By Mar-Vic Cagurangan
The Office of Insular Affairs today announced the transfer of $76.4 million to Guam representing the U.S. government’s advanced payments of the Section 30 federal income taxes for fiscal 2025.
Section 30 funds have been tapped to cover the war reparation claims under the Guam World War II Loyalty Recognition Act. While claims have since been awarded to war survivors, any unused balance will be off-limits for executive spending.
Under the newly signed budget act, the Guam legislature asserts its authority to appropriate Section 30 funds.
Section 30 funds are not factored into revenue projections for fiscal 2025 and are not appropriated under Bill 236-37, the 2025 budget bill that is now Public Law 37-125.
The budget law, however, contains a provision for the “sequestration” of any unused Section 30 funds allocated for the local war reparation program established by the World War II Loyalty Recognition Act.
“Such funds, upon receipt, shall be sequestered from other funds and remain
sequestered until appropriated by Guam legislature,” states the 2025 budget law.
The appropriations act mandates the director of administration to report to the speaker of the legislature “within 24 hours” upon the U.S. Treasury’s notification of Section 30 funds' transfer.
Section 30 funds are federal income taxes withheld from federal employees and active-duty service members stationed on Guam. The Organic Act requires the annual remittance of these taxes to the Guam treasury for local disposal.
“The Department of the Interior works closely with the U.S. Department of Treasury to ensure that these critical funds for the territories are calculated and transmitted as quickly as possible,” Carmen G. Cantor, assistant secretary for Insular and International Affairs, said in a statement announcing the funds’ transfer.
While Section 30 is normally reserved for Guam's coffers, the federal and local governments have agreed to draw on these funds, which were withheld by the Office of Insular Affairs, to cover payments of $10,000 to $25,000 to those who underwent forced labor or internment, suffered severe injury or rape, or lost loved ones during WWII.
In August 2022, the Department of the Interior stopped withholding additional Section funds for the Guam World War II Claims Fund "based on information received from the U.S. Treasury."
The government of Guam typically draws on Section 30 funds to cover tax refunds and debt payments.
In May, Vice Speaker Tina Muna Barnes introduced a series of bills proposing to invest the Section 30 windfall in public safety, health care and education.
The bills are as follows:
Bill 298-37 appropriates $700,000 to the Guam National Guard for the local fund requirement to match federal grants.
Bill 299-37 appropriates $1 million to the Guam Police Department for the purchase of patrol cars and security cameras along major roadways.
Bill 300-37 appropriates $1.3 million to the Guam Fire Department to purchase lifesaving vehicles and equipment, including those used in rescue and grass fire responses.
Bill 301-37 invests $900,000 in an existing physician retention program, which provides those who serve on Guam with financial support like loan repayments.
Bill 302-37 invests $900,000 into existing nursing recruitment and retention incentives that are managed by the Department of Administration.
Bill 303-37 invests $1 million to continue funding medical degree subsidies for local students who attend off-island universities through a program administered by the Guam Community College.
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