Adelup: Refunds in the mail by June

THE governor’s fiscal team was successful in selling the Series B bonds, Adelup announced yesterday.

As a result, about $60 million in tax refunds will be in the mail by June, the Governor’s Office promised.

According to the fiscal team, the $108.7 million bond was sold at a new record low interest rate of 4.60 percent with bond proceeds to be transferred to the government by the bond closing date, currently scheduled for June 6.

The interest rate is also a new record low for the government and replaces the previous low of 4.9 percent the administration earned in December.

“It’s pretty obvious that we are doing things right with fiscal policy and the people’s money if the markets are willing to give us such a low interest rate,” Gov. Eddie Calvo said.

“We’re making good on a promise to pay back the people and we’re cleaning up the bad financial practices that have plagued this government for so long. It’s a sign we need to press forward with our fiscal stabilization and deficit elimination strategies,” he added.

The bond will also pay GovGuam’s obligations to the Retirement Fund, estimated at $25.1 million, and about $18 million in health insurance payments.

Marie Benito, deputy director for the Department of Revenue and Taxation, said they are now just waiting for the money to be transferred over to the government’s coffers.

“As soon as the money is in the bank, then we can release the refunds. We’re looking at June 7 or June 8,” she said.

As for the 2010 tax refunds that have yet to be paid out, she said it was in the provision of the bond passed last year, which means they may only be able to accommodate 2011 tax returns.

“In the meantime, we’re continuing to identify funds to pay off the remainder of the refunds that are still owed. That includes the 2010 refunds and the balance of the 2011 refunds,” she said.

Although Benito couldn’t estimate what is owed for 2010, she said the remaining amount for last year is about $45 million.

According to Benito, all the refunds will be mailed in contrast to last December when a number of distribution centers were set up.

“We had a lot of checks and some of them were multiple years and we wanted to give them that opportunity to receive them. Over 80,000 checks were printed,” Benito said, referring to last year’s distribution of refund checks.

Benito added DRT would have been able to pay out all the refunds had they not been obligated to pay the other debts.