By Mar-Vic Cagurangan
Variety News Staff

DESPITE the economic opportunities that lay ahead for Guam, the local government is currently in a quagmire of debt that makes austerity measures a necessity, Vice Speaker Eddie Calvo, R-Maite said.
“With the coming military expansion, we have so many opportunities that we must take full advantage of. We must maximize whatever benefits these opportunities have to offer,” said Calvo, chairman of the committee of finance, revenue and taxation.
But, at the same time, he added, “we’re carrying a burden in regards to our current debts.”
He mentioned specifically the payment of the $120 million cost of living allowances owed to 4,000 retirees.
“We have to pay the COLA soon. And while we continue to provide better services, we have to tighten our belts at the same time,” Calvo told Variety.
Calvo said he is waiting for the administration to transmit its proposed loan agreement with a bankers’ consortium, from which the government will draw money to pay off the COLA.
“They said they will present the COLA bill soon. As soon as we get it, we will hold a public hearing and move along to make sure that the COLA issue is resolved soon,” Calvo said.
Besides the COLA debt, the government of Guam has other outstanding obligations amounting to $4 million in unpaid bills to vendors and utility agencies, unpaid remittances to the Guam Retirement Fund, income tax and corporate tax refunds and the $90-million settlement of the earned income tax credit case.
 The Camacho administration originally proposed to pay off these debts through a bond-borrowing plan, which was submitted to the 28th Legislature but it never took off.
Calvo said the 28th Legislature must be credited for prudent appropriations of the government’s limited resources. “We focused on the priority areas of education, healthcare and public safety,” he said.
 Calvo, however, deplored the fact that many government agencies failed to abide by the accountability mechanism that the past Legislature established.
 “We established the financial reporting requirements. Unfortunately, many agencies have not fulfilled that requirement,” Calvo said.
 “We’ll see if there are corrective actions that we can take to address that,” he added.