Subsidy bill for Guam Memorial Hospital signed into law

Lou Leon Guerrero

 By Pacific Island Times News Staff

Gov. Lou Leon Guerrero on Wednesday signed into law a bill appropriating $40 million to fund capital improvement projects at Guam Memorial Hospital, while describing it as “legally flawed.”

The substitute version of the governor-proposed Bill 1 (3-S) is now Public Law No. 38-59.

The supplemental appropriation measure will fund the hospital’s electrical system as well as its operational costs and supplies, authorizing GMH to spend up to $5 million to replace, repair, and/or maintain its Information Technology infrastructure “upon a declaration of emergency.”

“I must also note that not only is Section 3 of this bill legally flawed, utilization of the measure provided therein would hinder GMH's ability to use the funds as it needs to,” she stated in her transmittal message to the 38th Guam Legislature.

While the bill authorizes emergency procurements, the governor argued that setting a $5 million ceiling runs counter to Guam’s emergency procurement law, which she said provides “no limit” as long as “the procurement is made in an amount necessary to address the emergency for a 90-day period.”

The governor also noted that “it is unclear whether the bill requires a  declaration of emergency.”

“The distinction is meaningful, a declaration requires action by the governor

 through an executive order, while a certificate requires action by the chief

procurement officer or the head of a purchasing agency,” the governor said.

She warned that “the mismatched language and statutory reference of the bill

would potentially expose any resulting procurement to protest and delay these critical procurements.”

Nevertheless, Leon Guerrero resolved that the bill does not require GMH to employ a “confused method” to access the appropriation, nor does it limit the use of procurement methods available under the law to fix the electrical system.

The 38th Guam Legislature passed Bill 1 (3-S) during a two-day special session last week.

The governor proposed the bill following her veto of Bill 44-38, the fiscal 2026 budget act, which seeks to roll back the business privilege tax from 5 percent to 4.5 percent effective Oct. 1  and then to 4 percent on Oct. 1, 2026.

Leon Guerrero’s initial alternate bill proposed to reverse the BPT rollback and appropriate $40 million to GMH. Senators rejected this bill, prompting the governor to amend her proposal, focusing on GMH.

Senators are anticipated to override the governor's veto of Bill 44-38.

Despite her reservations about the legislature's version of Bill 1 (3-S), the governor agreed to compromise, noting that a "hard-fought" battle preceded her proposal.

“Though I welcome its passing, I would be remiss not to acknowledge the fiscal challenges our government will face in funding critical measures like this one in the future if the legislature persists in enacting its intended budget for the upcoming fiscal year,” the governor said.

“Notwithstanding the confused language in Section 3, I am confident that GMH and other agencies coordinating in its response, including the General Services Agency and the Guam Power Authority, have the necessary authority under existing law to accomplish the procurements needed to address GMH's needs,” the governor said.

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