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Governor launches $25M forgivable loan program, which can grow to $50M, for tourism businesses, others

Governor launches $25M forgivable loan program, which can grow to $50M, for tourism businesses, others

SPECIAL: In July 2021, dance group members of Guma' Ma Higa perform one of their cultural dances in the pouring rain during Ha'anin Minagof at the Valley of The Latte in Talofofo to celebrate the culture of Guam and Micronesia. Cultural tourism businesses such as the Valley of The Latte have been left out of pandemic relief aid packages, so the governor created a $25 million local program to try to help them. Post file 

Gov. Lou Leon Guerrero on Friday signed an executive order creating a $25 million forgivable loan program for pandemic-hit tourism businesses and other employers that were left out of federal aid packages, so they can keep their employees to sustain their operations.

Executive Order 2021-25 establishes the Local Employers' Assistance Program, or LEAP, using $25 million in federal American Rescue Plan funds, the governor said.

It can grow into a $50 million program, once a new bill seeking to appropriate $25 million from the government of Guam General Fund to LEAP, becomes law, the governor added.

Bill 214 is sponsored mainly by Sens. Amanda Shelton and Joe San Agustin, along with eight other senators.

Tourist attraction venues such as the Valley of The Latte, museums, watersports operators and laundry services that were mostly left out of pandemic relief packages such as the Restaurant Revitalization Fund and the Shuttered Venue Operations Grant, are among the employers that could benefit from this $25 million to $50 million program.

"Businesses still need more help," the governor said before signing the order, particularly because the COVID-19 pandemic has gone on for too long and is still wreaking havoc on the tourism economy.

The forgivable loan program is patterned after the federal Paycheck Protection Program, Guam Economic Development Authority Administrator Melanie Mendiola said at the signing of the executive order. 

GEDA is the lead agency in administering the forgivable loan program.

If Guam employers use the money to cover mainly payroll, so that thousands of workers can keep their jobs, the the loan forgiveness clause of the program kicks in, officials said.

"In order for us to recover as quickly as we can, we still need to be able to employ our employees. So the purpose of this program is to help these businesses contain and sustain their employees," the governor said.

The governor and other officials at the Friday executive order signing ceremony said Guam needs to ensure tourism-related businesses and other employers still have the employees needed for when tourists come back in droves.

A group of small businesses has been making the rounds, seeking support for a proposed $75 million grant program to directly help tourism-related entities and others that were not covered in federal pandemic relief programs.

Representatives from the group, including Guam Dry Cleaners executive manager Simon Sanchez and Valley of the Latte Adventure Park in Talo'fo'fo managing director David Tydingco, thanked the governor and the Legislature for their prompt response.

"Business leaders from our tourism sector called on us to work together — and the LEAP is the result of the collaboration of our island’s leadership that demonstrates our commitment to keep our people working and carry our businesses through this difficult time," Shelton said in a statement.

San Agustin said the pandemic has hurt the entire community and businesses have been burning the candle at both ends.

"More needs to be done. We can’t fix things overnight—but the LEAP Act will provide much-needed relief and is an important step forward," the senator said.

Representatives from other business organizations such as the Guam Chamber of Commerce and the Guam Women's Chamber of Commerce also welcomed the program.

The governor's LEAP also replaces a program idea that the governor and Guam Labor Director David Dell'Isola announced in June.

That program seeks to subsidize the salary of workers, up to $9.25 an hour, for up to three months, so businesses can reopen or remain open in the midst of a pandemic especially after the Pandemic Unemployment Assistance ended.

LEAP is separate from GEDA's $20 million small business pandemic assistance grant program for 2021. 

Besides federal and local programs to help businesses, there have also been programs to help individuals and families such as the All RISE program and the Economic Impact Programs.

This story will be updated.

Haidee Eugenio Gilbert

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