The legislature held an emergency session Monday and voted down Bill No. 1-3(S), Gov. Lou Leon Guerrero’s alternative budget bill.
At first, there was no clear indication of where the vote was going as many senators decided to pass during the first two voting rounds. But in the end, the governor’s budget bill failed with only 6 senators voting in favor of the bill.
During the entire day’s session, Bureau of Budget & Management Research director Lester Carlson and Department of Administration director Edward Birn reiterated Adelup’s need for an additional $7 million in the budget.
Carlson said the governor’s alternative proposal is actually the legislature’s Bill 282 with just some very minor adjustments.
“In the front, consistent with what we’ve advocated for since the beginning, was the request to consider raising revenues by $7 million — $2 million in corporate taxes and $5 million in withholding taxes. Everything else with respect to revenues remains the same,” Carlson said.
The Office of Finance and Budget, however, stood by its figures and revenue projections in the original budget bill passed by the legislature.
Office of Finance and Budget director Stephen Guerrero said he still believes the revenues presented by OMB in the original bill is adequate.
“As far as the increase in the $7 million, I am still of the opinion that our revenues as presented by OMB in the bill is an adequate revenue that we can look forward to and anticipate. By all means, I hope we generate more,” Guerrero said.
The OFB director was referring to the $7 million in additional funding that Adelup is calling for. The legislature passed the fiscal year 2021 budget bill — Substitute Bill No. 282-35 (LS) — last Aug. 31 without adding the $7 million requested by the governor.
“Being conservative, as we’ve always been since day one, and taking everything into account, we basically did a projection utilizing August actuals that we were able to pull out of the system. The figures indicate that the levels that we are suggesting for remaining 2020 and what we anticipate for 2021 basically haven’t changed,” Guerrero said.
During the August budget sessions, Guerrero had a grim prognosis for corporate taxes which Carlson referred to as one of the revenue sources that Adelup was counting on.
Guerrero said that of the 3000-some businesses on Guam, half of them are currently being adversely affected by the coronavirus and if unemployment continues at the rate it’s going, it will be difficult to calculate how much corporate taxes will be affected.
Perhaps the most emotional criticism came from Sen. Therese Terlaje, the chair of the legislature’s health committee.
“The bill is flawed. It. It was intended to give money to public health but it doesn’t give an additional dime to public health. There’s no use passing a bill that’s going to just give a false promise,” Terlaje said.
Terlaje also took offense to a letter from the governor which stated: “As chairwoman of the committee on health, you don’t need to be reminded of your ethical fiduciary and moral responsibility to ensure that critical health functions receive adequate funding amidst a global pandemic.”
In response, Terlaje said: “Where were you guys when I was trying to convince my colleagues to give public health every dime of additional revenues that we actually do collect. Where in the world is that $10 million dollars? Why didn’t they get to GMH before the crisis so they could have fixed their roof? Why didn’t public health get the lion’s share of the $117 million?”
Other discussions revolved around the governor’s transfer authority and how she can use that to work with the original budget passed by the legislature.
Senators also pointed out that there are more federal funds coming to Adelup that the governor can use.
Soon after the adjournment of the special session on the governor’s budget bill, Sen. Joe S. San Agustin, chairman of the committee on appropriations, wrote Speaker Tina Muna-Barnes, requesting for her to call an emergency session tomorrow, Sept. 15, at 2 pm, to vote on overriding the governor’s veto of Bill 282-35.
“With the Governor’s bill failing to pass in today’s special session, I requested that the Speaker call for an emergency session to entertain a possible override. We worked hard over the last several months and spent 3 weeks in deliberations with the final vote of 13 to 2 on Bill 282. Although it was tough, we managed to ensure the programs and services our people need will be available in our bill. Let’s get back to work and close this chapter on our Fiscal Year 2021 budget,” San Agustin said.