About $4 million in COVID-19 relief funding initially intended for the Small Business Pandemic Assistance Program under the Guam Economic Development Authority has been reallocated to pay for hotel quarantine facilities, according to Bureau of Budget and Management Research Director Lester Carlson.
Gov. Lou Leon Guerrero initially reserved up to $20 million from $118 million in federal COVID relief funding for the program, which began in May. The application period was either up to Dec. 30 or when funds run out.
"The GEDA business grant program, for all intents and purposes, they tapped out at $16 million. So we discussed that with GEDA ... and I transferred the other $4 million to the quarantine facility account," Carlson said Monday.
GEDA Administrator Melanie Mendiola said more than 2,200 business have benefited from the program and applications had slowed down significantly.
"There are many pressing needs of the government of Guam in dealing with the pandemic. The decision was made to reprogram the existing funding," Mendiola said.
In its place, GEDA is providing a short form for businesses that want to apply for a future grant, Mendiola added.
GEDA will submit supplemental requests for additional funding when needed, Mendiola said. Businesses that submit the short form are assigned an assistance application number, essentially saving a place in line for the grant.
Nearly $14 million had been awarded to small businesses near the end of August. GEDA wasn't seeing a surge in applications at that time and was discussing how the remaining money could be spent, according to Mendiola. It was not expected at that time that more than $2 million more in funding would be utilized.
The governor has discretion over the funds.
GEDA began looking at ways to accommodate the potential for additional applicants. They decided to replace the application form with the short form once grant awards appeared to meet or get near $16 million, to ensure some continuity in the process even without funding available.
The short form was uploaded about a week ago and about 20 businesses have now submitted the forms, according to Mendiola. She said GEDA will advocate for "every last business" that applies through the end of December for grants.
"Having said that, the governor has to balance our request with all the other needs for the community," Mendiola said.
Mendiola is scheduled to meet with the governor next week.
Carlson, on Monday, discussed the fluid nature of using federal funding in response to the pandemic. The governor has sole discretion on the COVID-19 relief funds and she is allocating resources for that purpose, he added.
Carlson also stated the COVID-19 relief funds cannot be used for general government operations or revenue shortfalls. A report on Guam's use of funding is due on Sept. 21 to the Office of the Inspector General, he added.
The larger context of that discussion was for the governor's version of the fiscal year 2021 budget bill, which lawmakers ultimately rejected.