As contractors scrambled to beat deadline
Although Guam Waterworks Authority officials previously expected revenues of up to $5 million as a result of the implementation of the agency’s system development charge, actual revenue may be significantly less due to a decrease in the number of new permit applications.
GWA general manager Leonard Olive, who was the guest speaker at yesterday's Rotary Club of Northern Guam meeting, said that since the charge took effect earlier this month, GWA has only successfully received an estimated $2,000 in system development charge from a single-family dwelling.
Olive previously told Variety that GWA hopes the charge would bring in revenues close to $3 million to $5 million this fiscal year.
However, chief inspector of permits at GWA Vern Tobey said those estimates may not be reached if the amount of new permit applications remains at a standstill.
Tobey said that since the development charge took effect March 1, he has seen an abrupt drop in the number of new permit applications.
While his office normally processes anywhere from 80 to 100 applications a month, Tobey said there has virtually been no new application since March began.
According to Variety files, the system development charge will tack on an additional $5,600 to the cost of building a new home. For larger housing or commercial projects the cost would be higher, depending on the size of the water meter needed for the unit.
Tobey said he saw an increased amount of new applications prior to the March 1 implementation of the charge, due to developers scrambling to get their permits before the charge took effect.
“Everyone was trying to beat the deadline,†said Tobey, who said he processed nearly 400 new applications last month, more than double the usual amount.
Tobey said that the number of new applications is not expected to increase again until later this year.
“Developers got enough permits before the charge took place to supply them with enough projects and enough work to last quite a while,†said Tobey.
He added that while the revenues will eventually begin to pour into the agency, getting to that point will take a while.
According to GWA officials, the revenue from the system development charge will go into an account earmarked specifically for improvements to the agency’s systems.
