March 3, 2018

Hagåtña — The Vice Speaker should have called Senators into session yesterday.

In a memo to the Governor, Attorney General Elizabeth Barrett-Anderson stated:

“The Governor has express authority to call multiple special sessions at any time. It is the opinion of our Office that the Legislature did not have the authority to refuse to hear the call of the Governor’s special session on March 2, 2018.”

Governor Calvo thanks the AG and her staff of attorneys and clerks who were at the office working today.

“The Attorney General obviously understands the situation that we are in, and I appreciate her working over the weekend to help us muddle through what has become some sort of legal drama with the Acting Speaker on whether or not they can be called into session again,” the Governor stated.

Acting Speaker Therese Terlaje did not call for special session as the Governor requested per his Organic Act authority. The Legislature was scheduled to resume session at 10 a.m. yesterday. Only 7 senators appeared at Legislative Session Hall before recessing for the holiday weekend. The Governor called them back into session at 1 p.m. to consider another compromise bill — it revises the Governor’s original Bill 245 but adds in amendments requested by Democrat and Republican senators in previous legislative sessions.

Speaker Cruz left island this week and Sen. Mike San Nicolas has been absent this whole week.

The Department of Administration and the Bureau of Budget Management & Research have told senators that everyday without a solution brings our government closer to a fiscal cliff.

For the last two months now, the Legislature and the Governor’s office have met to discuss the federal Tax Cuts and Jobs Act, which President Trump signed into law on Dec. 22, 2017. The IRS sent out the new tax tables on Jan. 12, 2018. The administration’s fiscal team and the Legislature’s Office of Finance and Budget had held several meetings, to include Special Economic Services meetings, and in the SES meeting on February 13, the SES determined the impact to be $67M.

As of last week, the Senators had yet to pass a bill that would act as a financial bridge to get the government over the financial crisis felt due to the federal Tax Cuts and Jobs Act. On Feb. 28, after Senators recessed without yet voting on a solution, the Governor called them back into session:

• Feb. 28, 2018: Governor called special session at 7 p.m. to consider Sen. Fernando Esteves’ bill. They gaveled in and referred the bill to the Committee on Finance. 
• Feb. 28, 2018: Governor called special session at 9 p.m. to consider Sen. Joe San Agustin’s bill. They gaveled in and referred the bill to the Committee on Finance.
• March 1, 2018: Governor called special session at midnight to consider a version of Sen. Joe San Agustin’s bill with amendments recommended by senators in previously. 
• March 2, 2018: Governor called special session at 1 p.m. to consider his original bill with amendments. Acting Speaker Terlaje ignored it, saying the Governor couldn’t call them into session again, and cited a memo from their legal counsel.

After all these attempts to avert a fiscal crisis, the legislature has yet to arrive at any long-term solution that would equalize the impact of the revenue shortfalls resulting from the federal Tax Cuts and Jobs Act.

Further, Acting Speaker Terlaje scheduled session to resume after the three-day weekend.

“This is the worst dereliction of duty I have seen in my years of public service,” Governor Calvo stated. “Everyone agrees that we’re going to need to enhance revenues and cut costs – the private sector, the Public Auditor, the Legislature’s fiscal team, my fiscal team. And yet, here we are.”

Meanwhile, the administration is left with no choice but to begin implementing cost-cutting measures that the Bureau of Budget Management and Research requested from agencies, and then submitted to Senators on Feb. 13. Those measures include reducing overtime, no new hiring, reducing overhead costs, and the ongoing furlough process. This has resulted in the non-renewal of about 40 LTAs employees, closure of fire stations and a police precinct, and the possible closure of the Department of Revenue and Taxation Drivers License satellite office at the Agana Shopping Center.

“There should be no reason why Senators don’t know that drastic cuts are necessary and that cuts get deeper with every passing day. There is an urgency to take action,” said Lester Carlson, acting BBMR director.

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