Guam Gov. Lourdes Leon Guerrero told the legislature that the territory’s finances are improving.
She said her government anticipates general fund revenues will rise $50 million in fiscal year 2023, which starts Oct. 1, compared to the current fiscal year.
Leon Guerrero estimates general fund revenues totalled $700.2 million in fiscal 2019, $747.2 million in fiscal 2020, $630.1 million in fiscal 2021, and will reach $623.6 million in fiscal 2022, and $695.8 million in fiscal 2023.
“Based on the government of Guam’s consolidated revenue and expenditure reports, general fund year-to-date revenue collections are trending higher than adopted budget revenues,” said S&P Global Ratings Director Ladunni Okolo. ”Through May 2022 (eight months into its fiscal year), revenues are about $601 million which is 16.6% above budgeted revenues. This is in line with our view of recent stabilization in the government of Guam’s short-term finances despite longer-term uncertainties in economic and revenue trends.”
Moody’s Investors Service Assistant Vice President Pisei Chea said, “Through May, fiscal 2022 general revenue is performing better than the year before and better than budget as Guam’s tourism industry continues to recover.”
According to the governor, fiscal 2018 had a $10.4 million deficit, fiscal 2019 had a $35.6 million surplus, and fiscal 2020 had a $46.3 million surplus. More recent numbers are not available as audits have not been completed.
In her executive budget proposed to the legislature, the governor said she expected tourism, which had shrunk dramatically in the COVID-19 period, to go up in fiscal 2023, aiding the economy and government revenues.
Leon Guerrero said federal funding for the government should remain above historical levels but shift from pandemic relief to increased defense and infrastructure expenditures.
Construction should increase, contributing to the local economy. An example of this would be the relocation of the Marine Corps facilities on the island, she said.
The legislature started fiscal 2023 budget hearings on Wednesday.
In the governor’s proposed budget, 16% of spending is allocated to public health, 37% to public education, 21.2% to protection of life and property, and 25.8% to everything else.
Moody’s rates the island’s business privilege tax bonds Ba1. S&P rates its general obligation bonds BB-minus.