Senator Guthertz Questions How Japan’s Cash Contribution Morphed Into Buildup Loan

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Guam – Last week CCU Chairman Simon Sanchez shot down reports by Japanese media that the Japan government was reluctant to lend money to GovGuam for the infrastructure improvements needed for the military buildup.

 

Now, legislative chairwoman on the buildup Senator Judi Guthertz is saying this is the first time anyone has ever mentioned that GovGuam would need to borrow money from Japan. As part of the military buildup agreement that would send over 10,000 marines from Japan to Guam the Japan government agreed to foot 60 percent or 6 billion out of the estimated 10 billion dollar cost for the move. Part of Japan’s contribution, specifically $740 million is supposed to pay for improvements to Guam’s infrastructure.

Improvements Guam wouldn’t have needed if the buildup wasn’t happening. This contribution has always been referred to as a contribution and not a loan, however last week Japanese media reported that their government would be lending money to GovGuam for infrastructural improvements.

In fact Japan media reported that the government was reluctant to lend the money because of worries that GovGuam couldn’t pay back the loan. Last week CCU Chairman Simon Sanchez said that the Japanese media were simply jumping to conclusions. Senator Judi Guthertz who has legislative oversight of the buildup says she was always under the impression that Japan would contribute the money as part of the agreement. “Apparently Japanese government and or their representatives are talking about lending money to GWA we were always told that the federal government would mitigate the needs of GWA because they want to tie into our water system and they want to tie into GWA’s wastewater system,” said Senator Guthertz.

Even when Assistant Secretary to the Navy Jackie Pfanenstiel visited Guam just weeks ago she made clear the U.S.’s commitment to getting Guam the money needed to improve it’s infrastructure for the buildup. She announced that Japan would pay $740 million dollars for GovGuam’s infrastructure. She made no mention of any loans.

“Certainly we don’t want a loan why should we have to borrow money to enhance our GWA infrastructure to accomodate the military this should be mitigation money it should be money provided to GWA by the federal government regardless of whether it comes from Japan or not because they are going to be utilizing our water infrastructure and we shouldn’t have to borrow it or get a loan and pay it back,” said Guthertz.

In fact Senator Guthertz has sent a letter to Pfanenstiel explaining just this. The final Environmental Impact Statement does note that Japan would be funding water and wastewater improvements. It also notes that both Japan and the U.S. are working on developing S.P.E.’s or Special Purpose Entities that would finance, construct and manage water and wastewater facilities. These SPE’s would essentially be private businesses who would recoup their money through the payments of service contracts.

In her letter to Pfanenstiel, Senator Guthertz is asking for the federal government to clarify whether or not the Japanese money will be a loan or a contribution.