Millions of dollars have flowed through the Department of Lands building fund with unclear accounting and no progress has been made in nearly 14 years since the agency was mandated by law to build new buildings. new offices in Hagåtña.
Director of Lands Joseph Borja provided lawmakers with an update on the construction fund and the new building during a budget request hearing on Monday, in response to a letter from Senator Telo Taitague. Borja, who took over as head of the agency in 2019, said an audit of the agency’s construction fund should be considered.
The old agency building in Anigua was built over a flood-prone area and had to be demolished in 2006 to prevent the Guam government from violating the national flood insurance program. In 2007, a construction fund for a new land management building was created by Public Law 29-46. The fund was to be managed by the director of the agency, who was authorized to grow the money through investments. According to Borja, this never happened.
The building fund received approximately $171,000 in local funds in fiscal year 2008 and a Federal Emergency Management Agency grant of approximately $1.5 million.
The agency has spent almost $1 million in grants to design a new building on a property next to the Julale Center in Hagåtña. Construction never materialized, Borja said.
“We have this stack of big, beautiful blueprints that we spent $984,346 on, but they’ll probably never be used because they’re obsolete.”
Over the years, construction costs for the Hagåtña facility have likely more than doubled, Borja noted.
Another $3.7 million was transferred to the department’s survey revolving fund account in fiscal year 2011, but was withdrawn four years later. Borja said he couldn’t explain the deposit, but it was eventually taken over by accounting to cover a shortfall in the survey fund.
Land Management requested that he be transferred back and he never was.
Senator Joanne Brown wanted to know what happened to the remaining FEMA funds.
“Obviously the building was never built. … What happened to the 1.5 million? she asked.
Minus the costs of unrealized building designs, approximately $788,024 — including federal grants — should have remained in the account. But a report shows that around $591,000 was withdrawn from the construction fund and permanently transferred to the general fund in January 2018.
“It’s according to the (Department of Administration),” Borja said.
But while Land Management books show there should still be some $196,000 left in the construction fund, the Department of Administration’s financial management system shows the account was zeroed in September 2020, according to Virginia Flores, Head of Land Management Administrative Services.
Borja said he sent a request to the administration agency.
“When will they respond? I am not sure. But I think it’s going to take several eyes to watch it,” Borja said.
Sen. Joe San Agustin asked Borja to check with FEMA on the status of the grant.
Borja asked lawmakers to review the original law that gave his agency the power to build a new office and consider revisions. The agency spends about $650,000 a year on rent, he said.
“Land Management is really not a promoter. We really don’t have anybody in the building who can… set it up, with the funding, you know, because it’s not just about building a funding mechanism,” he said.
The property identified for the new building in Hagåtña belonged to the CHamoru Land Trust Commission. Human remains were found on the property and Borja said the commission was told it had to make a decision on how to deal with the remains.
Land Management is requesting a budget of $3.4 million for fiscal year 2023, the same request as last year.