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Governor will hire with federal funds, pay partial amount GPA needs to avert rate increase

By Eric Rosario

eric@kanditnews.com



Gov. Lou Leon Guerrero will be using a portion of federal direct aid funds to hire government employees next year, but it is unclear whether she is willing to commit the $60 million Guam Power Authority needs to avert raising power rates through the next year.


"The government of Guam will direct [American Rescue Plan] funds toward their allowable uses, which, under the interim rule, includes hiring under certain circumstances," governor's director of communications Krystal Paco-San Agustin told Kandit in response to our inquiry into whether federal funds will be used to hire GovGuam employees leading up to next year's election.


"Hiring will take place in areas of need, most especially those positions that support healthcare, public safety, and education," Ms. Paco-San Agustin stated.


Hundreds of professional vacancies have severely curbed the ability of the Guam Department of Education, Guam Police Department, and the health and other safety agencies. According to former police officers, the rate of attrition at GPD has been near crippling.


The Governor's Office, however, has not been specific about the types of positions that will be filled with federal funds, or the estimated annual cost of filling those positions. The ARP direct aid funds to the government of Guam is a one-time grant of more than $600 million. How GovGuam will pay for the salaries of the new employees after the first year has yet to be answered.


However, the administration has provided a specific figure the governor will grant to GPA to help pay for its fuel recovery costs: $15 million.


"I’m not tracking anything additional," Ms. Paco-San Agustin said Friday, when asked whether the governor is planning to grant GPA more than that $15 million to avert an increase in power bills.


The Public Utilities Commission approved a three-phase power (levelized energy adjustment clause, or LEAC) rate increase that began Sunday, August 1. The increase of the fuel recovery charge from 11 cents a kilowatt hour to 13 cents/kwh is to help GPA recover losses from the price of fuel. The rate again will go up on October 1 to 15 cents/kwh; then again on December 1 to nearly 17 cents/kwh.


"If the LEAC rate was to be maintained at $0.11/kWh, the under recovery would increase to over $30 million," GPA general manager John Benavente told Kandit. "However, even if the Governor funded $30M this LEAC period, the LEAC will still definitely have to be increased in February 2022 to the levels proposed of about $0.167/kWh unless another $30 million is again provided."

All told, that is $60 million, or nearly 10 percent of the total direct aid funding from the federal government that is sitting in the bank now.


Kandit has asked Ms. Paco-San Agustin if the governor is considering granting GPA the $45 million to supplement the governor's current commitment of $15 million to avert a power rate increase over the next year. We await her response.



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