18 July 2014

Junk-Rated Guam Reports Budget Surplus

The Bond Buyer

LOS ANGELES — Auditors have confirmed that junk-rated Guam achieved its second consecutive budget surplus in fiscal 2013.

The Pacific territory's officials said Thursday they achieved their second consecutive budget surplus in 20 years, in a prepared statement released after its fiscal year 2013 audit posted July 1.

Fitch Ratings and Standard & Poor's have lauded Guam for efforts to right its financial position, but still rated most of the bonds junk.

Since taking office in 2011, Governor Eddie Calvo has been focused on returning Guam to financial stability by controlling expenses and implementing fiscal reform, Lester L. Carlson, Jr., manager of the Guam Economic Development Authority Public Finance Division, said in a statement.

Guam achieved a $30 million surplus on its fiscal 2012 budget and a $2.3 million fund balance as of the fiscal year ended Sept. 30, 2013, according to the auditor's report in the financial statements for fiscal 2013. Deloitte & Touche LLP prepared the audit.

Guam is roughly 3,800 miles west-southwest of Honolulu and 1,550 miles south-southeast of Tokyo. Its economy is driven by the military and tourism.