Public Hearing Held for Bill 310 on GEDA Helping Finance the New Simon Sanchez Facility

Guam Department of Education (PNC file photo)

A public hearing was held for A bill that will help the Guam Department of Education finance the New Simon Sanchez educational facility.

PNC’s Damen Michael has this story

Yesterday a public hearing was held for bill 310. Bill 310 looks to include the Guam Economic Development Authority solely for the purpose of entering into a financing agreement contracts on a new educational facility for Simon A. Sanchez.

The Guam Department of Education’s Superintendent Jon Fernandez supports bill 310 because it allows the Guam Department of Education contractors and the Guam Economic Development Authority to ensure cost-effective financing. With the current law funding, the rebuild of Simon A. Sanchez was restricted to no more than 5.1 million dollars from the territorial educational facilities fund used for the annual leasing payments for a 30-year term.

Jon Fernandez, Superintendent, Guam Department of Education} (16)

” with the proposed changes the law actually provides more flexibility to ensure that there is sufficient funding available to cover the updated costs of a new high school.”

Fernandez added that “the funding for a new high school was originally set forth by public law 32-120, which went into effect 2014, but over the years, several factors have affected the amount set aside for the current similar project in 2022.”

The factors are based on an analysis done by Taniguchi Ruth Makio Architects. These factors include average yearly inflation of 2.9% from 2014 to current, 1% increase in the Business Privilege Tax, 0.8% wage increase in 2022, 40% increase in cost due to H2B labor, military buildup issues, and pandemic supply chain issues, and lastly 8.7% increase in the estimated cost of escalation for 2023.

Jon Fernandez, Superintendent, Guam Department of Education stated, ” so what this means is that a project that would have cost 70 million dollars in 2014, which is generally around what we anticipated back then, will be projected to cost over 136 million in 2022 .”

Currently, they are working on refining the design of the educational facility that fits the need of the Simon A. Sanchez community while also being cost-effective. Still, Fernandez added that it’s clear that due to these factors, there does need to be more funding authorized than was envisioned in 2014 and the flexibility of obtaining the lowest cost to capital working with GEDA.

Damen Michael PNC News First.