The real reason Simon Sanchez High School hasn’t been built yet is the same reason any large procurement takes forever is the same reason litigation continues over faltering DFS’ claim to the airport concessionaire contract is the same reason it will take forever years to build a new hospital: Politically connected corporate giants in Guam always, always want a piece of the pie.
Historically, Guam companies have succeeded in influencing senators and governors (think jobs for families, loans, straight-up kickbacks, campaign contributions, etc.) to create public policy that advantages these companies for government contracts and economic benefits at the expense of what is good for the everyday Guamanian’s pocketbooks. Remember when non-Guam banks couldn’t have more than two ATMs?
Emergencies aren’t even immune to this corruption. Look at how long it took to clean up the island after Mawar. Politically favored government contracts. “Never let a good crisis go to waste,” Churchill once said about the Yalta agreement. That saying has since become an adage for less-than-statesman-like motives.
The influencing continues. It appears now to come at the expense of people on Medicaid and the other welfare programs administered by the Department of Public Health and Social Services.
Right now and for the past several years, the systems DPHSS uses to manage the claims, qualifications, processing, accounting, and reporting of the locally and federally funded welfare programs (chief of which is Medicaid for nearly 50,000 men, women, and children), are antiquated, frustrating to the staff, the main cause of delays in getting benefits to recipients, and non-compliant with the U.S. Centers for Medicare and Medicaid Services (CMS).
That non-compliance has meant that you – the taxpayer – have to pay more money for these systems as a result of a lower federal cost share to maintain these contracts.
The government of Guam can issue an RFP for a winning offeror to build and provide an IT system that will be CMS-compliant. But that means spending hundreds of thousands, if not millions, of dollars on creation, not to mention the time it will take to set up the system, train everyone, work out the kinks, and get final CMS approval.
The other option is for Guam to latch onto another state or territory’s already-CMS approved and contracted IT platform through a joinder. To accomplish this, Guam law would need to specifically allow this type of procurement, notwithstanding the current procurement law locally.
“Guam is strongly encouraged to leverage cooperative purchasing,” CMS Director, Division of State Systems Edward Dolly wrote in a November 14, 2023 letter to then-DPHSS Bureau of Health Care Financing Administration, Medicaid administrator Carlos Pangelinan.
That call by CMS to allow the joinder led to Tina Muna Barnes introducing legislation to allow for this to happen.
The bill had a public hearing by the legislative procurement committee. Every oral and written testimony on the record favored the bill, with only one request for an amendment. That came from the director of public health, who asked the committee to expand the joinder authorization to the entire DPHSS so that the agency could take advantage of other stateside existing contracts and lower the cost of products and services to the Guam taxpayer.
“It most certainly will allow CMS to be quicker and more prompt in the review of your procurements and contracts; and that they’ve already been previously approved and work through the terms and conditions,” Mr. Dolly said in live testimony before Ms. Perez’s committee, which has substantially altered the bill since. This is believed to be the first time a high ranking CMS official has testified in person before the Guam Legislature, underscoring the value of the bill.
He continued about the bill, “It allows us to focus specifically on the items that are of particular interest and in a technology world, that really increases the speed of the delivery of the service to the Medicaid program. Looking at the national program, we see great success in Medicaid agencies who have leveraged these opportunities, in not only the saving time on the procurement aspect itself, but also leveraging the lessons learned from other agencies.”
Rather than heed CMS’ recommendations or to make the amendment the public health director asked for, Ms. Perez’s committee instead substituted the Muna Barnes bill with a completely different version. No explanations on the changes. No indication where these changes came from. Just a new bill that removes the exemption from local procurement law, tacks on several barriers to the joinder, and appears – as we have seen time again in politically influenced procurements – to favor local contracting.
We asked Ms. Perez and every member of her committee – Therese Terlaje, Chris Barnett, Tom Fisher, Joe San Agustin, Telo Taitague, and Jesse Lujan – the following questions:
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None of the senators have replied to any of these questions since we sent them Wednesday. At the very least, if none of them had been lobbied and influenced by a local interested company, they should all have been quick to deny such a claim. Their silence raises suspicion to a whole new level.
In 2011 at the start of the Calvo administration, then-chief of staff Franklin Arriola wanted the Department of Administration to put out an RFP to procure a new financial management system to replace the antiquated AS 400. That system was the cause of so many delays, confusion by users especially the senators to whom Governor Calvo granted access, downed service, and most of all the inability to curate financial and other information in proper context.
Mr. Arriola was met with stiff resistance from a powerful member of the senior staff who wanted to protect her friend, who owned the company that had the government contract.
About two years later, Mr. Calvo wanted to include in his Fiscal Year 2014 budget millions for the procurement of laptops for students after Apple announced an inexpensive bulk purchase program for schools. Such a purchase would have driven down costs considerably for getting every public school student a laptop from Apple versus a PC laptop. We were informed by the Guam Department of Education that it could not be done because GDOE’s IT staff were only trained to maintain PC computers. Guess who benefitted from that policy, which wasn’t even written down anywhere?
Thankfully the Leon Guerrero administration has been unafraid to upgrade GovGuam’s financial management system, moving the government into the Twenty First Century, where other governors have failed.
Now if only our senators can show us the same non-corrupt backbone.