HOT Bond Sold, $90M to be Used to Build Museum and For Other Tourist Related Projects

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Guam –  In New York Wednesday, the Guam Economic Development Authority successfully priced $90 million of Government of Guam Hotel Occupancy Tax [HOT] Revenue Bonds in the municipal market.

The bond’s final rate, or true interest cost is 6.43 percent overall.  Standard and Poor’s provided an investment grade rating of BBB+. The bond issue will close on April 28th in Guam at the Office of the Governor.

The funds raised will refinance the 1997 Government of Guam Limited Obligation Infrastructure Improvement Bonds, and provide funding for a cultural center, tourism and infrastructure projects. The bond’s final rate, or true interest cost is 6.43 percent overall.

Governor Eddie Calvo is quoted in a release as saying: “This bond will make Guam more attractive as a tourist destination, and will fund improvements that can save jobs in our tourism industry.”

The release also quotes Acting GEDA Administrator Karl Pangelinan said he was pleased with the sale:

“Despite rising concerns surrounding the tragic events in Japan, the HOT bonds were fully subscribed for in just over 30 minutes. We had investors come to the table a few weeks ago, who stayed interested in the bonds. This tremendous investor confidence in Guam was truly evidenced by the response to the sale of these bonds. This was a collaborative effort between GEDA and the Administration’s fiscal policy team. The success of the sale is attributed to the finance team’s marketing efforts and demonstrates continued strength in investor perception of Guam’s tourism industry.”

A large component of the bond proceeds, $27 million, will be used to build a Guam museum and cultural center that reflects a sense of Guam and the Chamorro culture. The museum will provide for the display of artifacts and historical documents, encourage community involvement; and increase the research of Guam’s unique culture.

An additional $28.6 million can now be used to fund more projects that will help grow our tourism market and strengthen our tourism industry. Not all items in the following list can be funded, but the projects authorized in law include:

* Improvements to the Fujita pump station

* Hagåtña restoration projects

* Restoration of the Inarajan community center

* Restoration and rehabilitation of of the Malesso Bell Tower

* The design and construction of new village signs

* The design and construction of a Farmers Cooperative Association facility in the Dededo flea market area

* The construction of a historic monument and plaza to commemorate Ferdinand Magellan’s historic visit to Umatac Bay

* Improvements to the Nimitz Beach outdoor pavilion, public restrooms, lighting, benches and walking paths

* Improvements to the public facilities near the Fish Eye Pier, including public restrooms, washing facilities, benches, lighting, and picnic areas

* Improvements to the stalls, public restrooms, landscaping and walking paths of the Mangilao Public Market; improvements in Tumon Bay, to include pedestrian corrals and safety railings, and overhead lighting at the Governor Joseph Flores Memorial Park

* The restoration and repair of scenic byways, overlooks, and historic sites, including the Cetti Bay and Sella Bay Overlooks; the Umatac Bay Overlook; the Agat Spanish Bridge (Talifak River); the Talofofo and Fadi’an Point Overlooks; the Santos Memorial Park ocean views; and the East Agana Bay picnic shelters and ocean views

*The design and construction of a permanent monument for the late Senator Angel L.G. Santos Park

* Improvements of the Hagåtña Tennis Courts

* Improvements of the Hagåtña Pool