FOR IMMEDIATE RELEASE (September 15 2020 – Hagåtña, Guam) – Bill 398-35 (COR), AN ACT TO APPROPRIATE QUARTERLY EXCESS REVENUES TO THE DEPARTMENT OF PUBLIC HEALTH AND SOCIAL SERVICES IN FISCAL YEAR 2021, was introduced by Senator Therese Terlaje, the Oversight Chair on Health, as she continues to fight for more funding for the operations of the Department of Public Health and Social Services. 

The proposed measure appropriates all fiscal year 2021 withholding and corporate income tax revenues collected in excess of the revenue level budgeted per quarter, as reflected on the monthly Consolidated Expenditures and Revenue Report, to the Department of Public Health and Social Services for the expansion of its environmental health inspections, its other regulatory purposes, and other DPHSS operations, not to exceed $5.8 million for the fiscal year.

The policy was initially proposed as an amendment during a Committee on Appropriations meeting as a way to get additional resources for Public Health without having to increase already optimistic revenue projections but failed to garner enough votes in committee.

Terlaje stated, “This bill is a compromise and instead of raising revenue projections beyond what the body is comfortable with, we would dedicate any actual revenues collected every quarter that is above what is in the budget to Public Health to shore up any shortfalls.”

The Department’s budget amount in Sub Bill 282-35 covers all existing payroll with Senator Terlaje successfully passing a provision that carries over their expected lapses into FY 2021, and provides them flexibility tools to shift money around to address any immediate needs for health and social programs, however, the shortage for their operations could exceed $13 million, pending a final accounting on carry-forwards.

“The economic impact from COVID-19 has taken its toll and that includes the government of Guam.  We must use our federal funding to direct resources to our COVID response while strategically using our local funding to continue to prop up DPHSS.  We must support them to ensure our community is safe from COVID-19 and to continue with the numerous mandates we have placed upon them, including protecting our children and our manåmko’ among their many other duties.  I humbly urge my colleagues to consider this option to truly prioritize public health,” stated the Senator.

September 8, 2020

Transmitted via Electronic Mail:

All Members, 35^th Guam Legislature

RE: Substitute Bill 282-35

Dear Colleague,

As the oversight chair for Health, I am sharing facts regarding Substitute Bill 282-35 recently passed by this body and forwarded to the Governor for action. I have confirmed with the Director of DPHSS that the budget amount provided in Sub Bill 282-35 is enough to fund current staff and will not necessitate furloughs or reduced hours, despite threats in recent press releases or media reports. This is consistent with what OFB assured us during budget deliberations. DPHSS also told me last week that about $4 M in direct federal CARES Act funding may be used to hire 80 to 90 additional staff to respond to their needs related to COVID-19 response. In addition to this direct federal funding, DPHSS has yet to receive from the Governor the supplemental request made by former Director Linda Denorcey in June for $3 M in Coronavirus Relief Funds to support its divisions, like the  Division of Environmental Health or Division of Senior Citizens who provide services on the frontlines or enforce the mandates under the public health emergency.

During discussion on the Public Health budget section, DPHSS testified and I also confirmed last week again with the Department that while the local funding amounts in the original Sub Bill were not adequate to meet the Medicaid match, the anticipated prior year lapses for Medicaid and MIP, included in the bill as amended, should be enough to match and access the full federal Medicaid amount of $129 M for FY 2021. The local match appropriation for the Children’s Health Insurance Program (CHIP) is about $2 M less than what is needed to access the full federal CHIP potential, however, Sub Bill 282 provides the same amount of funding that BBMR proposed in its rebuttal budget to OFB for CHIP. As described during budget deliberations, DPHSS must receive its lapses and transfer authority as provided by law and reaffirmed by Sub Bill 282, as amended, to maximize Medicaid, CHIP and MIP during FY 2021 for the many displaced workers who may have lost jobs and health insurance.

OFB estimated that the Governor’s 15% transfer authority would equal approximately $27 M and would be more than adequate to meet the $2.5 M overall shortfall for DPHSS compared to FY 2020.

As I repeatedly stated during our budget deliberations, prioritizing DPHSS is imperative to getting the island through this public health emergency, taking care of our residents, reopening our schools and businesses safely, and bringing back our tourists. However, I do not believe it is prudent to merely pretend to fund agencies or balance the budget by adopting higher revenues than what could be justified by OFB amidst all of the economic uncertainty. The Legislature must act reasonably under the current circumstances to hold government spending within its means and not exacerbate the challenges we face in making debt payments, prompt payment of tax refunds, the provision of healthcare and critical services and to meet the new challenges families face because of the months-long health emergency. There was some support for my proposed amendment to the budget that attempted to appropriate an additional $6 M for DPHSS operations on a quarterly basis based on actual excess collections of quarterly withholding and corporate revenues, but ultimately that failed. This option would have ensured additional revenues are appropriated to DPHSS on a quarterly basis but only when and if they are actually collected, and should be considered anew by the Legislature moving forward.

I plan to introduce this option again as a separate bill and have other proposed legislation that may tap other possible funding sources for DPHSS’ needs. Thus far there have only been four options presented with the FY 2021 budget and that is to either (1) adopt higher revenues than what OFB is predicting, (2) take any excess revenues each quarter and appropriate to DPHSS as the actual revenues come in, (3) allow the Governor to transfer funds from other parts of the budget to meet any shortfalls or (4) cut more than the $64.6 M already being cut from agencies. The bill as amended also allows the Legislature to examine excess revenues on a continuing basis and appropriate those collections as needed. We all must continue to look for alternate ways to assist DPHSS beyond the limited options discussed during our budget deliberations.

Sub Bill 282 with its $64.6 M in spending cuts from FY 2020 is by no means the easy way out.  Yet it attempts to reflect the gravity of our current economic conditions, and provides tools for maximum flexibility under the circumstances by allowing the Governor to transfer approximately $27 M to any agency in need, envisions the continued use of CARES Act and federal stimulus to supplement public health and safety requirements, and allows for focused allocation of excess collections on a quarterly basis during FY 2021 to meet the critical needs of our community yet without appropriating beyond our proven means.

It is important as we move forward in addressing any shortfalls in the budget that actual facts and figures are used from the agencies impacted, and that misdirection and intimidation are left out of the budget process.

Senseramente,

Therese M. Terlaje

CC: Art San Agustin, Director, Department of Public Health and Social Services

FOR IMMEDIATE RELEASE (September 1, 2020 – Hagåtña, Guam) 

After months of hearings and weeks of budget discussions, the FY 2021 budget passed with a vote of 13 – 2.  Senator Therese Terlaje, the Oversight Chair for the Committee on Health, Tourism, Historic Preservation, Land and Justice, voted in favor of Bill 282-35 as substituted by the Committee on Appropriations.

We should all be horrified that Public Health was not the priority of the original bill in the middle of a pandemic. A $66 million cut across the board would definitely impact services provided by the government of Guam, but it should not have been on the back of the very department that we must trust to get the island through this public health emergency, take care of our residents, reopen our schools and businesses safely and bring back our tourists. “We tried our best to support the projections of the Office of Finance and Budget, with or without the cooperation of the administration, but the bill in its original form would have left the Department of Public Health and Social Services budget with a $13 M shortfall in operations and short on the local match to ensure Guam accessed the full availability for Medicaid insurance,” said Terlaje.

“Through our amendments, we fully funded the Medicaid local match according to DPHSS testimony and restored approximately $1.4 M to DPHSS operations. We removed all earmarks from other Public Health funds except Medicaid allowing them flexibility and leaving them overall a total of only $2.1 M less than FY20,” stated the Health Committee Chair. The Senator attempted to dedicate an additional $6M for DPHSS operations through quarterly excesses in withholding and corporate revenues, but ultimately that failed, noting that additional funding sources will be sought through the rest of the term and faith will have to be placed in the Governor to utilize federal funding and her 15% transfer authority of approximately $27M to shore up $11M in public health operations during the emergency.

The Oversight Chair also noted that GMH will be receiving $750,000 more than in FY20 to improve patient care and safety, that it is authorized to hire nurses and respiratory therapists without limitation, and that it will be paid 2.8 million for services provided to DOC.

Senator Terlaje stressed that Public Health must succeed in FY21 as the safety net when all other possibilities have failed:  in rapid tracing and isolating the COVID virus, in inspections and guidelines for the safe opening of businesses in our new economy, providing childcare so parents can work, safe guidelines for schools, the prevention of cancer and diabetes  that are killing our people too early,  expanded community health centers and health insurance, and food for families who have lost their income.

In closing, Senator Terlaje stated, “For Public Health and all agencies to succeed despite the cuts, we must wisely use the transparency and flexibility tools provided to us by this bill, as a legislature and as a government, to act swiftly and focused and to work together for all of our community who are counting on us.”

Other amendments Senator Terlaje incorporated into the Budget include:

Prioritized the Guam Memorial Hospital and Fought for DPHSS Operations

• Funded and support for the hiring of nurses, public health personnel, respiratory therapists, contact tracers and investigators along with other health professionals for frontline agencies with required reporting for accountability
• Authorization for DPHSS to utilize all unexpended balances
• Removed restrictions on funding MIP and carried forward lapses for MIP and Medicaid to ensure maximum access to federal match
• Gave transfer authority to DPHSS, providing flexibility to address shortfalls as needed
• Prioritized DPHSS for any excess revenue from the Healthy Futures Fund
• No cuts to GMH Operations from FY20
• Ensured the payment to GMH for health services provided to DOC
• Supported a fee study allowing for the alignment of GMH rates and fees with Medicare rates
• Carried over the appropriation of $10 million for the GMHA Capital Improvement Fund which remains unpaid from FY2020

Alignment of Judicial Agencies and Protection of Funding Sources

• Supported access to qualified and experienced attorneys for the Judicial Branch
• Carried forward lapses for indigent defense to ensure full funding for Public Defender Service Corporation and Alternate Public Defender
• Protected the Victim/Witness Housing/Travel Fund

Accountability Measures for the Government of Guam

• Supported the public vetting of exemption to the ban on hiring a lobbyist
• Ensured public scrutiny of bond refinancing
• Mandated the reporting of payments toward prior year obligations for increased transparency 
• Narrowed authorized travel adding accountability measures
• Pushed for progress past the planning stage by appropriating funds for the construction phase of Simon Sanchez High School

Support and Protection for Land and Historic Preservation

• Provided CLTC access to legal services for non-litigation and land registration matters
• Protections for CLTC Survey and Infrastructure Fund
• Appropriated excess Tourist Attraction Fund revenue to DPR for the maintenance of restroom facilities, public parks, cultural sites, and the Guam Historic Resources Division

Rebuilding Tourism

• Lump-sum funding and the carry forward of lapses for greater flexibility for GVB
• Aligned public law for GVB procurement to correct audit deficiencies
• Protects GVB’s access to Tourist Attraction Funds at the end of the Fiscal Year

FOR IMMEDIATE NEWS RELEASE (August 24, 2020- Hagåtña, Guam)

During today’s budget hearing, Senator Therese Terlaje attempted to lock up any excess revenues collected under withholding and corporate taxes for the Department of Public Health and Social Services in FY 2021.  The proposed amendment would have appropriated all fiscal year 2021 withholding and corporate income tax revenues collected per quarter in excess of the revenue level adopted (or ‘revenue budgeted’) for that quarter as reflected on the monthly CRER to the Department of Public Health and Social Services for expansion of its environmental health inspections, its other regulatory purposes and other DPHSS operations, but not to exceed $6 million for the entire fiscal year.

“We are being tasked to make hard decisions and difficult cuts.  The Office of Finance of Budget has cut DPHSS by $3.5 million overall and $13 million in operations, and the Department is still short $9.8 million to fund our full match in Medicaid and $2 million in CHIP. This amendment simply ensures that if there is excess revenue, that it is appropriated to the agency that is going to continue to get us through this health emergency for their operations over any other priority of the Government of Guam,” stated Senator Therese Terlaje.

Senator Terlaje further stated, “If we don’t lock this money up right now for public health we may never see it again.  Last year we appropriated $10 million in excess revenues from FY 2019 for capital improvements at GMH and have yet to see these funds transferred by the administration, even though it was signed into the FY 2020 budget law and there was more than $30 million in excess revenues available.”

During the discussion, Senator Terlaje noted that the current substitute bill for FY 2021 appropriates $13 million less for DPHSS operations than what was earmarked in FY 2020 for the basic operations of public health that could not be funded by new CARES grant funding.

The Terlaje amendment failed with 7 votes in favor and 8 votes against.  Senator Therese Terlaje thanks Vice Speaker Nelson, Legislative Secretary Shelton, Minority Leader Senator Taitague, Senator Perez, Senator Moylan, and Senator Castro for their support on the amendment.