Guam – Education Committee Chair Senator Judi Won Pat has introduced a bill that offers alternative funding for repairing the island’s Public Schools.
Bill #448 states that because GuvGuam is “unlikely” to afford the $139 million dollars cost for renovating and repairing the island’s public schools, her bill would give a contractor contemplating repair work on the schools the right to “look within the government of Guam’s financial resources to identify within its proposal the best lease payment structure to provide financial support for the rehabilitation, renovation and construction work on the schools.”
According to a release issued by the Senator: “Won Pat’s bill allows developers to think outside the box and find creative ways to identify funds by giving the contractor access to public records of the government of Guam’s financial resources.”
The Calvo Administration Sunday issued a release in support of a rival school repair bill, Bill #437. That measure proposes using tax credits and ARRA funds to fix all of the island’s aging public schools.
Education Task Force Chairman Vince Leon Guerrero and GEB member Joe S. San Agustin stated in the release that they support the measure.
However, the release emphasizes the Administration supports the measure ONLY with the amendments which have been suggested by GEDA and its bond counsel.
Bill #437 was introduced by Senator Judi Guthertz and co-sponsored by Senators Yamashita and Respicio. Senators Mabini, Palacios and Duenas have also signed on in support of the bill.
Senator Won Pat’s rival Bill #448 is co-sponsored by Senator Tina Muna Barnes.
READ Senator Won Pat’s release in FULL below:
FOR IMMEDIATE RELEASE: April 20, 2012
Won Pat Introduces bill that would allow developers to use creative ways to find funds to rehabilitate, renovate, maintain and build public schools.
Bill 448-31 (COR), gives developers the flexibility to find creative ways to develop a proposal to rehabilitate, renovate and build schools and would also protect the government of Guam if the developer fails to meet the conditions of the contract.
The bill also includes recommendations from the Office of the Attorney General which places safeguards to the government if the contract is breached by the developer in order to prevent and avoid problems such as the delayed completion of the new John F. Kennedy High School.
For example, the bill ensures that the Department of Public Works, the Guam Economic Development Authority and the Guam Department of Education engage in the contract negotiation which must include warranties; liquidated damages;performance and payment bonds; insurance; standard and technical specifications; progress schedule; maintenance and compliance with Guam labor laws.
Won Pat’s bill allows developers to think outside the box and find creative ways to identify funds by giving the contractor access to public records of the government of Guam’s financial resources to identify within its proposal the best lease payment schedule to provide financial support for the rehabilitation, renovation and construction of schools.
According to DOE, estimates indicate that the cost of renovating and rebuilding schools is $139 million. Given the financial constraints facing the government, it is unlikely that GovGuam can afford payments for the full renovation and rehabilitation or construction of schools.
“So what we’d like to do is give the developer the opportunity to look at government resources by allowing them access to records of public financial governmentoperations and let the developer look at ways to become creative on how to get the money and do their proposal. At the end of the day, GEDA will approve one proposal which it will then submit to the legislature for final approval,” said Won Pat.
“This also gives GEDA the opportunity to incorporate creative ways of finding funding sources for future projects because of our issues with our debt ceiling,” said Won Pat.
The pledge of funds will be based on the concept of the municipal lease which does not affect the debt ceiling, the same concept used to build the five new schools, including JFK.
“The legislature still has to agree that the payment source that the developer is recommending is a viable source. We need GEDA to engage because when developers submit their proposal, this is going to fire up the true entrepreneur spirit of competition, and that’s a good thing,” said Won Pat.
Won Pat’s bill also provides the least amount of financial impact to the government coffers by ensuring that the lease back will not affect the debt ceiling; will not raise taxes or fees; or create new taxes or fees; and will not have anymajor impact to government operations.
The bill also protects the integrity of the procurement process in which over $30 million in the Adequate Education Act Trust Account funds have already beenobligated. This was part of the $60 million that was approved by the U.S. Department Of Education in the ARRA State Fiscal Stabilization Fund grant.
During testimony by GEDA Administrator Karl Pangelinan on another bill, Pangelinan said that in order for DOE to construct new schools, it will cost an additional $80 million in new monies, and in which DOE would have to shoulder the cost. This means, said Pangelinan, DOE would have to cut $7 million from its operating budget each year.
“That cut will deeply impact the operations of DOE. Seven million is equal to one pay period and at least 80% of DOE’s budget is in personnel. While we all agree that DOE must find ways to live within its means, this $7 million cut is too deep and will definitely disrupt the continuity of student learning,” said Won Pat.