Congresswoman Madeleine Borballo’s legislation requires GWA to pay fair market value for the takeover. He says he would like to sit down with her to see how flexible that is. Bordallo’s legislation suggest that GWA pay for Navy’s water and waste water system and then use compact impact funds to cover the $200 million dollar price tag. But Sanchez disagrees.
Sanchez says, I think the challenge there is compact impact effects are not just felt by the water co , they are actually more felt by other entities like education, public health, public safety and social services. If any one should be getting that money for compact impact it should be those agencies, not GWA.
If GWA pays for the Navy’s water and waste system, will it will affect GWA ratepayers?
Sanchez replies, “If we have to pay 200 to 300 million dollars for their system, it will definitely affect rate payers rate payers are the only source of revenue for GWA and thats probably 15 – 20 million dollars of debt service that we would have increase rates to pay that would be a hugh rate increase and we would prefer not to do that.”
Sanchez says the irony of buying the water and waste water system from the navy, GWA would just turn around and charge the Navy for the cost of paying for the system. He says there has to be a better way because the rates will go up for both the local ratepayers and the navy just to pay for the same system we are sharing. Sanchez says we should just merge the our systems together