The rating stems from the tax refunds and cost of living allowance bonds.
“I don’t think there’s any doubt that we’re going to see the tax refunds by Christmas,” Gov. Eddie B. Calvo said. “This is exciting. I’m very happy for the people who are owed money by this government, who have been waiting too long for their payments. I just ask for a few more weeks of patience as the bonds sell. It won’t be too much longer.”
Standard & Poor’s, another rating agency, yesterday informed the governor’s office of its “A rating with a stable outlook” for the tax refund and COLA bonds.
“The bonds are expected to sell via negotiation on Nov. 15, 2011,” according to Fitch Ratings.
“This is really good news,” Calvo said. “We’ve worked hard to make good on our promise to pay the tax refunds by Christmas. This is going to be a great Christmas for many people. For our island, this is an affirmation that our fiscal policies and the changes we’re making are taking the island up a better path, in a new direction.”
Calvo thanked Guam lawmakers for authorizing the bond.
“They made the right decision, obviously. We just wish the legislative leadership would have authorized a bond that would take care of all tax refunds,” said Calvo.
Fitch Ratings noted GovGuam’s history of operating deficits, and “a large end-of-year fund deficit.”
However, “the current administration is taking steps to achieve structural balance in the budget including a hiring freeze, reductions in the use of electricity and vehicles, a rescinding of across-the-board pay increases, 3 percent budget retention for all agencies and other cost reductions.”
