A general oversight hearing was held Friday on the Port Authority of Guam, and among the questions from oversight chair Sen. Jesse Lujan was the status of the port’s proposed 17% tariff increase.
The PAG presented its proposal to the Public Utilities Commission in January, but the Governor’s office stepped in and asked the PUC to hold the new tariff adjustment in abeyance so as not to impact consumer prices.
PAG General Manager Rory Respicion sought to clarify. “So it wasn’t withdrawn, and the governor never asked us to withdraw it. The governor wrote to the PUC asking that it be held in abeyance,” he said.
Respicio also said, should the increase be approved, the actual impact to consumers would be very minimal. “So in this tariff adjustment, not only are we trying to raise the 2020 rate to 2025 … The aggregate of it is about 17%, but the impact of it is not 17%. It’s about one 10th of a penny for every can (imported to Guam).”
He said they also advised carriers and importers that the average increase per container would be $60. “If the tariff adjustment goes through, this is what your bill would look like so they could see transparently what the impact would be.”
According to Respicio, the rates were not updated since 2020 in part because the Port was allocated some $15 million in American Rescue Plan funding by Adelup. “It was with a commitment that we weren’t going to do anything with our tariffs,” he said.
Lujan asked Port officials to brief the committee on the end-to-end cargo clearance process with CQA, “and where do the handoffs break down?”
The Customs and Quarantine Agency has been under increased scrutiny after Attorney General Douglas Moylan charged that a significant amount of illegal drugs are entering Guam in cargo shipped through the port.
Both CQA and the PAG have rejected the AG’s claims and his call for 100% inspections of all incoming cargo.
“We do have a very good working relationship with Customs. In fact, Mr. Chairman, when they did a very targeted operation for six weeks on these inspection of containers, we had a meeting at the office. And I said, well, you didn’t find any contraband, you didn’t find any drugs. Go tell the people at Guam that you didn’t find anything,” Respicio said.
He said they all have to do a better job of the messaging, “Because as I shared this publicly, the biggest detriment to the supply chain is if you demoralize the very employees that are pushing all this cargo out.”
“There’s been no evidence of port employees being involved. There’s been no evidence of us obstructing any investigation or preventing customs from doing their job. All we’re doing is supporting what customs are supposed to be doing,” Respicio added.
