By Gerardo R. Partido
Variety News Staff

THE Guam Contractors’ Association has joined the other business groups on the island in opposing the gross receipts tax increase.
According to John Robertson, chairman of the government, military and labor affairs committee of the Guam Contractors’ Association, the government of Guam is facing a crisis that is an imminent threat to its survival. 
“It is serious, as indicated by Standard and Poor’s decision to place our government on credit watch. The exchange of ideas now taking place is refreshing and may contribute to the resolution of the issue but the Guam Contractors Association disagrees strongly with some measures proposed by Governor Camacho’s administration,” Robertson said.
In particular, the association is opposing increasing the GRT from 4 percent to 5 percent regardless of the intended 18-month duration. 
Robertson said this proposed increase is detrimental to growth and will discourage investment in new construction and major facility improvements.  It is especially troubling for small businesses that already operate on thin margins and suffer most from tax increases.  
“The private sector drives our prosperity funding for new businesses, products, facilities and infrastructure.  Critical to this business expansion are attractive government policies such as financially viable climate, and increased taxes are counterproductive to this effort,” he added.
In lieu of increasing the GRT, the Guam Contractors’ Association requests the government of Guam to consider the following ideas to increase revenues and reduce costs:
To increase revenues:
• Initiate an aggressive campaign for collecting taxes from all businesses and individuals;
• Increase fees for business licenses, driver’s licenses and similar items to recover actual costs;
• Privatize or outsource government services to increase the tax base, realize additional revenue and reduce the number of government employees;
• Encourage the hospitality industry through partnership and incentives to invest in facilities that attract premium visitors;
• Pursue transshipment and transportation hub opportunities through partnerships with appropriate private companies;
• Encourage the federal government to invest in Guam’s infrastructure; and
• Bank borrowing should be used only to amortize the cost of capital improvement projects.
To reduce costs, the Guam Contractors’ Association is suggesting the following:
• Eliminate questionable positions in all areas of GovGuam, i.e. reduce staff to the bare minimum.  The private sector needs trained employees. It is therefore the time to transition unneeded staff to the private sector;
• Quantify the accountability of GovGuam officials at every level;
• Establish a part-time legislature using the bill drafted by former Senator Bob Klitzkie in 2006;
• Reduce existing and future GovGuam retiree costs using a fair and reasonable benefit baseline;
• Contract to privatize or outsource services that can be performed more efficiently by the private sector. There is considerable information on privatizing landfill management, port operations, water and wastewater services, and power and hospital operations as examples.  It is time for GovGuam to support privatization;
• Reorganize the government with the intent of significantly reducing the number of facilities and employees as planned by the administration with community leaders several years ago but never implemented; and
• Perform a lease vs. build review of existing GovGuam facilities and infrastructure.  The intent of this exercise is to reduce the GovGuam footprint and to secure permanent territorial capital facilities. 
“The government of Guam must take specific, quantifiable steps to resolve the present crisis.  Simply raising taxes or borrowing money will not lead to a solution.  The time for political expediency is gone and the future success of our community is in doubt without a clearly delineated plan for achieving financial stability.  The Guam Contractors’ Association stands ready to participate in development and support of a responsible fiscal program,” Robertson added.