The Consolidated Commission on Utilities violated the open government law when it approved behind closed doors the $1.3 million in pay raises and bonuses for unclassified employees of the Guam Power Authority and Guam Waterworks Authority, the Office of Public Accountability said.
“The open government law states that the people of Guam do not yield their individual rights to the public agencies which serve them,” Public Auditor Benjamin Cruz said in an OPA report released today. “The people insist on remaining informed.”
Cruz maintained that discussions on public agencies’ salaries “should not be conducted in private and should not be tolerated.”
The attorney general required GPA and GWA to pay back the increments and bonuses received by its unclassified employees arising from the Nov. 27, 2018 CCU executive meeting. However, OPA noted inconsistencies in the manner the monies were returned.
"Most employees returned the net amounts (net of payroll deductions), while the Board Secretary returned the gross amount. We also noted various installment payment periods, the longest of which would take eight years to repay," OPA said.
The CCU sets the salaries of the unclassified employees who work at their pleasure. Records show that CCU provides salaries to certain unclassified employees higher than the other personnel.
“Although both GPA and GWA general managers received pay increments and bonuses between fiscal year 2015 and 2019, the CCU did not conduct formal performance evaluations for these officials,” OPA said. “Therefore, OPA questioned the CCU’s basis and measure of its approval on the GMs’ pay raises and bonuses.”
OPA questioned $1.3 million paid to GWA’s former chief financial officer Greg Cruz, who was hired by the CCU through a “contract arrangement” for 11 years without an actual contract in place.
With an initial salary of $135,000, the former CFO worked from 2008 to 2018 without proper documents to support his employment at GWA.
“The legal counsel opined that the relationship between the former CFO and GWA was that of employee and employer,” OPA said. “Misclassifying an employee as a contractor may be suggestive of issues with retirement benefits and withholding taxes, among others.”
Due to limited access to employee personnel information, OPA referred the question to the Office of Attorney General for further investigation.
OPA made the following recommendations:
1. AG to provide an opinion in each of the salary levels, adjustments, and bonuses made to unclassified employees that were effective between October 2013 and January 2019;
2. CCU to consult with GPA and GWA’s payroll specialists as to how employees shouldreturn the salary increments and bonuses;
3. AG to provide an opinion on how the employees should return the void salary increments and bonuses, and
4. CCU to consistently apply the agency-wide adopted pay scale.
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