Lawmakers Debate $40 Million Bill for Guam Memorial Hospital

Lawmakers in Guam convened on Wednesday afternoon to deliberate a bill proposed by Governor Lou Leon Guerrero that would allocate $40 million to the Guam Memorial Hospital (GMH) for facility repairs and to settle outstanding debts. The bill, which assigns the Department of Administration (DOA) the responsibility for managing the funds, comes at a crucial time as the hospital faces significant financial challenges.

During the session, GMH Administrator Lillian Perez-Posadas informed lawmakers that the hospital currently owes approximately $26 million to vendors. Additionally, she indicated that between $16 million and $17 million is required to address issues with the hospital’s aging electrical system, which had previously caused a fire. The urgency of the governor’s proposal was underscored by its introduction alongside three other financial measures aimed at supporting the struggling hospital.

The governor’s funding proposal followed a rejection earlier on the same day of a budget compromise that would have provided GMH with $40 million by eliminating certain business privilege tax cuts in the fiscal year 2026 budget. The latest bill aims to finance GMH’s capital improvement projects, including necessary electrical upgrades, along with operational costs and supplies.

Funding Sources and Legislative Responses

In a session that extended past 18:00, lawmakers summoned the Adelup fiscal team and GMH leadership to address queries regarding the bill. Senator Sabrina Salas Matanane, who chairs the hospital oversight committee, pressed DOA Director Ed Birn on the timing of the funding proposal, questioning why such a source had not been identified sooner given GMH’s “state of emergency.”

Birn explained that the $40 million would be sourced from the government’s General Fund balance, which is the primary operational fund for GovGuam. He noted that excess revenues or unspent funds from previous fiscal years could contribute to this balance. He also mentioned the possibility of $30 million remaining from fiscal year 2024, pending confirmation from ongoing audits.

Senator Telo Taitague and other Republican senators proposed additional measures to provide substantial financial support to GMH. Taitague introduced a bill that would allocate nearly $19.75 million sourced from bond savings to assist with the hospital’s critical capital improvements and essential medical supplies. The funding is derived from debt service savings realized through refinancing existing bonds without imposing new taxes.

Hospital’s Financial Needs and Future Outlook

Lawmakers raised concerns about the sustainability of the proposed funding. Senate Majority Leader Jesse Lujan inquired about the duration the $40 million would last before GMH would require further assistance. GMH representatives indicated that the hospital’s budget request for the fiscal year was significantly higher than what was approved, leading to ongoing financial strain.

The hospital had initially sought $72 million for its fiscal year budget but received approximately $58 million. GMH’s budget for fiscal year 2026 includes a request for an $80 million subsidy, while the previously passed budget, which was vetoed by the governor, allocated around $47 million.

As discussions continue, the future of GMH remains uncertain. The urgent need for funding and the ongoing debates surrounding budget appropriations highlight the critical situation facing Guam’s only public hospital. The legislative session is set to reconvene as lawmakers aim to address these pressing financial issues and ensure the continuity of essential healthcare services in the region.