San Nicolas to governor, senators: DO NOT WASTE all this money we got for Guam

By Johnnie Rosario

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U.S. Congressman Michael San Nicolas (D-Gu) brought in $2.5 billion in federal non-defense funds, and $1.6 billion in military funding commitments during the pandemic, according to his report to the public today.


"All of these resources have prevented our island at-large from suffering catastrophic generational loss not only in direct support into the pockets of our people and onto the tables of our families, but in the coffers of our government, which enjoyed robust federally related tax revenues in excess of $800 million dollars, generating enough operational surplus to retire a multi-year accumulated deficit in the midst of an island shut down in a pandemic," Mr. San Nicolas told the legislature.


With all that money, not including the funds locally generated for GovGuam, we beg the question:


Isn't it time to roll back the business privilege tax to four percent?


"That would be very interesting to do, absolutely," Sen. Jim Moylan (R-Tumon) said immediately after the address. "Since the 35th Guam Legislature, I've been asking for this, too. We haven't given up the fight, so we'll continue to press it."

Mr. Moylan has, several times through independent legislation and as attempted riders to budget bills, tried to roll back the BPT increase put into place by former Gov. Eddie Calvo. The tax increase was ironically championed by Moylan's Republican predecessors, kept in place by the current Democratic administration, and has been a key driver in the increase of prices since 2018.


San Nicolas has opposed the tax increase since its inception. Gov. Lou Leon Guerrero said the revenue from the increase is needed to keep government operations afloat.


But the numbers tell a different story. The one-time $4.1 billion infusion (that, by the way, is nearly equal to an entire year of gross island product) of federal and military money into the economy was met by yearly realignments in federal funding to Guam. These realignments include Medicaid funding and the inclusion of immigrants from the compacts of free association into the federal health program, the historic reimbursement of the earned income credit, and the opening of the island to unemployment insurance.


Generational Golden Age not seen since the glory days of the 1990s

Mr. San Nicolas tried to expand the perspective of legislators, the governor and the lieutenant governor about the resources he has brought in.


From his speech:

"With federal funds and federal outcomes resulting in systemic budgetary gaps like EITC, Medicaid, and COFA Medicaid eligibility being filled, with our multi-year deficit being filled, with our debt ratings improving in a non-existent economy, with our primary tourism markets trending towards 60% and 80% vaccination rates within the next 4 to 6 months, with $600 million in federal funds available for deployment, and with the various other federal investments we have outlined today, we are strongly situated in the months and years ahead for a generational golden age of resources on our island not seen since the early 1990’s. "What we do with these resources is going to define where we go generations from now. "The lessons of the past have taught us the harsh reality of succumbing to political appetites. They have taught us what happens when we make the next election more important than the next generation. This is neither the time for political patronage nor is it the time to short-sightedly inflate the status quo. "This is the time to learn the lessons taught to us by our people. Our people who stood in the breach these last 19 months and counting, their children and their grandchildren, have proven during these pandemic circumstances that they are the ones who will do whatever is necessary to see us succeed, if we just give them the resources to do so and provide the services they require of us reliably. "We must fully fund education, health, and public safety as we have promised time and again to do, rather than try to find ways to scalp local funds because federal funds happen to be available. The computer science programs should not be closing down, healthcare agencies should not be asking for less when we all know they need more, and our police officers should not be undermanned and overwhelmed with drugs and crime. We must expand scholarship opportunities into fields and industries we want to attract, so that we can make economic diversification a reality from the grassroots up, rather than creating task forces and talking groups that are seemingly well-intended but more often than not turn into time and resource vampires. We must tangibly reduce the cost of doing business on Guam and awaken from the regulatory permitting, processing, and timeline nightmares that kill new enterprises in their infancy. We must close out our local legacy commitments by resolving the CHamoru Land Trust, building the schools we say we are going to build year in and year out, and even just cutting the grass on the side of the road. "There will not be another $600 million in the future. There is no more EITC or Medicaid gap to fill. We will not see a similar confluence of circumstances that will bring our credit ratings up and increase our debt ceiling capacity like we have today…which means if the people in this room screw this up, we screw it up permanently."


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