Republicans frown on FY 2005 budget

By Mar-Vic Cagurangan
Variety News Staff
Monday, August 30, 2004

HAGÅTÑA — The Democratic majority in the legislature believed they came up with the best budget layout for fiscal year 2005, but the Republicans thumbed down the spending bill, which they said shortchanged the people of Guam.

The spending measure, Bill 268, which gives the government of Guam a total budget of $518.9 million covering the general local funds as well as the special and federal funds, was approved last Friday on a 9-4 vote.

The Democrats were proud to have given 60 percent of the budget to education, public health and public safety, but the Republicans said the legislature could have given these priority areas more than what they stand to receive had the majority-approved bill distributed the budget in a more prudent manner.

The points of political arguments involved the revenue projection, which the Republicans believed was “excessive;” the lower appropriation for tax refund; the freeze on salary increments for government of Guam employees; and the un-itemized appropriation for the legislative Tax Review Commission.

Republican senators Mark Forbes, Ray Tenorio, Jesse A. Lujan and Larry Kasperbauer voted “no” to Bill 268. The two other Republican senators, Joanne Brown and Bob Klitzkie, who are both in New York to attend the national Republican convention, were unable to vote.

“We have only increased the budget at the expense of the taxpayers,” Tenorio said. “The allocation for the core functions of the government did not reach the level where they should be.”

Kasperbauer said he expects Gov. Felix P. Camacho to veto the budget bill. “Even the governor believes the revenue projection was excessive,” Kasperbauer said.

The administration’s budget officials, during an earlier oversight hearing, projected the revenue for fiscal year 2005 to reach only about $339 million.

Achievable target?
Bill 268 projects revenues of $447.4 million in general fund, $81 million in special funds and $27.8 million in federal funds.

Vice speaker Frank Aguon, D-Yona, chairman of the legislative committee on budgeting and appropriations, said he believed the revenue target was achievable considering the revitalized economic activities on Guam.

Aguon described the approved budget as “well balanced,” saying that “it speaks of the critical needs of the priority areas” and “highlights the direction where the government should go.”

Speaker Vicente Pangelinan, D-Barrigada, said the Democrats were “pleased with the allocation of the budget” as it “reflects the areas of priorities.”

He mentioned, for example, the $30 million increase that the Department of Education will get and the $11 million subsidy that will go the Guam Memorial Hospital.

“We also want to point out that we’ve given the governor flexibility in order to make sure that this budget measure works,” Pangelinan said.

He said the budget measure has retained the governor’s transfer authority that would allow him to decrease or increase the budget of certain agencies as he sees fit.

Forbes, however, said the $60 million provision for tax refund was way too low to allow GovGuam to pay all taxpayers.

“Because of the way of the income tax refund reserve was shrunk to provide for additional potential revenues, thousands of people will stand in line, perhaps in vain, waiting for their tax refund, given the fact that we already have such a backlog of tax refunds from prior years. This is going to be the unfortunate consequence of this particular measure,” Forbes said.

He also questioned the lack of allocation for the Earned Income Tax Credit.

But Aguon explained that the budget bill has authorized the governor to use the lapsed funds of between $25 million and 30 million from fiscal year 2003-2004 to take care of all tax obligations.

Tenorio and Lujan, for their part, questioned the $500,000 appropriation for the Legislative Tax Review Commission.

“We have no plan for how that money is going to be spent. There is no document that says where that money will go. We know what the purpose of the commission is but how can we budget for something when we don’t know how to spend the money?” Tenorio asked.

“This is a budget from the legislature to the legislature. We hold other people accountable to a standard that we don’t apply to ourselves. We ask the education and the police departments to assess every aspect of their budget requests but we don’t do the same to ourselves,” Tenorio said.

Tenorio, a former police chief, said the $500,000 could have been added to the budget of the Guam Police Department, which in the approved budget bill, would get $19 million.

Although the GPD budget is $4 million more than the fiscal year 2004 level, Tenorio said the department deserved more.

Lujan agreed. “As the number of tourists continue to rise, the rate of crime proportionately increases. We have to keep up with this,” Lujan said.

He also criticized the Democrats for inserting the “last-minute” amendment that froze the increments for GovGuam salaries.

“There’s a lot of slush funds committed in this budget and we can’t even give workers their due increments. This budget bill is travesty,” Lujan said.

Kasperbauer also slammed the Democrats for not giving the minority a chance to air their position on the amendment to freeze the salary increments for GovGuam employees. “It was sneaky of them. They recessed at 6:30 in the afternoon and then returned in the afternoon to introduce the amendment at 2 in the afternoon without allowing an opportunity to discuss it,” Kasperbauer said.



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