By Gerardo R. Partido
Variety News Staff

GIVEN the government of Guam’s current financial condition, the Office of the Public Auditor believes it would be hard to prioritize funding for the Guam Public School System as required by law.
As the government of Guam’s financial manager, the Department of Administration is obligated to release GPSS funds first as required by the new budget law without jeopardizing the operations of other government of Guam entities.
But with a deficit that has risen by $137 million and historically lower receipts compared to projected revenues, OPA said DOA will continue to find it hard to manage available cash to ensure that all government of Guam entities receive funding and are operational.
The public auditor said DOA will be forced to continue releasing GPSS funds based only on cash availability.
Although the Legislature has attempted through the Budget Act to make GPSS its priority in receiving cash, OPA said the reality of the deficit prevents this prioritization from occurring.
For the past few pay periods, GPSS had been experiencing difficulties in meeting its full pay period.
DOA released enough money for GPSS to pay teachers during the last pay period. GPSS said that it needed $2 million in order to meet the payroll and DOA remitted that amount.
But previously, GPSS had only been able to provide the net pay of its employees while health insurance payments and other deductions have not been remitted by GPSS.
The Attorney General’s Office had earlier threatened to initiate legal action against GPSS if it continues to mismanage its financial affairs.
GPSS has said it has not been getting its full funding allotments.
But the governor’s office has said that the administration has been funneling money to GPSS and that it’s the GPSS administration that is having problems managing the money.
The Legislature, which insisted that GPSS be prioritized in the government’s budget, is now planning to hold a public hearing to get to the bottom of GPSS’s financial plight.
Speaker Mark Forbes is also planning to hold a roundtable discussion on the issue.
In an earlier report, OPA said GPSS exceeded its budget by $12.9 million in fiscal year 2006.
According to public auditor Doris Flores Brooks, GPSS submitted to the Legislature and OPA a cash disbursement schedule amounting to $185,915,407.
This exceeded the $172,957,804 budget amount approved for GPSS operations by $12,957,603.
In addition, OPA said GPSS is still in the process of making retroactive payments to personnel affected by the various pay adjustments.
Based on historical data, OPA’s calculation indicates that the estimated FY 2007 total cost for GPSS salaries and benefits to be $152,379,574.
This amount is inclusive of the 1.13 percent increase in the retirement fund contribution rate from 21.81 percent to 22.94 percent effective for the pay period ending Oct. 14, 2006.
“We will revisit the analysis after the completion of the first quarter of FY 2007. We anticipate that by the end of the first quarter, payroll costs will have reflected the effects of the pay adjustments and the 1.13 percent increase in retirement fund contributions, which will then be a better basis on which to refine the estimation base used in the calculation,” Brooks said.
Pursuant to Public Law 28-149, the Public Auditor is required to approve GPSS’s projected schedules of monthly cash disbursements for each school, division, and program, by expenditure category, for the fiscal year.