AFTER the Guam Education Board approved a board petition allowing salary increments to be paid out to Guam Department of Education employees, Department of Administration Director Benita Manglona sent a letter yesterday addressed to GEB chairman Francis Santos and GDOE Superintendent Jon Fernandez stating grave concern about the action, citing that GDOE is “disconnected from the financial realities the people are facing.”

As discussed in the last GEB board meeting, GDOE has set aside around $2 million to pay these obligations owed by the department.

In her letter, Manglona said the increments are “clearly an unfunded obligation the Treasury cannot afford and, worse, an empty promise to teachers.”

Manglona also pointed out that the “news of GDOE’s pursuit of unfunded pay raises came the same day the legislative minority pointed out the Fiscal Year 2013 budget did not address the $100 million needed for the tax year 2013 provision for tax refunds.”

“It is financial anathema to raise operational spending as we identify solutions for this shortfall. Keep in mind that though GDOE is a semi-autonomous agency, the vast majority of your costs come from the same pot of cash. Every dollar of encumbrance GDOE makes is a dollar taken from our ability to pay tax refunds,” Manglona stated in the letter.

Other concerns

Aside from the $100 million gap, Manglona also cited other fiscal matters of concern, including the “2011 tax refund deficit and vendor payables that go all the way back to 2004.”

Manglona said a “large fraction of this deficit belongs to payables on GDOE’s books, including moneys due to former employees of the department because of a Civil Service Action and unpaid salaries to teachers.”

“More importantly,” she said, “the governor wonders about GDOE’s priorities when pay raises are being pursued at a time when teachers are still waiting for instructional laptops, and discussion to give students iPads or laptops is virtually non-existent.”

Manglona also mentioned the department’s “inability to prioritize funds for textbooks, standardized test scores, or white boards for classrooms and to supply even rudimentary materials such as school supplies, toilet tissue, and reams of copy paper.”

The letter also stated GDOE informed the Legislature that textbooks were not ordered because of the unreleased 15 percent reserved funds.

“GDOE informed senators that no funds were available, yet at the Special Economic Service meeting, it was revealed that GDOE has made $28 million in encumbrances above the allotment schedule. This appears to be a deviation from the rest of the government to hold the line on spending,” the DOA official stated.

Manglona also mentioned that “the Department of Administration and the Bureau of Budget and Management Research have absolutely no access to the financials of GDOE, the rate of spending, the aging of payables, encumbrances, and other financial information,” and that they have requested GDOE to “provide actual expenditures and outstanding encumbrances, but the information has yet to be provided.”

Nearly half of the $30 million in revenue held in reserve for GDOE was already released, according to the letter.

“Yesterday, GDOE said it is able to pay the increments because the increments are funded and the money is available. If that is so, and if the department is now saying it can afford its operational costs – despite months of telling the Legislature and the media that it cannot live without the full release of the reserve – then it is obvious to us that GDOE no longer needs the remainder of the reserve,” Manglona said. 

The letter concluded with Manglona stating “she will be recommending to the governor that no such future release occurs, and that all savings be directed to the payment of tax refunds.”