U.S. GAO says GovGuam debt doubled in 10 years because of bond borrowing

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A U.S. Government Accountability Office report states that GovGuam’s debt has gone up to $2.5 billion dollars mostly because of borrowing money on the bond market.

Guam – GovGuam’s public debt more than doubled between fiscal years 2005 and 2015.

According to a report by the U.S. Government Accountability Office, Guam’s public debt went from almost $1 billion to $2.5 billion. The U.S. GAO report states that most of this debt was used to comply with federal requirements and court orders. Despite growing revenues, recent economic growth and expected economic growth, GovGuam’s large unfunded pension and post- employment benefit liabilities “may present a risk” according to the GAO. Most of Guam’s public debt is due to bonds or money GovGuam borrows on the bond market. In fact, the GAO report says that between 93 and 97 percent of GovGuam’s total outstanding public debt between 2005 and 2015 is from bonds. The GAO cites a GovGuam report that states that the largest increase in debt happened between fiscal years 2008 and 2009 because of bond borrowing to pay for past due tax refunds and unpaid cola. Speaker B.J. Cruz issued a statement in response to this GAO report reading in part, “The GAO’s report speaks for itself. Guam has a debt problem and some island leaders seem committed to making that problem even worse.”